7 Ecommerce Marketing KPIs You Should be Tracking
Posted August 11, 2017 by Eric Breiner in Ecommerce Marketing, eCommerce Website, Marketing Statistics, PPC
One of the best parts of eCommerce marketing is that nearly everything you do can be tracked and measured. The issue can be that there is too much information. Jumping into your eCommerce platform, advertising dashboard, or Google Analytics with no plan of attack can be overwhelming. Clicking around without knowing what you are looking for can eat up hours of valuable time. We wanted to help by providing our top 7 eCommerce marketing Key Performance Indicators (KPI) you should be tracking below.
Everyone knows about revenue. Everyone loves seeing revenue. This isn’t a mind blowing recommendation as everyone should already be tracking this but we didn’t want to leave it out. Revenue is a key indicator of the success of your eCommerce marketing. With all of the quirks of analytics platforms and services, your eCommerce platform should the reference point for most accurate revenue numbers.
Insider Tip – If your site uses PayPal as a payment method, there could be a large number of transactions unaccounted for in Google Analytics. PayPal may also be showing up as a referral source. Shoot us a message and we can help fix that.
Tracking the number of transactions is another standard KPI most people already track.
Average Order Value
Average Order Value (AOV) is a metric that should always have your attention. Tracking AOV can show trends in shopping behavior and seasonality. Compare AOV month to month but also year to year. One of the easiest way to drive more revenue is to increase the AOV. You don’t have to get more visitors, orders, or spend more in advertising.
Insider Tip – One of the best ways to increase your AOV is through up-selling & cross-selling functionality on your site.
It is easy to glance over traffic without looking into it enough. While traffic on its own doesn’t tell you much, pairing traffic data with eCommerce marketing metrics will often show very useful information. What channel drives the most revenue, what source has the highest conversion rate, or what campaign has the highest average order value. This information is much more powerful and actionable than a simply looking at the number of visitors.
Insider Tip – Use Segments in Google Analytics to break out your traffic source and dive into the eCommerce overview for a quick look. Layer in a date range comparison for an even better look at how things are going.
Conversion rate is one of the most important metrics for eCommerce marketing. Everyone should know their conversion rate, but many people overlook it. Once you know your own conversion rate, find out what is average for your industry. This data will let you know if you have a large amount of ground to make up or if you are performing well. Your conversion rate can make or break the success of your eCommerce marketing efforts. A high conversion rate generally drives a higher return on ad spend. Getting people to the site is only part of the equation, getting them to buy is a bigger part of it. A low conversion rate can be the result of driving the wrong traffic to your site, a poorly designed website, or not providing enough value during the shopping experience. In the end, one of the best ways to increase revenue by simply driving more transactions from the traffic you are already getting.
Bounce rate is when a visitor lands on a page and leaves without visiting any other pages. It is a good indicator of a number of things. It paints a picture of what users expect when coming to your site compared to what they see when they land on the site. A high bounce rate indicates you either need to adjust your messaging on acquisition methods to more accurately inform visitors of what to expect or revamp the landing page to match your messaging. Reducing your bounce rates gives your visitors a chance to convert.
Cost per Acquisition
Cost per Acquisition is extremely important in both planning and managing your eCommerce marketing efforts, especially pay-per-click advertising. When you are planning a PPC campaign, you need to set goals in order to measure your success. You can successfully reverse engineer a target Cost per Acquisition based on your AOV and profit. You can take it a step further and include frequency of purchases and lifetime value. The number you come up with can be used as a target percent or dollar amount.
In the end, Cost per Acquisition is one of the most important metrics for revenue focused for a major reason. Unless you are pursuing very aggressive revenue growth, you want to at least break even. If your AOV is $50 and your profit is $10 on that order, you want your Cost per Acquisition to be less than $10.
We’d love to hear your thoughts on these 7 eCommerce marketing KPI’s. What are your most important metrics? Comment below! If you need some help with your data and analytics, send us a message. We’d love to help!