How to measure online store performance? Popular KPIs
All online store owners want their resources to work effectively. However, how can you measure the effectiveness of an online store? What performance indicators should you look for in order to evaluate how commercially profitable it is to continue to maintain and develop your online store? The main project performance indicators (KPIs) used in e-commerce will be discussed in more detail below.
At the stage of creating an online store, you need to think about how it will be evaluated, so that if necessary, be able to make any adjustments. The list of criteria for evaluation in each case may be individual, but in general it will always include 3 groups of performance indicators – KPI sales, KPI marketing and KPI service.
Sales performance metrics
You can measure how well your online store is selling. This is probably the most important KPI group for an e-commerce project owner. This group may include the following metrics.
Average purchase check
The metric is calculated as the ratio of the number of orders to the amount of online store revenue over a given period – month, quarter, year, etc. The higher the average check of a purchase compared to the money invested in attracting each buyer, the better for an online store, because it means higher profits. If the average check amount is almost equal to or less than the cost of attracting a buyer, then urgent action is needed: either reduce the cost of attracting buyers, or direct efforts to increase the average check, for example, through cross-selling or upselling.
An indicator that actually created an online store. From the total income received by the online store, you must deduct all expenses, and then the necessary figure will be obtained. Profit data needs to be analyzed to determine if it satisfies the owner’s net income. If the size of this indicator is unsatisfactory, it is a signal that in the operation of the online store something needs to be changed – to reduce costs, increase the trade margin, increase the number of buyers, etc.
E-commerce development criterion: The more sales you make over a period of time, the higher your store revenue and the higher your revenue will ultimately be.
The number of so-called abandoned baskets clearly shows whether visitors to the online store have problems ordering goods. If this is higher than the average for an online store niche, or if there is a tendency to increase, it is important to perform additional online store analysis for usability issues or other barriers to purchase, as well as remarketing.
Marketing Performance Indicators
With the KPI Marketing team, you can determine how well your marketing efforts are invested and make timely adjustments to your advertising campaigns. This group may include the following metrics.
The amount of traffic
In order to evaluate the feasibility of investing in the promotion of an online store and its products through a particular internet marketing channel, it is simply necessary to analyze the amount of traffic generated by each channel. You can do this with popular web analytics services such as Yandex.Metrics and Google Analytics, and it is useful to use UTM tags to get the most accurate results for each of your running campaigns.
Search Engine Positions
Organic search is one of the main channels for attracting potential buyers to an online store. And in order to promote an online store in a particular search engine, a set of measures is usually undertaken to reach the highest possible positions in the search results for certain keywords. Measuring the achieved position in these words is necessary for a proper assessment of the efforts made, making adjustments to the promotion plan.
Cost of attracting a targeted visitor
This metric makes it possible to understand how profitable it is to invest in one way or another to attract customers to an online store. The optimum value of this indicator is strictly individual for each store and even for each specific product group in this store, but in general the average cost of attracting a buyer should be lower than the average check, otherwise to continue the activity of the online store may be simply unprofitable.
One of the main indicators of this group, and perhaps the most important. Conversion – The ratio of the number of buyers to the total number of visitors to an online store – demonstrates how effective marketing is, whether it leads to targeted online visitors or generates traffic in vain. If the store’s visitors are targeted but the conversion is low, it may indicate usability issues, unsatisfactory customer terms, delivery, and