eCommerce ROI: 3 key steps to maximize it

Monika | Wed Apr 29 2015 | Industry insights


Making money from e-commerce is not easy, but once you understand what turns your effort into sales, you will be good to go (and grow).

ROI, or return on investment, is a must-do measurement for every business. It’s like a compass that navigates you through the market opportunities and helps you to edge you out of the market.

For eCommerce companies, including live and on-demand video broadcasters, there are two key factors that impact their ROI: 

  • Conversion rates,
  • and refund rates.

If you wish to maximize your growth, you will need to skyrocket your conversions while keeping the refunds to the minimum.

Boosting the ROI is easy, if you stick to those 3 steps:

1. Invest in quality

Sounds like a no-brainer, but we've seen many failed events (examples: AWS Summit or the Oscars ceremony) utilizing a low-quality pay-per-view solutions. Obviously, the quality solutions come at a certain price, yet over time, they always benefit you.

Smart eCommerce business owners invest in quality to permanently improve their sales and cost per sale, and thus their ROI of their Live pay-per-view events.

Simply compare the gains and losses if you decide to go for a cheaper solution that won't guarantee you the best quality. Let's say you have sold your event to 10K viewers, charging $10 per ticket:

A GOOD quality solution: Since all went without a hitch, and you didn't have to handle any refunds, chargebacks or complaints, the gains are obvious:
  • Working with quality providers (just like Cleeng), for 2 hours of HD streaming and PPV solution, you will pay ± $2.5 per viewer, i.e. $2.5k.
  • Your event will convert at an average 10%. So that's 1000 purchases.

Your net revenue = $7500 (k-ching!)


A BAD quality solution: The payment and access control didn't work well on mobile devices and TV set/Chromecast.
  • Instantly, you lost 20% of users minimum.
  • The payment flow and choice of methods were not optimized. If you offered only Paypal that typically covers only ±15% of the market, you lost another 15%.
  • There was no real-time support for your buyers during the event, so you had to refund 4% of all orders. As a result, you receive $720 in net orders = $7200 in revenue.
  • Include the fixed amount you need to give away for capturing and recording the event (assuming the video platform + PPV only cost this time 1.25cc per stream - a massive 50% discount compare to the previous scenario.

You earned = $6262 net.


How to tell a good monetization solution from a bad one?  Here’s a checklist that will help you decide on the outset:

  • Does the solution work with the major OVP platforms to guarantee your viewers a seamless broadcast experience?
  • From a usability standpoint - will your customers be able to buy within a click? Or, they will rather be dragged through a tiring purchase process?
  • Is the payment flow and choice of methods optimized?
  • Can you sell globally, without worrying about the tax differences between the countries?
  • Will your customers receive professional and timely support?


2. Keep your customers happy - they will tell others

If you want a share of the already crowded eCommerce market, you need to build it around loyal customers who are likely to recommend you further. This is especially true for Live pay-per-view events where time is of the essence.

The ephemeral nature of Live events, together with the strong emotions linked to them, require a real-time support for your customers. Don’t make the mistake of under-investing in your support teams, especially when you’re first starting out.

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3. Scale up with different business models 

There is a thing called Customer Lifetime Value. Winning new customers is a fantastic investment only if you know that a healthy percentage of these customers will buy again and stick to your offer.

You can easily make your customers stick not only through a great UX experience during the purchase and accessing your event, but also through a wider offer. Become more flexible by combining different online video business models: pay-per-view, rental, bundle and subscription.

The time to claim your space on the OTT market is now. 

Don’t settle for “good enough", go for Cleeng!


Set up pay-per-view - it's free!


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