If you're managing an E-Commerce team, you need to measure how well they're performing and what areas need improvement. But with so many metrics to choose from, how do you decide which ones to prioritize? In this article, we'll help you identify the most important metrics for your E-Commerce team based on your goals, strategy, and industry.
The most obvious metric to track is how much money your E-Commerce team is generating and keeping. Revenue is the total amount of sales you make, while profit is the difference between revenue and expenses. You should monitor both metrics to see how efficient and profitable your E-Commerce team is. You can also break down revenue and profit by product, category, channel, or customer segment to get more insights into what's working and what's not.
Para analisar o faturamento é importante primeiro alinhar alguns conceitos: Venda Captada: Transa??es feitas na plataforma ou que pode ser analisada no GA, por exemplo. Venda aprovada: De todas as transa??es feitas quanto de fato foi aprovado. Aqui você elimina boletos n?o pagos, pagamentos n?o aprovados por anti fraude etc. Venda Faturada: Depois de algum tempo a logística irá faturar os pedidos aprovados. é importante analisar sua Perfomance pela venda captada. Há muita venda perdida no processo de aprova??o e uma maneira de aumentar sua rentabilidade e faturamento é um melhor gerenciamento da sua taxa de aprova??o. Seja ela por um melhor mix de pagamentos seja por uma melhor eficiência do seu ecossistema de pagamentos.
An e-commerce commercial team must generate value: top-line growth and/(or) improved profitability. To ensure that your team is on track on the revenue growth side, in a B2C Marketplace, I monitor GMV and Gross Orders. On the profitability side, I monitor the Gross Margin after Operating Costs or, in a more mature business, EBITDA. I believe it is important to ensure that each team member understands what are his/her targets (individual breakdown) and is full accountable for them. Then as leaders we must guide the team to understand in detail what are the levers they can use to drive the value generation. Split by vendor/category is also a valuable piece of data.
E-commerce division success is measured primarily by - traffic and channel mix - COA and ROAS - unit matrix performance . - channel repeat rate/ retention - attachment and solution sales mix - platform conversion. - clv and probability bridge. - NPS
Beyond the metrics mentioned by other contributors, an E-commerce team should be judged on how they have grown the e-commerce operation relative to how well it was funded. Metrics are often the result of changes in market demand, or how much was spent on advertising. The team should be judged on things such as: 1. Did they transform the e-commerce operation to make better use of data, social media, etc? 2. Did they evolve the customer experience? 3. Did they add new channels or partnerships? 4. Did they improve efficiency through AI or other means? This list will go on. The important thing is to judge the team on what they can control, and the creativity they applied given their available resources.
Absolutely, understanding the pulse of E-commerce metrics is pivotal. While it's essential to prioritize key metrics like conversion rates, customer acquisition costs and LTV for benchmarking, it's equally crucial not to get lost in a sea of data. The real value lies in actionable insights derived from this data. By balancing thorough analysis with the agility to implement quick changes, teams can optimize performance without sacrificing speed of execution. Focus on what matters most, adapt swiftly, and keep the momentum going towards success.
Conversion rate is the percentage of visitors who complete a desired action on your website, such as making a purchase, signing up for a newsletter, or downloading a resource. It's a key indicator of how well your E-Commerce team is attracting and converting potential customers. You should aim to optimize your conversion rate by testing different elements of your website, such as design, copy, layout, offers, and calls to action. You can also segment your conversion rate by source, device, or behavior to identify the best and worst performing segments.
Taxa de convers?o é uma das principais métricas de todo e-commerce e complexa pois diversas áreas podem impactar a mesma. é importante que isso n?o seja o indicador de apenas uma área, mas que todo ecossistema seja corresponsável. A maneira mais pragmática é ter KPIs claros e mensurá-los diariamente para entender possíveis correla??es. Alguns exemplos: - Competitividade de pre?os - Ruptura - Qualidade do trafego: Os canais organicos sofreram a mesma queda de convers?o ou isso foi focado nos canais pagos? Se sim, vale a pena rever a estratégia de mídias. - Prazo de entrega - Bugs - UX/UI - Tempo de carregamento
Transactional sites continously battle to increase their conversion. As much as conversion is important as a metric, I also recommend to focus on the right type of conversion. For instance if visitors are landing on the homepage and only purchasing products or services that are highly discounted and drive negative contribution, conversion increases and it is celebrated however this conversion is driven by inventory and generous pricing and often it is hard to replicate. Other productive ways of measuring conversion is increased AOV or GP per visitor which result in a healthy conversion increase.
