5 Essential KPIs To Track For Greater E-Commerce Success

It’s tough to predict success. Amazon looked doomed to fail in its first five years since its inception in 1994. Simply put, it wasn’t earning. The game changed when they knew which ecommerce KPIs to track to measure their success.

Despite being infused with billions of capital, the online giant (not-so-gigantic then) barely had cash on hand in 1999 and had turned a profit only in 2003.

Many people didn’t know that Jeff Bezos, Amazon’s visionary founder, had his eyes set on the long game. He was refining his processes. It took a virus to show everyone how ready Amazon was for success.  

While it’s anybody’s guess what Jeff Bezos was thinking all along, we’re pretty sure he’s eyeing Key Performance Metrics or KPIs right from the get-go. KPIs allow you to see customer behaviour. It shows how much work you’ve done and digs deeper.

It shows you how well you’re doing when it comes to achieving your goals, as long-term as it may be.

The MOST Crucial KPIs For Better E-Commerce Success:

Not looking into your KPIs can be disastrous on your part as an online marketer. Take note e-commerce is a very technical business. Knowing what to look for on your website traffic can save you a lot of trouble.  

So, here are ecommerce KPIs to track to measure your success:

1. Average Order Value (AOV):

AOV stands for average order value. While you could increase your total sales by having more people buy products from your online store, there’s another way you can get the same bottom line. And that’s having customers spend more. This means you achieve the same results with fewer people.

To get to your AOV, take your total revenue for a period and divide it by the number of orders. In short, it’s the average spending for every customer that bought for that period. You must see your sales from this perspective to better strategize how to increase them.

Some things to try to increase AOV:

• Sell products in packages/bundles (the more extensive the package, the greater the discount)  

• Give discounted rates on bulk orders  

• Always upsell products  

A customer who lingers in your online store is highly likely to be in the mood to order. Don’t miss the opportunity. Entice them to buy more by showing how much they’d pay less with bulk orders or upselling before adding to the cart.  

2. Conversion Rate:

Conversion Rate is simply how many of your website visitors believe in your business or a customer. Some may not buy, but if they sign up for your newsletter, that can also be considered as a conversion.   

You should monitor this KPI as much as possible. Simply put, a website with over 5,000 visits daily with only eight conversions is in trouble.  

The most helpful tool for monitoring your conversion rate is Google Analytics. Just make sure you have your desired conversion goals factored in. You can refine your strategy by choosing your goal to achieve greater conversions.

In addition, there’s a KPI related to conversion rate. We’re talking about products returned. You must exercise proper product returns management, as it can go a long way in customer retention, not to mention save you a sellable product.   

A smooth return management process returns confidence to the customer, restoring their faith in the brand.  

3. Shopping Cart Abandonment:

Think of a lady shopping at the grocery store. She puts tons of products in her cart, and her phone rings as she walks to the counter. And off she goes without paying. That’s the offline version of shopping cart abandonment. There are many reasons this can happen in your online stores.

Like many online marketers before you, you could be tempted to run after the numbers. However, if your leads aren’t converting, you’ll have to make the most of what you have: converted leads.

You’ll have to look deeper into why your website visitors are abandoning the cart. Some of the things you could do are:  

• Use a more straightforward registration form

• Boost brand with trust seals/security badges

• Nix hidden charges

4. Revenue On Advertising Spend (ROAS):

ROAS stands for Revenue on Advertising Spend. Simply put, it shows you how effective your marketing ads have been. The higher your ROAS, the more return on investment you are getting.

However, if your ROAS is below average, you must investigate your advertising methodology. It’s high time you give it a makeover.  

5. Customer Lifetime Value (CLV):

CLV, or Customer Lifetime Value, is a projected average of how much your customer is likely to spend in your online store in a lifetime. You can fine-tune your acquisition strategy and minimize marketing costs by looking into your CLV.

You don’t have to ask every customer to get your CLV. To arrive at the data, use Google Analytics. Click on Audience and proceed to Lifetime Value. You should have your current figures in an instant.  

All the numbers can undoubtedly be numbing. But making sense of your essential KPIs can get you closer to the success you dream of for your online business.

These are some of the most important ecommerce KPIs to track that can give you an idea of the areas of improvement. When you fix the problems, you automatically bring in more customers.

And It’s A Wrap!

That was all on the ecommerce KPIs to track that can give you a measure of your online success. The article lists some of the most important KPIs that can tell you about your ecommerce success, especially if you are new to it.

These points guide you through measuring your performance and give an idea of how things work. These key performance indicators measure success and can reveal a lot about the process.

Which KPIs did you miss before? Surely, add them to your checklist now!

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