Key metrics for e-commerce: number of visitors, conversion and average purchase
Measuring the success factors of your ecommerce business is critical to making informed decisions and improving your business.
Three key metrics that every online retailer should track are visitor numbers, conversion rates and average purchase. These metrics can help you make small improvements and increase your store’s turnover and profitability.
The simplest formula to calculate the performance of an online shop is
number of visitors x conversion rate x average purchase
and by increasing these you increase your profit.
Page visits
Page visits is the number of people who visit your online store in a given period of time. This metric is important because it gives an overview of the visibility and attractiveness of your site. Tracking the number of visitors helps you to assess the effectiveness of your marketing campaigns and to identify when your site is getting the most traffic.
How to increase your traffic? Invest in search engine optimisation (SEO), use social media and consider paid advertising such as Google Ads or Facebook ads. Quality content and regular updates will also attract more visitors.
Conversion rate
Conversion rate measures the percentage of visitors who take the desired action, such as making a purchase, placing an order or contacting you. This metric is critical because it tells you how well your online store is doing at converting visitors into paying customers.
How to improve your conversion rate? Make sure your online store is user-friendly and mobile-optimised. Provide clear and attractive product descriptions and images, and a smooth and secure payment process. Customer reviews and testimonials can also boost trust and improve conversion rates.
Average purchase
Average Order Value (AOV) is the average amount customers spend in a single purchase transaction. This metric helps you understand your customers’ buying behaviour and find ways to increase sales.
How to increase your average purchase? Offer customers attractive additional products and services, such as product recommendations and package deals. Also consider loyalty programmes and discounts to encourage higher purchases.
Example of the impact of metrics on performance
Assume that 100 customers visit your online store per day, of which 5% make a purchase. The average purchase is €28.
The formula: number of visitors x conversion x average purchase
(100 x 0.05 x €28) gives a daily result of €140.
If all the measurable figures can be tweaked upwards a little by various marketing measures, the situation changes radically:
e.g. 120 visitors x 6% conversion and 30 average purchases would already generate €216.
Visitor numbers, conversion rates and average purchase are therefore the most important metrics for your online business, helping you to monitor and improve your business. By tracking these metrics, you can make informed decisions and optimise the success of your online store. Remember that each metric tells you your own story