There are hundreds of KPI’s that can be tracked in any number of ways, but which ones really matter to your business? With the number of trackable metrics you may be hit by analysis paralysis. The only thing worse than not tracking KPI’s at all is tracking the wrong KPI’s when making major decisions… so we’ve compiled this list of metrics that should matter to most ecommerce website managers.
Before we share with you the KPIs, you need to consider that looking at averages or aggregate information won’t always give you the insights you need to make a good decision. For instance, sessions could be up, caused by extra email blasts, while your organic traffic is tanking monthly. For every KPI we list, we HIGHLY recommend segmenting your data to find root causes and looking for patterns and trends (Note: Trends need six data points). Year over year, month to month and past 3-6 months are decent ways to find these nuggets. Some good segments include:
- By Device (mostly mobile vs desktop)
- Geographic
- Channel (search vs non-search)
- New vs Returning
Here are the 9 ecommerce metrics:
1. Sessions
Traffic is good. More traffic means more chances to convince prospective customers of the value of your product, which means more opportunities for conversions. Sessions also speak to the reach your website has, and tracking growth or decline trends in your sessions is a good way to measure how well your marketing efforts are working. Sessions may also give you insights into fluctuations in your marketplace such as seasonality which can help you plan business accordingly.
Google Analytics Path: Audience>Overview>Sessions
2. Conversion Rate
If sessions are going up…up…and away but revenue isn’t keeping pace, a metric to check is conversion rate, or the measure of how successful your site is at turning visitors into customers. A low conversion rate could signal a slow website, misdirected or lack of marketing efforts, or a misaligned product/market fit. It could also be an indicator of bad UX or a confusing checkout process. A high conversion rate is a signal for how well you know your customers and that you’ve truly offering them what they want.
What to look for: Ecommerce conversion rates should hover at around 3-4% of sessions.
Google Analytics Path: Conversions>Overview>
3. Pages/Session
Now that you’ve successfully gotten customers to your website, how can you tell that they’re interested? Pages per sessions is a KPI that tells you how engaged a user is with your website and is closely related to the user experience of your website, as well as the amount of rich content your site is offering. If they like what they see, visitors tend to poke around a bit.
What to look for: 3-5 pages per session is the current benchmark.
Google Analytics Path: Audience>Overview>
4. Bounce Rate
This is the “nope” metric. In other words, how many people clicked into your site, took one look, said “nope”, and clicked off. Bounce rate is mostly used as a test of website relevance, but the bar is pretty low here. If a visitor clicks on one thing once before they leave the site they will not be added to the bounce rate tally. However, this is a great metric to keep an eye on as you test landing pages for different products and marketing efforts.
What to look for: The average bounce rate for ecommerce sites is 33.9%, but smaller sites tend to have a higher bounce rate than this and larger sites much lower. If your bounce rate is 50% or higher, its cause for concern.
Google Analytics Path: Audience>Overview>
5. Average Order Value
AOV is a measure in efficiency. If it your cost per conversion is $10 and your average order value is $5, there’s a problem. Between AOV and cost per conversion, an ecommerce site can tell if the marketing money being spent is working – or perhaps should be reviewed and something new applied. Segmenting AOV is also a good way to determine which customer types spend the most money on your site so you can aim marketing at customers who are most valuable.
Google Analytics Path: Conversions>Overview>
6. Attribution
Attribution is channel specific, meaning it breaks down value added from each channel at each stage in the funnel. With attribution you can track just how much money you are bringing in from each channel on both a direct and indirect basis. This matters because in many situations some channels are far more expensive and far less efficient than others, and that money can be put to use elsewhere for a greater return. Keeping an eye on attribution per channel also allows much more detail for tracking the effectiveness of changes. For example: after making changes to your social media strategy you can look at attributed revenue to see if those changes have had an effect on the overall funnel social media is a part of, not just direct revenue from social media, which is in most cases very small.
Google Analytics Path: Conversions>Attribution>Model Comparison tool
7. RPV
RPV, or revenue per visitor, takes into account conversion rate, AOV, and sessions, which means you have to run a few quick calculations yourself. RPV can be calculated two ways:
RPV= Total revenue/Total unique visitors
OR
RPV= AOV/Conversion rate
Revenue per visitor matters because you’re paying, one way or another, to bring traffic to your ecommerce website. If your RPV is greater than your competitors, it will allow you to be more efficient in your spending, and allow you to make higher bids for ad placements, since every session is worth more to you than to them. Essentially, RPV lets you track how much a single visitor is worth to you on average, which is important information when making decisions to grow an ecommerce website.
Google Analytics Path: Conversions>Ecommerce> Overview
8. Cart Abandonment Rate
A visitor has worked their way through your website and made a product selection, you’re on the home stretch to getting a conversion…but at the last second they abandon their cart and leave the site. What gives? This happens more than you might think and can be an indication of many things, from a flawed payment processing page, shipping rates that are too high, or perhaps your site did not convince the visitor that this is in fact the best deal. A high cart abandonment rate is a sign that consumers do not feel comfortable committing to the next step in their relationship with you. The good news? Decreasing your abandonment rate by just a few percentage points can have huge impacts to your bottom line. Consider using email drip campaigns post abandonment to get those users back to convert. Offers and reminders of what they’ve left behind are effective.
What to look for: Average cart abandonment rate is around 69%.
Google Analytics Path: Conversions>Ecommerce>Checkout Behavior
9. Revenue
Obvious right? Tracking revenue is meaningful not just because it is the measure of the health of your business, but because if you are not tracking changes in revenue none of the other metrics have meaning. Revenue puts the rest of your KPI’s, and all your ecommerce efforts in perspective. Change in revenue is your final determination of whether a website change or marketing campaign has had an effect or not.
Google Analytics Path: Conversions>Overview>
All of these KPI’s should be tracked over time to get an indication of the effect your website changes and marketing are having. There are of course piles more, but if you’re looking for a place to start your google analytics journey, you can’t go wrong by starting here.