The Most Important Marketing Goals of Successful Online Shops
Without marketing, an online shop would depend mostly on luck and chance, which won’t make boosting sales particularly easy. Therefore, it is important to make plans and set marketing goals for your business. This is the only way to make sure that both your customer base and your sales grow. But what are the most important goals you should keep in mind?
Why are marketing goals so important?
“Without goals and plans to reach them, you are like a ship that has set sail with no destination.” – F. Dodson
The best things in life aren’t planned. In the business world, however, the lack of a plan is not a success factor. On the contrary.
Those who fail to think about…
…are very unlikely to have a business in the black.
That’s why every company, big or small, should set goals and develop plans to achieve them.
Be aware of your marketing goals. This way, you won’t be sailing the seas of business aimlessly, but on course to success.
But what goals should you focus on? Although this varies from company to company, the following goals are (almost) always to be prioritised.
Take your time to think thoroughly about what your goals are.
“I want to sell more” is definitely too vague.
To achieve this goal you would need just one more sale a year. Unless you are selling something with a gigantic profit margin, it can be assumed that only one sale wouldn’t have a noticeable effect, though.
The more specific your goal is, the more likely it is for you to achieve it.
Only after you’ve set yourself the goal of increasing sales by 150% can you think about how to achieve it.
In a brainstorming session, you can quickly find ways to achieve this goal, be it by investing more in Facebook ads, focusing on content marketing, or sending out more e-mails.
Tip: Break down a “big problem” into smaller ones in order to solve it step by step.
Having said this, we can now get started with the most important marketing goals.
#1 Increase sales
The marketing goal of increasing sales is the highest priority for many entrepreneurs.
Not surprisingly. Only when sales are made can turnover increase. However, as mentioned above, you should think of the exact number of sales you want to get to.
Only then can you think about how you can achieve this goal.
We’ve already covered various strategies on our blog that can help you achieve it:
#2 Winning new contacts/leads
Before a customer buys something, they’re only an interested party or contact (also called a “lead” in the business world). Similar to window shopping, only a small number of visitors will actually turn into paying customers.
Nevertheless, lead generation is one of the most effective methods to win new customers.
Indeed, instead of advertising the product directly, you can try to pique the potential customer’s interest first.
With free guides, e-books, sweepstakes, or other growth hacks, you can build up a list of people who might later become customers.
Recommended: Check out our FREE webinar on writing texts that convert customers!
#3 Winning new customers
What good is a list full of new contacts if none of them actually become customers? Make sure that you focus your marketing efforts on your exact target group.
Attracting new customers is a crucial goal for any business whether you’re selling your products to individuals or other businesses.
While this seems fairly easy to measure, some companies find it quite difficult to reliably identify new potential customers.
For this reason, you should develop a reliable tracking method to make sure that you’re using your marketing budget efficiently.
#4 Increase customer satisfaction and retention
It’s cheaper to persuade an existing customer to shop with you again than to win a completely new customer. Therefore, one of your goals should be to increase the satisfaction of those who have already bought something from you.
Indeed, customers who are satisfied with a shop are more likely to buy from it again. With the help of customer reviews, you can find out how your online shop is performing (and boost sales).
You should therefore try to reduce the number of one-time orders. This is possible through retargeting, e-mail marketing, or guerrilla marketing.
Including some goodies or a present in the first order reduces your profit at first, but can mean that the customer orders again (and again) from you.
#5 Increase presence/gain attention
Some goals are often very obvious, like getting more people to visit your website.
However, this is one of the goals for which you really need to focus on quality. Make sure that you can generate qualified traffic and measure bounce rates, conversions, time on page, and other similar KPIs.
To achieve this goal, you can use organic Facebook marketing, paid ads, or classic search engine optimisation.
If you want to be successful over the long run, you need to know where you’re going. Only then can you develop a strategy that will attract new customers and increase sales.
Think about your marketing goals in as much detail as possible. Then, develop a strategy enabling you to achieve these goals step by step.
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Building committed online shoppers through shopping goals and switching cost
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Goals for a Small Store | Small Business
A small store caters to customers in a community. A customer visiting a small store may be looking for something she wants, rather than what she needs. To stand out from the large retail outlets, a small store may need to set goals to be community-focused, carrying specific products of community interest and developing personal relationships with each customer. While a small-business owner keeps customer service in focus, running a good business and keeping current with online customers are equally important goals.
Improve Shopping Experience for Customers
The small-store owner can develop plans to focus on customer service. Unlike a large retail outlet, in a small store, the owner can make each customer feel that their wants and needs are important by taking the time to get to know each customer, understanding their needs and asking about what the customer is interested in. By developing relationships with customers, the small-store owner can takes steps to improve the shopping experience for both the customer and the community.
Improve Store Layout
Especially during times when cash flow may be a bit too tight to purchase additional inventory, setting a goal for a new layout can give the appearance of a better-stocked store. Partitioning the layout for more intimate shelving filled with merchandise will give the appearance of good turnover for a small store and may help attract more customers. Coffee, vending machines or other income-generating services may be useful goals to add to the divided space.
Sell Specialized Merchandise
A small-store competes with retail giants and local malls, not necessarily with another small store down the street. Therefore, a store may need to set a goal to gain a competitive advantage and sell specialized merchandise to stand out from the giants. Customers may visit the mall for variety in clothing but may visit a small apparel store specializing in baby clothes, imported leather and jewelry for specific desires.
Generate Online Sales
One of your goals may be to generate online sales. To find your target customers, you can use Twitter’s advanced search and enter phrases your customers may say when searching for your product. For a small baby clothes store, for example, you may search the phrase, “Where can I find trendy baby clothes.” This will retrieve a stream of conversations. You can follow the individuals in the conversations on Twitter to find out which sites and forums they visit. By joining the forums and participating in discussions you can find target customers.
Here’s How to Reach Your Sustainable Shopping Goals in 2020
With the first full month of 2020 just about in our rearview, you’re bound to have rethought your goals for the new year by now. More power to you if not (seriously—go you!), but many dreamers hoping to overhaul their lives begin to sink back into reality by the end of January, which allows doubt to creep its way in and convince us that we’re doomed to fail.
Folks, you’re not doomed. Even if you’re having trouble, there are ways and means to pick yourself up and get back on track. If you resolved to eschew fast fashion in favor of more sustainable shopping practices, it’s not too late—we’re here to help.
Popular blogger, businesswoman, and podcast host Elsie Larson (half of the sister-duo behind A Beautiful Mess and A Color Story) promised herself in 2019 that she would only shop for used clothing for the entire year. After 10 months of practice, Elsie said on her blog, “I would definitely say that the best part of this whole experience is creating better habits and feeling much less wasteful, both of my own time and money, and also with the waste associated with over-shopping.” Her statement encapsulates exactly how droves of people feel about buying traditional retail, and it’s that not-so-great feeling that’s inspired shoppers everywhere to take on a similar challenge themselves.
According to thredUP’s Annual Resale Report, 64 percent of women have bought or are now willing to buy second-hand products, no doubt due to the rise of information made public regarding the fashion industry’s impact on our one and only planet Earth.
But with the lure of online shopping right at our fingertips, it’s still difficult to transition from “I have to have everything!” to “Maybe I can set this aside for now.” Whether you’re looking to erase or simply reduce your intake of fast fashion this year, there’s no better time to commit to the undertaking thanks to the ever-increasing number of reliable outlets available to help you along the way.
Shop Sustainable, Shop Local
We Houstonians love our vintage and resale shops, and if you’ve made the intention of exploring the world of conscious spending, there are plenty of trendy spots here to cut your teeth. But don’t let the practice of shopping used keep you from supporting local artisans.
What’s just as important as buying second-hand? Making an effort to spend your hard-earned coinage on items from ambitious Texans peddling their quality wares. Backing local businesses and purchasing pre-worn items go together like tacos and Tuesdays.
Yes, you can still get your online-shopping fix and lessen your footprint when it comes to revamping your wardrobe. Instead of mindlessly browsing to web-based corporate marketplaces like Amazon or Target (guilty as charged), try resale sites like thredUP and Poshmark—alternatives that provide the same payoff of hitting up a yard sale without requiring a trip to the bank for actual cash.
The two sites do differ in return policies and how they handle commission for sellers, but they’re both surprisingly easy to navigate and fun to peruse. With thousands of merchants hosting both high-end and more affordable products, your shopping list and will grow—and your bank account will cry—just as quickly as if you were buying something brand-new.
Houston is also home to a unique online outlet that offers consumers a chance to fill their closets with basic, everyday pieces. Expect the unexpected with Goodfair, thanks to the site’s surprise picks for classics like a denim jacket or a trusty white tee: Simply select your size and the Goodfair peeps will ship you an item of their choice. The most exciting order looks to be their short-sleeved Hawaiian shirt deal, because who could possibly pass up a mystery print made for the tiki bar?
Oh, and don’t forget Rent the Runway.
With a Little Help From Our Friends
You’re used to heading to the Galleria with your friends for an afternoon of brunch and browsing, and it doesn’t have to be any different in the resale community. Brands like Poshmark will host get-togethers for local sellers and shoppers to network and get acquainted with each other—they did just that here in Houston last week—or you could gather your most fashionable friends and host a shindig of your own to swap and sip, just like any other Sunday afternoon.
