| Average Sale |
| In order to compare the true cost from different vendors or marketing strategies on the basis of the cost-per-sale, you need to consider the revenue you expect to get for a typical sale. It can also help you calculate your ROI. Knowing what your Revenue target is, and dividing it by the Average Sale size, you can calculate how many sales need to be generated from the program. And, as you'll see, if you divide that by the close rate, you can also calculate how many leads you'll need to generate in order to deliver the revenue you're lookng for. Of course, the close rate on high-quality leads is going to be better than the close rate on low-quality leads, but we can assume that a sale is going to be the same size regardless of who generates it. (Hmmm... Maybe that's not such a good assumption... Oh, well.) |
