Ecommerce Playbook · with Richie Mak & Conor Lane · March 1, 2023 · 41 min
Summary
This episode breaks down the critical components of designing an effective e-commerce forecast, emphasizing the connection between marketing efforts and financial outcomes. It highlights how robust forecasting, incorporating all variable costs, leads to predictable profitability and informed decision-making for DTC brands operating across multiple channels.
Key takeaways
Implement a comprehensive MER calculator that includes all variable marketing costs, not just obvious ones like COGS, to accurately reflect profit margins.
Prioritize net profit as the primary output of your forecasting model, especially for bootstrapped businesses or those with non-consumable products requiring profitability on each purchase.
Integrate all sales channels (DTC, Amazon, wholesale, QVC) into a unified forecasting model to understand profit drivers across the entire business.
Don't just forecast revenue; model unit economics to understand the profitability of each unit sold across different products and channels.
Regularly review and iterate on your forecasting methodology, recognizing that initial assumptions will need adjustments based on real-world performance and evolving market conditions.
In this episode of the Ecommerce Playbook Podcast, Taylor chats with Connor Rolain, Head of Growth at HexClad, and Richie Mashikov, Head of Growth at Birdie. They discuss forecasting, unit economics, and the rules for growth amidst uncertainty.
Show Notes: Need help building your marketing calendar? Our strategy team is putting together 12-month audit packages here: https://bit.ly/3ZLKfjw The Ecommerce Playbook mailbag is open — email us at podcast@commonthreadco.com to ask us any questions you might have about the world of ecomm. Connect with Richie: https://www.shesbirdie.com/ https://www.linkedin.com/in/richardmashiko/ https://twitter.com/richiemashiko Connect with Connor: https://hexclad.com/ https://www.linkedin.com/in/connor-rolain-b190ab148/ https://twitter.com/connorrolain
What does this episode say about finance & fundraising?
Implement a comprehensive MER calculator that includes all variable marketing costs, not just obvious ones like COGS, to accurately reflect profit margins.
What does this episode say about analytics & attribution?
Prioritize net profit as the primary output of your forecasting model, especially for bootstrapped businesses or those with non-consumable products requiring profitability on each purchase.
What does this episode say about dtc strategy?
Integrate all sales channels (DTC, Amazon, wholesale, QVC) into a unified forecasting model to understand profit drivers across the entire business.
What does this episode say about finance & fundraising?
Don't just forecast revenue; model unit economics to understand the profitability of each unit sold across different products and channels.
What does this episode say about finance & fundraising?
Regularly review and iterate on your forecasting methodology, recognizing that initial assumptions will need adjustments based on real-world performance and evolving market conditions.