The breath of life that comes with another trip around the sun inspires all sorts of goals and resolutions, and if you’re excited to make a mindful change in how you dress yourself in the morning, there’s no better time to start than right now.
12 Tips to Set and Achieve Your Retail Sales Objectives (2021)
As a retail business owner, you already know setting sales goals and objectives is crucial to the success of your company. Without creating targets to measure your sales performance against, it will be difficult to continually scale your brand.
Whether you’re struggling to meet your current retail sales targets, are achieving your goals and looking for ways to surpass them, or you have no idea where to start with setting your sales goals, this article will help you outline specific and measurable actions you and your associates can take to reach your goals.
Let’s get started.
What are sales goals?
Defining sales goals is more than just throwing out a number and hoping you reach it. It’s important to hone in on specific key performance indicators (KPIs) and sales metrics that will help you reach your business goals. You’ll also want to make sure your goals align with historical sales data and the resources available to you.
For example, your leading sales goal might be to increase annual sales revenue by 30% year over year. One way to achieve this may be aiming to raise your average order value (AOV) by 50% in 2022.
But you need more than one main goal to succeed. By making and achieving small goals quickly, you and your team will feel more motivated and confident to build up to your larger, overarching sales goal.
Why do you need sales goals?
Without a clear set of sales goals and an action plan, you and your employees won’t know what target to work toward. If you don’t know where you’re heading, you’ll likely never get there.
Having clear sales goals contributes to overall business success and will help you:
- Measure sales performance
- Ensure sales associates feel accountable
- Create sales targets that you and your staff can visualize
- Motivate yourself and your team to reach sales goals
Types of sales goals
There are many types of sales goals that you can set depending on your business model and resources. Here are a few to consider:
Annual sales goals are set with the intention of reaching them within the next year. Usually these types of goals specify the overall sales revenue target for your retail business within one fiscal year. This way you and your employees can align on objectives and priorities to collaborate on, setting shorter term goals such as quarterly, monthly, weekly, and even daily sales goals to help you work up to reaching your annual goals.
An example of an annual sales goal is to make $500,000 in sales revenue by the end of this fiscal year.
Quarterly, monthly, weekly, and daily sales goals
Annual goals inform your overarching sales strategy, but setting quarterly, monthly, weekly, and daily goals helps break them down into more achievable steps that you can measure along the way. These types of goals are easier to reach, which will keep you and your staff motivated throughout the year.
An example of a quarterly sales goal could be to make $100,000 in sales revenue during Q2. A monthly sales goal could be to increase monthly sales revenue by 10% month over month during Q3 and Q4. Weekly, you could aim to sell $5,000 worth of product, and on a daily basis you may choose to set individual sales goals for each associate to support your weekly and monthly goals.
When setting quarterly goals, keep in mind for many retailers sales peaks and dips are seasonal. You likely shouldn’t set the same quarterly sales goals for Q4 (holiday season) as you would for Q1.
📌 GET STARTED: Setting goals helps motivate staff and keep your store on target, but using historical data to inform your sales goals is important to ensure they’re attainable. To see your store’s sales data for any time period, go to your Shopify Admin and select Retail sales reports.
Setting specific goals for yourself or each of your sales associates provides a sense of ownership and accountability. These goals can be set daily, weekly, monthly, quarterly, or annually. But shorter term objectives generally work better for setting individual goals as you can measure them faster. You’ll want to aim to exceed performance metrics from the period before and also look at sales history to set realistic goals.
For example, your sales goal for week one of December might be $5,000, and your goal for week two will be to increase that number by 10% to reach a weekly sales target of $5,500.
Involving your entire team in setting sales goals can boost employee engagement and also provide insights into what your sales staff can realistically manage. This will help increase the likelihood of achieving them. You can do this by holding quarterly, monthly, and weekly meetings and encouraging all employees to participate in providing feedback and setting goals. Doing this will also promote teamwork and a healthy level of competition.
For example, you could decide as a team that next month you’ll set a $150,000 gross sales target and, if there’s five of you, you’ll each aim to sell $30,000 worth of merchandise that month in the hopes of reaching your team goal.
📌 GET STARTED: View your staff sales reports to ensure everyone is helping your store get closer to its goals. To see the total sales made by each of your retail staff for any time period—including their average order value (AOV) and units per transaction (UPT)—go to your Shopify Admin and select Retail sales by staff at register.
Actions you or your sales associates can take during the sales process, disregarding factors shoppers contribute to the equation, are activity goals. They help provide a level of control over improving performance.
Activity sales goals may include the number of:
- Conversations started through a virtual clienteling app
- Post-purchase email campaigns sent
- Engagements with potential customers on social media
For example, you could set an activity goal to start at least five virtual shopping conversations a week next month.
Pushing yourself and your team to exceed initial sales goals are what we call stretch goals. Usually these types of goals involve incentives or rewards to motivate employees to surpass their quotas. Stretch goals should be challenging but attainable.
For example, if your sales goal for Q4 is $200,000, you could stretch it to $220,000, and when the team succeeds, reward them with dinner at a local restaurant.
If you’re creating stretch goals for yourself, it might be something like surpassing your weekly sales goal of $6,000 by 5% week over week and then treating yourself to a massage at the end of the month.
Waterfall goals allow you to build upon goals over time. Rather than setting much larger new goals, you can raise them gradually week over week or month over month.
For example, if your goal is to increase virtual clienteling chats week over week, don’t try to go from five to 20 in one week. You could start by raising your goal to 10 next week, 15 the following, and then 20.
If you set goals too high and miss them it can demotivate you and your team. The waterfall goal setting strategy also ensures that quality isn’t compromised as output is increased, and prevents burnout.
Prioritizing goals by which ones add the highest value when they’re attained is how you can create sequence goals. You can make sure you’re first hitting the goals that affect your bottom line the most. This way, even if you or your associates don’t meet every goal on the list, you’ll achieve the ones that make an immediate impact on your sales revenue.
For example, you could prioritize your goals in this order:
- Make $3,000 in sales this month
- Send five email campaigns this month
- Dedicate one hour each day to engaging with Instagram followers
How do you set sales goals?
Looking at your previous years’ retail sales history and crunching numbers to determine a growth rate that will help you scale your business is a good start. And taking an annual target and dividing it by 12 to set monthly sales goals may seem like a simple solution, but there are many other factors that go into setting SMART sales goals that are challenging but realistic.
That’s why, before you set monthly, quarterly, and annual sales goals, it’s crucial to consider all variables including:
- Everything you need to reach your sales goals (i.e., staff, software, money)
- Historical sales data
- Sales channels, new products, and seasonal shopping peaks and dips
- Consumer and market trends that may influence sales
- Sales promotions and events throughout the year
- Input from your employees
Doing this will help you set the right retail sales targets for your business and break your sales goals down into smaller objectives to ensure success.
Then you can use the following strategies:
1. Set SMART sales goals
SMART sales goals are specific, measurable, attainable, relevant, and time-bound. Whether you’re hoping to increase monthly sales revenue, units per transaction, or start more virtual clienteling chats, the SMART goal framework will help you outline, track, and hit your goals.
Let’s say your overall revenue goal for the year is to hit $500,000 in sales. Here’s an example of how you can break this down quarterly into a SMART goal:
- Specific. Increase online sales revenue in Q4 when compared to Q3 of the same year.
- Measurable. Q3 sales revenue was $100,000 and the target is a 15% increase ($115,000).
- Attainable. Increasing sales revenue by 15% in Q4 (holiday shopping season) is achievable.
- Relevant. This goal aligns with your overall sales goals.
- Time-bound. The deadline is set for the end of Q4 to ensure you stay motivated and on track.
2. Analyze your sales cycle
How long does it usually take to convert a lead into paying customers? This is your sales cycle. If your business is omnichannel and you sell online and in-person, review this data for each channel. Then you can set goals to lower the amount of time it takes to move a lead through the buying journey to speed up the sales cycle and generate revenue faster.
3. Identify a collective goal
Setting goals as a team encourages associates to work together to achieve them. It also improves motivation and gives your staff a sense of ownership. You can create an incentive that’s only offered when everyone on the team meets the sales goal.
For example, all team members must sell at least $1,000 worth of merchandise this week. And if you’re working on implementing virtual selling strategies a goal could be for each person to start at least three virtual clienteling chats this week.
If the goals are met collectively, the reward could be a team dinner, happy hour, or fitness class, depending on what your sales associates prefer.
4. Use data to set your goals
Jotting down numbers in a spreadsheet with the hope that you’ll achieve them likely won’t lead you to the success you’re hoping for. But using historical data to predict future business performance ensures the goals you set are both accurate and achievable. The most effective way to do this is to view your store’s sales performance for a period of time.
Next, organize your sales data by store location, year, quarter, and month. Once this is done, calculate your monthly and yearly growth rate. This will give you a clear picture of how your sales fluctuate throughout the year, as well as whether or not your sales are growing from one year to the next.
💡 PRO TIP: To calculate your growth rate from one time period to the next, subtract the previous time period’s value from the current time period’s value. Next, divide the sum by the previous time period’s value. Finally, multiply that sum by 100 to get your growth rate.
Equipped with that historical information, you can create annual, quarterly, monthly, weekly, and even daily sales goals. Share those goals with store managers and have them set daily, weekly, and monthly goals for store associates to ensure your store’s performance trends in the right direction.
