Ecommerce metrics are like scorecards for your online store’s performance. They help you see how your store is doing and make smarter decisions. Learn where your visitors are coming from, how many people are interested in your products, how many customers actually make purchases, and more, and make strategies accordingly.
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In this article, we’ll discuss seven important ecommerce metrics that are crucial for measuring how well your online store is doing. Keep reading to learn!
7 Key Ecommerce Metrics You Should Be Tracking
Tracking ecommerce metrics is important for online businesses. Here are some important ecommerce metrics you should definitely keep an eye on to measure the success of your store in 2023:
- Average Order Value (AOV)
- Cart Abandonment Rate
- Customer Retention Rate
- Customer Acquisition Cost
- Return Rate
- Conversion Rate
- Search Traffic and Conversion
1. Average Order Value (AOV)
One of the key metrics for measuring the performance of your online store is Average Order Value. This metric basically shows how much customers typically spend in one shopping session at your store. To calculate AOV, divide your total earnings by the number of orders.
What’s really cool is that if you make the average amount customers spend even higher, your business could really start soaring. You don’t even have to work too hard on getting more people to visit – just by focusing on this, you could give your earnings a serious boost.
2. Cart Abandonment Rate
Turning visitors into customers is a big challenge for online stores. When people put items in their shopping carts but don’t finish buying, it’s called Cart Abandonment. A lower abandonment rate means more money for the store.
But what if you’ve already lost potential buyers? There’s good news: you can still win them back. You have a 60-70% chance of getting them to come back and shop again. Just use some smart strategies to grab their attention and bring them back.
If your online store uses woocommerce, you can use the Woocommerce Abandoned Cart Recovery plugin by Addify. This cool tool can send friendly reminders to people who left without buying. It even offers them great deals to entice them to come back and shop at your store again.
3. Customer Retention Rate
Customer Retention Rate is a metric that shows how many of your current customers keep shopping with you over a certain time. A higher retention rate means your store is doing well, whereas the lower one implies customer dissatisfaction with your products and services.
To calculate the Customer Retention Rate, you can use a simple formula. Begin by subtracting the count of new customers acquired during a designated period from the total customer count after that same period. Following this, divide the resulting figure by the total number of customers you initially had at the start of the period.
4. Customer Acquisition Cost
Customer acquisition is another key metric you should be using for tracking the success of your online store. It shows you how much money you usually use to bring in a new customer. Implementing effective Ecommerce Solutions is crucial for online retailers.
To find out your Customer Acquisition costs, just add up what you spend on marketing and then divide it by the number of new customers you got. If your Customer Acquisition Cost is lower, that’s great news. It means you’re finding new customers without spending too much, and that’s a clever way to make more money.
5. Return Rate
Are your orders being sent back as quickly as you send them out? If yes, your products or services might have problems. Ecommerce platforms need to fix this right away, because it can really hurt your business’s image and how much money you make.
The Return Rate is a metric that you must evaluate in that situation. It shows the percentage of orders clients send back due to concerns like dissatisfaction, poor product quality, or other problems they might have encountered.
To calculate the Return Rate, just divide the number of returned orders by the total number of orders and then multiply by 100.
6. Conversion Rate
The Conversion Rate is another important metric that every online store should keep an eye on. It shows you the percentage of visitors who actually make a purchase. The higher the number, the better your ecommerce business performance.
To calculate the conversion rate, you just need to divide the number of purchases by the total visitors, then times it by 100. If your conversion rate is high, it means your shop is great at turning visitors into happy buyers.
The main reason why visitors don’t buy from online shops is because the buying process is too frustrating. So, as the shop owner, it’s super important to make sure it’s easy and fast for customers to buy things from your shop. If you’re using WooCommerce, the Woocommerce Checkout Fields Manager can help make the buying process smoother.
7. Search Traffic and Conversion
Track how customers discover your products on search engines and adjust your SEO strategy accordingly for better visibility and higher rankings. Analyze the keywords and search terms that lead users to your site, and focus on optimizing your content and website structure to align with those search patterns.
By tailoring your SEO efforts to match user behavior, you can enhance your online presence, attract more organic traffic, and increase the chances of converting visitors into customers.
Final Words
E-commerce traffic metrics and Essential e-commerce KPIs (Key Performance Indicators) act like a map, helping you navigate the complex world of Ecommerce marketing and strategies. By keeping an eye on these seven important metrics, you surely can make your ecommerce store work better in many ways and keep it successful over time.