If you own an e-Commerce business and are trying to grow your profits, you should already know that using metrics is an important activity.
However, sometimes it can be difficult to know what the data means, and which metrics you should be prioritizing. The right marketing metrics can reveal a lot of important information about how your sales and marketing efforts are performing. Moreover, they can tell you how customers interact on your website, track performance using easily digestible data, and identify key areas for improvement.
So which marketing metrics should you focus on?
Read on to find out the top e-Commerce marketing metrics to track.
Marketing Metrics Explained
Marketing metrics are tools you can use to measure the success of your marketing efforts. These are also commonly called key performance indicators (KPIs). The numbers are individual touchpoints, meaning that they will be different for each business and you will have to incorporate them into how you navigate your digital marketing strategy. Use the following metrics to your advantage to grow your sales and have your company perform as well as possible:
Most Useful Marketing Metrics for eCommerce
Website Traffic and SEO Analytics
The basics for any marketing strategy, you want to have plenty of people frequenting your website. This is an arduous process, and any website creator knows. The first step to making profits for your eCommerce website is to increase website traffic. This is usually accomplished by optimizing your website for search engines to find you, otherwise known as SEO. Google Analytics is a good place to start, not only for analyzing website traffic but also for optimizing marketing for the rest of these metrics as well.
Average Order Value
Fairly self-explanatory, this metric tells you how much customers are spending per individual order. You can calculate this value by dividing your total revenue by the number of orders. This metric is a basic but important indicator of how customers spend on your website. Depending on the type of business, you may favor small transactions. But for the majority of eCommerce companies, you naturally will want to raise your average order value.
This metric is incredibly valuable in advising opportunities for how to make orders larger. For example, if your average order value comes in at $24, you can use this information to upsell. Providing free shipping for orders over $25, upselling by offering inexpensive add-ons, or providing other incentives may drive this value higher.
Sales Conversion Rate
Sales conversion rate is the percentage of visitors to your website who end up making a purchase. This metric is incredibly important because it indicates whether your website traffic is satisfied with the products you offer. You may have incredible web traffic, but low sales. Visitors are not being converted into customers. This could indicate some problem with your sales interface, product descriptions, or other conversion rate optimization issues. Consider testing out different changes or conducting a sales conversion study.
Customer Behavior and Value Metrics
How customers behave on your website is arguably more important than how many customers you have. Again, you may have plenty of visitors but if they are not purchasing or purchasing very small amounts, this indicates a need for a change in strategy.
There are several metrics that measure loyalty and retention. One of these is the shopping cart abandonment rate. This lets you know what percentage of customers are getting all the way to the end, just to not go through with a purchase. There are some interface changes you can test out to try to finalize the sale.
Another important metric is customer lifetime value. As it sounds, this measures how much value a customer has added to your revenue by how much they have spent on your website. These customers are very valuable, and keeping them should be an obvious priority. Customer surveys, point of purchase feedback data, and purchase analytics can be smart ways to improve customer satisfaction.
Customer Acquisition Cost
Another reason why it is so important to build solid customer relationships is that it costs money to acquire new customers. This may seem obvious to some, but the money spent on advertising and marketing can be equated to paying a small cost for each individual customer. This can be measured. Find out what your customer acquisition costs are and look up averages for what is a competitive number for your particular industry.
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