5 Important eCommerce Metrics you Shouldn’t Neglect
What are the most important eCommerce metrics your online business needs to monitor for success? These 5 KPIs will ensure your eCommerce conversion rate is trending up, keep reading.
Ecommerce is one of the most prospective and lucrative industries in existence. In fact, its current value stands at almost 3.5 trillion US dollars, while its value is expected to exceed the 4.88 trillion dollar mark by 2021. This not only means that there is plenty of market share to go around, but that thousands of aspiring entrepreneurs are entering this competitive arena each year in pursuit of lifelong affluence and success.
What is your only chance of survival in such an environment? To keep close tabs on the most relevant KPIs in order to make the best cost-effective decisions.
After all, knowledge is power, and the more you know about the market as well as your business’s standing in the industry, the greater the chances you have of acquiring customers and turning them into loyal brand followers.
With all of this in mind, let’s take a closer look at the most important eCommerce metrics you shouldn’t neglect if you want to make it big in Ecommerce.
1. Your shop’s conversion rate
The first and arguably the most important eCommerce metric you should keep track of is your conversion rate.
While it is useful in the grand scheme of things, it’s not very informative all on its own. It simply tells you how much of your website’s traffic you’re converting into paying customers. This is extremely valuable information, but it’s best used in conjunction with other KPIs in order to give you a comprehensive overview of your standing in the industry.
You can calculate your conversion rate easily by dividing the number of sales with the number of visitors and multiplying the score with 100. Most eCommerce platforms like BigCommerce, Shopify, 3D Cart, etc will provide analytic that calculate this type of data for you.
image source: BigCommerce
Next, aim to improve your conversion rate by improving the quality of your images, integrating trust badges throughout your side to boost credibility and transparency, emphasizing customer reviews and user-generated content, and implementing a live chat service to improve customer support. All of this will influence the shopper’s decision-making process.
2. Your website’s traffic
Improving your conversion rate gives you the drive and incentive you need to improve your site’s traffic. After all, more traffic means more sales if you invest in optimizing conversions and maintain the quality of your service even with the added workload. Luckily, tracking website traffic is easy, as you should find all of the information you need on your Ecommerce platform’s dashboard.
If you’re using Shopify, for example, one of the most reliable Ecommerce platforms in the world with the best themes aesthetics, you can check out this data by clicking on the Reports button in the admin page, and then the Acquisition section. Once you have the information you need, you can work on increasing website traffic through social media management, influencer marketing, SEO services, content creation, and of course, PPC campaigns.
3. Website bounce rate, engagement, and interaction
The Ecommerce market is a battlefield.
Every brand is fighting for their customer any way it can, and special emphasis is put on website design, responsiveness, performance, and the accompanying metrics that portray customer engagement and satisfaction while shopping on the site itself. This is why every successful Shopify agency puts top priority on the website’s bounce rate and its complementary metrics such as engagement and interactions in order to gauge site performance and optimize it for the modern customer.
It’s all about tailoring the shopping experience to the industry trends and simplifying the shopping journey as much as possible in order to make it easy for the potential customer to make the decision to buy from your store. To achieve this, agencies are emphasizing performance-driven UX web design in terms of functionality and aesthetics, and keeping close tabs on the bounce rate to measure customer satisfaction. If you want to track the bounce rate yourself, simply divide the average number of bounces across all of your pages by the total number of visits.
4. Email subscription conversions
Email marketing is a huge component that needs to be tracked. In fact, it has undergone a true renaissance in recent years and came out on top as one of the most profitable marketing methods in the modern business world. So naturally, it only stands to reason that you should exploit the potential of email to acquire new customers and nurture existing ones.
You can calculate your email opt-in conversion rate by dividing the number of opt-ins with the total number of users and multiplying the value by 100.
But again, there are so many helpful resources, like MailChimp, that integrate with your eCommerce store that do this work for you allowing you to focus on what’s important.
After that, aim to improve the score by offering incentives for your audience members to subscribe to your mailing list. Add discounts and deals for new subscribers, put pop-ups on your site to catch the attention of existing customers, and be sure to change up your offer from time to time in order to appeal to different types of visitors.
5. Conversion rate by traffic source
And finally, it’s imperative that you know which traffic source produces the biggest results.
Why? Because this will give you the information you need in order to boost underperforming areas, and invest further in the most lucrative revenue streams. If you simply invest in all traffic sources without actually knowing how each one is performing or what its ROI is, you have no way of optimizing your marketing expenses or maximizing any source in particular.
You can use Google Analytics to track this metric, after which you can weed out the underperformers and decide whether to invest in their growth, or stop investing in them altogether. You might choose to double your investment in the most profitable sources instead, and thus capitalize on the most lucrative revenue streams in your niche.
Ecommerce might be a thriving industry with plenty of potential for long-term financial gain, but it’s important to keep in mind that the trends that make it so great are also the trends that are attracting thousands of competitors into the fray. Your only chance of strengthening your position in the field is to track these crucial eCommerce metrics and use them effectively to pave the road to long-term success and affluence.