Ecommerce brands have been using data to drive sales, reach new audiences and upsell like crazy for nearly two decades.
Now that it’s nearly 2020, every eCommerce brand should be using key metrics in three areas to build out success: advertising, storefront and shipping.
Emma Miller, Senior Editor at Bizzmark, calls metrics the “one thing that can make or break your online presence.” She goes on: “To succeed in the competitive online market, you need to set measurable goals, choose the right metrics to track, and analyze your online performance continuously.”
The most important of these metrics span advertising, storefront and shipping metrics.
Making the Connection: Advertising Metrics
There are dozens of different marketing metrics you can track across many different channels and platforms. While all of them may have their time and place, some serve a more consistent purpose. The most important or telling of these marketing metrics include marketing attribution, click-through rate, returning visitors, funnel abandonment, and brand awareness.
If you’re spending money on marketing, it’s a good idea to know how helpful your marketing efforts truly are. Marketing attribution helps you determine which of your marketing efforts are most effective. Are your paid efforts leading to more page views and purchases than organic efforts? Are you getting more click-through traffic from mobile sources or desktop? Does your Twitter content draw in more traffic than what you post on Facebook? Knowing where customers are coming from can help you streamline the process and save money.
This metric measures the number of people to click a hyperlink that leads them to your webpage, and can be broken down between different sources. For example, do most of your page views come from those led there by emails, social media campaigns, or other avenues? This can help streamline your marketing process. It can also help determine what content customers from each platform like most, making you more relevant to both potential and current customers.
The returning visitors metric measures how often your audience members return to your site. Based on this, you can also often determine what pages of your site they’re returning to and for how long they remain on your site. This can help in measuring customer loyalty and satisfaction. However, problems in gathering the information for this metric can arise when visitors visit from a new device or from a device that doesn’t accept cookies.
Funnel abandonment refers to the rate at which customers lose interest in your brand or content. Or, in other words, how far down the marketing funnel do they make it before they give up or decide not to follow or support your brand further? Are customers unsubscribing from email lists before even visiting the site? Do they lose interest upon reaching a landing page for a specific product? This feedback can help you to target your marketing more effectively and catch these potential customers before they bail, making it more likely that they initiate a purchase. This may mean optimizing an email campaign, creating more informative landing pages, or simplifying site navigation.
Brand awareness is a metric used to convey how your brand is performing on social media and branded search. It helps quantify the results of social listening, or audience awareness and perception of your brand. This metric can encompass even more than one measurement per platform, and will include everything from Twitter followers and mentions to searches for your brand to Facebook fans. Once you’re more aware of how your current audience views your brand, you can better tailor future marketing efforts based on that knowledge.
Selling Your Brand: Storefront Metrics
With marketing and sales so connected, many storefront metrics bleed from advertising metrics. While conversion rate remains important, there are other metrics that are just as vital to keep in mind.
Bounce rate refers to the number of visitors to your site that never leave the page they first arrived to, often the homepage. This is an important metric, because it can show that the marketing that led your audience to your site may have promised something different or more interesting than what your site truly offers. It may also speak to a different problem with the landing page. Knowing this rate can also be useful in comparing it with the number of visitors who do ultimately make a purchase.
Customer retention tracks how many customers become repeat customers. This is important, because the more customers you have coming back again and again, the less money you need to spend on acquiring new customers. Additionally, repeat customers tell you that customers are satisfied with your product and your service. It’s important to track customer retention and respond to changes. If longtime customers stop purchasing from you, it may be necessary to evaluate the reasons behind that. If customer retention increases, you may be doing something right.
Customer Lifetime Value
LTV is, at its core, a quantitative measure of customer satisfaction. LTV is a measure of the average value of a customer over their entire engagement with your brand. While it is closely intertwined with customer retention, it takes into account how much each customer is spending during this time, not solely how long they stay involved. This can be an especially important metric to look at when analyzing segmented revenue. If the vast majority of your revenue is coming from returning customers, you likely have a high LTV and it is more important that you focus on current customers than on potential customers.
Pageviews measure the number of pages viewed by your audience per visit. This is an important metric to take into account when determining how good your site is at keeping customers engaged. This metric can be improved with quality content, internal linking, and simple navigation.
Cart abandonment refers to the rate at which customers abandon their online cart or planned purchases before ever actually completing the purchase. It’s important to look at how far they got in the purchasing process before doing so. Are they abandoning their cart because they can’t easily remove an item they selected on accident? Or do they decide against purchasing something once they see the shipping costs? Knowing where and why the process is abandoned can help you take measures to stop this from happening.
Bringing it Home: Shipping Metrics
Your relationship with customers doesn’t end once you make a sale. How can you improve their experience even after they’ve made a purchase? These three metrics can help you determine just that.
Inventory accuracy refers to the measure of how close the electronic record of your inventory is to the true state of your material inventory. Keeping your electronic record as updated as possible ensures that you never promise a customer something that you can’t deliver, and helps you keep track of revenue more accurately.
Keeping a measure of how often items are delivered within the promised time frame is another good way to see if you’re keeping your word to your customers. Customers need to be able to trust that they’ll receive their products when told and within a reasonable time frame to trust a brand enough to make a purchase from them again.
Keeping track of the rate at which items are returned is another good way to keep tabs on how satisfied your customers are. A high return rate means not only that you’re losing money, but that you’re losing customers. Keeping track of which items are returned most often can lead you to problem areas that require attention.
Bonus: Net Promoter Score
Net promoter score, or NPS, is a good final indicator of success and remains highly relevant, since it takes into account ad effectiveness, storefront engagement, shipping satisfaction and more. NPS is essentially your customer base’s willingness to promote your product. It is a result of high quality products and a positive customer experience.
Multichannel: Bringing Marketing, Storefront and Fulfillment Together
With multichannel eCommerce, you can’t separate out marketing efforts from your sales or your sales from your inventory management. They’re all tied together.
The efficacy of your marketing efforts will affect the size of your sale, which will affect your relative shipping costs, which will affect fulfillment options, which will affect customer satisfaction, which will affect… you get the idea?
Understanding how they all tie together is the first step toward keeping everything straight when running multichannel campaigns and fulfillment.
For that, you’ll need two things: a short list of critical KPIs for your eCommerce brand and a way to visualize how these metrics interplay, ultimately affecting your bottom line. You can use the metrics identified above as a starting point.
Changing your mindset to think of marketing, sales and fulfillment as part of the same entity is one thing. But actually bringing them under one roof is another.
Even narrowing these eCommerce metrics to a shortlist leaves the average company with a lot to keep track of. With marketing, eCommerce and fulfillment platforms typically kept separate, how can you keep them all straight?
Having the platforms separate doesn’t mean your metrics have to remain in a silo. You can use a profit analytics dashboard, for example, to bring together the most relevant metrics for advertising, sales and fulfillment. Monitoring your profit and marketing performance in eCommerce shouldn’t be hard — and a single dashboard for all your metrics makes it easier.