Taxa de convers?o é um indicador chave para gest?o de e-commerce. Se você investe em mídia, quanto menor sua taxa de convers?o, mais cara será sua venda, pois você precisará trazer um grande número de pessoas para sua loja para realizar uma venda. Vários pontos podem influenciar na baixa taxa de convers?o, mas, baseado em minha experiência, recomendo come?ar sua avalia??o por dois pontos: 1. Direcionamento de campanhas: Estou direcionando minhas campanhas corretamente para o meu público alvo? 2. Usabilidade do site: Meu cliente consegue navegar com facilidade no meu site? As informa??es podem ser encontradas de maneira clara? A jornada está eficiente?
Customer lifetime value (CLV) Is the total revenue an ecommerce business earns from an individual customer over time and takes into account every one of their orders. It is an excellent metric to size up your average customer satisfaction, loyalty and a brand's viability.
Customer satisfaction rate is a critical metric for assessing the performance of an e-commerce team as it directly influences customer retention, brand reputation, repeat business, and competitive advantage. By prioritizing customer satisfaction, teams can gather valuable feedback, improve operational efficiency, and ultimately drive higher customer lifetime value, leading to long-term success in the competitive e-commerce market.
Customer acquisition cost (CAC) is the average amount of money you spend to acquire a new customer. It includes all the marketing and sales expenses involved in attracting and converting a customer. You should calculate your CAC by dividing your total acquisition expenses by the number of new customers you gained in a given period. You should compare your CAC with your customer lifetime value (CLV) to see if you're spending more or less than what a customer is worth to you.
Sometimes we tend to overspend on the cost of acquiring a customer for the adrenaline of improving the sales. This becomes very difficult to cut down as the business grows multi folds. The key for a successful business is driving organic growth by monitoring some key parameters like 1. Review Score (Optimising SEO strategy) 2. Getting good testimonials from users (content marketing) 3. On-time/speedy delivery/Query resolution (Optimising the user experience).
Customer Acquisition Cost can be looked at for both new and returning customers. Profitability can be another way to look at CAC, Simply put, it can be revenue generated divided by cost (MDF and OPEX) to determine the profitability of the campaign.
O Custo de Aquisi??o de Clientes (CAC) é uma métrica importante para entender o retorno sobre o investimento em marketing e vendas. Ele representa a média de dinheiro gasto para adquirir um novo cliente, incluindo todas as despesas envolvidas na atra??o e convers?o do cliente. Calcular o CAC é essencial para avaliar a eficácia das estratégias de aquisi??o de clientes. Dividindo as despesas totais de aquisi??o pelo número de novos clientes adquiridos em um determinado período, é possível determinar o custo real de cada cliente. Muito importante comparar o CAC com o valor da vida útil do cliente (LTV). Essa compara??o permite entender se o investimento em aquisi??o de clientes está gerando retorno positivo ou negativo.
Acredito que a estratégia para gerenciar o CAC:CLV dependerá muito do seu tipo de e-commerce. Se for de multi produtos e com a possibilidade de aumentar a recorrência, você pode gastar mais na sua aquisi??o de clientes ( até mesmo perder dinheiro na primeira venda), mas é vital para a saúde financeira da sua empresa que você consiga fazer com que esses consumidores recomprem através dos seus canais n?o pagos. Porém se seu e-commerce for de baixa recorrência como por exemplo a venda de produtos duráveis, seu olhar precisa ser para uma eficiência de mídia, redu??o drástica de CAC para que toda venda seja rentável. E essa é uma frente n?o apenas do time de mídia, mas de todo o time. Ex.: Um site mais performático ajudará a reduzir o CAC
CAC plays a vital role for the sustainability of an E-commerce platform. CAC and LTV should be correlated; this will help to understand the expenses compared to life time value
Customer retention rate (CRR) is the percentage of customers who stay with you over a given period. It's a measure of how loyal and satisfied your customers are with your E-Commerce team. You should calculate your CRR by dividing the number of customers at the end of a period by the number of customers at the beginning of the period, minus the number of new customers acquired during the period. You should aim to increase your CRR by providing excellent customer service, delivering value, and creating loyalty programs.
The importance of customer retention and scope of action is relative to the frequency of purchases with the type of products or services you sell. For example, consumers purchase mattresses perhaps once every 10 years, so while a good purchase experience is important, the product experience is probably more relevant. Marketplaces or retailers with high frequency product categories have a much higher reliance on customer retention, as a driving factor behind their sustainability and within this context, a frictionless purchase/post purchase experience is king.
Customer retention rate (CRR) is a crucial metric, and it shouldn't be viewed in isolation. It's best analyzed alongside new customer acquisition costs (CAC). Here's why: When you prioritize value for existing customers, through time-saving features or cost reductions, you cultivate higher satisfaction scores. This translates into positive word-of-mouth marketing, a powerful tool for any brand. The cherry on top? A strong CRR naturally leads to a decrease in CAC over time.
