Kevin Hillstrom: MineThatData

In case you are wondering why I'm talking about items / merchandise more often, this is a process that happens every 3-5 years. Business doesn't go the way we want it to, we focus on merchandise for awhile (which often fixes the problem), then we get away from merch and focus on marketing channels until marketing channels don't work great (usually caused by merchandise problems) ... and we repeat the cycle.

We're always repeating the cycle.

Sometimes our merchandise assortment gets stale. It happens to every company. It's during the "stale periods" when we dig a bit deeper.

Let's pretend you measure how much items sell by year ... let's pretend you've analyzed the dynamic for items you've offered for at least four years. You see the following.

• Intro Stub Year = $50,000 per item.
• First Full Year = $75,000.
• Second Full Year = $38,000.
• Third Full Year = $19,000.
• Fourth Full Year = $9,500.

        

If you want to understand if your customers are being impacted by your merchandise assortment, you can run my comp segment metrics (obviously) - you can run my Class Of Reporting (duh).

You can also measure what I call "Assortment Age".

Take every item a customer purchased in September, and for those items calculate the number of months that item has been available to be sold. If it were introduced fifteen months ago, the age of that item is 15 months. Perform this for every item you sell.

Compare September 2026 to September 2025, to September 2024. What is the average age of the assortment the customer purchased?

You might see something like this:

• 2026 = 13.2 Months.
• 2025 = 18.1 Month.
• 2024 = 13.6 Months.

        

One of the challenges of ecommerce-in-a-box is that you work so hard to piece together a credible vendor solution (i.e. Shopify) that you don't stop to ask yourself how the customer sees the experience.

Example?

Friday Pickleball.

I was on the ground floor, watching their funny videos years ago.

I've spoken with the guys at a pickleball tournament. If you've never been to a PPA Tournament in Mesa (or elsewhere), by all means, open up your wallet and enjoy. You might see the guys there.

My wife paid $ to be coached by Kyle Koszuta. I've forwarded his videos to my audience at Pickleball Mathlete. We've watched him battle the pros in early rounds on Pickleball.TV. We've enjoyed watching Rachel Rohrabacher battle the best in the business, using their paddles as their first signed pro.

We took their Pickleball Personality Test.

We watched those guys as they changed their lives, moving to Phoenix to grow their careers.

Last week, I needed a new paddle ... I bought the Friday Aura to help protect my arm from tennis elbow.

You'd likely say I'm a "fan".

Their ecommerce-in-a-box solution doesn't know that. They've sent me two ecommerce-related messages since.

1. Please Become An Affiliate Marketer For Them.
2. The Message Below.

        

Growing up, we had a Classic Rock station (it wasn't really "classic" yet, but you get the drift) that adored the month of October. They called October "Rocktober". Combine that with "Two for Tuesday" and you really had something ... the dulcet tones of the band Rainbow singing "Stone Cold" and "All Night Long".

I thought about stopping the post right there, but that wouldn't be fair to you, the loyal reader.

Every one of you has a marketing channel that is dying. Sort of like FM Radio is dying. My favorite station in the Pacific Northwest was KRXY ("Roxy") 94.5 from Shelton. You'd hear Rainbow's "Stone Cold" followed by "Cherish" by Madonna followed by "Loser" by Beck and then they'd wrap it up with something from Arianna Grande. Just random Rock/Pop nonsense.

There was nothing like it.

And then?

Spotify playlists.

On June 30, KRXY didn't sell to some soulless entity and become part of the "iHeart Radio Family". They just shut down. Over. Fin. Bankrupt. Their scraps were ultimately acquired by another local station.

Every one of you has a marketing channel that is dying. For some of you, you don't have the metrics to realize that the marketing channel is dying. You keep paying Facebook and they keep sending you customers eight years older than your average customer and you think things are fine. They're not fine. One of the signs of a dying marketing channel is that the customers delivered by the marketing channel are disproportionately older than the age of customers from other marketing channels. Catalogers know this all too well ... they ran their businesses into the ground trusting co-op marketing channels who delivered 74 year old customers instead of the 47 year old customers they needed.

Identify the average age of all customers acquired in the past year by marketing channel. Yeah yeah, I know, marketing attribution double-counting blah blah blah. Do the work anyway. If the nascent new customer from ChatGPT is 33 years old, the Google Search customer is 43 years old, and the paid social customer from Facebook is 58 years old, you have a pretty good idea which marketing channel is going to become KRXY.

        

When you increase prices (typically by discontinuing a product line and introducing a new/comparable line at a higher price), there are several things that can happen.

1. Nothing. This is the hope. You essentially increase prices and customers don't care. It's the kind of thing Apple gets away with.
2. Fewer Items per Order. This is the most common outcome. Prices increase from $20 to $25, customers in-kind decrease items per order from 2.5 to 2.0. Nothing has been accomplished with the notable exception of fewer items going through your distribution center.
3. Fewer Orders per Buyer: Happens less frequently than (2) above but it still happens. Some of your existing customers just say "no". AOV hawks will quickly point out that there's nothing wrong with AOV, and they're right, AOV often increases in these circumstances. And yet? Business is just "off" a few percentage points ... because customers are not buying as often.
4. Lower Repurchase Rate: Sort of a byproduct of Fewer Orders per Buyer, but more significant because some customers just say "no mas" and go find something cheaper on Amazon. Once you start trading in the dark arts of lower repurchase rates, all sorts of lousy outcomes transpire. Your buyer file decreases, you have to "make budget" so you acquire more new customers at ever-more-expensive rates to make up the difference harming the p&l in the process. This is a common scenario.
5. Fewer New/Reactivated Buyers: The counterpart to (4) above. (4) is a measure of what your existing customers think, (5) is a measure of what "the market" thinks about your pricing. It is common to see a disconnect here ... stable repurchase rates among existing buyers but a 20% drop in new/reactivated buyers. If your annual rebuy rate is 30%, the market dictates what you do. If your annual rebuy rate is 70%, you dictate what you do.