Running an online store is no joke. You must pay close attention to key metrics and KPIs to measure your website’s online performance. There are plenty of things to consider like bounce rate, the pattern of visitors, and the cost of acquiring new customers. eCommerce metrics gather insightful data that can be converted into meaningful actions to drive business growth.
So, buckle your seats and let’s explore the world of eCommerce metrics.
Why Metrics are Important in Your Digital Journey
Analysing the data behind critical eCommerce metrics helps you evaluate the performance of your online business. Think of them as visual graphs quantifying the number of visitors to your website, the size of average purchase, and the total customer spend on your brand.
1. Identifying Trends
Metrics reveal the customer’s mind. By looking at the numbers, you gain insights about their online behaviour. Whether it’s product popularity or the latest market demands, this invaluable information helps you make informed decisions regarding product development and website optimisation.
2. Marketing ROI
E-commerce metrics are the backbone of marketing ROI. They assess the return on investment on customer acquisition value, conversion attribution, and lifetime value. Numbers rule the game as every dollar spent goes towards creating lead-generating marketing campaigns.
Did you Know: India’s e-commerce industry is expected to reach 7591.94 billion by 2029, growing at an annual rate of 11.45%.
Business can allocate their marketing budget as per eCommerce KPI metrics to channels that yield positive results.
3. User Experience
Users interact in different ways and tracking their online activity will help you pinpoint areas for improvement. For example, eCommerce metrics like cart abandonment rate, bounce rate, and dwell time are critical to enhance customer satisfaction and increase sales.
What works and what is ticking their mind off is answered only when you measure key metrics to asses their buying journey.
4. Customer Data
Segregating customer data and converting them into detailed eCommerce metrics help you understand consumer demographics. Their purchase history and behaviour provide a rich source of information to detect shopping patterns. This is used to personalise marketing campaigns, tailor product offerings via personal filters, and enhance customer engagement.
5. Future Prediction and Forecast
The eCommerce industry flows like a wave. Didn’t get us? Don’t worry, let’s clarify it. There are high and low patterns in sales trends mimicking the wavy path. Analysing historical e-commerce metrics helps you make strategic plans for future growth.
Predicting sales trends and demand fluctuations becomes easy as decisions are backed by critical analysis and research.
6. Benchmarking Standards
Top eCommerce metrics allow businesses to benchmark their performance against competitors. When comparing critical metrics, you gain deep insights into industry standards and your eComm store’s performance gap.
Researching KPIs like average order value, and market share improves your resource allocation to stay ahead of the game.
7. Inventory Control
Tracking inventory is a different ballgame altogether. Mix it with customer expectations for faster delivery and you end up in a soup. But, not anymore because analysing eCommerce metrics like turnover rate, COGS, and sell-through rate helps you avoid stockouts, minimise excess inventory, and ensure optimal product availability during peak customer demand.
Thanks for sticking with us, you understand the important eCommerce metrics. Let’s check those you don’t want to ignore in 2024.
6 E-commerce Metrics to Track
eCommerce metrics are important data to gauge your business success. Each digit specifies a hidden pattern revealing newer opportunities for customer retention. Here is a list of the best metrics to supercharge your eCommerce business.
1. Average Order Value
This is the average amount your customers spend on a product at a particular time.
Here’s the formula.
AOV = TOTAL REVENUE/ TOTAL ORDERS
Average order value is a great eCommerce metric to measure revenue and set realistic goals for acquiring newer customers. For example, if your AOV is 50 and you are targeting 10000 INR revenue in a month, you need to get 200 customers in that period.
2. Cart Abandonment Rate
You have an enticing website lined with great, out-of-the-box products yet there will be customers not completing their purchase. This is shopping cart abandonment where a user adds products to the cart but abandons the entire checkout process. This is a crucial part of eCommerce helping you to detect checkout problems.
Use this formula:
ABANDONEMENT % = X TOTAL PURCHASES/ X TOTAL ADD TO CARTS CREATED * 100.
A high abandonment rate between 80-100% means there are potential red flags in your checkout system prompting people to skip the complete transaction.
3. Conversion Rate
This is one of the best eCommerce metrics churning the wheel of your business. It’s the biggest indicator of the success of your top-level marketing campaigns. It is easy to measure the conversion of product purchases, newsletter signups, eBooks, PDF downloads, etc.
Tools like Google Analytics have pre-set features that measure your website’s conversion rate.
CONVERSION RATE = NO. OF PEOPLE TAKING ACTION/ TOTAL NO. OF USERS * 100
If you want to go further beyond, segment the data to track the behaviour of new customers and check how your website appears to first-time visitors.
4. Returning Visitor Rate
The repeat customer rate is the number of customers repeatedly purchasing from your website. Calculating your returning audience will help you invest resources to expand your existing customer base and preferably retarget ads to attract older buyers to your store.
RETURNING RATE = X OF RETURNING CUSTOMERS/ TOTAL CUSTOMERS * 100
5. Bounce Rate
Another one of the best eCommerce metrics is the bounce rate. This isn’t limited to eCommerce sites, it caters to anyone having an online website to their name. It specifies the number of people leaving your website without taking action like checking a product, clicking on a webpage, or filling out a form. It can also include the average time spent on the site.
It appears in your Google Analytics dashboard under the “Reports” option. To reduce bounce rate, create visually appealing and easy-to-navigate websites that convey crisp and clear information to the user.
6. Organic Traffic/ Impressions
So, your website is a conversion machine and hits all the eCommerce analytics metrics like a home run. But, do you know the source of your impressions? What is the origin of your organic traffic?
Whether it is paid ads, social media marketing, or email marketing, you need to understand the site traffic to calculate the revenue from multiple traffic sources. The common traffic elements include:
- Website Traffic – The total impressions, clicks, and total no of users on your website for a particular period.
- Blog Posts – Blogs refer traffic like a champ
- Google or other search engines
- Social Media platforms
Finally, let’s move to the FAQs and answer the users’ commonly asked queries.
FAQs – Top 6 eCommerce Metrics to Track in 2024
What are metrics in eCommerce?
These are estimated values of visitors buying the product or landing on your page. The metrics also include customer acquisition cost and the percentage of people ordering the product at a particular time. There are even eCommerce supply chain metrics to measure stocks and the total number of goods sold.
What are the three most important KPIs for eCommerce?
The three vital KPIs are reach, engagement, and total no. of clicks/impressions.
How to track eCommerce sales?
Tracking sales is about identifying the metrics related to conversions and engagement. Calculate the customer lifetime value, acquisition cost, rate of conversion, and cart abandonment rate.
Conclusion
Tracking eCommerce metrics keeps you in the loop to gather data for improvement. You don’t require complex numbers to measure everything under the sun. As discussed earlier, these metrics will get you started in the right direction, helping you build a robust marketing plan.
E-commerce is the first step of the supply chain network. Feeling a bit lost in the maze of logistical analysis? Fret not, Qodenext has got your back. Our expert-driven team will supercharge your supply chain to newer heights.
