Knowing Your Numbers
Should you care about Hogsheads and Buttloads? Absolutely!
I was talking with one of my sons’ friends who is studying petroleum engineering. He mentioned the output of a good oil well is 600 barrels per day. Knowing that a “barrel” holds 42 gallons and a “Buttload” contains 126 gallons, I divided by 3 and announced that the well was actually producing 200 “Buttloads” of oil per day.
He thought a “Buttload” simply meant a “whole lot” as he didn’t know “Buttload” is a specific measurement. I then mentioned that a “Hogshead” (63 gallons) is half of a “Buttload” so he could describe the well as producing 400 “Hogsheads”, if he preferred. He loved the new measurement terms (actually very old). In fact, he announced that he was going to use “Buttloads” and “Hogsheads” as his descriptors in an upcoming presentation as they are more attention grabbing than “barrels”. My point is that “words matter” and everyone needs to understand the meaning of measurement terms that affect them in order to know how they are doing.
There are a few key terms that must be understood in our photo businesses: total sales, average order, participation rate, and sales per person photographed is generally THE most important measurement of your performance. Example: if there are 300 players at a sports shoot and total sales are $4,500 then your sales per person photographed is $15. If 150 subjects buy a product your participation rate is 50% and your average order is $30.
Total sales vary greatly due to the number of participants, not necessarily how well you performed. While participation rate and average order are important to know, the most important number is sales per person photographed. That number sums up your overall effectiveness and ties directly to your profitability.
In the photo business, focusing on a great average order can be counterproductive. If your products and packages offered are all at high prices, you will have a large average order, but those high prices can badly hurt your participation rate as prices clearly impact participation. That can result in lower total sales for the event and a poor sales per person photographed.
Plus, if the prices offered are viewed as too high – you may lose the opportunity to photograph the event again. Unfortunately, many people state their average order first when discussing results as it’s always a higher number and seems more exciting. Focus on improving your sales per person photographed not average sales.
The first key to achieving good sales per person photographed is to obtain lots of good contact information. Remember this – Unless you can get your images in front of your buyers (parents) it doesn’t matter what your pictures look like, what products you are offering, or your prices, etc. So, the priority is having good contact information for every participant to maximize sales per person photographed.
A high percent of subjects with emails and cell numbers collected allows you to market effectively to the most subjects/parents. Good performance here will lead to high total sales and a good sales per person photographed. Interestingly, good or bad performance on data collection will not affect your average order, as you could reach just half of the subjects with your offer and still have a high average order.
There are two separate targets for obtaining contact information. First, get email addresses, cell phone numbers, and street addresses for each participant. You measure that as a percentage of participants providing information. This percentage needs to be 100%, or very close to it. You must make every effort to get some information from every participant. It does not just happen – you must make it happen.
Second, get multiple emails and cell numbers from the participants providing contact information for the different members of their family. That will always boost sales. Measure that as the number of emails for each participant providing information. It is not uncommon for that to be over 2.
Top performing photographers frequently have 100% of participants providing contact information and they get two emails (plus cell numbers) for each participant providing information. This should be your goal on every job if you want the best results.
Important – do not deceive yourself. You cannot take the total number of emails collected and then divide by the total number of participants and say something like, “We did great, we got 350 emails for the 300 participants, so we got over 100%”. Wrong – Your 350 emails might have come from only 70% of the participants and you would have 30% of the participants that will never see your pictures and offer!
In summary – focus on having higher sales per person photographed. Remember that a great start to achieving that is to work hard to get 100% of participants to provide multiple sources of information.
Do that and you will have high total sales and make a Buttload of cash!
President of Candid Color Systems