People often ask the question about whether to go with a general e-commerce store or start with a niche store…
We here at MB3 have multiple stores… some of which fall into the general category while others are strictly focused on a single niche. These single niche stores have in most cases been started due to the data and success we saw in that single niche through the general store. We then break off that audience and begin focusing in on the single niche store.
This was pretty much the whole plan from day one when creating our general stores. The plan was never about creating something like Jet… even though maybe I should of since they just sold for a few billion to Wal-Mart lol… so our marketing tactics fit this strategy of finding winning niches and focusing in with a single store.
To help give some insight on the difference between a general store and a niche store, I thought I’d share a data point that I’ve noticed over the past year for us…
Our general stores typically average about $0.50-$1.25 revenue per visitor to the store. So If I receive 1000 visitors in a day, I’ll typically make around $500-$1250 for that day.
Our general stores have a wide range of products and they are broad across tons of niches… sometimes these niches overlap with the buyer but in most cases, they are very far apart.
Now our niche stores produce much better ratios than this. A single niche focused store will typically produce around $1.75-$2.50 revenue per visitor. So for that same 1000 visitors to the niche store, we’ll see $1750-$2500 revenue for the day.
The niche stores are able to focus in the right products much easier for every viewer and in most cases, almost all the products on your store can fit that potential buyer. This leaves us with higher cart order averages and better conversions overall.
Now, traffic is a little bit more complicated when focusing on a single niche whereas it’s easy as hell to get traffic into the general store. So that’s a difference that plays in this equation as well.
But overall, we see much greater returns and better ROI from our single niche stores over our general stores. Even though general stores might make a smaller percentage back to us, this works out in our favor nicely because of how I use general stores to find my winning niches to focus in on with a single store. So even breaking even or losing with a general store ends up producing huge turn around by “showing me the light” on lucrative niches.
The type of store you plan on opening really just depends on the business you want to run. I don’t want to be the owner of a Wal-Mart style store. It’s not in the cards for me… and that’s why my general store isn’t run to succeed like that. It’s used to test and research possibilities.
With Christmas on the way, the general stores will get a nice bump in cart order sizes due to people seeing a bunch of random cool stuff they typically wouldn’t jump on. It’s the impulse of the holiday season which will help those revenue ratios to jump. Where the niche stores will probably stay around the same cart order size average for the holidays… we’ll see a conversion rate across both styles of stores.
Hope that gave some insight into the biz. Let me know any questions or comments you have below.
Just to carry on a little bit more on my post earlier, here is our latest niche store we opened up.
Started with 10 product tests. We are down to 2-3 products that are converting, the rest are turned off.
Next round of testing ads come in tomorrow and scaling the winners as well. Looks to be a good start for this one