From economic terminology, I would like to use the term "marginal utility theory" here. It simply describes a development where each additional profit unit purchased is more expensive than the previous unit. In other words, you usually buy your most loyal (VIP) customers from the region of your business and for a significantly lower price than the remaining customers.
Visualisation of marginal utility theory, source: https://xplaind.com/
"So how do I know that I want to run my business towards profit rather than sales volume, or vice versa?"
The difficulty of answering this question is equivalent to the question: "What should I do to be happy in life?". So, it's nice to have someone you can consult about your plans, ask them such a challenging question and use their practical experience, but it's important to realise that the final decision and especially the real work is 95% up to you. No one will gain happiness for you and no one will build your business for you. Your business (e-shop) is reflected a lot on your personality, dreams, and goals.
"Hmm, so I don't know where to start now, it's just getting complicated."
In my experience, the first step to a successful data-driven e-shop is a business plan. From dozens of different online businesses and hundreds to thousands of hours spent on business planning, we have gradually put together a template based on the free Google Sheets technology (freely available later in this article).
In our simple template, you can start managing your e-shop (in terms of technology, Google Sheets and spreadsheets are generally just the beginning of the journey and the know-how you have to go through).
Template for simple planning of operational and marketing investment of an e-shop
Basically, it is necessary to put together the company's operating costs (salaries, rents and other fixed items), marketing costs and margin information (at least the overall average) in one place. You will get an overview of how many orders you need for your company to generate the required amount of cash flow at the end of the month (or fiscal period). You can download the template for planning within Google Sheets as our best practice tip for beginning here for free.
Author's tip: When working with data, try (even if you're at the very beginning and only have 10 orders a day) to work with scalable cloud technologies like Google Sheets, the general Google Cloud Platform, and other tools that you'll read about later in this article. Always keep in mind: everything I do must be easily available for collaborative work online and ideally automated, otherwise the competition will overwhelm me. It is best to completely avoid locally stored Excel files and similar customs from times past. This "innovative" approach is more important (and simpler and cheaper) than it might seem at first glance. For me, one of the keys to the success of effective e-shop management or "every saved second of time counts".