Metrics are the tools that show how your business is doing. After all, selling online without tracking your results is like driving a car with your eyes closed. If you don’t measure your results and improve your marketing strategy, it will eventually stop working. No business can survive if the owner does not learn more about his customers and marketing results.
Many companies make the grave mistake of not collecting data about their customers or focusing on the wrong metrics. The thing is, by tracking what works for your store and what doesn’t, you can achieve faster business growth and therefore increase profits.
There are many methods to track your online store’s results. So how do you know for sure which ones are worth using? It can be hard to choose, especially for a newbie. In this quick guide, I’ll introduce you to the three metrics to focus on first.
The 3 Most Important Metrics Every Online Store Owner Should Keep Track Of
1. Bounce Rate
Often the visitor’s experience with your store ends before it has even begun. The bounce rate reflects the percentage of users who leave your website after visiting one page without action. To calculate it, divide the number of users who have seen just one page by the total number of users.
An excellent bounce rate is considered a range of 26-40%. The value between 41-55% is deemed average, and a value higher than 56% is already a reason to be wary.
What Do You Do If the Bounce Rate Is Suspiciously High?
It’s worth analyzing your website regarding loading speed, content quality, and usability to reduce it.
- Analyze the content on pages with a high bounce rate
Perhaps you need to improve your content somehow, make it more understandable to users, or optimize it. Think about how you can make the page more valuable to the user.
- Check the usability of your page
Is it possible that your store visitors leave because of poor UX and UI? Then you should improve the navigation, remove an annoying pop-up window, rework the design, and so on.
- Improve the performance of your website
Check how fast your online store’s pages load. If the numbers are disappointing, it’s time to think about how to increase the loading speed of your site.
Poor loading speed is one of the most common reasons for the high bounce rate of online shopping websites. So how do you solve this problem? It all depends on what CMS your online store uses. For example, if you have a large online store built on Magento, it is worth using Magento Ecommerce Development Services for your website optimization strategy.
2. Cart Abandonment Rate
Almost all online store owners are familiar with cases when customers add many products to their cart but never pay for them.
A very high cart abandonment rate can be due to the following factors:
- There is no possibility to place an order without registering on the site;
- The user doesn’t see the number of stages of order placement;
- Problems with security on the site;
- Technical bugs and errors;
- The final cost of the order is not clear to the customer;
- Long delivery period;
- Too expensive delivery.
What Is the Best Advice for Owners of Online Stores with a High Cart Abandonment Rate?
Make the payment process as simple, straightforward, and flexible as possible. The easier it will be for the customer to place the order, the lower the cart abandonment rate. You can see a great example of a convenient guest checkout process in the Ralph Lauren online store screenshot below.
The screenshot was taken on the official Ralph Lauren website
3. Average Order Value (AOV)
Average order value (AOV) shows how much money a customer spends on average on a purchase. This important eCommerce metric is calculated as follows: the total profit is divided by the number of orders. The greater the resulting value, the higher the income of the online store.
AOV can be calculated for any period, but most companies calculate it as a monthly average.
Several Ways to Enlarge the Average Check
- Cross-sell related products – Many online stores successfully use this option, offering customers to buy extra products. It makes it possible to sell goods in addition to those already purchased, which the person did not originally intend to buy, thus increasing the average order size and bill.
- Offer to buy a combo of products at a discounted price – Often, stores suggest buying several items at once, giving a better price. It encourages customers to buy more, as well as to sell less popular products.
Check out how the iHerb store employs both tactics above on its website.
The screenshot was taken on the official iHerb website
- Offer free shipping for orders of a certain amount
The opportunity not to pay for order delivery is an excellent motivation for customers to add more products to their cart and pay for them. Therefore, your profits will grow.
- Provide a discount when placing an order for a particular amount
Offer a discount on a larger amount spent, for example: save 10$ when you spend a minimum of 80$. As a result, customers will consider buying more.
In this article, we talked about the three main metrics that online store owners should track first. If you wish, you can continue this list on your own. ABut, as you now know, all those parameters are interconnected and aimed at identifying the weak points of your eCommerce business. This knowledge will help you prepare the right strategy for its growth and development.
With the help of these and other metrics, you will notice in time if something goes wrong with your business. In addition, knowing your metrics will allow you to conduct the most effective marketing campaigns that will positively affect your profits.
About the Author
Kate Parish, chief marketing officer at Onilab, with 8+ years in Digital Marketing and eCommerce web development promotion. Kate constantly upgrades her knowledge and skillset to stay fit in the progressing online world. She always does exhaustive research in such spheres as SEO, branding, SMM, PPC, and Magento PWA development, before sharing her expertise with a wide audience.