Make Money Online

How do I earn 5k a month on Shopify?

Whatever type of business you do, it’s always best to understand your metrics.

Let’s start with your end goal: $5,000 per month. I assume you mean gross profit, which is the income you earn after you take your sales revenue and subtract cost of goods sold, fees, shipping, etc.

Now let’s divide that by 30 to get daily goals: $166.66 per day is the amount of gross profit you need to hit $5,000 per month.

Let’s pretend that the average gross profit for one of your products is $16.66. That means you’ll need to sell roughly 10 of these each day.

Now that we know how many products we need to sell each day, let’s focus on our 

marketing metrics.

Conversion rate, if you’re unfamiliar with it, is the percentage of visitors to your page that make a purchase. The average retail conversion rate is somewhere between 2–5%[1]. To make things easier, let’s say that you’re converting well on the high end, somewhere around 5%.

So, to understand how many visitors we’ll need to come to the site per day to hit our aforementioned benchmarks, we simply divide the conversion rate into the number of daily sales needed: 10/0.05 = 200 visitors.

Recap: great—200 visitors per day will produce 10 sales. At $16.66 per item, we’ll make roughly $166.66 per day, or roughly $5,000 per month.

So how do we get these people to the site? Let’s introduce another metric: Click-Through-Rate (or CTR). CTR is the number of people who see an advertisement or mention of your product or service and click-through to the site. For online shopping, this number is about 2%[2], which means that for every 50 people that see a link or ad for your site, 1 will click on it.

Our goal is to get 200 visitors per day to head to the site. So now we’ll divide that goal by the CTR: 200/0.02 or 10,000 impressions per day.

Let’s recap again—if 10,000 people see our ad or link each day, and 200 people click on the ad or link and 10 of those people buy for an average of $16.66 per sale, then we’ll make $166.66 per day—or $5,000 per month.

So now we need to get 10,000 people to see our link or ad per day. How do we do that?

Here’s some free ways to do it:

• We could answer questions on Quora (my current CTR is roughly 2%).
• You could create an Instagram account dedicated to your products (my current CTR is roughly 2% here, too).
• You could participate in conversations on Reddit (I haven’t used Reddit yet, but I’ve heard the CTRs are awesome once you earn the community’s trust).

Of course, there are some paid ways, too (of course, spending money on ads means you’ll need more sales to pay for those ads which means you’ll need more traffic, so more ads which means more traffic and… this is more or less the jet fuel condundrum):

• Facebook ads (cost roughly $7.19 per 1,000 impressions)
• Google ads (Google ads are cost-per-click (CPC or PPC), meaning you only pay when someone goes to your site; for example, at $0.50 per click, you’d have to spend $100 per day or so)
• Affiliate marketing (have other people advertise your stuff and pay them commissions when they make sales)

In conclusion, if you make 10,000 people aware of your site each and every day and you get at least 2% of those people to click through and become visitors, and then your site is able to convert 5% of those people into buyers for an average of $16.66 in gross profit per sale, then you will make $5,000 per month.

Hope that’s helpful! Good luck to you.