This one is a simple hack that doesn’t work for all websites, but it works for most local small businesses. Depending on how much data you have at your disposal you can either find out how many sales a month they make, or what’s their estimate income.
Start by analyzing your own business
- What is your average cheque?
Calculate the average purchase amount, normalize the results by excluding anything extraordinary, like someone buying 11 pairs of shoes to equip a football team.
- How many orders are left unpaid?
How often do people place an order and never go through with the payment?
- How many orders are returned?
This one is obvious.
Once you’ve got the data, you can move on to analyzing your close competitors. It works for closest competitors only since all of the info you got will differ in various niches, or sometimes even areas.
Move on to the vanilla version of industrial espionage
- Place an order at your competitor’s store on Monday.
When you get order details to your email, look for order ID. In most places, they are numbered in order.
- Write down the order number, e.g. 00327
- Place another order on Tuesday around the same time, and write down that order’s number as well.
- Place another order on Friday, write down order number.
- Place one order in Saturday and one on Sunday.
- Split data into 2 groups: work days and weekend.
Estimate how many orders per week they get
Split the data into two sets: work days and weekend
Calculate the difference in order numbers between Friday and Monday.
e.g.: On Friday you got order number 00367 and it was 00327 on Monday. it means they get around 40 orders in that period.
Use order number from Tuesday as a marker to double check if daily order numbers go in line with the total number.
Do the same for the Weekend numbers, there might be a noticeable difference, so I recommend separating the weekend data.
Account for your data to make final estimates on your competitor’s revenue
Now that you know how many orders your competitors get every week, add your own data to the mix.
Multiply the number of orders by your average purchase amount (50 orders * $100 avg = $5000)
Subtract some of that based on your unpaid orders and return rates and you’re good to go.
It’s not the most accurate method but it should give you some perspective.