5. Calculate your break even point
Your business’ break even point is the point at which you’re selling enough to cover your fixed and variable costs. You’re not profiting and you’re not losing money. Knowing how to calculate your break even point will help you identify how much you need to sell before your business starts profiting. This is key when setting sales goals.
6. Avoid confusing sales goals and objectives with metrics—they’re not the same thing
Sales goals and objectives are long-term overarching goals that drive your overall retail business growth. But analyzing shorter-term sales performance metrics is vital to make sure you’re on track to reach your annual goals.
Setting key performance indicators (KPIs) or target metrics that you’ll measure performance against will help you define steps and strategies to accomplish your sales goals.
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11 real-life examples of KPIs and metrics to help you reach your sales goals
With any business, the main objective is to increase sales revenue and run a profitable, sustainable business. In retail, there are many strategies and metrics you can target to work toward your annual sales goals. And breaking them down quarterly, monthly, weekly, and even daily will help you measure your progress and inspire you to reach the next milestone.
Let’s take a look at various examples you can put into action today to help you achieve your long-term sales goals:
1. Increase your monthly, quarterly, or annual sales revenue
Growing your sales revenue is the heart of your retail business. That’s why it’s important to make revenue targets the foundation of setting your sales goals. These long-term objectives will inform all the other short-term strategies you work on to increase your sales.
Start with your annual revenue goal and then break it down into smaller time frames to help you feel a sense of achievement along the way. Having a big goal to look forward to at the end of the year is a great way to keep your employees on track.
SMART goal example
Increase year-over-year sales revenue by 15% by creating strategies to boost and measure performance on a weekly, monthly, and quarterly basis.
Building a profitable company that continues to grow requires an overarching sales goal based on revenue and it will connect with all the other KPIs you define. Your sales revenue goal should always be at the top of the list and then you can use the various strategies we’ve listed below to achieve it.
2. Increase average order value (AOV)
Increasing your average order value involves strategies such as product bundling, upselling, and using cross merchandising to sell similar or complementary products. The main objective is to increase the average amount each customer spends at your business. Doing this will ultimately lead to higher overall sales volume.
To calculate your store’s AOV, divide your total sales revenue from a given period by the total number of purchases in the same period.
For example, if you sold $4,000 worth of products last month and there were 150 purchases, your AOV is roughly $26.
💡 PRO TIP: If you’re using Shopify POS, you can see your store’s average order value in just a few clicks—no manual calculations required. To get started, select Analytics from the POS app’s main menu. From here, you can see your store’s net sales, average order value, and items per order for any period of time.
In-store, you can use visual merchandising strategies to leverage store layout and a merchandise marketing calendar to regularly refresh your in-store product assortment. This can help improve new product discovery and lead shoppers to spend more during each visit to your retail store.
Online, you can use post-purchase notifications to upsell similar or complementary products, add a section to the cart page that suggests additional items they may like to add to their shopping basket, or implement a high shipping threshold to encourage customers to spend a certain amount to enjoy free shipping.
SMART goal example
Increase your ecommerce average order value in Q3 by 10% by adding an upselling feature to the shopping cart page of your website. Evaluate performance at the beginning of Q4 and make adjustments to improve the customer experience, if necessary.
3. Increase customer lifetime value (CLTV)
Customer lifetime value is the total amount a person spends at your retail business over the whole period of their relationship with your brand. This is an important metric because it can cost five times more to acquire new customers than it does to retain existing ones. Also, increasing customer retention by 5% can increase sales profits by 25% to 95%.
You can use this formula to measure CLTV:
Customer revenue per year x length of relationship in years – total cost to acquire the customer = CLTV
Let’s do the math using this example. If one customer spends $5,000 at your business per year over a length of three years and the initial cost to acquire that customer was $45, then their CLTV is $14,955.
$5,000 (per year) x 3 (years) – $45 (CAC) = $14,955 (CLTV)
💡 PRO TIP: Shopify POS customer profiles help you see how much each of your customers’ spend at your store. To get started, select Customers from the POS app’s main menu. From here, you can select a customer profile and see their purchase history. You can also bulk import customer profiles into other loyalty apps, or export them into a CSV file if you prefer working in spreadsheets.
But what strategies can you use to increase CLTV?
First, you’ll want to decide if you want to target a percentage or amount increase in the lifetime value for existing customers. Then you can use customer retention strategies such as loyalty programs, personalized email campaigns, and SMS marketing to continue engaging with customers post-purchase. The ultimate goal is to encourage them to make repeat purchases. Similar to increasing your AOV, upselling and cross-selling are also great strategies to boost your CLTV.
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Raise your CLTV at your brick-and-mortar store using retail merchandising and strategies to improve the checkout experience.
SMART goal example
Increase CLTV by 15% next year by sending automated post-purchase upselling emails showing related products to online and in-store customers, encouraging them to make repeat purchases. Set up this email flow by the end of this year and review performance on a monthly basis to make improvements.
Another SMART goal could be to increase CLTV by 10% next year through a customer loyalty program. Implement the program by the end of January and aim to have at least 10 customers join the program each month.
4. Decrease customer churn
With increasing CLTV also comes decreasing customer churn. As you’ve already learned, acquiring new customers is far more expensive than retaining the ones you have. That’s why decreasing customer churn is crucial to reach your sales goals. During a given period of time, you may gain or lose customers, either to your competitors or because they have stopped purchasing from your retail business for other reasons. Of course, gaining new customers will ultimately help you boost sales, but losing customers results in customer churn.
Customer churn happens when your customers stop buying products, stop visiting your store or website, and switch to buying from one of your competitors because of a lower price or better experience. Managing customer churn is vital in retail, as this metric tells you if customers like your products, are satisfied with your customer service, and if your pricing is competitive. High customer churn can also result in shoppers sharing their negative experience with friends and family, and this can lead to a poor image of your retail business.
One way to decrease customer churn is to ask customers for feedback through surveys or conversations when they visit your store. This way, you’ll know what areas need improvement to ensure your existing customers stay loyal. Essentially, anything you can do to strengthen relationships with customers will help you keep them.
To calculate your customer churn rate, divide the total number of churned customers over a given period of time by the number of customers you had on the first day of the same period.
For example, let’s say on September 1st you have 5,000 customers and throughout the month you lose 250 customers.
Here’s the math:
(250 / 5,000) x 100 = 5% churn rate
When looking at your churn rate month over month, it’s important to keep in mind that while you may lose some customers each month, you will also gain customers. So your total churn is made up of existing customers you lose as well as new customers you gain and lose in the same month. Then add up existing customers from the beginning of the month plus new customers to determine your total number of customers at the beginning of the next month.
Here’s an example:
Now you can also calculate your churn rate for the next month (October, in the example above).
- Existing customers = 6,700
- Existing churn + new churn = 300
- (300 / 6,700) x 100 = 4.48% churn rate
The recommended customer churn rate in retail is 5% to 7%. Aiming for less than 5% is a good goal, but if your churn rate exceeds 10%, it’s time to reevaluate. If you’re losing a larger number of customers than you’re gaining, it will be difficult to grow and sustain your business.
SMART goal example
Let’s say your current customer churn rate is 7.5%. You can set a goal to decrease customer churn by .05%, month over month, until it’s down to 5% per month. Then aim to maintain a 5% customer churn rate. Do this by surveying customers to understand how you can improve your products and customer experience, and do everything possible to resolve their issues quickly.
5. Reduce customer acquisition costs (CAC)
Customer acquisition cost is the amount you spend on sales and marketing to acquire a new customer. You can calculate it by taking the cost of sales and marketing divided by the total number of new customers acquired.
For example, if you host a pop-up shop and spend $2,000 on the space, sales staff, and marketing efforts and acquire 100 new customers during the event, your CAC is $20.
Sales and marketing costs for the pop-up ($2,000) / new customers gained at the event (100) = $20 CAC per customer
Lowering your CAC can directly impact your profitability and help you meet other sales goals too, such as decreasing sales cycle times. And it’s key to make sure your CLTV outperforms your CAC to run a profitable business.
You can reduce your CAC by analyzing your sales funnel and the customer journey to see where you’re spending money and where you can cut costs. Creating detailed customer profiles and buyer personas will also help you get a better understanding of your target customers and how you can reach them. Plus, you’ll be about to weed out prospects that are less likely to convert or be loyal customers. Then you can tweak your approach to bring in more new customers at a lower cost who are likely to make repeat purchases.
Another way to lower your CAC (and retain customers while you’re at it) is to create a referral program encouraging your existing customers to share your retail business with their friends and family. According to GWI, in North America, nearly 50% of consumers say rewards in the form of discounts or free gifts motivate them to promote their favorite brands online. Providing incentives to promote word-of-mouth marketing will help you gain more customers at a lower cost than what you’d spend on events or advertising.
SMART goal example
Decrease your average customer acquisition cost by 5% next quarter by using historical customer data to target the right audience via social media ads.
6. Reduce sales cycle time
Sales cycle time is the amount of time it takes for you to convert a lead into a paying customer. The customer journey from discovery to consideration to eventually buying varies depending on the industry as well as each individual business and customer. It’s a complicated process with many touchpoints.
You can create a list of touchpoints where potential customers might engage with your business and then see how you can speed up the process by reducing the number of steps or providing more information at certain points to make the buying decision easier.
