What Are eCommerce Metrics?
eCommerce metrics are a compilation of information and actions pertaining to online commerce. They track the number of consumers who make purchases from your website, the amount they have spent, the number of visits you receive each day or each week, and the search terms those visitors use to find your website. eCommerce metrics are frequently used as a measure for determining whether a website is competitive with similar products supplied by other websites and how well it is performing in the industry. By increasing the number of visitors to your website and the revenue you generate from that traffic, you can increase the proportion of visitors who become paying customers.
Why Is Keeping A Close Track Of eCommerce Metrics Important?
Keeping close track of eCommerce metrics is essential for any business wanting to thrive in the marketplace because it allows you to track your performance and make changes to your site.
Metrics are used by marketers to provide a piece of information such as conversion rate and average order size. This is important because it can be used when developing and testing new products or services. This will help you determine the best versions of a particular product to develop in order that you can increase sales.
Online marketers can enhance their ability to understand these metrics by using tools such as conversion rate and average order size, which help determine how well a website is doing in terms of its sales.
Metrics can be helpful to the marketing team in determining the performance of different campaigns. They can also indicate when a current campaign or new one should be taken over by the eCommerce department.
Another reason for tracking your eCommerce metrics is that it allows you to learn more about your business and how you can improve it.
Metrics You Need To Be Aware Of
1. Sales Conversion Rate
The proportion of visitors to your online store or website who actually complete a purchase is known as your eCommerce sales conversion rate. Even if we're not listing them in any particular order, we'll still suggest that one of the most crucial indicators to pay attention to is your conversion rate.
The equation is as follows: CVR = (Number of Purchases / Number of Sessions) x 100
2. Average Order Value
The average order value (AOV) of your online store lets you know how much the typical customer spends there. Your AOV is a fair indicator to monitor because it can be used to estimate revenue and set reasonable targets for acquiring new clients.
Use the following formula to calculate: AOV = Total Revenue / Total Number of Orders
3. Customer Lifetime Value
Customer lifetime value (CLV) calculates the total amount you make from an average customer over the course of their relationship with you. In other words, it is the total amount of money your company may make from a single client over the course of their engagement with you, if not their entire lifespan. Your CLV is crucial for your eCommerce website development
because it acts as a guide for how much you can spend on customer acquisition and how far you should go to retain them.
4. Customer Acquisition Costs
Although expanding your consumer base is undoubtedly crucial, it only accounts for half of the solution. Your customer acquisition cost (CAC), which includes everything from marketing and sales expenses to the cost of paying your personnel and hosting your website, keeps track of the typical cost of acquiring one customer.
5. Shopping Cart Abandonment Rate
No matter how popular your products are or how great your conversion rate is, some customers will still choose not to complete their transaction. Shopping cart abandonment is the practice of customers adding things to their online shopping carts but not proceeding all the way through the checkout process, thus abandoning those purchases.
6. Email Click-Through Rate
A tracking link that keeps track of responses should be included in every email's call to action (CTA). The click-through rate (CTR) counts the proportion of emails that receive at least one click. Alternatively stated, the email campaign's click-through rate (CTR) is the frequency of email clicks.
7. Bounce Rate
Anyone with a website, not just eCommerce sites, needs to be aware of the metric known as bounce rate. The percentage of visitors to a specific website that leaves after reading just one page is known as the bounce rate, which is closely related to the cart abandonment rate.
8. Refund and Return Rate
Refund and return rates represent the proportion of orders that were either refunded or returned, based on the total number of orders. A high return rate indicates issues with product quality, customer happiness, or lead quality even while taking returns is a requirement. Refunds are worse because they typically signify a dissatisfied customer. If you take on eCommerce website development services from us, we maintain control over all necessary metrics.
9. Repeat Customer Rate
Basically, the percentage of customers who visited your website in a repeated manner. Increasing your repeat customer rate—which is determined by dividing the number of consumers who made several purchases by the total number of customers, often over a rolling 365-day period—is the key to improving client retention and loyalty.
Managing a profitable eCommerce business require numerous process including branding, marketing, supplier management, and customer care. You can achieve this goal by using the eCommerce metrics listed above to determine which techniques are working and which require more attention.