Question

Topic: Research/Metrics

Understanding Response Rates To Project Grow

Posted by Anonymous on 5/14/2008 at 1:25 PM ET 250 Points
I am launching an online business and will be approaching investors in the next few months. I am trying to project possible growth rates on our site. I did not want to simply pull figures from the sky. I know the size of each portion of the market we plan to strategically target and was looking for some insight on what the best methods are to attract users for an e-commerce type business as well as response rates for each?
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RESPONSES

  • Posted by Peter (henna gaijin) on 5/14/2008 at 1:47 PM Accepted
    This is rather difficult to answer, as response rates vary tremendously between markets, type of company, and especially, how well the marketing is done (targeting, messaging, the offer, etc.). There really aren't any useful numbers that we can just spit out for you.

    The best bet is to talk to someone in as similar a business as you are after, and see what happened with them. Then try to figure how you would do in comparison.
  • Posted by Jay Hamilton-Roth on 5/15/2008 at 8:55 AM Accepted
    Get Alexa ranking (https://www.alexa.com/) for your competitors for the maximum. That will help show traffic numbers. You'll have to estimate conversions, since that information is generally confidential (and as Peter mentions, since that'll depend on the quality of the copy/offer).
  • Posted on 5/22/2008 at 9:19 AM Accepted
    I agree with the above posts...these numbers can vary greatly. One thing that will help you immensly is to benchmark the competition and similar business models. If you can get some figures or some ideas from those other companies it will give you something to work from, and you will not be pulling numbers out of the sky.

    You will have a lot more pull with you potential investors if you can say "ABC company did X and they had X growth in the first 1,3,5 years. I am doing X+1 and judging from benchmarks within the industry/market I plan to grow/make X within the first 1,3,5 years."

    Hope this help,
    Zack Pike
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