Lesson 5

How Can I Quickly Make More Money With What I Already Have?

Part 1: Where to Start

One of the #1 reasons HammerTap is such a valuable eBay market research tool is because it shows you how you can make more money from the products you’re already selling. There are a lot of ways that HammerTap helps you optimize these listings, so many in fact that it’s going to take us three lessons just to get through them all!

This is really exciting stuff, so hold on to your hat, because you’re going to be blown away by the information HammerTap puts right at your fingertips!

Introducing the Findings Window

In our last lesson, we worked a lot with the Category Search, which is a great tool for looking at the market as a whole. However, today we’re moving back to our Product Search. So, do me a favor and let’s open up our Skullcandy earbuds report. Remember, we want the filtered one because we’re going to start making decisions based on the results. Your report should be named something like Filtered Earbuds (if you need a review on opening a saved report, check out Lesson 3).

The first screen you see when you open your report is called the Findings Window. This is the most basic results screen, and it’s a great place to start looking for answers.

We first want to take note of the LSR and ASP. We talked about these a little bit in Lesson 4 (remember, LSR = Listing Success Rate and ASP = Average Sales Price), and we’re going to use these numbers as benchmarks as we figure out how to sell better. Always remember that LSR and ASP are averages. That means there are plenty of sellers both above and below these rates. You want to figure out how to sell above them, and that’s where HammerTap comes in.

So, let’s look at my LSR and ASP.

For our Skullcandy earbuds we have a LSR of 81.68% and an ASP of $12.13. We’re going to use these numbers as a starting place.

People often ask whether X% is a good success rate. There isn’t a simple cut off that equals a good LSR. If you can list the product more than one time and still make a profit, the answer is yes. If your profit margin is too narrow to list the product multiple times, then the answer might be no. It really depends on your situation, the price you paid for the item, and how much the research says you can make on it.

So we can use our LSR and ASP averages as a starting place, but we want to sell better than that. Selling better really depends on what we want to accomplish and our selling strategy. (Don’t freak out on me… I know selling strategy may sounds a little intimidating, but I promise it’s actually really simple, and you’ll probably have yours figured out before I’m even done explaining them.)

Selling Strategies

Here at HammerTap, we realize that there isn’t always one right answer. We understand that each of you has a very unique business based on unique backgrounds, experiences, products, and goals. And since you are each so very different, it wouldn’t be correct if we simply interpreted the data for you and said, “Ok, here’s the one right answer.� I mean, except for math and science problems, how often is there really only one right answer?

So we’ve based the answers you’ll see on three different selling strategies. Scroll down in the Findings Window and you’ll see a chart that looks like this:

Check out all the options this chart has! It’s going to tell you exactly what you should do for each of these choices. (Just imagine how much easier this will make your life! Now, instead of guessing you’ll have easy answers based on facts!)

Ok, but here’s the catch. Notice that there are three columns, which each have different answers. Well, which one do you follow? That’s where your selling strategy comes in. Each of the columns represents a strategy, and the right answer for you will be the column that represents the strategy you’re running your business by.

LSR: Listing Success Rate

The first strategy is a LSR, or Listing Success Rate, strategy. This is a high volume, low price strategy. If I had 1,000 sets of earbuds that I’d bought at wholesale, I would want to go with this strategy. I’m interested in selling my product as often as I can—getting it out the door the first time, every time, as often as I can. This is because I don’t want to be stuck with left-over inventory, and I also don’t want to spend the time and money it would take me to relist my items. Because I bought in bulk, I probably got a decent discount on the product, and I’m more likely to be willing to accept a lower price.

With this strategy I’m looking to maximize my listing success rate. This column is going to give me those answers that will help me sell my product more often, which is exactly what I would be looking for.

ASP: Average Sales Price

The next column contains answers for the ASP, or Average Sales Price, strategy. This strategy focuses on low volume and high price. This would be my strategy if I had a smaller number of earbuds. For example, let’s imagine that I bought 5 pairs of earbuds on sale at Best Buy. I got a deal, but it wasn’t amazing. In this situation, I’m going to be a little more price-sensitive because I have a higher cost of inventory per item, and I only have five chances to make my overall profit. I’m willing to list my product a couple times if it means I’m going to get a higher price, and I’m interested in those options that are going to increase the price I receive on my earbuds.

This column helps me do just that. It shows me exactly what I need to do for my listings if I want the highest price. So, instead of spending all my time listing five items trying to figure out what works, and ending up with wildly varying prices, I can follow this column and know what has the greatest chance of consistently working.

