Online retail is booming – and not just because there are more online shoppers than ever.
E-Commerce has also become a much more analytical arena in the last few years, with businesses using data to optimize their sites, inventory, and sales channels like never before.
This is because being able to measure your e-commerce strategy effectively is the key to its success. Businesses that invest time and money in monitoring their e-commerce performance see much stronger results than those that don’t keep track of such things.
However, you can’t improve what you can’t measure – so read on to discover how.
Know Your KPIs
As you know, measuring your e-commerce sales is all about measuring traffic, conversions, and sales. These are the three most important metrics in any e-commerce strategy – and, of course, the KPIs you should be tracking in your analytics.
Your KPIs are the metrics that matter most to your business. You can use them to identify your strengths and weaknesses and to track your progress over time.
Here are the KPIs you should be tracking for your e-commerce sales:
- Traffic – how many visitors (and what type) visit your website
- Conversions – how many visitors become customers
- Sales – how much money do you make from these sales
Look at Your Web Traffic
The first thing you need to do when measuring your e-commerce sales is to look at your web traffic. Whether you’re selling online or a brick-and-mortar retailer with an online presence, it’s crucial to know how much traffic your website attracts.
Knowing your website traffic allows you to calculate how much sales potential you are missing out on – and how much investment you’ll need to increase these numbers.
There are various metrics you can use to track your website traffic, such as unique visitors, page views, time on site, bounce rates, and conversion rates, depending on the KPIs (Key Performance Indicators) that are most relevant to your business.
Keep in mind that these numbers vary drastically from industry to industry. For example, retail and B2B (business-to-business) websites tend to see high bounce rates, while e-learning websites tend to see high conversion rates.
Use Social Media Analytics
You should also track your social media analytics if you’re selling online. This is especially important if you’re selling via social media or running a social media marketing campaign for your e-commerce store.
However, you can also use social media data to track e-commerce performance – especially if your e-commerce business is on a platform like Shopify.
Ideally, you use a CRM (customer relationship management) system that integrates with your social media channels. This way, you can track customer interactions and purchases across all platforms – which is incredibly important if you’re selling on social media.
Use Online Tools
There are plenty of online tools that you can use to measure your e-commerce sales, like Google Analytics, Shopify, and Amazon analytics tool. These tools offer a wide range of analytics functionality – from traffic and conversion rates to customer behavior insights.
You can use them to track your overall sales numbers and monitor how much profit your e-commerce strategy is bringing in – i.e., how much revenue you’re making versus how much you’re spending.
This can help you pinpoint the areas of your e-commerce strategy that are working well, as well as those that need improvement.
In Conclusion
E-commerce is an extremely fast-paced and dynamic industry, making measuring your performance as an e-commerce business much more challenging. Therefore, e-commerce businesses need to juggle a variety of metrics, from traffic and conversion rate to average order value.
If you’re just getting started with e-commerce or want to take your measurements to the next level, the information highlighted above should help you get started!
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