In order to set targets and achieve growth, first you must decide what performance metrics to asses. Without monitoring your progress you may miss opportunities or not identify weaknesses in time to rectify them.
There are hundreds of metrics that you could measure, from email click-through rates to average time spent per page, and each result can be valuable to your store's success. Overall there are 3 strong metrics to gauge how well your business is performing.
1. Website Traffic:
Google analytics is a great one stop shop to see how your online store is performing, include the e-commerce tracking code to take full advantage of the data available. Other tools are available to use, but for an overall traffic view, Google Analytics leads the pack.
Traffic can indicate the performance of many aspects of an e-commerce business. How many browsers are actively searching for the store or product? How popular or on trend is the merchandise? How well are SEO or marketing activities performing? Predominantly, low traffic indicates customers simply aren’t finding your store. Consider investing in paid search, either via Google Adwords or display marketing such as Facebook adverts, which can really boost brand exposure.
There are free ways to boost SEO, you could attend industry events, gain press exposure in print and/or digital channels or launch creative social media campaigns. However, the true champion of great SEO is content. Content is everything from the homepage, to the active blog, to content share guest posts on other sites, video interviews and YouTube “how to” vlogs; Anything created for customers and posted online counts as content. Make sure that it is optimised and links cleverly but clearly to related products.
Contemplating either paid or organic method to growing your audience? Check out our blog “SEO or PPC? Plus 3 tips to succeed at both” and see which method is best for different e-commerce aspects.
2. Conversion Rate:
Calculate your conversion rate by dividing the number of people who purchase from your store by the total number of visitors to calculate a percentage.
This is a key and obvious indicator of e-commerce performance. An industry average is 3% of visitors should result in a sale. Your conversion rate is your bread and butter and consistency is key. There will be peaks and troughs, holidays, payday splurging and trends can affect your CR, however, your year on year should remain steady.
If your conversion rate is low, is the store easy to purchase from? Does it load quickly, does it look professional and trustworthy? overpriced in comparison to competitors or should you revisit your website copy to ensure you are targeting the right group of consumers? For quick tips on how to improve your e-commerce store, read “10-minute actions to improve your online sales” for actionable advice on how to improve your conversion rate.
3. Customer Retention Rate:
If you are running a Shopify store or an online retail outlet, retaining customers is a cheaper and more effective strategy than continually trying to find new customers, so it is vital to have an e-commerce customer retention strategy. If you can increase customer retention rates by 5%, you can increase profits by a figure of 25% to 95% according to Bain & Co.
Customer retention rates can be low for many reasons. Consumers may have had a bad experience with your product or delivery service, others may have found your store tricky to use. Check reviews and feedback regularly, they may highlight areas of your business that needs attention.
Customer retention is about remembering your customer, engaging with them in a relevant way and making things easier for them. If you want to improve your CRR rate you must become truly customer-first, personable and responsible. For more information read “6 secrets to customer focused e-commerce” and bring the consumer back to the heart of your business.
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