Digital Abbreviations

Hello, my friend and future millionaire. 

Welcome to this episode of The Money Wheel. 

My name is Andrea Koput. 

Today, I am going to define, decipher and break down for you some of the common abbreviations that you’re going to hear me and other people say. 

These are just ‘industry speak’ for e-commerce, digital marketing and building your online business.

Time is money. 

Those of us, online entrepreneurs and entrepreneurs in general know that every second counts, because every second counts we are known for abbreviating anything we can.

Since every second counts, the shorter it takes us to say something the better. 

So I’m going to quickly break down for you the top abbreviations you are going to hear me say, Don and Kris say, and other industry people too.

You’re going to soon know these by heart.

Give yourself a couple of weeks and you’re going to know them even better than I know them. 

So let’s go straight to the first one, CTR. 

What does that one stand for?: Click through rate. 

A click through rate is exactly what it sounds like: when your traffic, your customer and your people come see your link.

Whether it’s advertising, emails or an ad, when they click on it, that’s your click through rate. 

The click through rate goes up or down, depending upon the effectiveness of whatever it is you’re putting out there. 

The higher the click through rate, the better the results.

So we’re always looking to improve our CTR. 

Another C term that is really important is: CPC. 

This is your cost per click. 

Cost per click goes directly with your click through rate.

With a lot of advertising, you are charged per click. 

It is pay per play advertising. 

That means as soon as your person clinks on your ad, you’re going to be charged per time that person or any person clicks on the ad. 

The lower your cost per click, the more people you can afford to invest in that advertising. 

So think about it: If you’ve got a really, really high CTR and a really, really low CPC, that means you’re paying very little for a very, very high click through rate. 

That’s more eyeballs, more efficiently, and a very good returning ad.

Now I’m going to switch it for you. 

Those are click-through rates cost per click, they’re very relevant for your email marketing and your advertising: whether that advertising is on Amazon, Google, Facebook, other ad platforms like email marketing. 

That’s what you need to think about there.

Now let’s go to goods and sales. 

We’re going to talk about the number one and number two terms you’re going to hear me talk about all the time. 

Number one is: COG. 

This is important, COG is the cost of goods.

This is how much it costs for you to produce, build, sell, and ship. 

Don’t forget shipping. 

Whatever it is you are selling your customer: a digital product course or physical product, it doesn’t matter, there’s a cost of doing business and this is your COG (cost of goods) per said product. 

It’s important to know your cost of goods so you can allocate and build your profits and your pricing structure. 

Cost of goods is going to go directly into the next one.

The next one is: AOV. 

AOV is one of my favorites and it will be yours too. 

AOV is your average order value.

The higher the order value per customer, the higher profits and the less work you have to do selling a person, one pen versus selling them (because this is what’s on my desk), a pen and a spoon. 

Sell them this (the pen), upsell them that (the spoon). 

This increases your AOV for one customer. 

Work less hard to bring in more profits, advertise them via your click through rate, via your CPC for your cost of goods.

For one pen, sell them this, upsell them that (the spoon). 

Your profits just went up. 

You didn’t have to work as hard to increase your AOV. 

That’s the mission in life.

When it comes to sales, increase your AOV, your average order value, more customers, more sales, more customers, higher average order value, more dollars in your pocket and a happy day for you.

That’s everything I have for this episode of The Money Wheel.