This list can include touchpoints before, during, and after the sale. For example:
Before the sale
- Social media
- Customer reviews
During the sale
- Retail store, pop-up shop, or website
- Virtual clienteling
After the sale
- Post-purchase notifications
- Thank you messages/cards
- Follow up to ask for product reviews
SMART goal example
Reduce the sales cycle time by 5% next month by being available via Instagram direct message to answer customer questions. Do this by scheduling specific times each day that you check and respond to messages.
7. Boost conversion rate
Conversion rates can be broken down into different types based on your goals. For example, online or in-person sales, adding products to cart, capturing email addresses, and social media shares are all examples of conversions depending on your objectives.
Putting strategies into action to increase these conversions can boost your bottom line.
To calculate your retail conversion rate, divide the total number of sales in a given period by the total number of visitors in the same period.
Let’s say last weekend you had 250 store visitors and 40 of them made a purchase. Here’s how you can calculate your store’s conversion rate:
(40 / 250) x 100 = 16%
The average retail conversion rate ranges from 20% to 40% depending on the product category, and in ecommerce it ranges from 1% to around 4%, also depending on the products you sell. You can use this as a benchmark to set realistic goals for your business.
There are various tactics you can use to increase your conversion rate in-store and online including:
- Optimizing your product pages with high-quality images and detailed descriptions (online)
- Running limited-time discounts (online and in-store)
- Offering free shipping (online)
- Pricing products competitively (online and in-store)
- Implementing cart abandonment email flows (online)
- Innovating the payment experience to make it as frictionless as possible (online and in-store)
- Accepting more payment methods (online and in-store)
- Adding a live chat feature to your website (online)
- Testing your checkout process regularly and improving it (online)
- Offering more order fulfillment options such as buy online, pickup in-store (BOPIS)
- Training and motivating sales staff (in-store and virtual selling)
- Retail merchandising (in-store)
SMART goal example
Boost your in-store conversion rate by 5% in Q3 by running a limited-time discount on best selling products.
An online SMART sales goal could be to increase your ecommerce conversion rate from 1% to 2% in Q3 by adding a live chat feature to your website. This way, customers can get immediate feedback on questions and complete their order faster.
8. Increase lead generation
Generating more online leads through email subscribe forms lets you keep in touch with prospective customers who don’t convert after their first engagement with your business. By keeping in touch, you can educate shoppers about your products, share customer reviews, and provide incentives to hopefully convert leads into paying customers. For example, it’s common to see an offer for 10% off your first online purchase in exchange for providing your email address.
SMART goal example
Collect 50 new email addresses month over month by adding a newsletter pop-up form to your website and incentivize website visitors to subscribe by offering 10% off their first online order.
9. Improve gross profit margins
Calculating your gross margin helps you analyze how much money your retail business is making after spending money to make or buy the products you sell.
It’s shown as a percentage, and this is the formula:
Gross margin = (total sales revenue – cost of goods sold) / total sales revenue
The goal is to increase your gross profit margin to ensure you’re keeping more money on each sale you make. With higher margins it will be easier to run a profitable business.
In retail, profit margins generally range from 5% to 20%. And in ecommerce, a good profit margin target is around 45%. You can use Shopify’s profit margin calculator to help you find a profitable retail price for a single product. Plug in numbers to figure out the right selling prices to make sure you’re profiting on each product sold. Then use this data to inform other ways to improve profitability for your business.
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Here are a few tips to help you increase your gross profit margins:
SMART goal example
Increase gross profit margins by 5% in Q4 by reducing the number of promotions you run from four to two in Q4.
10. Increase sales per channel (and test new channels)
If you run an omnichannel retail business, setting sales goals to increase sales per channel is a great way to increase your overall revenue. Let’s say you have an ecommerce store and two brick-and-mortar locations and sales are steadily increasing online and at one of your retail locations but have been slow at your second retail location.
You can put short-term goals in place with the objective of increasing sales at your second location. What works for one store might not work for another, so it’s important to test different strategies for each location.
At the same time, you’ll want to make sure to maintain and continue increasing sales via the channels that are working well. For your online store, this could mean adding a “you may also like” section to product pages as a cross-selling strategy to encourage shoppers to increase their AOV. Or you could create an automated email flow to win back online shoppers who abandon their carts.
And if you haven’t already tried your hand at social commerce, virtual clienteling, pop-up shops, and local SEO, experimenting with new channels and marketing strategies is another way to increase revenue and reach your annual sales goals.
SMART goal example
Increase sales revenue at your second retail store month over month by 10% by running a bi-weekly promotion on new arrivals to encourage local shoppers to visit more often and increase their AOV. Share this promotion via social media, email campaigns, and in-store signage.
For your online sales channels, a SMART goal could be to recover 15% of abandoned shopping carts in Q4 by creating compelling email automations, including a 10% discount to encourage customers to complete their purchase.
11. Reduce abandoned cart rate
Using abandoned cart emails to recover lost sales is a great customer retention tactic that will help you reach your sales goals. Abandoned cart emails are used to remind customers who haven’t completed checkout to revisit their shopping cart and finish the online ordering process. Customizing the emails with product images, special offers, and a prominent call-to-action (CTA) button is a surefire way to bring shoppers back to the checkout page and increase your ecommerce sales.
The average abandoned online shopping cart rate is 69.8%. A few of the most common reasons for lost sales are:
- 49% of shoppers abandon their cart due to extra costs being too high (shipping, taxes, fees)
- 24% leave because the site required them to create an account
- 19% say the delivery time is too slow
- 18% say the checkout experience is too long or complicated
Strategies such as free shipping, guest checkout, and offering additional order fulfillment options like buy online, pickup in-store can help reduce your abandoned cart rate. But you can also set goals to earn back a certain percentage of lost sales during a given period.
SMART goal example
Step one could be to reduce the abandoned cart rate next month by 5%. You could do this by streamlining the checkout flow so it only takes three steps instead of five, for example.
Then you can also look at how you can increase the amount of lost sales that you win back through abandoned cart emails. Let’s say you’re currently earning back 2% of lost sales using recovery emails. You could set a goal to increase this number to 5% by the end of next quarter by improving the design and personalization of your abandoned cart email flows. More enticing emails could result in more shoppers coming back to complete their purchase.
Tips for achieving your sales goals
After setting your SMART goals, you and your team will have to work hard to achieve them.
Here are a few ways to make sure everyone is on the same page and stays motivated throughout the year:
1. Communicate with sales associates
Making sure your team is aware of your sales goals will ensure that they’re aligned and do their part to help you achieve them.. It can also boost employee motivation and productivity.
Have your store managers communicate sales goals in pre-shift huddles to motivate store associates for the task at hand and keep them focused on reaching their daily targets.
2. Offer mentorship and support
Having monthly or weekly one-on-one meetings with your sales staff is a great way to provide regular training and support. You can review associates’ sales results for the week prior and talk about how they can improve the following week. It’s key to give both positive and constructive feedback, and to not only look at the numbers, but their overall performance.
3. Provide the highest of level of customer service possible
Having products that your target market is looking for is, of course, a big piece of the puzzle. But boosting customer satisfaction by leveling up your customer service will help you succeed at reaching your retail sales goals.
A few components of good customer service are responding quickly to questions or concerns, offering self-service options to make the buying process easier, and going the extra mile to provide a positive experience.
You can achieve this by adding a personal touch to the shopping experience in a way large retailers can’t, by being transparent about your business and how the products are made, and being available to help customers across many channels, including social media, email, phone, in-store, and virtual shopping apps.
4. Ensure your staff are knowledgeable about the products you sell
Trying to buy a product from a salesperson who can’t even explain the features and benefits of it is probably one of the biggest frustrations you can experience while shopping. That’s why it’s important to make sure you and your sales staff know your products intimately and can articulate the advantages of buying them.
Use the FAB formula to explain the features, advantages, and benefits of the merchandise you sell and to help educate your sales staff about product details.
FAB stands for:
- Features of the products
- Advantages of the product features
- Benefits the products and features provide to the customer
5. Use gamification and rewards to motivate sales staff
Building an employee rewards program will help motivate associates to reach their individual and team sales goals. You can gamify the process by running contests and awarding winners on a weekly or monthly basis.
For example, if you set a goal for each associate to sell $1,000 worth of merchandise over the next week, you can reward the winner with a $50 gift card.
Or you can create a team reward, such as a lunch outing, if everyone hits their monthly sales goal.
Creating a healthy level of competition can boost your bottom line, but make sure you don’t go overboard to the point where your sales team starts working against each other rather than together to reach your sales goals.
6. Leverage consumer psychology
Understanding how consumers behave will help you set realistic sales goals and build strategies to reach them. You can ask yourself questions like:
- What would motivate shoppers to buy the products you sell?
- How can you market to your ideal customers?
- What variables would influence their purchasing decisions?
Creating a sense of urgency, building social proof, and creating a great customer experience are a few more ways to incorporate consumer psychology into your sales and marketing strategy.
For example, encouraging customer reviews can help build social proof and increase your brand credibility and trust. In turn, more people may be motivated to buy from your business.
7. Regularly track and analyze sales goals
Last but not least, an essential part of achieving your retail sales goals is regularly monitoring performance. After creating your SMART goals, you can use Shopify’s analytics and reports to measure progress on a short-term and long-term basis.
