The best business owners know the importance of data. Numbers provide them with a clear picture of their performance and insights into what decisions they should take to improve their results.
However, as an online store, you can access thousands of eCommerce metrics on your store’s activity. And the truth is, most of them won’t matter to you.
So to make life easier, we’ve compiled a list of the most important metrics you should be keeping track of to measure your success and improve your store.
Table of Contents
Web Traffic Metrics
Keeping track of your eCommerce store traffic is a great starting point for improving its performance. Here’s how you can measure your web traffic and interpret it:
1. Overall Website Traffic
The first metric you should be measuring is your online store’s number of visitors, which often is the result of your SEO ranking.
However, it’s important to note that you don’t want just to drive the most traffic possible: you also want to generate the right kind of traffic. We’ll go over later on how to determine if your web visitors are actually converting.
2. Bounce Rate
Bounce rate is the number of people that land on your website and bounce off instantly without browsing any of your products.
There are various ways to reduce your bounce rate. For example, you could improve your website’s speed: according to research by Google, 53% of visitors will leave a site if it loads for more than 3 seconds.
Another tactic you can use is installing pop-ups to catch the attention of visitors before they leave. You can set this up with a tool like Privy, that uses pop-ups to promote special offers and boost conversions.
3. Pages Per Session
Pages per session is how many pages a visitor viewed during a single session. You calculate it by dividing the number of page views by the user’s total number of sessions. It’s a useful metric to determine how engaging your website’s experience is.
Driving traffic to your eCommerce website is just the first step. The next is to ensure that those visitors convert and eventually become paying customers. Here are the conversion metrics that you should be keeping track of:
4. Conversion Rate
An eCommerce conversion rate consists of the percentage of web visitors that took a desired action on your eCommerce store. For example, these actions could include making a purchase, adding an item to their shopping cart, clicking an ad, and more.
We wrote a whole blog post you can read to learn more about conversion rates and what you can do to measure them. You’ll also gain insights into the steps you can take to improve it.
5. Average Order Value (AOV)
Your store’s average order value is the typical size of your customer’s order. To calculate it, all you have to do is divide your total sales by the number of purchases.
To boost your average order value, you can set up post-purchase upsell offers that complement the customer’s order. Not only does it allow customers to get the most out of their purchase, but you’ll be winning more sales.
6. Cart Abandonment Rate
Many eCommerce stores struggle with shopping cart abandonment: studies show that the industry’s average cart abandonment rate hovers around 66.7%.
You’ll want to regularly keep track of how many abandoned carts you’re losing. From there, you can set up strategies and find ways to reduce them.
7. Customer Acquisition Cost (CAC)
As the name suggests, customer acquisition cost measures the investment needed to get a prospect to purchase.
The simplest way to measure it is to divide all the costs spent acquiring more customers by the number of customers acquired during that period. Make sure to take into account the acquisition costs per channel for precision.
Customer Engagement and Retention Metrics
Keeping your current customer base happy is vital to your success: in fact, it’s 60 – 70% easier to sell your product to an existing customer than a new one. The metrics below are significant indicators of how well you’re keeping customers engaged:
8. Customer Retention Rate
While getting first-time customers to your store is essential, retaining existing ones is even more crucial. Over 46% of a store’s revenue comes from only 8% of its customers.
Your customer retention rate is the percentage of repeat customers you’re able to keep as time passes by. The higher your retention rate, the more your revenue and brand reputation will improve as well.
9. Customer Lifetime Value (CLV)
Customer lifetime value measures how much you can expect your customers to spend on your store during their relationship with you. On top of helping you predict revenue, it’s a reliable metric of how your company performs in terms of experience and quality.
To discover your customer lifetime value, multiply your margin by your retention rate divided by (1+discount rate- retention rate). Or, for Shopify users, multiply your average order value by your purchase frequency.
10. Net Promoter Score (NPS)
A satisfied customer is the best one you can get. They’ll continue purchasing from your store and can even become brand advocates.
As your company grows, you’ll want to keep track of your customer satisfaction. Your customer’s feedback will provide valuable insights on your brand experience and areas that you can improve.
