Ecommerce or electronic commerce is a great way for businesses to reach their customers on a global scale. But knowing if your business is targeting the right people in the right way is essential for any ecommerce company. Setting out the right KPIs can help you determine exactly this so that your business can grow a successful ecommerce strategy.
In this article we will list the best KPIs for your ecommerce strategy, whilst looking at how to measure KPIs and how to optimise online performance.
Before we look at KPIs and eCommerce strategies, it’s important to define exactly what eCommerce is. Although many people are familiar with the term, there are a significant number of people who ask, ‘what does eCommerce mean?’ – even those who work in the industry!
In its simplest form, eCommerce is simply selling goods or services online. So, if you accept orders and ship goods or accept payments to deliver online products and services, then you’re engaging in eCommerce.
Global revenue from eCommerce is expected to reach $3.64 trillion USD in 2023, which means there are plenty of people who are eager to break into the industry and capitalise on the opportunity to generate a profit.
While anyone can start an eCommerce business, knowing how to do eCommerce successfully is key to making a good return on your investment. There are many factors to consider if you’re thinking about launching an eCommerce business, such as what you’ll sell, who your audience is and what your overheads will be.
Fortunately, knowing how to set eCommerce KPIs and engage in effective eCommerce marketing can help you to maximise the success of your enterprise.
Key performance indicators (KPIs) are a measure of performance, and they can provide you with extremely useful information, particularly when you’re running an eCommerce marketing campaign. Although KPIs can be used for a variety of activities, including long-term company performance, they are routinely used to measure the success of marketing campaigns.
When you’re running an email marketing campaign, your open rate and click-through-rate (CTR) are key metrics that should be integrated into your KPIs. By setting an open rate KPI of 30% within two days of the email being sent, for example, you can gauge how well your campaign is performing against your goals.
eCommerce KPIs are simply key performance indicators that are well-suited to eCommerce marketing campaigns or online selling in general. These can include:
While these are a small sample of eCommerce KPIs, there are many more than can be utilised to enhance your company’s performance. Although it may be tempting to use numerous KPIs, be sure to select a manageable number that you’ll be able to track accurately and, crucially, that you’ll be able to use to optimise performance.
When you’re setting KPIs, first consider the purpose or goal of your overall activity. When you’re selling goods online, for example, you may use pay-per-click (PPC) advertising to drive targeted traffic to your website. If so, relevant KPIs may include:
However, simply monitoring these metrics isn’t the same as setting KPIs. To actually set KPIs, you’ll need to look at your baseline performance alongside average KPIs for your industry to set custom goals that are both measurable and realistic. Then, you can determine what your short and long-term KPIs really are.
Once you’ve decided on your KPIs, you’ll need to know how to measure them if you want to make use of the data you’re gathering. Fortunately, many platforms have built-in tools to collate analytics, which can be extremely helpful when you’re measuring metrics and KPIs.
When you use Google Ads for PPC campaigns, for example, key metrics are automatically generated. You can view this data in the platform or export it so that it can be compared to your KPIs. In addition to this, there are a variety of software tools that can be used to collate data from a variety of sources to provide granular insights across a campaign.
KPIs can and should be utilised every time you run a marketing campaign, but this isn’t the only time that eCommerce companies can benefit from setting and measuring KPIs. In fact, you can use KPIs across every aspect of your business to generate measurable insights into performance. What’s more – using KPIs in this way will give you the data you need to make actionable changes that enable you to reach your long-term commercial objectives.
Setting and measuring KPIs can be extremely valuable for eCommerce businesses, providing you use the information in the right way. Although KPIs can be informative, it’s vital to use the insights they offer to optimise campaign performance.
As key metrics can be measured in real-time, you can use short-term KPIs to optimise campaign while they are on-going. This gives you an opportunity to increase the campaign ROI, rather than waiting for the campaign to end to analyse its metrics.
Similarly, the KPIs and metrics used for a single campaign can be used to enhance future campaign, thus enabling you to consistently optimise performance and increase revenue.
From choosing the right KPIs and setting up reliable tracking systems to launching, managing and optimising campaigns – creating a successful eCommerce marketing strategy can be more difficult than it seems.
At Smarter Media, our range of expertise and experience empowers us to deliver optimal eCommerce marketing services. If you’re eager to increase sales, reach a new audience, boost conversion rates or enhance the ROI on your advertising spend, we can help you to achieve your goals.