35 Ecommerce Metrics with Formulas, Benchmarks and Tips
An ecommerce company's success depends on how well it understands statistics that track sales and measure operational performance. In this article, we’ll cover which key metrics businesses should monitor for ecommerce and why. Plus, you’ll find formulas and benchmarks to gauge the success of your online selling efforts.
What Are Ecommerce Metrics?
Ecommerce metrics measure the sales and business processes of a company that sells products online. For example, an ecommerce metric might show how many website visitors become customers or the average value of all customer orders.
Tracking these numbers gives companies insight into their overall performance and how their customers are shopping. They also reveal whether the business is on an upward or downward trajectory and if their strategies are working or not, providing information that could shape decisions and future plans.
What Is the Difference Between Ecommerce Metrics and KPIs?
Ecommerce key performance indicators (KPIs) can be a specific category of metrics that leadership has recognized will provide the critical insights into their business they need to monitor the health of the business and adjust strategy as needed.
A business should track KPIs that are in alignment with its business goals.
Key Takeaways
- Sales conversion rate is one of the most critical and widely used ecommerce metrics.
- Ecommerce metrics can be categorized by where a person is in the buyer’s journey, from discovery through advocacy.
- It's vital to track other operational business metrics in concert with your ecommerce sales and marketing metrics to see the big picture and grasp the relationships between these numbers.
How to Measure Ecommerce Success
To measure ecommerce success, you must watch the metrics that directly relate to business goals and see how they trend over time. By comparing your current ecommerce metrics against your performance in the previous period (this week compared to last week or year-over-year), you can measure how you have improved or come up short. Regularly measure the most crucial metrics and consider changes based on what those metrics reveal.
How Often Should I Track Ecommerce Metrics?
You'll want to review some ecommerce metrics more often than others. Some metrics will provide revealing insights weekly, while others that offer more long-term and strategic guidance may only be worth evaluating at the end of each quarter.
Here’s a list of ecommerce metrics organized by how often most companies check them:
| Weekly Metrics | Bi-weekly metrics | Monthly | Quarterly | Campaign-based Tracking for A/B testing |
|---|---|---|---|---|
|
|
|
|
By performing A/B testing, you can test and track how customers react to a marketing message, like sending promotional emails on Fridays versus Mondays, or the timing of a sale. This should be done regularly but is dependent on marketing campaigns and the frequency of email sends. |
Frequency for Reviewing Ecommerce Metrics
| Weekly Metrics | Bi-weekly metrics | Monthly | Quarterly |
|---|---|---|---|
|
|
|
|
Ecommerce companies have identified a number of metrics that help them better understand their operations and how they change over time. These metrics reveal how customers engage with the company, its products, and its website.
Here are 14 fundamental ecommerce metrics that most online sellers monitor:
- Sales Conversion Rate
$$Sales conversion rate = \frac{Total transactions}{Total visits} \times 100$$
The average ecommerce sales conversion rate is around 2% to 3%.
Since sales conversion rate is such an important metric, any incremental lift can make a dramatic difference in overall sales. In order to optimize each part of the shopping process, organizations can filter conversion rates by specific traffic sources or purchase paths to see where they are doing well and where they need to improve. For example, you might track conversion rates on traffic from different Facebook advertisements to see what campaigns are performing well. You might monitor the conversion rate for a certain category of products to see if they’re worth spending extra marketing resources to drive more category page traffic. Learn more about other sales metrics by reading our post on sales KPIs and metrics.
- Website Traffic
Website traffic measures the number of visits to your website and their quality. You can measure traffic by total visits or total page views, and many companies pay close attention to how long the average visitor spends on the site. Website traffic comes from both paid (search and social advertising, retargeting, affiliate marketing) and free (organic search, social media, direct word of mouth, referral) sources. Businesses must invest time and effort into creating engaging content marketing and running cost-effective advertising to drive more website traffic.
- Cost Per Acquisition (CPA)
$$Cost per acquisition = \frac{Total spent on campaign to acquire new customers or users}{New customers or users acquired}$$
The metric can help you optimize campaigns for attracting new customers and identify your most and least effective marketing efforts when compared against the customer lifetime value (CLV) — as long as it's cheaper to acquire customers than what they're worth long-term, keep the traffic flowing. The best way to determine if your cost per acquisition is on par is by comparing it to your customer lifetime value. Your goal is to keep a profitable ratio, while reaching as wide an audience as possible.
- Customer Acquisition Cost
$$Customer acquisition cost = \frac{Total marketing and sales expenses}{Number of customers acquired}$$
Customer acquisition cost is an essential metric for online retail because it tells businesses whether they’re operating profitably and earning more from new customers than they’re spending to acquire them. It is also one of the most important business-to-business (B2B) ecommerce metrics because it also considers associated selling costs (sales rep overhead and commissions) beyond the lead acquisition spend. Learn how the right platform can help B2B ecommerce companies succeed.
- Average Order Value (AOV)
$$Average order value = \frac{Dollar value of all sales}{Number of customer purchases}$$
Companies typically target a higher average order value, but this number could vary greatly depending on what a business sells and how many items clients usually buy (think about a $40 order of household cleaning products versus a $2,000 furniture set, for example). Organizations can increase the average order value by selling accessory items for purchases at a discount or recommending associated items. Loyalty programs and offering free shipping on orders above a certain dollar value also helps.
- Revenue by Channel
Revenue by channel tells your company which advertising or communication channels are bringing in the most revenue. You can use a web analytics tool like Google Analytics to monitor the revenue delivered through many different channels. You can also look at data from specific channels, like YouTube, to calculate the effectiveness of advertising there. As you measure the revenue that comes in from each channel, you’ll want to adjust how much you're investing in each channel to make the most of your budget.