Put your SMART sales goals into action
Now that you understand how to create an action plan and outline SMART sales goals for your retail business, it’s time to put them to work. Start small by testing only one to two strategies at a time and then, based on what works, you can build from there. Ultimately, your sales goals should lead to one main goal—working together as a team to reach milestones and build a profitable and viable business.
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Research Findings on the Consumer Pathway to Purchase in the Mobile Era by Girish Punj :: SSRN
Posted: 21 Jul 2020
Date Written: June 1, 2020
The present study examines the effect of using a mobile device on search and evaluation by a shopper in a brick-and-mortar store. A conceptual model that proposes inter-relationships between shopping goals, the amount and type of in-store mobile device use, and purchase outcomes is developed. Data from a national quota sample of 1034 mobile shoppers is used to test hypotheses derived from the proposed model. The findings provide several new insights into the impact of in-store mobile device use on the consumer decision journey in a brick-and-mortar store. Depending upon the shopping goals of the consumer, the use of a mobile device by shoppers in a brick-and-mortar store can either decrease or increase search, lead to more deferred purchases or in-store-now purchases, and more online or physical store purchases. The study is among the first to model the pathway to purchase for mobile device assisted shoppers in brick-and-mortar stores.
Keywords: mobile shopping, shopping goals, in-store mobile search, multichannel retailing, brick-and-mortar stores, information search, pathway to purchase, consumer decision journey
JEL Classification: M31
Punj, Girish, The Effect of Shopping Goals and In-Store Mobile Device Use on Purchase Outcomes in Brick-and-Mortar Stores: Research Findings on the Consumer Pathway to Purchase in the Mobile Era (June 1, 2020). Available at SSRN: https://ssrn.com/abstract=3637515
What Are They & How Do They Work?
For online retailers with thousands of products, creating and managing Google ads is a time-consuming process. That’s why Google has come up with a solution, goal-optimized shopping campaigns, to save time on account management and boost ad performance.
At a glance, the new ad campaign type automates ad creation and bidding. No manual optimization or tedious account maintenance needed.
In this article, you’ll learn what goal-optimized Shopping campaigns are, how they work, where they show up, and how effective they can be.
What are goal-optimized Shopping campaigns?
Goal-optimized Shopping campaigns are another Google ad type that incorporates automation and machine learning to improve ad performance. With the new ad campaign type, you can set a goal for your campaign and Google will optimize your ads to maximize your conversion value.
For example, if you set this value to “revenue,” the campaign will automatically optimize your ad across all networks to maximize revenue based on your max budget. Google will optimize your bids, identify the right audiences, and determine where to shows your ads.
For search ads, search queries and predicted intent determines which product from your feed to show. Display ads are personalized based on a user’s engagement with your website and brand. If a user visited or expressed interest in a product on your website, Google uses your product feed to show a relevant ad.
Google also considers:
- Product attributes (e.g. the price of the product, price competitiveness, etc.)
- Context signals (e.g. time of day, browser, device, geolocation, etc.)
- A user’s past search habits (e.g. bids increase or decrease depending on the likelihood of a conversion)
In summary, with one product feed, one campaign, and one remarketing tag set, all you need to do is add products to your campaign. Google handles the rest.
Where will ads show up?
Google Ads Shopping campaigns combine Shopping and Display remarketing campaigns. Since that’s the case, there is no need to create separate campaigns to show ads in both places. The campaigns show ads to relevant users (those most likely to purchase your product) on Google’s Search Network, Display Network, YouTube, and Gmail:
With shoppers researching products in many different places, Shopping campaigns enable you to show ads to consumers searching online, watching product videos, reading blog posts, and reading product ratings all from a single campaign.
This simplified process allows you to spend less time manually optimized ads and more time on other areas of your funnel (like perfecting your ecommerce post-click landing page).
Who can shopping ads be targeted to?
Goal-optimized shopping campaign ads have the same targeting options as traditional Shopping campaign ads. Like search campaigns, you can target Google users by location and product groups.
How are product groups used in shopping campaigns?
Product groups are a subset of your ad group and can be used to manage your inventory. All the products inside that group will use the same bid.
Shopping campaigns use product groups instead of keywords to decide when to show your ads on a search results page. You can separate products into groups based on category, brand, item ID, condition, product type, channel, channel exclusivity, or custom labels:
You can also create multiple levels of product groups. For instance, you can divide your products by brand and break them down further by category. This level of organization allows you to adjust your bidding by group for less or more profitable products.
What about YouTube Shopping Ads and Bing Shopping Campaigns?
YouTube Shopping Ads can be set up through Google Ads and shown in YouTube videos as cards:
However, with goal-optimized campaigns, there is no need to create a separate campaign to show your ads in YouTube videos. YouTube is already one of the places your shopping ads will show when using this ad campaign type.
Bing Shopping Campaigns work similar to traditional campaigns in Google (targeting users by location and search terms). You can even import your Google Shopping campaigns into Bing so you don’t have to start from scratch.
Bing offers some automation capability but using these features does require more manual setup than Google’s machine learning. For instance, Bing allows you to set automation rules for changing bids automatically and starting and stopping campaigns at preset times.
Some examples include:
- Starting and stopping your campaigns for special events (like Black Friday)
- Increasing bids to keep your ads on the first page
- Avoiding costs on poor performing keywords or ads
How to set them up
All you have to do is link your Merchant Center account, set a budget and country of sale, and upload assets (like your brand logo, ad images, and ad text). Google will use your assets and test different combinations to discover the best performing ads.
Before jumping in, there are a few things you should know:
- Goal-optimized Shopping campaigns take priority over standard Shopping and Display remarketing campaigns. If you have the same product in both, ads from the goal-optimized campaign are shown rather than the ads in your standard campaign.
- Before you can create a goal-optimized Shopping campaign, you must set up conversion tracking. You also need to have a minimum of 20 conversions across all your Shopping campaigns during the last 45 days. You also have to set up a global site tag and have a remarketing list with at least 100 active users.
Since this ad type will show remarketing ads, numbers may look better than they are. It’s important to closely analyze the number of new customers your campaign is delivering versus customers who would have returned to purchase on their own.
Lastly, while automation has reduced the work needed to create high-performing ads, there are still a few things you need to do manually. In addition to uploading assets and different products, if you have different goals for different products, Google recommends having separate campaigns.
For example, you likely have different profit margins on different products. Thus, managing Return on Ad Spend (ROAS) targets through separate campaigns may improve results.
How effective are they?
Early users of goal-optimized Shopping campaigns have seen impressive results. For instance, Newlentes, a Brazil-based contact lens provider, launched a campaign that resulted in 57% more revenue at a 61% higher ROAS.
Turkey-based ecommerce platform, n11.com, decided to implement the new ad campaign type after they saw positive results with Universal App Campaigns. In their test of goal-optimized Shopping campaigns, n11.com saw an increase of 23% in revenue at a 9% higher ROAS.
Optimize every step of your funnel
Goal-optimized Shopping campaigns represent a great opportunity for retailers and ecommerce websites to improve Google ad performance. With automation and machine learning taking control, advertisers can spend less time tweaking their campaigns while automatically delivering the best ads to users who are more likely to convert.
The new ad campaign type is intriguing, but there is a lot more that goes into building a successful ad campaign beyond the ads themselves. To get the most out of your ad spend and receive the most ROI, advertisers must optimize their entire sales funnel, including both the pre-click and post-click stages.
To improve that process, read “The Marketer’s Guide to New Optimization Opportunities.” In the guide, you’ll learn crucial details marketers miss when optimizing their funnel, advertising misconceptions, and the difference between pre- and post-click optimization.
