How to Evaluate the Effectiveness of an E-commerce Store
KPI – key performance indicators. They are expected to get where and at what speed the business is going, to analyze issues and to accomplish objectives. As a speedometer and oil level sensors in the vehicle, only for the online store: attendance, traffic sources, conversion, the viability of advertising channels, abandoned baskets, income, profit – how to monitor them, how to survey the effectiveness of the online store and how to react to changes read in our article!
What are the KPIs?
KPIs, or key performance indicators, are digital indicators with the assistance of which business execution is estimated. They help to accomplish operational and vital goals.
If we talk about KPI online store, there are various indicators by which you can follow how rapidly and effectively your business is developing. As a matter of first importance, only when formulating KPI Internet advertiser ought to ask himself: what are the objectives of the business and how is its success determined. Having responded to these questions honestly, we can pick the measurements – which we will think about today.
There are a lot of performance indicators, they cover and influence one on another. The indicators diverse for various types of businesses. In the article, we will tell about the markers for the online store, which novices can use to analyze the effectiveness of work.
There are “weak” indicators that are going to be easily, however, they give little to comprehend the business. For instance, attendance at an online store. You may have a hundred thousand guests per month, and zero deals.
Untargeted traffic. Or all 200 visitors to the site come from a thematic forum and purchase each. But the “weak” indicators depend on “strong”. For instance, if the traffic is focused on, its decrease relies upon the benefit.
We have picked a few KPIs for you and separated them into 3 groups for your convenience
Website performance indicators
Everything that occurs on the site: how many people come, on what pages there are, how rapidly get to the “Basket” and why leave.
To begin, you have to master the standard indicators of Google Analytics or Mageworx extensions may help you. Then you can set up tracking of “your” events and gather more data.
With the help of the analytics system you should keep track:
Attendance (traffic) – the total number of visitors to the site for the period. Focus on the dynamics (increase or decrease) and times of activation of visits. The indicator will be helpful for the calculation of conversion.
Traffic structure – how many visitors come to the site from various channels (social networks, mailing lists, search engines, contextual advertising, direct transitions, and others) in the sum and rate.
Commodity page views – the number of views of every item. It may turn out that visitors are less likely to view the goods on which you bet. In this case, you need to make changes to the site: change the navigation, put new photos of the products, decrease costs and others.
Number of requests – the all out number of requests through the site for the period.
Conversion – the ratio of the quantity of requests to attendance as a rate.
Conversion for each channel – the ratio of the quantity of requests from visitors from a specific channel to the quantity of these visitors.
Share of new customers – number of new customers for the period in rate.
Incomplete orders (abandoned baskets) – the quantity of visitors who put the item in the basket, but never finished the purchase.
Each KPI ought to be viewed in dynamics and analyzed. Only in correlation, you will know if it is high or low.
Deals and everything related to them: delivery, refunds, exchanges, discounts.
Total orders – all requests received not only through the site but also through comments on social networks, offline orders, and others.
Executed orders – just requests that reached the recipient.
Share of completed orders – the ratio of finished orders to their total number in rate.
Reasons for outstanding orders – shows what problems need to be corrected first. The reasons are different: the buyer did not confirm the order, changed his mind to buy, the goods were not available, the transport company lost the parcel and others.
Delivery structure – the percentage of orders, which are delivered to the regions, in their own city and self-export. You can also go deep into the reasons for the returns on each type of delivery.
Indicators in financial terms.
The sum of the order value is the estimation of all orders.
The sum of the value of completed orders – the estimation of only completed orders. This marker and the previous one are fundamental and will be helpful for further counts.
Average check – the sum of finished orders divided by the quantity of requests. This marker should only be tracked over time. Once it gives no useful information. You can also compare the average check for various categories of goods or advertising channels and make inferences about the viability.
Profit – expense minus income. Helpful in further estimations.
Average profit to order – profit divided by the quantity of completed orders. The indicator ought to be viewed for every deal channel.
Advertising costs – the percentage of benefit you spend on advertising.
Cost of attracting a buyer – the expense of advertising, divided by each new customer for the period. Also, you need to count on each promoting channel.
For your business use our indicators or add your own. For instance, extra markers to assess the work of employees, warehouse operations, delivery services, etc.
No one will improve the online store for you, but KPI tracking will help you choose the right direction to change!