Data can be an amazing thing. Especially for a growing eCommerce business. It’s quite easy to get access to every single piece of information that you could possibly need. You can use this data to identify where to tweak your eCommerce business and track the effects of the changes that you make to your products, operations, and marketing.
But as you may have guessed, there’s a tradeoff. There’s such a thing as too much data. You could spend all day analyzing your metrics yet not know which ones will impact your business the most. After a while, they can just look like random numbers with no meaning.
In this guide, we’ve considered the most important business objectives that you should track key performance metrics against in order to grow your eCommerce business.
The Objectives of a Growing an eCommerce Business
The KPIs that matter the most are the ones that align with your growth objectives. In the case of a growing an eCommerce business, there are a few objectives that should be looked at:
- Decreasing costs per transaction Cutting costs is one of the most immediate things that you can impact in your company. Imagine if you maintained the same sales as last month but reduced costs by half. That’s a very nice boost in profits. However, one thing to be wary about in decreasing costs is that you don’t restrain your growth. It is better to reduce costs by introducing more efficient processes and technologies rather than just decreasing spending outright.
- Increasing customer lifetime value Acquiring customers is expensive. You often don’t turn a profit from the acquisition until a repeat purchase is made. The longer a customer stays with your company and the more transactions, the more returns you get on your initial acquisition cost.
- Increasing ROI of marketing In the initial stages of your eCommerce business, you may have tried every marketing tactic to find out what works and what doesn’t. But in the growth stages, it’s time for you to focus and double down on the ones that work.
The Important List of eCommerce Performance Metrics
Here’s a list of crucial performance metrics that you can use as a reference when growing your eCommerce business.
- # of orders per month
- Average order size
- # of new customers
- # of repeat customers
- Customer satisfaction score
- Total gross revenues
- Gross & net profit
- Avg. revenue per customer
- Sales per visitor
- Cost per visitor
- Cost/profit per new customer
- Unique visitors
- Pages per visit
- Time on Site
- Conversion metrics
- Cart abandonment %
- Conversion %
- Top-selling products
- Top-selling categories
If possible, get as many of these metrics broken down by acquisition source. For example, it is very helpful to know which marketing channel results in the lowest cart abandonment.