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ComponentMatching - The Business Case

If you’re in the business of marketing consumer IT, the chances are that you are confronted with the perennial issue of sales growth; the tricky and recurring challenge of how to extract ever more revenue and profit from the marketplace. If the web is one of your key routes to market, you are typically faced with one of two options:

  • drive more consumers to your site; and/or
  • leverage higher revenues and profits from those visitors to site by improving your conversion rate.

Of those two options, higher conversion rates is usually felt to be the smarter route, but also the more difficult one: It often relies on ‘soft’ factors such as ‘improved customer service’ which, while intuitive and perhaps valuable, can be difficult to measure and therefore justify in relation to the bottom line. On the flipside, it can be more rewarding than yet more referral expenditure where a dollar is converted into a dollar and five cents.

ComponentMatching is the exception which disproves the rule; a ‘hard’ expenditure that dramatically improves conversion rates and can be measured and justified against the bottom line. It is unique in offering all the benefits of a ‘soft’ customer-service orientated expenditure, while simultaneously delivering significant and quantifiable improvement to your revenues and your profits. How many marketing programs will you undertake this year that offer:

  • a return on investment ratio of 3:1;
  • a revenue improvement of at least 35%;
  • a guarantee that if you don’t get the expected results , you don’t pay; and
  • a demonstrably better shopping experience for your consumers, all in a single service?

Yes, that’s right, if the expected results don’t happen you don’t pay, not a cent, no fine print, no lengthy list of exceptions to the guarantee, no hidden conditions. How can work4sure offer this guarantee?

Based on results from existing satisfied customers, work4sure is absolutely confident that the ComponentMatching service will increase revenues, boost profitability and provide a return on investment of at least 3:1.

In side by side tests on client sites, pages served with work4sure ComponentMatching available produced at least 35 % more revenue than identical pages without ComponentMatching. ROI has ranged from 3:1 to as high as 10:1.

These are aggressive claims, but the ROI calculation is fairly simple and backed by a simple guarantee. Here is a sample ROI calculation based on actual experience, but with numbers rounded off to even thousands to preserve confidentiality. Non-rounded ROI numbers were actually slightly better. The client implemented two alternative pages for customers to the e-tail site, one page that offered work4sure component matching and one page that did not. The site was setup to divide all visitors evenly between the respective pages. The average sale size for this site was $150 and the Gross Margin was 25%.
Comparison of work4sure enabled page versus generic page
  w4s Page Generic Page w4s Full Site Projection Comment
Impressions 61,000 61,000 122,000  
Orders 2,800 2,100 5600 2800 * 2
Conversion 4.59 3.44   Orders/Impressions
Order Increase 700   1400 w4s Page -Generic Page
Revenue Increase 105,000 0 210,000 Order Increase * Average Order Amount
Profit on Increase Sales 26,250 0 53,000 Revenue Increase * Gross Margin
Cost of work4sure 5000   5000 Fixed
Net Profit Increase 21,250   42,500 Profit less work4sure cost
ROI Ratio 4.25   8.5 Net profit Increase/Cost
         

The instrumented period was for 27 days rather than a full month and thus figures are slightly understated.

Contact us for further details of these remarkable returns on investment and how they might relate to your business.

 
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