Combo (LSR x ASP): Balanced Strategy

This is the final strategy, and you can probably guess that this one offers you the best overall option. We recognize that there are often times when you want to both sell your item quickly and get a high price. This column makes it easy for you to find the best “middle-of-the-road� answer.

You’ll notice that the numbers in the Combo column don’t seem to make much sense. These are actually meaningless numbers because they’re simply the LSR percentage multiplied by the ASP. So don’t worry about what these numbers mean; look instead at the options in this strategy’s left column.

So, have you figured out your strategy yet? Good job!  Now, let’s take a look at some of the answers this chart gives us.

The Findings Chart

The first option on our chart is Listing Type. Simply click the green arrow next to the title and it will expand out.

We can now see graphs depicting the answers based on each strategy. First, let’s check out the LSR column. With this strategy, we will have the highest chance of success using an auction-type listing. This listing type brings our LSR from 81.68% (our average) to 85.48%. Next we’ll check the ASP column, where we can see a very clear and distinct peak in the chart, indicating that the 109 listings that used the Fixed-Price format had a much higher closing price (the numbers in parentheses next to the listing types specify the number of listings that used that format). And finally, the Combo column also indicates that Fixed-Price is the best choice. Do you see how easy that was?!

Now, I want you to check out the Start Day and End Day options on your own. What are the answers for the different strategies?

Next, we have the End Hour section, which I’m going to look at with you.

Here you’ll notice something interesting. In the LSR column, it tells you that the best time to end is between midnight and 1 a.m., and in the Combo column, it recommends ending between 2 and 3 a.m. That seems a little odd, doesn’t it?

All times within HammerTap are in Pacific Time, because that’s how eBay records all time related data.

We need more information! So, let’s go to the Summary Window. Simply click at the bottom of the page, and we’re going to check out the End Hour table (either click the End Hour link at the top, or scroll down until you see the table).

Here’s the table from my results (with a few of my own underlining edits):

Ok, so the first time underlined in red (00:00 – 00:59) was the time recommended by our LSR strategy. Notice the first yellow column (Number of Auctions). There were only 5 listings that closed at that time. In other words, the 100% success rate is based on only 5 listings! That doesn’t sound very reliable or proven to me. Five listings isn’t a very large sample size, and you can’t rely on results that haven’t been proven. However, if I had quite a few products (remember, LSR is a high volume strategy), I could test the ending time and see if it worked for me. But if I wasn’t willing to take that risk, I would want to find another, more reliable time, to end my listings.

The next time underlined in red was the Combo column’s recommendation. Can you spot the problem? Only 1 listing! That’s like flipping a coin! Definitely not reliable.

And finally, let’s check our ASP strategy ending time since we’ve been having problems with the other two results (the third time underlined in red). Again, what’s the problem? Yep, there are only 3 listings, an unreliable sample size.

So, what are you to do? All of your “answers� just got blown out of the water! Does this mean that all of the answers in that Findings Window chart are unreliable? No, it doesn’t. The end hour results simply provide you with the ending times that have the highest LSR, highest ASP, and the best combination without taking sample size into account. With your more advanced brainpower, you can quickly and easily check these answers and find times that are proven. Check out the three times I underlined in blue. These times have decent sample sizes, good success rates, and respectable prices (or high prices for the last two), and they only took me about 5 seconds to pick out. You can do it too!

The chart in the Findings Window is a great place to start getting answers on how you can make more money with the products you already have. It sometimes does require a little double checking, but the Summary Window makes it easy for you to make sure the answers you’re looking at are proven and reliable (and to find new answers when they aren’t).

Take a minute and go through the rest of the Findings chart and see what other answers you can find for our Skullcandy earbuds, and I’ll see you in our next lesson where we’ll talk about other ways to increase our profits!

Assignment #5: How can you improve your own listings?

Now, I’m sure you’re excited to try this out for your own products. Take a minute to conduct a Product Search on one of your own products (remember to check your research for accuracy!), and take a look at the chart in the Findings Window. Look at the column that fits your strategy, and use the Summary Window to ensure that you’re results are reliable and proven.

What did you find out about how you can improve your listings? Pretty cool, right?

CONGRATULATIONS! You’ve finished Lesson 5 (you’re half-way through the Power to Profit course! Can you believe it?), and you’ve learned some great stuff about how to increase your profits. In our next lesson we’ll talk about even more ways you can make more money. Remember to send your questions to our support team!

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