The first thing to measure is traffic – how many people come into my store every day. To that end I purchased an Amseco Wireless Door Chime with Counter which I installed across my main entrance. It’s an electric eye system that rings a chime and increments a counter every time someone comes into the store. It’s sophisticated enough that exits are counted differently from entrances, but not so fancy that it hooks up to a computer. Instead I purchased a giant dry-erase wall calendar on which I record every day’s count.

While I’m at it I also record the day’s sales on the same calendar. Every week or so I copy the data into an Excel spreadsheet, where I do fancy stuff like graph sales and traffic, project trend lines, collect weekly and monthly totals, etc.

For my business all those graphs are extremely spiky (I love those technical terms – “spiky”). I’ve plotted some rolling averages which are helpful, but still my business is so small that one of the most significant things I’ve been looking at are “zero dollar days” – the days when I would have done better to stay home in bed.

Anyway, today I decided to look at the year as a whole. I tallied up all the sales, and all the door swings, and discovered that, on average, every time my door swings my cash register rings up another $10 in sales!

I find that to be remarkable, especially when I consider all the things that cause that door to swing – the mailman, rolling bikes out in the morning and back in in the evening, going out to get lunch, etc. I knew when I installed it that I was going to be counting a lot more than just customer visits, but hey! you’ve got to start somewhere!

On a day-to-day basis there’s no correlation between door swings and dollars. My products range in price from under $1 to more than $5,000, so one customer coming in to buy a scooter makes up for a lot of spark plug sales.

Another way to look at things is the door swing to sales transaction ratio. A quick analysis shows one sale for every 21 door swings. Again, that’s regardless of why the door swings.

All these numbers are interesting, but what are they good for? I think they help evaluate the success of any marketing efforts, for one thing. If I spend $500 on an ad campaign it needs to result in at least 50 more store visits in order to be considered successful.

I have three ways to improve the profitability of my store based on these numbers. I can increase the number of visitors (door swings), increase the percentage of visits that result in sales, or increase the dollar value of each sales transactions.

The real value of the door swing counter will come in next year, when I can compare against this year’s numbers.

What do you do to track your sales efforts? Do you have something like a door swing counter to monitor the traffic into your store? How often do you look at it?

According to a recent court ruling Microsoft has been ordered to stop selling Word because it infringes on a patent held by Toronto-based i4i. The patent has something to do with custom XML, which is a way of encoding data fields in a document so that software can extract and interpret them.

This ruling appears to be a follow-up to a May ruling, which apparently Microsoft chose to ignore. At least that’s the way I read the article. Read it for yourself. (Here’s a longer article on the same subject.)

Do you think Microsoft should be forced to stop selling Word? If it does, how would that impact your life?