We at Printout Designer like figures. Tracking your key metrics is an easy way to get a birdseye view of how you are performing – against historic figures, in comparison to similar businesses or the industry average in general. According to Shopify – your key metrics can be divided into 3 major categories – Sales KPIs, Marketing KPIs and Customer service KPIs. For a full list of possible KPIs to consider, read the article on the Shopify blog. Based on our own and our customers experience, here are Printout Designers top 5 metrics to follow in your ecommerce business.
Conversion, conversion, conversion
Conversion, conversion, conversion – we have talked about the importance of increasing your conversion rate before on this blog, but this is by far the most important KPI to follow. Your conversion rate shows you how many of your store’s visitors actually end up buying something. So if your conversion rate is already high, all you need to do to increase revenue is to increase the number of site visits. High conversion -> More visits=more revenue.
Increasing site visits should be on the top of your agenda when you are starting out. As we mentioned in the previous point – maximized site visits along with a high conversion rate equal success. It is a delicate game though – as real-world examples show, conversion rates tend to level off at some point when your site visits reach high volume, so you must keep working hard to retain the conversion.
Know your costs
Sales are expensive – we all know that. A good metric to give you an idea of how expensive it actually is, is Cost of Acquiring Customer (CAC). This metric will show you, in cold hard cash, how many dollars do you have to spend to get one customer to finally end up buying something from your store. This figure includes the total cost – everything from promoting a product to having your potentials visit your store to finally making a purchase. Depending on the average price level of products in your store, a high CAC might render your business unprofitable. Afterall, spending $50 to acquire a customer that makes a $10 purchase makes no sense in any context.
Control your shopping cart abandonment rate
A shopping cart left is a sale of a cart full of products lost – shopping cart abandonment rate is a definite resident on our metrics to follow list. This metric shows you the percentage of shopping carts including products that don’t end up with a check-out and, ultimately, payment and fulfillment. Business Insider claims that abandoned carts include 4 trillion dollars worth of products every year, out of which 63% are actually recoverable. This means that 2.5 trillion (yep, that’s 12 zeros) in ecommerce sales can be recovered using different strategies. Just as a comparison – the whole tax revenue of the US was about 3 trillion in 2015. That could buy a lot of goodies.
Make your customers happy
A happy customer is a returning customer – increasing repeat purchases are one of the most cost effective ways to increase your revenue. So naturally we want to keep our customers coming back. Churn is a metric that will show you, in percentages, how many of your customers don’t come back to shop again. So decreasing your churn should be on top of your to-do list to make it in ecommerce.
The list of different ecommerce KPIs and metrics is virtually endless and in case you do run out, you can also start combining different metrics in matrices and start measuring more complex KPIs, for example the average purchase value of repeat customers. This however will still require you to get your basics in place. We hope you find some guidance in some of these tips and will have you KPI boars up and running in no time. Until next time – keep crunching those numbers!
Printout Designer enables you to create invoices, packing slips, labels and other printouts with a truly customized look, independent of the e-commerce platform you use. You can customize every aspect of your business document creation process without wasting countless hours. Read more about Printout Designer from printoutdesigner.com