eCommerce sites have many key performance indicators that must be optimized to improve business.
Who? What? When? Where? Why? How? These form the basic blocks of every question an eCommerce director asks when gaining information about his or her customers.
When it comes to starting and growing a business, information is power. Knowledge about your customers, such as how often they visit your site, what they browse, how much they spend, and so on, are all important metrics for assessing your company’s strengths and weaknesses, and making the necessary changes. All of this can be provided with proper web analytics software.
Below is an overview of some of the most important key performance indicators for eCommerce sites and what questions they answer.
Traffic Data
The first questions that any eCommerce site needs to know is the Who and When. And web traffic data provides the answers. Who visited the site, and when did they come?
This is where one learns information about visitors (unique or new), how many pages they viewed, and how long they stayed on the site. Web traffic data also provides averages – page views per visit, the time on site per visit, etc. And finally, the “when” is also important. Is the traffic mostly in the morning? The lunchtime hour? After work? Late at night?
All of those key performance indicators establish the habits of potential customers and provide clues on what interests them.
Conversion Data
Conversion tells the What and the Why. It poses important questions like “Why did the customers come, and what did or didn’t they buy?”
New customers leave lots of information behind. The specifics of what they buy make the backbone of a business. But what they didn’t buy is also important. What is the cart abandonment rate? What is getting added onto wish lists or buy later lists. What is the checkout abandonment rate? Are there patterns that can be learned from these purchases?
Beyond purchases, return rates also matter. Are there certain items that get returned more frequently than others? Is this due to a merchandising mistake, such as inaccurate details or photos on the website?
The numbers behind the purchases are also revealing. Average order value indicates what people are spending, while internal information, such as gross margins and shipping costs metrics, lets a business know its own profits and expenses.
Marketing Data
Marketing data enables a business to learn the How and the Where. How did the customer find your site, and where are they coming from? Did they find you through a referral source, such as direct, email, or pay-per-click (PPC)? Did they find you through social media? Did they find you through other content on your site? All of those things should be collected and measured for the most complete picture.
Marketing KPIs enable a better understanding of strategic planning. For example, a company that is heavily invested in PPC advertising would want to know cost–per-conversion and total conversions to evaluate the effectiveness of the advertising campaigns. Similarly, one would want to know the open and click-thru-rates (CTRs) of e-mail campaigns.
Social media has its own metrics. Facebook likes, Twitter retweets and followers, Instagram followers, and other platforms all reveal what customers support and how they interact with a business.
Customer Service
Customer service is less about asking questions and more about listening. However, resolving customer issues has its own important metrics that can be quantified and studied. The objective is self-evident. It’s about satisfying the customer with an added bonus of customer retention.
The basic customer service KPIs are quantities of contacts: by phone, by email, or by chat. For each of those, resolution time matters, as does the nature of the contact. The object is to resolve as many cases as possible and close all open cases quickly, efficiently, and ideally with a happy customer.
There is no limit to what questions can be answered using analytics. However, the one that matters the most is “Will they return?” For any manager or director who takes the time to properly interpret the data, improve all KPIs, and follow through with good customer service, the answer will hopefully be “yes.”
Improving profit margins is at the top of all eCommerce merchandiser’s to-do lists which is why we’ve created The Digital Merchandiser’s Guide to Maximizing Margins with Visualized Data eBook.
Download the eBook to learn more!