In service agencies, Customer Retention Rate is very important. If a client stays for a long time that represents the client satisfaction with our services. It also indicates the team's customer support, service delivery.
Can't agree more, any online store should aim for higher CRR since CAC is not cheap. With a good CRM tool implemented, half the battle is won. The other half is to have an eCommerce team to monitor the data and optimise the engagement rules.
CRR is a critical metric as it often costs less to retain existing customers than to acquire new ones, and loyal customers tend to have a higher lifetime value. Enhancing CRR can also lead to positive word-of-mouth, further driving down acquisition costs. To truly leverage CRR, e-commerce businesses should also analyze the reasons behind customer churn and address them directly, which could involve product improvements, personalized marketing, or more responsive customer service.
Customer satisfaction score (CSAT) is the average rating that customers give to your E-Commerce team based on their experience with your products or services. It's a way of gauging how happy your customers are with your E-Commerce team. You should collect CSAT feedback by asking customers to rate their satisfaction on a scale of 1 to 10, or by using emojis, stars, or thumbs up/down. You should analyze your CSAT scores by product, category, channel, or customer segment to identify the strengths and weaknesses of your E-Commerce team.
Customer satisfaction is the most important aspect of any e-commerce platform. We can design all sorts of CX or UX, however if the customers are not happy, none of them matter. A satisfied customer mostly likely will purchase again and ongoing satisfaction creates customer loyalty and they become your brand ambassadors. It is why it is extremely important to track CSAT and continuously to improve them.
The Customer Satisfaction Score (CSAT) measures the happiness of your customers with your e-commerce offerings. It's gathered through ratings—be it 1 to 10 scales, emojis, stars, or thumbs up/down—reflecting the customer's experience. Analyzing CSAT by product, category, channel, or segment reveals your team's strengths and areas for improvement. This analysis helps in understanding customer preferences, pinpointing issues, and tailoring strategies to enhance satisfaction, leading to higher retention and loyalty. Regularly tracking and acting on CSAT insights is crucial for maintaining a positive customer relationship and driving business growth.
In a world full of reviews and transparent customers experiences this is a must KPI to look at. This metric provides insight into how happy or unhappy customers are with their purchase and experience. It is a great source also do identify possible improvements on products. High satisfaction often correlates with high retention.
The CSAT is a vital metric as it directly reflects customer perceptions and experiences. It's important to note that while numerical scores provide quantitative data, the reasons behind the scores are equally critical. Qualitative feedback accompanying these ratings can offer actionable insights into specific areas needing improvement. Additionally, segmenting CSAT by customer demographics or purchase history can reveal trends and preferences, enabling more personalized service and targeted enhancements.
Digging into CSAT scores shines a spotlight on customer vibes about your shop. Getting them to rate their experience through an easy peck at emojis or stars can crank up response rates. Then, break those numbers down by different angles like product types or shopping channels. This move unlocks insights into where your team's nailing it or needs to buff up their game. It’s like having a map where X marks the spots for both treasure and trouble. Action those insights, and you’re on a path to tweaking your e-commerce experience.
Other helpful metrics are: - Site Speed and Performance Metrics - Bounce Rate - Traffic Sources - Inventory Levels and Turnover - Return Rate and Reasons for Returns
Returns has been an issue for ecommerce and in average this could be as high as 30% to 35%. In order to reduce return rates providing added value it is important. Added value can come in the shape of integrating technologies such as AR/VR, Metaverse or even technologies that allow to attaching sentimental value to acquired good right from the get go.
Beside that, there's one important point left: is there a plan in place to improve everyone's skills? Beside those hard facts mentioned above it is important that the team as a whole and individually constantly un-learn and learn, because the playfield e-commerce is constantly changing.
It depends a bit what you consider 'e-commerce team'. Mostly people think of marketing and sales profiles. But as e-commerce (and measuring its performance) is very heavily technology based, it makes sense to include product owners and software developers in the team. So, on top of metrics already mentioned, you could look at software quality, time-to-market of new features, onboarding speed of new or changed products, categories, markets, channels, etc. This metrics show how agile and future-ready your organization actually is, instead of how it is doing now or in the past. These metrics also really measure team performance; hardly anybody carries the responsibility of these metrics on their own.
Evaluating the performance of an e-commerce team involves assessing various metrics such as sales revenue, conversion rates, customer satisfaction scores, website traffic, average order value, and return on investment for marketing initiatives. Additionally, factors like inventory management efficiency, customer retention rates, and response time to customer inquiries can also be considered. Regularly reviewing these metrics helps identify areas of improvement and success within the e-commerce team.