Digital industries have come a long way in recognizing the value of their customers' data for making well-informed and timely decisions. Businesses invest a lot in implementing innovative strategies, but they also need some metrics to observe the effectiveness or success of those strategies to drive future decisions.
Like any other industry, metrics in the e-commerce industry are quantifiable measures of an's performance. One of the most significant advantages has over other is the enhanced visibility of the actions customers take on an .
Businesses track variousto gain insights from their customer data. However, it is counter-productive to track all , so companies generally prioritize the that are most useful for achieving their goals.
Before discussing some of the most critical, it is essential to understand why are crucial to track and how they can impact brand performance.
Why Is It Important to Track?
Behind every successfulare performance metrics and ( ) that drive their and decisions. While these terms may be used interchangeably, metrics and serve different purposes.
are critical data measurements that give a bird’s eye view of their performance in terms of customer engagement, customer acquisition, customer retention, and more.
A quantifiable performance report is crucial for a company to take calculated steps towards its business goals.are the goals or values a business sets for its metrics to achieve.
Simply put, metrics are a measure of a business’s processes, whereasare a measure of how the processes perform.
Metrics andare both essential to in analyzing its performance. Besides measuring business progress, they also indicate any hindrances in achieving its growth targets.
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Moreover, with the increasing popularity of data visualization for analytics, many tools, like, allow to track their metrics visually.
While every company has a choice of which metrics they want to track, the following are the 10 mostthat every business can benefit from:
- Product Impressions/Reach/Engagement
- Engagement Rate
- Boost Ecommerce Sales By Understanding Your Customer
Let’s discuss them in detail below.
( ) measures the value a single customer brings to an throughout their lifetime.
The term lifetime refers either to the lifetime of the business or the lifetime of the customer’s interactions with the company. It is formulated as:
= Average purchase value x per year x Customer lifetime (in years)
assessment can help businesses define the worth of a customer and highlight their most valuable customers. This metric allows to improve their marketing and sales strategies in the following ways:
Spending business resources on targeting and acquiring the right customer demographic.
Targeting their most popular products in front of valuable customers to maximize revenue.
Defining strategies to retain customers and encouraging them to spend more throughout their relationship with a business.
( ) is an average estimate of a business's spending on acquiring .
It is measured using the company’s spending on sales andand the number of acquired as a result.
= Marketing budget for customer acquisition / of
Knowing theiris essential for an to expand its profitably. The should be aimed at keeping as low as possible without compromising on . This means that every acquired should bring enough value to a company for to not cause any loss.
gives an an idea of the shortcomings in their customer acquisition strategies and how they can be adjusted to meet business targets.
(CRR), also called rate, is a measure of the percentage of customers who make from an . It is measured over a using the number of at the end of that period and the at the start of that period.
CRR = (Number of/ ) x 100
A high CRR points to an's need to acquire and expand its . A low CRR depicts the need to improve overall and use re-targeted marketing to encourage customers to return.
is crucial to any business as it ultimately gains . An 's CRR clearly shows the satisfied with the store’s .
(CTR) measures an generated through clicking on the website’s link.
It can be calculated by counting the number of clicks on a company’s website link through ad impressions, e.g.,, posts, or other advertisement campaigns.
CTR = (Number of clicks /of impressions) x 100
Typically, CTR is a very low percentage metric where 2% or higher is considered a good CTR score.
CTR of a business essentially determines how successful itshave been. A company’s high CTR means their are appealing enough for users to click through to their website. A low CTR means a company needs to work on making its impressions more attractive to gain more clicks. are typically more successful at getting clicks than other types of a company’s impressions.
( ) measures a customer’s loyalty to a brand. It is estimated based on the results of a survey presented to customers, usually at the end of checkout.
The survey scores depict, on a scale of 1-10, the likelihood of a customer recommending the brand to someone. These scores represent three categories of customers:
Promoters: Happy chaps who give a score of 9 or 10
: Customers who give a score of 7 or 8—neutral ones!