One way to determine this is through Net Promoter Score (NPS) surveys. Out of a score of 10, customers rate the likelihood that they’ll be spreading the word about your brand.
11. Return Rate
One common headache among eCommerce stores is customer returns. According to studies, eCommerce consumers return around 20% of their items, double the return rate of brick and mortar stores.
You must keep track of how much of your items customers are returning. If you notice that a particular product keeps coming back, for example, there could be a quality issue you must fix.
Tactics to reduce your return rate can include implementing a generous returns policy or making the descriptions of your product pages as accurate as possible so the customer has clear expectations of your item.
Email Marketing Metrics
Email marketing is an excellent tactic to promote upcoming deals and new products you’re launching. According to a survey by eMarketer, email has an impressive ROI of 122%, which is 4X more than other tactics. The most important email metrics include:
12. Email Opt-in Rate
One of your priorities as an eCommerce business should be to grow your email list. The bigger your email list, the more customers you can reach.
Email opt-in rate is the percentage of web visitors that convert into email subscribers. Considering that 96% of customers aren’t ready to buy, getting prospects to sign for your newsletter is the opportunity to nurture them through the funnel.
To improve your email opt-in rate, you can offer attractive opt-in incentives such as free shipping or exclusive discount codes. Customers can take advantage of these deals by signing up for your email list.
13. Email Click-Through Rate
However, as important it is to measure your email opt-in rate, it doesn’t give you a full picture of your results. You also need to be measuring the engagement of subscribers to your email list.
Email-click-through rate measures how much of your email subscribers opened your email and clicked on your links. It’s a useful metric to determine how your audience is responding to your email campaigns.
Things that will increase your click-through rate include optimizing your email design and copywriting. Segmenting and personalizing your emails also goes a long way.
14. Email Unsubscribe Rate
Whether you like it or not, some customers are going to unsubscribe from your email list — and it doesn’t always have to be a bad thing.
Customers unsubscribing from your list means you’ll be focusing fewer efforts on leads not worth pursuing. It’s valuable time you can save and use for more vital areas of business.
However, a high unsubscribe rate could be a sign that something is wrong with your newsletter emails. If that’s the case, you’ll need to understand which type of emails are causing people to unsubscribe.
Lastly, to ensure your business is on the right path, you need a clear picture of your revenue. It’s the ultimate way to measure your real eCommerce success. Here are the most critical revenue metrics that matter:
15. Total Revenue
It may come across as a no-brainer, but you always need to know how much revenue your store is driving. Slice it up by the week, month, quarter, and day even to get a better idea of how certain times of the year are performing for you.
Keep in mind that revenue is different from profit. Profit takes into account how much you’ve made after the cost of goods and services (which we’ll get into in just a second).
16. Revenue Per Traffic Source
To drive the best results on your eCommerce store, you must know which channels are most worth investing in. Otherwise, you’re just throwing away countless marketing and advertising money out the window.
That’s where measuring your revenue per traffic source comes in. Once you’re able to identify which channel brings you the most sales, you can proceed to put all focus on it.
Measuring your revenue per traffic source is easy with Google Analytics, which shows you which marketing channels are driving you the most sales.
17. Average Profit Margin
Profit margin is a metric that assesses your eCommerce store’s true bottom line. Instead of only looking at the amount you drove off a sale, the profit margin considers the costs in acquiring the item and customer.
There are two ways to look at profit margins: net and gross profit.
Net calculates your store’s profitability by finding your net income (your total expenses subtracted from your total revenue). You can divide the net income by your total revenue and multiply it by 100% to turn it into a percentage.
Gross profit margins, on the other hand, are more focused. It determines which products are most lucrative and comes with data on how you can better manage your spending.
How Much You Should Check eCommerce Metrics?
After outlining all the vital eCommerce metrics you should track, you may wonder how often you should measure your business’s performance.
We recommend that you should check your metrics at least once a week. Doing so should give you a clear picture of how your eCommerce store is growing over time. It’s also nice to analyze each quarter what marketing efforts worked and what didn’t so that you can pull lessons out of them.
Put The Story Together
All of these metrics give you the full story of what’s happening within your eCommerce store. You’ll be able to instantly find what works and which areas of your business you need to improve.