You must Measure to Manage! Without insight on your exiting performance and productivity you can never boost the traffic on your website.
In many businesses, decision making is done without proper planning, or by setting ideas only on goals. The problem is that many managers focus too much on operational activity indicators such as number of emails sent and number of posts on social networks. However, it is essential to reflect on what has been achieved. Following performance indicators and metrics you measure the sales and traffic on your website.
While it is important to measure the productivity of team actions, if there is no direct analysis of how they relate to the results expected by your company, you are most likely to be wasting time and resources.
With constant analysis of the metrics it is possible to identify in advance what is not working and correct the course of the strategy before it causes considerable losses to the company. In addition, from the observation of what is being effective, you can redirect resources and optimize investments. Without a clear analysis of these factors, one can often lose growth opportunities that would otherwise not be perceived. Following 12 ways can be used to accelerate the sales and traffic f your website.
1. ROI (Return on Investment) and ROAS (Return on Advertising Spend)
ROI (Return on Investment) accurately shows you the return on the value you invested in a certain action to promote your e-commerce. In addition to presenting whether or not you should increase the investment. To achieve this result, the following formula can be applied:
ROI = Return on Investment / Cost of Investment
The ROI problem is that it is only possible to have the correct calculation after a financial close with a lot of information that is not so easily treatable. Therefore, it is advisable to use a very similar metric that is ROAS (Return on Advertising Spend), which measures revenue from a media, or set of media, by comparing cost and revenue directly.
This KPI is classic and every e-commerce manager should know and put into practice:
ROAS = Revenue from Media / Cost of Investment
Thus, the return on this media investment was 15 times its value.
2. Middle Ticket
This is another basic metric that every business owner must use to calculate roughly how much each customer spends in a virtual store. It does an average spend on purchases based on total revenue and the number of consumers in that period.
If your average ticket is low, give benefits, such as releasing free shipping on purchases over a certain amount or providing free gifts. Another possibility is to use the progressive discount strategy, which increases the discount in the price as it increases the amount spent by the consumer. This way, you will raise your average ticket per order, and ultimately your profit.
To calculate this metric, apply the following formula:
Average Monthly Ticket = Monthly Revenue / Number of Monthly Customers
It is important to remember that in reality these values vary and this is just one way for you to do a systemic analysis of how shopping in the business is.
3. Order Approval Rate
There is a big difference between paid orders and paid orders. Some of these are simply abandoned by the client, i.e. unpaid. Often the reason behind this is not necessary to pay on time the customer has the chance to think twice if he will actually make the purchase.
So if you want to know the order approval rate, divide the quantity of payments effected by the total number of orders and multiply by 100, and you will have the order approval rate.
Approval Rate = (Orders Paid / Total Orders) x 100
TxA = 60%
That is, in this example, only 60% of the orders made have been completed. Other factors may also influence this metric, such as the credit card company’s refusal or lack of limit. One way to reverse this is to offer multiple forms of payment, giving options for the consumer to complete the transaction.
4. Conversion Rate
This metric is versatile and can be used for various purposes such as sales, downloads, sign-ups or signatures. The value obtained will depend on your goal. If the conversion rate was low, what has happened should be analyzed, and how to improve it starting from actions that optimize the result according to your expectations.
Different Medias have different conversion rates. That way it’s very important to have funnel top media that usually have lower conversion rates, balancing with funnel end media with higher conversion rates. To calculate it:
Conversion Rate = (Converted Clients / No. of Visitors) x 100
5. AC (Abandoned Cart Rate)
Very useful metric to measure how many users are leaving the cart in their e-commerce. What if you realize that this rate is high? Calm. Evaluate whether the form of payment, condition, or freight amount are in line with market values. Consider having more variety of payment, or if applicable, apply a survey to find the opinion of your consumer audience.
One way to reverse this situation is to opt for an e-commerce platform that has abandoned cart recovery functionality. With it, the shopkeeper can develop a strategy directed by sending marketing emails to the logged in customer who abandoned the shopping cart, seeking to resume the sale.