Article 2. Basic concepts used in this Federal Law / Consultant Plus
Article 2. Basic concepts used in this Federal Law
For the purposes of this Federal Law, the following basic concepts are used:
1) trade (hereinafter also – trade) – a type of entrepreneurial activity associated with the purchase and sale of goods;
2) wholesale – a type of trading activity associated with the purchase and sale of goods for use in business (including for resale) or for other purposes not related to personal, family, home and other similar use;
3) retail trade – a type of trading activity associated with the purchase and sale of goods for use for personal, family, household and other purposes not related to entrepreneurial activities;
4) commercial facility – a building or a part of a building, a structure or a part of a structure, a structure or a part of a structure, specially equipped with equipment designed and used for displaying, displaying goods, servicing buyers and making cash settlements with buyers when selling goods;
5) stationary trade object – a trade object, which is a building or part of a building, a structure or a part of a structure, firmly connected by the foundation of such a building, a structure to the ground and connected (technologically connected) to the networks of engineering and technical support;
(as amended byFederal Law of 30.12.2012 N 318-FZ)
6) non-stationary commercial facility – a commercial facility, which is a temporary structure or temporary structure that is not firmly connected to the land plot, regardless of the presence or absence of connection (technological connection) to the networks of engineering and technical support, including a mobile facility;
(as amended by Federal Law of 30.12.2012 N 318-FZ)
7) area of a retail facility – a room intended for displaying, displaying goods, servicing customers and conducting cash settlements with customers when selling goods, and passing through customers;
8) trade network – a set of two or more trade objects that legally belong to an economic entity or several economic entities that are part of one group of persons in accordance with the Federal Law “On Protection of Competition”, or a combination of two or more trade objects that are used under a single commercial designation or other means of individualization;
(p.8 as amended. Federal Law of 03.07.2016 N 273-FZ)
9) food products – products in natural or processed form in circulation and consumed by humans (including baby food, diet food), bottled drinking water, alcoholic products, beer and drinks made on its basis, soft drinks, chewing gum, nutritional supplements and dietary supplements;
10) services for the promotion of goods – services provided to business entities supplying food products to retail chains in order to promote food products, including by advertising food products, carrying out their special display, researching consumer demand, preparing reports containing information about such products, or the implementation of other activities aimed at promoting food products;
(p.10 introduced by Federal Law of 03.07.2016 N 273-FZ)
11) goods marked with identification means – goods on which identification means have been applied in compliance with the requirements of this Federal Law and the regulatory legal acts of the Russian Federation adopted in accordance with it and reliable information on the marking of which (including information on the means applied to them identification and (or) material carriers containing identification means) are contained in the state information system for monitoring the turnover of goods subject to mandatory labeling with identification means, in accordance with the requirements of this Federal Law and the regulatory legal acts of the Russian Federation adopted in accordance with it;
(p.11 as amended. Federal Law of 02.07.2021 N 354-FZ)
12) goods subject to mandatory labeling by means of identification – goods included in the list of individual goods subject to mandatory labeling by means of identification, approved by the Government of the Russian Federation, as well as goods for which the Government of the Russian Federation has approved the rules for labeling by means of identification;
(Clause 12 introduced by Federal Law No. 488-FZ of 25.12.2018; as amended by No.Federal Law of 02.07.2021 N 354-FZ)
13) identification means – a marking code in a machine-readable form, presented in the form of a bar code, or recorded on a radio frequency tag, or presented using another means (technology) of automatic identification;
(Clause 13 introduced by Federal Law No. 488-FZ of 25.12.2018)
14) marking code – a unique sequence of characters, consisting of an identification code and a verification code;
(p.14 introduced by Federal Law of 25.12.2018 N 488-FZ)
15) identification code – a sequence of characters, which is a unique number of a copy of the goods;
(Clause 15 introduced by Federal Law No. 488-FZ of 25.12.2018)
16) verification code – a sequence of characters generated as a result of cryptographic transformation of the identification code and allowing to reveal the falsification of the identification code when verifying it using the fiscal accumulator and (or) technical means of checking the verification code;
(p.16 introduced by Federal Law of 25.12.2018 N 488-FZ)
17) technical means of checking the verification code – software and hardware encryption (cryptographic) means of protecting marking codes, providing the ability to detect the correction or falsification of the identification code as a result of its verification using the verification code and a key document designed to verify the identification code;
(Clause 17 introduced by Federal Law No. 488-FZ of 25.12.2018; as amended by No.Federal Law of 02.07.2021 N 354-FZ)
18) technical means of generating a verification code – software and hardware encryption (cryptographic) means of information protection, which ensure the generation of a verification code as a result of cryptographic transformation of the identification code and in respect of which the federal executive body in the field of security has issued a document on their compliance with the established requirements to encryption (cryptographic) means of protecting information, acting in relation to encryption (cryptographic) means designed to generate verification codes;
(p.18 introduced by Federal Law of December 25, 2018 N 488-FZ; as amended by Federal Law of 02.07.2021 N 354-FZ)
19) participants in the turnover of goods subject to mandatory labeling by means of identification – business entities engaged in trading activities related to the purchase and sale of goods subject to mandatory labeling with identification means, as well as business entities supplying goods subject to mandatory labeling with identification means, in including manufacturers of these goods;
(p.19 introduced by Federal Law of 25.12.2018 N 488-FZ)
20) importer of goods subject to mandatory labeling with identification means – a legal entity, an accredited branch of a foreign legal entity in the Russian Federation or an individual entrepreneur importing goods subject to mandatory labeling with identification means into the Russian Federation, except for cases of transit movement of such goods through the territory of the Russian Federation.
(p.20 introduced by Federal Law of 02.07.2021 N 354-FZ)
90,000 O WTO – Principles, objectives, rules and functions of the WTO
World Trade Organization (WTO)
Location : Geneva, Switzerland
Founded : January 1, 1995
Established : Based on the results of the Uruguay Round negotiations (1986-94)
Number of members : 164
Secretariat staff : about 640 employees
Chapter : Robert Covale de Azveved
Goals and Principles :
The World Trade Organization (WTO), the successor to the 1947The General Agreement on Tariffs and Trade (GATT), began its activity on January 1, 1995. The WTO is called upon to regulate the trade and political relations of the Organization’s members on the basis of the package of Agreements of the Uruguay Round of multilateral trade negotiations (1986-1994). These documents are the legal basis for modern international trade.
The Agreement on the Establishment of the WTO provides for the creation of a permanent forum of member countries to resolve problems affecting their multilateral trade relations and monitor the implementation of agreements and agreements of the Uruguay Round.The WTO functions in much the same way as the GATT, but oversees a broader range of trade agreements (including trade in services and trade-related aspects of intellectual property rights) and has much greater power to improve decision-making and implementation by Members. organizations. An integral part of the WTO is a unique mechanism for resolving trade disputes.
Since 1947, the discussion of global problems of liberalization and the prospects for the development of world trade has been taking place within the framework of multilateral trade negotiations (MTP) under the auspices of the GATT.To date, 8 ICC rounds have been held, including the Uruguay Round, and the ninth is in progress. The main goal of the WTO is to further liberalize world trade and ensure fair conditions for competition.
The basic principles and rules GATT / WTO are:
- mutual provision of most favored nation (MFN) treatment in trade;
- mutual provision of national treatment (NR) for goods and services of foreign origin;
- regulation of trade mainly by tariff methods;
- refusal to use quantitative and other restrictions;
- transparency of trade policy;
- Settlement of trade disputes through consultations and negotiations, etc.
The most important functions of the WTO are:
- control over the implementation of agreements and arrangements of the package of documents of the Uruguay Round;
- carrying out multilateral trade negotiations between interested member countries;
- settlement of trade disputes;
- monitoring the national trade policies of member countries;
- technical assistance to developing countries within the competence of the WTO;
- cooperation with international specialized organizations.
The total benefits of WTO membership can be summarized as follows:
- obtaining more favorable conditions for access to world markets for goods and services based on the predictability and stability of the development of trade relations with the WTO member countries, including the transparency of their foreign economic policy;
- elimination of discrimination in trade by accessing the WTO dispute settlement mechanism, which ensures the protection of national interests in the event that they are infringed upon by partners;
- the opportunity to implement their current and strategic trade and economic interests through effective participation in the ICC in the development of new rules for international trade.
- As consumers 90,080 people get the opportunity to choose goods of a wider range, higher quality and lower cost.
- As sellers people get the opportunity to sell their goods in more markets.
- Bilateral Trade Negotiations : These are negotiations in which two countries enter into a separate agreement governing the terms of trade between them.
- Regional Trade Agreements: These are special agreements made between countries to create more favorable conditions for trade between them. Mercosur (a common market for South American countries that includes Argentina, Brazil, Paraguay and Uruguay) and NAFTA (North American Free Trade Agreement between Canada, the United States and Mexico) are examples of regional trade agreements.
- Show interest in discussions and hot topics in international trade.
- Find out what policy your country is pursuing in this area and what agreements it participates in.
- Find out which countries your country trades with and why.
- Take the initiative and write to your government representatives if you think your country’s trade policy needs to be changed.
90 140 90 000 Commerce – World Bank Student Resource “Did You Know …?”
What is it?
Trade is the process of exchanging one thing for another; business of buying and selling goods and products.
Trade gives people the opportunity to buy goods and services that are not produced in their countries. In addition, revenues from the export of goods and services help determine the amount that can be spent on imports, as well as the amount of foreign credit that countries can afford.
Trade can stimulate a country’s development and economic growth. It helps create new jobs, improve living standards and empowers people to manage their lives.
International trade without barriers such as tariffs, quotas and government subsidies can benefit people in all countries, developed and developing alike.
International trade can be a much more effective way of reducing poverty than aid, because trade can make a country economically independent, rather than living off foreign aid. However, the current international trading system is characterized by a range of inequalities that affect the interests of poor countries.
International trade is governed by a number of rules that have been developed over the years by the governments of various countries. Typically, poor countries do not have access to developed country markets due to trade barriers and agricultural subsidies. These barriers make it difficult for poor countries to sell their products overseas and improve living conditions domestically.
Although free trade is beneficial to all people, sometimes governments try to protect their country’s products and its domestic market from foreign products by subsidizing local producers or creating barriers in the form of tariffs and quotas, for example.This practice is known as protectionism.
When producers receive additional funds (subsidies) from their governments, they can significantly reduce the price of their products relative to their real market value. This is a particularly serious problem in agriculture.
World Trade Organization
Most countries in the world are members of the World Trade Organization (WTO).WTO members meet every two to three years to discuss ways to liberalize trade.
Trade liberalization would eliminate all tariffs and quotas, as well as create conditions for the sale of goods and services only for their real value. This would encourage poor countries to enter new markets and sell their goods. If the ministers of the WTO member countries could agree on tariff cuts in agriculture and industry, the resulting trade changes would lift 140 million people out of poverty.
