ecommerce key performance indicators

Ecommerce KPI Overview

Key Performance Indicators (KPIs) are vital metrics that help e-commerce businesses track performance and make informed decisions on how to improve there service. The most important e-commerce KPIs generally include:

  1. Conversion Rate: Measures the percentage of visitors who make a purchase. It’s critical for understanding the effectiveness of your website and marketing efforts in driving sales.
  2. Average Order Value (AOV): Indicates the average amount spent each time a customer places an order. A higher AOV suggests customers are purchasing more expensive items or buying in larger quantities. For high volume stores with low value products, increasing the number of items a customer purchase per order can have a profound impact on sales and profit growth potential. This is an area we have specific experience of so feel free to reach out and discuss what’s possible.
  3. Customer Lifetime Value (CLV): Estimates the total revenue a business can expect from a single customer account throughout their relationship with the company. CLV helps in understanding long-term business viability and what marketing cost per acquisition costs are appropriate.
  4. Cart Abandonment Rate: The percentage of shopping carts that are filled but not converted into a purchase. This KPI is crucial for identifying issues in the checkout process. Any friction caused by an unusual checkout processes can result in lost sales – which lets be blunt are means you’ve don all the hard work with no return!
  5. Traffic (Unique Visitors): The number of unique individuals visiting your site. This metric is essential for gauging brand reach and the effectiveness of marketing campaigns in attracting new visitors.
  6. Traffic Sources: Identifies where your website traffic is coming from (organic search, paid ads, social media, etc.). Understanding traffic sources helps in optimising marketing strategies.
  7. Return on Advertising Spend (ROAS): Measures the effectiveness of advertising campaigns, calculating the revenue generated for every pound spent on advertising.
  8. Customer Retention Rate: The percentage of customers who return to make additional purchases. High retention rates indicate customer satisfaction and loyalty.
  9. Bounce Rate: The percentage of visitors who leave the website after viewing only one page. A high bounce rate may indicate that the site’s landing pages are not relevant or engaging to visitors.
  10. Net Promoter Score (NPS): Measures customer satisfaction and loyalty by asking customers how likely they are to recommend your business to others.

These KPIs provide valuable insights into various aspects of an e-commerce business, from sales performance and marketing effectiveness to customer experience and loyalty. Regularly monitoring these metrics is essential for any e-commerce business looking to grow and succeed in a competitive online marketplace.

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