As technology advances, sales can be measured and tested to see if the business meets the qualifications. Every detail of the information that enters your site can be tracked so that you can follow up on it for greater profits. With a variety of data available, choosing the right e-commerce metrics to inform strategic decision making should be done so that business owners know the current trends and whether their business is running properly. These metrics are often referred to as KPIs or Key Performance Indicators although there are differences between the two. You can refer to this article to find out clearly what KPIs and Ecommerce metrics are important for your E-commerce business.
Key performance indicators (KPIs) are Ecommerce metrics that can improve a specific user's interaction with an e-commerce website, web application, or digital campaign. Behavioral information of users who access these sites can provide important knowledge and data about how businesses or products are performing in a business and enable business owners to take strategic actions to grow their business.
A well-designed Ecommerce website can attract large numbers of visitors to your site, but confusing product listings or complicated checkout procedures can discourage customers from making a purchase. If sales decline due to a faulty strategy then the error can be detected and resolved simply by having the required data. How many customers make purchases, how satisfied customers are with your products and services, how likely they are to buy again and how much profit you earn on each sale are all factors that help determine how your business operates. The right strategy from KPIs can certainly help you grow the business you are currently running.
Metrics are collections of data that can be tracked and reflect general business strategies in a wider range while KPIs are specific types of metrics with defined targets and accompanied by actions that support their achievement. Most of the data obtained from customers both products and services that can be followed up to build long-term relationships and possible sales strategies will be taken from KPIs.
To find out if an e-commerce metric is a KPI, ask yourself if it has a major impact on your business, or generates critical information about a critical business component. Metrics can be measured over a certain period of time such as every day, week, month and even year. KPIs themselves are usually measured over a longer period of time, for example every week or every month depending on the strategy used. Some examples of metrics include SEO ranking, profit margins, Return on Investment or ROI, employee happiness level, number of published content and others. While some examples of KPIs include Cost per acquisition, lifetime value, cart abandonment rate, average order value and others.
To get maximum profit. You can consider data that gives a complete picture of your achievements this month or next month. The most relevant KPIs to consider for an e-commerce business of course depend on a number of factors. The main factor to consider in the KPI is the number that best reflects the company's performance. Here are some important metrics that you should pay attention to in your business.
ROI or Return on Investment is one of the most basic Ecommerce metrics to consider in a business. While there are several other metrics that will provide information about how much you spent and returned as a result, ROI is still the main thing you should consider as a metric.
Customer behavior is also an important metric to watch out for, you can tell that some customers may be loyal to you while others buy only once and then never return. Understanding customer retention rates will help you see if you're already on good terms with your customers. If your relationship with your customer has not been good so far, you can use this metric to improve customer service, operations, and so on.
Building a community is an important key when you run an online business. Nowadays social media is also a powerful tool to attract customers and many of them actually buy because they see a product on their social media pages. Use the many social media channels available today to develop your brand and try to attract the attention of those social media users. You can also provide them with product information that matches their interests. If you are able to attract users' attention and maintain a good relationship with them, you can be sure that they will buy your product and also recommend it to friends or family.
These e-commerce metrics can reflect how likely your customers are to recommend your products and services. The Net Promoter Score or NPS can be obtained through a simple survey sent to your customers via their email or on your website. Conducting customer surveys is a great way to measure and understand the overall customer experience so you can identify and strategize to improve customer satisfaction.
This metric can help you figure out how much profit a customer has in your business over a period of time. The CLF value can be found from the following formula:
CLV = Average order value X repeat purchases X Average retention time (usually months or years)
By calculating the CLV value, business owners can tell if their sales or marketing strategy is working and keep customers coming back to buy. Of course you can consider many things in your business by looking at the value of CLV and improving strategies or services if the value of CLV in your business decreases over time.
You may get a high income but if the rate of return is also high of course it can cause losses. By monitoring these metrics, you can identify problems in the production of your items or see if your product descriptions differ from reality. In essence, the more you know about why an item is returned, the more information you will have to improve your product and provide better service to customers to get their satisfaction.
The refund rate is also a metric to consider as this metric is found to measure the percentage of returns that are eventually returned to the form of payment of funds. If a customer asks for a refund, it can be considered that they are ending their relationship with your business. In addition to the refund ratio. The exchange rate must also be considered. This metric can measure the percentage of returns where the customer decides to return the product and get a product replacement according to their expectations. This metric is important to consider because a memorable return experience can encourage customers to make an exchange rather than request a refund.
You can use specialized software like ReturnKey to help make your return process easier and allow you to better understand your return metrics. Don't ignore these metrics because they are all important things to consider in order to profit and grow your business.