While the WTO is working to liberalize and modernize international trade rules, reaching agreements that meet the expectations and desires of each country is an elusive goal. Try to expand your knowledge of the WTO negotiations on this issue by visiting the Doha Round website.
In addition to membership in the WTO, countries that actively trade with each other often develop separate rules governing the flow of goods and services between them.They establish preferential treatment for their products, which gives them advantages over the products of countries that are not parties to the relevant agreements.
Why does this concern me?
By setting tariffs and import quotas on foreign products, governments are trying to make them more expensive for the domestic consumer. This is done in order to stimulate the consumer to continue to purchase domestic goods, which will continue to be cheaper, although, in reality, the production of these goods may turn out to be more expensive than the production of foreign counterparts.
Due to the fact that the economies of poor countries are not so well developed and diversified, in most cases they produce a small amount of competitive products that can be sold abroad. When trade barriers restrict or prevent the sale of their products abroad, when opportunities exist, it complicates the solution to development problems and the improvement of people’s lives.
What is the international community doing?
The implications of trade inequality are one of the main reasons for criticism of globalization.Many international organizations, from the World Bank to non-governmental organizations (NGOs), are working to make the global trading system more equitable and to provide equal opportunities to all countries, including the world’s poorest countries.
However, for all countries to benefit from globalization, the international community must continue to work to reduce imbalances in international trade (removing agricultural subsidies and trade barriers), from which only developed countries benefit, and to create a more equitable system.
What can I do?
More information on the World Bank website
90,000 How to set goals in the market and what to write in a trading plan
Almost every action we do in life has a purpose. When you start trading in the market, you also need to decide on your goals first.
From the very beginning, traders usually set a goal for themselves in numbers, for example: “I will make 1% per day of my capital” or “I will earn 30% per year.”If you only have a digital beacon in front of you, it does not mean at all that you will not stray off course, trying to swim in the darkness to the target. First, you should study the market very well and develop your discipline and trading strategy.
When you start trading, focus primarily on the process of trading, and not on the result. If you make profits without honing your skills, the market is likely to take your money.
Like any other business, trading requires total immersion in the process.The result never comes overnight. Many businesses take time to become profitable, and many end in failure. Trading is similar: without understanding how the markets work, you cannot make money, hoping only for luck.
To build a winning strategy, follow three guidelines:
- Always have a plan
The plan should contain information about what trades you are going to make – which securities to enter and from which to exit, while you should calculate the profit and loss.The plan should be very detailed and take into account the specifics of the markets in which you will trade, risk parameters, your position size and market environment.
- Develop discipline
When a trader has set a certain goal, expressed in monetary amount, he strives to achieve it with all his might, even if conditions are not favorable for this. The market does not provide an opportunity to make money as often as you want, and some people prefer to make deals anyway, even if they are inconvenient for them.This tactic will quickly eat up your profits.
When you can open a position or when you need to say “NO” to yourself – all this should be spelled out in your trading plan. Your goal will be achievable exactly when all your deals fit into a pre-written plan.
- Look at trading easier
Some are convinced that the more complex a trading plan, the better it will work. But don’t overdo it with analysis and trading strategies.Avoid making your winning strategy more difficult, as this will only reduce its profitability.
Focus on just one market and a few simple strategies when you start trading. Also, do not drastically change your strategy, market or analysis – follow your plan. Over time, however, it may need revision, but the fixes should be simple.
When you start trading, be a trader with few tasks.These goals should focus on the process that will allow you to make money. Results will come over time if you act according to your trading plan and do not make bad trades.
Based on materials from investopedia.com
90,000 World Trade Organization History of origin, goals and objectives
On September 5, 2001, the President of Ukraine issued Decree No. 797/2001 “On Additional Measures to Accelerate Ukraine’s Accession to the World Trade Organization” in order to ensure the implementation of the strategic course of foreign economic policy aimed at integrating Ukraine into the world economic system.This document provides for a comprehensive reform of the foreign trade regime of our state, as well as consistent provision of harmonization of Ukrainian legislation with the norms and principles of the World Trade Organization (WTO). During 2001-2002. it is planned to hold a series of negotiations with the WTO leadership on the mechanism for Ukraine’s entry into this international organization.
Our country, as one of the members of the international community, sells and buys goods, services and intellectual property.We strive to actively develop trade relations with other states. For effective negotiation and subsequent implementation of trade transactions, well-established rules are needed at the level of the international community. In order to eliminate discrimination in international trade, unfair competition and some other negative phenomena in the world economy, the WTO was created in 1995.
WTO was created to regulate trade relations between different countries.The documents signed by the WTO member countries create a legal framework for international trade. In addition, within the framework of an international agreement, manufacturers are provided with appropriate conditions for the export and import of products.
The main goal of the WTO is to protect the principles of free trade, which includes the removal of barriers to free trade, as well as the development of appropriate rules for international trade, the observance of which could prevent the possibility of a sharp change in the economic course of a country in relation to which other countries have certain economic interests.The WTO Guidelines assume that trading rules should be clear and predictable.
Since the WTO is a community of states engaged in trade operations, in some cases with opposing economic interests, it can act as an arbiter through which disagreements can be resolved through negotiations. Contracts and agreements signed as a result of painstaking negotiations within the WTO often require additional interpretation by the leadership of this organization.
WTO has been in effect since January 1, 1995, but its trading system was created more than half a century ago. Back in 1948, the General Agreement on Tariffs and Trade (GATT) entered into force, which predetermined the “rules of the game” on the international market. The countries that signed the GATT were actually members of the international organization of the same name. At the same time, negotiations were held, as a result of which the foundation was laid for the creation of the WTO. The longest period of negotiations, known as the Uruguay Round, lasted from 1986 to 1994.During it, the prospects for the creation and the mechanism of work of the future WTO were discussed. The holding of the Uruguay Round contributed to the development of the world economy, an increase in world trade turnover, investments, favored the creation of new jobs, as well as an increase in the income of the participating countries. Currently, the GATT is not perceived as an organization, but as an agreement that regulates the trade of various goods within the WTO. It should be noted that sometimes GATT is used as a synonym for WTO, but it should be borne in mind that the WTO deals not only with trade in various goods, but also with the sale of services and intellectual property.
The agreements signed by the WTO member countries are voluminous and complex, since they cover various areas of commercial activity, for example, agricultural, textile, light industry, banking, food sanitary inspection, intellectual property, etc. However, they are based on certain fundamental principles , which are reflected in almost all WTO documents and regulate the system of multilateral trade relations.
Trade without discrimination
Guided by the principles of the WTO, member countries of this organization should not take discriminatory measures in relation to other member countries that are trading partners.When deciding to reduce the size of the state duty on the import of a certain type of goods produced in a certain country, it should apply to similar products supplied by other countries.
At the same time, the WTO countries use the most favored nation principle, which at first glance seems to contradict the above principle of trade without discrimination. What do you really mean? Each individual country – member of the WTO carries out trade relations with all other member countries in the most favored nation regime.Thus, the principle of equal participation in the WTO is duly respected.
In the 19th century, when the first bilateral agreements in the field of trade relations between the most economically developed countries were signed, the principle of most favored nation treatment was clearly discriminatory. Only a few of the countries that made up this exclusive club enjoyed the Most Favored Trade privilege. Since most countries in the world joined the WTO, such a club no longer exists.
The GATT, the General Agreement on Trade in Services (GATS), the Agreement on Trade-Related Aspects of Intellectual Property Rights (Agreement on Trade -Related Aspects of Intellectual Property Rights – TRIPS).
However, there are some exceptions. Firstly, the countries of a certain region can sign a free trade agreement, which does not apply to other countries – members of the WTO, and secondly, trade sanctions against a country violating international law are possible.However, the possibility of applying discriminatory measures in relation to WTO member countries is clearly limited.
In general, the principle of ensuring maximum-favored-nation treatment provides for a constant reduction of trade barriers, improvement of conditions for free market access for other WTO member countries, equal participation in international trade of economically highly developed and economically poorest countries.
The WTO trading system must:
not to discriminate – each country – member of the WTO provides the most favored nation treatment in trade with other states;
ensure freedom of trade – remove artificial barriers (established by the government) on the way to the development of trade relations through negotiations with interested states;
Pursue predictable economic policies – foreign companies, investors and governments must be confident that trade barriers (including tariffs, non-tariff barriers, etc.)will not be installed arbitrarily; in this regard, the conclusion of agreements between countries at the WTO level on the issues of fixed rates of customs tariffs and a number of other problems associated with entering the national market is becoming more and more widespread;
Ensure free competition by eliminating the “unfair” practice of exporting goods at dumping prices in order to develop a certain market segment;
Create favorable terms of trade for economically less developed countries by providing some special privileges and benefits.
Identical requirements for foreign and domestic subjects of trade
Trade in goods of domestic and foreign origin should be regulated by the relevant laws of the country. This also applies to trade in services, intellectual property rights and patents. This principle (to present the same requirements to national and foreign manufacturers) is the basis for the three main WTO agreements – GATT, GATS and TRIPS.
Free trade – through negotiations
Limiting trade barriers is one of the most effective means of stimulating trade relations between countries.Trade barriers can include duties (or tariffs), bans on imports of certain types of products, introduction of quotas, etc., which limits the amount of imported goods. In this case, a certain role can sometimes be played by bureaucratic factors, as well as changes in the exchange policy between countries.
