Key KPI for ECommerce Industry
KPIs or Key performance indicators helps the industries evaluate their performance on the basis of the data collected. KPIs are really important to track because it helps highlight the problem areas within an organization and helps the companies make the required changes to improve their current condition.
E-commerce industries make use of KPIs to gauge and analyze their performance and to know where they stand in the business market. E-commerce industries are growing day by day all across the globe. There are tons of wonderful benefits that e-commerce websites offers to their consumers. But with the pros also comes the cons.
Given the new and innovative tools in the market today, the disadvantages have the potential to get easily converted into the advantages. And KPIs help the e-commerce industry enhance their overall performance and operational efficiency. So if you are wondering what are the major KPIs for the E-commerce industry then you have come to the right place.
Listed below are the important KPIs to gauge for the e-commerce industry:
Traffic plays an important role in multitude of ways. It refers to the amount of people who visit your website on a day-to-day basis. High website traffic means more number of people on your website. And the more the people, the higher are the chances of your brand getting promoted. So traffic certainly plays a huge role in boosting the growth of the e-commerce industry.
One of the main points to keep in mind is the fact that higher traffic doesn’t always guarantee higher purchases. But it definitely guarantees some purchases being made through your e-commerce website. And this happens because if your website has the potential to attract attention then all this attention certainly has many advantages with it like website recommendations by your website visitors to their friends who later visit your website, also known as referral traffic, which adds to the overall popularity of your brand. There are a lot of different tools that helps the e-commerce industry analyze the traffic. Google analytics being one of the most popular tools to analyze and evaluate the website traffic. Hence, measuring the traffic is central for the maintaining the overall productivity for the e-commerce industry.
2. Conversion Rate
Conversion rate is the rate at which a website traffic gets converted into website customers. It is no wonder that it is one of the most important metrics to gauge as it has the potential to convert the visitors into regular customers. Customers are of great value to the e-commerce industry because they transform the way an e-commerce industry performs. The aim for the e-commerce industry is higher conversion rate because higher conversion rate leads to more consumers. And more consumers means more profit. Lower conversion rates, however, indicates the e-commerce industry that even though it is able to attract the traffic, it is not able to convince them to become their consumers. And this could be a scenario for a lot of reasons. From attracting the wrong traffic to higher product rates, the low conversion rate indicates that the e-commerce industry has to really step up their game in terms of conversion rate.
A lot of different tools today helps the e-commerce industry effectively analyze their conversion rate and evaluate ways to improve this rate. A new method called conversion rate optimization or CRO, is helping e-commerce industry in enhancing their conversion rate, thereby, leading to more profit.
3. Bounce Rate
Bounce rate refers to the rate at which your website’s visitors leave your website after arriving on it. This is also one of the important metrics to calculate in an e-commerce industry.
A high bounce rate is an indication that the visitor upon arriving on your website did not find what they were looking for and hence left. It helps reveal the reasons that shows why the visitors did not find your website appealing. These reasons vary from complicated layout to wrong keywords usage. Hence, opting for effective SEO method and making your website consumer friendly leads to a huge drop in the bounce rate.
4. Cart Abandonment Rate
Cart Abandonment Rate is the scenario where the consumer puts things in their cart but when they reach the checkout process, they don’t make a purchase, thereby, “abandoning” the cart.
Google analytics is a tool that helps the e-commerce industry effectively gauge their cart abandonment rate. The cart could be abandoned midway for a variety of factors. These factors include high shipping charges, high product cost, lengthy forms and mandatory signing up process. Taking measures to get rid of these bottlenecks, e-commerce industry could have lower cart abandonment rate and high profit.
So these are some of the important KPIs for the e-commerce industry. Tracking these KPIs helps enhance the overall performance of the e-commerce industry and it also helps them succeed against their competitive rivals.