One way to calculate this metric is from the ratio of the number of visitors who did not complete the checkout to the total number of those who started it, multiplying the result by 100:
Cart abandonment rate = (number of visitors who did not complete checkout / number of people who started checkout) x 100
6. Rejection Rate
Wondering how many people are joining your site? But what if you find that the bounce rate is high? Yeah. This metric points out that users left without interacting absolutely with anything on the page. This can occur because it is a product page with high price, bad description, or the user did not click for example on the buy button.
This information you can view in Google Analytics: Behavior> Site Content> All Pages. That way, you can identify on which page there is the highest bounce rate, and jump to an action. This metric is the percentage of sessions on a single page in relation to the total sessions:
Rejection Rate =% of sessions on a single page
7. CPC (Cost Per Click)
This metric is for you to measure the performance of ads whose billing mode is the pay for each user click.
If your CPC is too high, and does not have a good return, evaluate whether your ad is relevant, whether the landing page and keyword are related to the subject, or if you have a competitor advertising the same content. In this case, factors such as the budget established and the quality index determine the ranking, according to the media in which this advertisement was served.
To calculate it, you must take into account the amount invested and the total amount of clicks:
CPC = Total Cost of Clicks / Total No. of Clicks
8. CPA (Cost per Acquisition)
Another metric to calculate the outcome of your marketing campaigns is the CPA. It indicates how much you had to spend to get the expected result. It is also a thermometer to analyze your investment in that action. Ideally, the lower the cost per acquisition, the higher the return on investment. For this, we have the formula:
CPA = Amount invested / Number of Sales
In order to assess whether this investment is advantageous or not, it would be necessary to take into account the final price of the product and other expenses to market it.
9. Lifetime Value or LTV (Customer Lifetime Value)
Many are customers who only buy once on your site and never come back. However, there is probably a percentage of consumers who buy recurring in their e-commerce. Would you know how much these people render during the time they are faithful to your site?
To arrive at this answer, you can use the Lifetime Value calculation. This is a very interesting metric as it helps to calculate a predictability of yields and identify the potential profitability of each consumer.
Focusing on re-purchase, when the customer makes other purchases in the virtual store, or contracts a recurring purchase, you can increase the LTV of the customers, directly impacting the revenue of the site. One way to arrive at this result is by calculating:
LTV = Average Monthly Ticket x Average Time of Retention of each Client
10. Number of Site Sessions
A session is a set of actions that users perform within your site. It is calculated as follows:
• If the user has been inactive for 30 minutes without interacting with any page, the session is terminated;
• If the user left the site and returned after 30 minutes, he held 2 sessions;
• If the user left and returned within 30 minutes, the session remains the same;
• If the user continues browsing for more than 30 minutes, the session remains the same.
Sessions can come from paid and organic search, ads, social media, email, when the user types the URL in the search engine or from the referral from another site.
If your conversion rate is stable and you are able to increase the number of sessions of the site without losing quality, any growth in that direction has the potential to increase sales in your e-commerce. To discover this information, you can access data like those found in Google Analytics.
11. Number of Organic Sessions
The organic sessions are those that come straight from spontaneous research in the search engines, that is, without the stimulus generated by an advertisement? They typically represent an important weight for the long-term growth of e-commerce.
They can be viewed in Google Analytics: Acquisition> All traffic> Channels
Usually organic sessions have a better conversion rate than other media, at the same time they represent well how relevant your site is to the products it sells. For large billing numbers, organic session augmentation is critical.
SKU is the acronym for Stock Keeping Unit, which stands for “Storage Unit” or “Inventory Control Unit”.
Basically it is a product identifier code for your e-commerce, which facilitates organization, such as identifying and finding goods on the platform, controlling the flow of items, handling data on genres, and facilitating the registration of new products.
For most retailers, having merchandise diversity is very important to ensure indexing and site navigation, maintaining a high number of SKUs is indicated in that case.
In general, tracking information from these metrics will help you better understand how your business performs and make better strategic decisions to achieve the sustained and steady growth of your e-commerce.
However, this step will only be complete if your online store has a high performance system that enables continuous improvement to reach more and more results. To learn more about this please;
Contact Us or Call Now at
+1 (416) 953 8671