Since the signing of the GATT in 1947-1948. 8 rounds of negotiations took place. The agreement reached during the 1st round related to the reduction of tariffs and duties on imported goods. As a result of subsequent rounds of negotiations, by the end of the 1980s, an agreement was reached to reduce tariffs on manufactured goods to 6.3%.From about this time, negotiations began regarding new objects of trade – services and intellectual property.
The regulation of the activities of open markets is carried out by means of regulations and special agreements. The agreements signed by the WTO member countries allow the implementation of measures for the “progressive liberalization” of the market. Developing countries, as a rule, are given additional time to fulfill their obligations to other countries – members of the WTO.
Predictability – due to stabilization of the regulatory framework of trade relations
In some cases, making a commitment not to raise trade barriers can be just as important as deciding to lower them.Stability and predictability are important factors in promoting investment, job creation, etc. As a result, the consumer can fully enjoy the benefits of free market competition – a wide range of goods and services and low prices. The WTO Comprehensive Trading System is an effort by various countries to ensure that their business structures operate in a stable and predictable environment.
In deciding to open their markets to goods and services, WTO member countries are striving to maintain their restrictions at a stable level.Thus, the upper limit of the customs tariff rates for goods and services is established. The country can change the size of the customs tariff rates, but only after negotiations with trading partners who could compensate for the losses. The introduction of stable tariffs and duties resulted in an increase in the volume of international trade.
WTO seeks to improve the predictability and stability of tariffs and duties through other means, in particular by prohibiting the use of quotas on the import of certain goods, as well as other measures that restrict the import of products (the introduction of quotas is usually combined with excessive bureaucracy and unfair competition) …In addition, the WTO helps member governments develop clear and transparent international trade laws where necessary.
WTO is often classified as a “free trade” organization, which is not entirely accurate.This organization basically proposes that member states comply with certain customs tariff rates and, in some circumstances, other forms of protection of the internal market. A more precise wording would be: WTO is an organization dedicated to ensuring open and fair competition. Since open and fair competition is complex, the WTO has developed specific criteria to help classify competition as fair or unfair, and has proposed schemes under which national governments should act to remedy the damage caused by unfair trade.Many WTO documents are developed to support fair competition in the agricultural sector, in the areas of intellectual property, services, etc.
Development and implementation of economic reforms
Economists and trade experts recognize that the WTO contributes to the economic development of its member countries. Everyone knows that a signatory country must have sufficient time to implement its commitments under the GATT. In doing so, developing countries can count on special assistance and certain trade concessions.
It should be noted that 75% of WTO members are developing countries or countries with market economies in transition. With the Uruguay Round lasting 7.5 years, about 60 such countries independently implemented a program of trade liberalization and at the same time tried to take an active part in the Uruguay Round negotiations.
These facts confirm the implausibility of the claims that the WTO was created in order to serve the interests of only economically developed countries.Moreover, this organization has provided and is providing certain support to developing countries in the implementation of the agreements signed by the participating countries in practice, it involves the provision of certain benefits during the transition period to the poorest developing countries so that they can make certain adjustments in their economic activities.
Evidence suggests that developed and developing countries are largely meeting their commitments. At the final stage of the Uruguay Round, WTO member countries decided to show increased flexibility in relation to developing countries.In turn, economically developed countries are taking steps to improve the conditions for entering their national market for goods and services from developing countries, as well as providing them with the necessary technical support.
Based on materials from the official website
of the WTO (www.wto.orgrel = “nofollow” target = “_blank”>)
90,000 Set your trading goals. How to Become a Consistent Trader
It is very important for you as a trader to define your own trading goals.This will help you stay on the right track while traveling. Setting good goals strengthens your consistency and discipline. The only catch is choosing the right one.
The purpose of today’s article is to explain the importance of setting trading goals and why some are better than others.
The importance of trading targets
One of the most important reasons for setting trading targets is to help you follow your trading plan. This can be especially helpful in the beginning, but don’t forget about your trading goals later.They will make your trading more consistent and this is another main reason why you should list them.
Trading Objectives Help Develop a Plan
Trading Objectives will change as you gain experience. First, you should focus on the trading process itself so that the goal should be, for example, adhere to such daily habits as a healthy diet or a lot of exercise. These things are as important as sitting in front of a computer. You should take care of your body and soul because you want to think straight when you finally sit down at the table.Over time, you will be able to focus on your trading results.
Things to Avoid When Setting Goals
You should avoid setting goals. Monetary goals are one example. They are not the best, mainly because you should focus on protecting your account balance in the first place. Once you can keep money in an account, you can start thinking about making a profit. However, setting monetary goals is not recommended.Market conditions often change in unpredictable ways and this is something that you have no control over.
The first thing to do is to protect your capital.
Moreover, avoid setting vague goals. You must be able to measure your progress. Don’t include anything like “work more systematically” or “use this strategy better.” It will be difficult to verify whether you have achieved such a goal or not. Be specific, break big goals into smaller ones, and pick ones that can be achieved.
Objectives should focus on the process
Your trading goals should be process-focused, not outcome-focused.You want to become a professional trader and this is only possible when you develop your skills. Develop goals to help you stick to the trading plan you’ve created.
You can, for example, state your goals in “if” statements. If something happens, this is how you react. Let’s say if the currency pair you are trading falls to a certain level, you will open a buy position.
Follow the rules you’ve set for yourself and don’t worry about the outcome.Sometimes you win, sometimes you lose. But remember that even if you sometimes lose, this does not mean that the trade was not done correctly. Focus on the process.
Follow the process
You should always keep track of your actions. This will not only help you focus on the process, but it will also show you which areas need improvement. The best idea is to write a trading journal or use a trading checklist.
When you review your past transactions, you can draw conclusions.You will learn what is the best time to trade, which indicators are useful and which strategy suits your trading style.
You can also add a scorecard to your trading journal and note whether you have traded with or against your plan. It will show you if your plan needs adjustment or if the plan is working well and only you should follow it more closely.
Setting trading goals does not guarantee success, but it definitely brings you closer to it.You need a plan, you need to focus and develop.
Set process-oriented goals. Don’t force yourself to earn a certain amount at a certain time. It will only force you to make reckless decisions. Think of a long-term plan instead of the immediate future.
Develop your own trading plan, which will include all the details of the transactions. Include, among other things, market entry and exit conditions, money and risk management.
Proceed step by step. Don’t try every indicator or trading strategy you know. This will only add chaos to your work. Work on multiple tools at the same time. This will help you stay focused.
Following this tip will help you increase your trading confidence. And when entering the market, you need to be calm and confident. It is possible. Just focus on the process and take the time to practice.
We wish you good luck!
90,000 Permanent Representative of the Russian Federation: Climate goals should not be used to restrict world trade – Society
UN, October 27./ TASS /. Russia believes that the implementation of the climate agenda should not be used as a pretext for unjustified discrimination and restriction of international trade. This was stated on Tuesday by the Deputy Permanent Representative of the Russian Federation to the UN Dmitry Chumakov, speaking at a conference of the high-level world organization on climate.
“There are only a few days left before the Glasgow climate conference. The event has many challenges, the priority of which is to agree on common approaches to the functioning of market and non-market mechanisms for the effective implementation of the Paris Agreement,” he said.“This instrument was designed to be the backbone of a long-term climate regime, and its success will ultimately depend on respect for the agreements reached, the implementation by all countries of decisive action to combat climate change and the reinforcement of the stated goals with the means of achieving them.”
“Today it is obvious what measures need to be focused on: there is a lack of efforts in the field of adaptation to the negative effects of climate change; it is necessary to increase technical assistance to developing countries, especially the most vulnerable in terms of climate change; to mobilize funds,” the diplomat said.
Chumakov also noted the potential of solutions in the field of sustainable environmental management. “In this context, we welcome the growing interest in forest management and land use in general,” he continued. “Forest ecosystems have excellent absorptive capacity.”
The Russian side calls for increased attention to “prevention of deforestation, sustainable forest management, conservation, restoration, as well as protection from fires, diseases and pests,” the diplomat said.”The measures taken by the countries in this direction should be duly taken into account when solving the tasks of the Paris Agreement,” added the Deputy Representative of the Russian Federation.
Do not restrict international trade
“The implementation of the climate agenda certainly requires the mobilization of the efforts of all stakeholders in different directions. At the same time, it should not be used as an excuse for unjustified discrimination and restriction of international trade,” Chumakov noted.“The UN Framework Convention on Climate Change calls on countries to cooperate in building an open international economic system.”
According to the diplomat, work on the climate track should not harm the energy security of countries. “On the contrary, to promote the use of energy sources that, in certain regions of the world, can contribute to reducing the carbon footprint of the energy sector while expanding access to energy,” he said. “In particular, natural gas, nuclear power and hydropower have such potential. …Various types of hydrogen technologies have great prospects. “
Russia is committed to combating climate change and providing assistance to other countries in this area on a voluntary basis. “We are consistently working to improve the national legal framework and create all the necessary conditions for the implementation of the Paris Agreement,” the Deputy Representative of the Russian Federation noted. “The President of the Russian Federation, Vladimir Putin, announced that Russia will in practice seek carbon neutrality of its economy, and we set a specific benchmark here – no later than 2060.