: Customers who give a score below 6—not so happy chaps!
Based on these scores, theis calculated as follows:
= Percentage of Promoters - Percentage of
The value ofranges from -100 to 100. A negative denotes a higher number of , whereas a positive means there are more promoters of your brand than .
is a key e-commerce for a business as it is an indirect assessment and indicator of the overall customer relationships of the company.
6. Product Impressions/Reach/Engagement
To expand the, there are different product discovery approaches an can take. spread their brand’s awareness and track user activities through the following product discovery metrics:
Product Impressions are a measure of the number of times a user comes across a product’s ad, e.g., through, paid ads, and more. Based on the marketing budget, a brand can control its product impressions and measure its response to those impressions to track product discovery.
Product Reach is a measure of theof users who are aware of a product or its brand. Businesses need to track their product reach to measure the success of their discovery and .
Product Engagement is a measure of the number of users that engage with the product. It is an interaction between product reach and product impressions.
Product engagement is not the same as product purchase because not every interaction will result in a purchase, e.g., clicking through. Product engagement is an important metric to see what kind of products customers like and what steps can be taken to increase conversion.
engagement rate is the percentage of followers interacting with a business through platforms like Facebook, Twitter, and Instagram.
With the ever-risingpopularity, are increasingly adopting marketing through brands’ channels. The pages or channels generate a following of , and their interactions on are measured by likes, comments, or shares.
engagement is calculated as:
SMER = (of interactions / of followers) x 100
A low SMER indicates the need for improving. A high SMER depicts an increased interest of followers in a brand’s content.
is a blessing for a brand’s marketing as it helps them gather a following of their target demographic. With SMER, brands can highlight content that increases their reach and improve content with low engagement.
(SCAR) is the percentage of users that abandon their cart items and leave without completing the .
It can be measured by comparing the number of shopping carts created and the number of purchases completed during a specific period.
SCAR = (No. of completed purchases / No. of created carts) x 100
On average, SCAR lies between 70% to 85%, depending on user device type. A low SCAR percentage indicates that a large portion of a brand’s visitors converted into customers. A high SCAR of anis an effective indicator of potential issues in the , e.g., a bug in the sales funnel or an overall poor .
Knowing the abandonment rate helps businesses identify issues preventing customers from completing their purchase process. SCAR enables companies to understand their problems and work on solving them throughstrategies.
( ) estimates the amount an spends on a single order. It is the average contribution of one order to the total business revenue.
It can be calculated by dividing the total business revenue by theduring a specific time period.
= Total business revenue /
Once customers are acquired, a company needs to know the average value generated by every new acquisition.is an important metric for tracking an 's revenue to make sure a customer spends more on a brand than a brand spends on acquiring that customer.
Highwith a low indicates the lack of high-value customers. Keeping track of can help businesses readjust their goals and strategies from time to time.
of an is the that view a single page, e.g., a , and exit without taking any further action, e.g., opening a new page, checking out, etc.
It can be measured by dividing theof single-page visits over the of website visits where the action was recorded.
BR =of single-page visits/ of website visits
In the case of 20%-45% is considered the for . A high denotes problems with website navigation. Every visitor is a , so need to know if their visitors are having difficulties engaging with their website.,
To lower their, businesses should focus on making their website user-friendly and appealing. An easy-to-navigate is more likely to attract visitors to its product, resulting in a lower .
Boost Ecommerce Sales By Understanding Your Customer
Being a digital industry,deal with loads of data daily. From opening an and building a brand name to product creation and servicing customers, many aspects of e-commerce require attention.
Thanks to the enhanced visibility of customer data,can effectively keep track of data in all these aspects using the metrics explained above.
serve as a viewing lens for understanding your business’ performance and your customers. With an idea of a customer’s likes and dislikes, your brand can identify and tweak the problem areas in its strategies and drive profitable actions.
At integrate.io, we pay special attention to e-commerce processes and integrations. If you have an contact us now.and wish to improve your customers’ experience with better operational insights,