How to Enhance Business-Focused Decision-Making Through Effective Metric Tracking
Measuring an eCommerce website’s performance in today’s information-rich online marketplace is a daunting task for small to mid-sized business (SMB) owners. With so much raw data at their fingertips, many fail to extract the proverbial golden nuggets that facilitate wise decision-making.
Resist the urge to become buried in a mountain of figures and, instead, focus time and energy on some of the key performance indicators below. Using these strategies can not only help make better use of resources, but can also free up time to focus on the core qualities which make your business a success.
Skillfully Navigate the Deep Sea of Data
As the owner of a startup or SMB, you are likely inundated with excessive volumes of information each day. This never-ending stream of letters and numbers often translates to a wide range of data about the daily operation and performance of a business. Although the details it unlocks can be valuable in some form, not all of it deserves your undivided attention.
Below, we’ll lay out several key metrics business owners can hone in on to assess performance and improve decision-making.
1. How often do customers sign up for access to your mailing list?
Marketing via email is not a dead art, as many suggest. In fact, based on a recent study, email marketing accounts for nearly 60% of a business’s return on investment. How well does your company perform when placing an option to sign up for email lists in front of a user? Don’t lose sight of this all-important metric when deciding on a marketing strategy for next quarter.
2. What are your current conversion rates?
How many users visit your website each day, week or month? How many of those who visit decide to buy a product or service from you? Now divide the total visitors by the ones who make a purchase and you have a conversion rate. This critical bit of performance data deserves to be closely monitored to look for trends and develop strategies to drive the percentage higher.
3. How much do you spend to acquire a new customer?
Beyond email subscriber data and conversation rates, it is equally essential for SMBs to keep a finger on the pulse of the cost of customer acquisitions. What is the average price tag associated with bringing another customer onboard when compared to your site’s operating and advertising costs? If you’re spending more to acquire each customer than they spend per order on your site, you may quickly find yourself in a sinking boat. Keep a keen eye on this metric to balance advertising costs with revenue.
4. How often do abandoned shopping carts affect your site?
How often do users browse your site, select the items to add to a shopping cart and then decide to abandon the transaction? Although this is a common practice in today’s online retail space, it can still be a source of frustration for the owner of a startup. Don’t ignore this powerful metric, but instead use it to help make decisions about necessary adjustments to improve website performance and to develop better ways to market to your target audience.
Tie the Metrics Together to Make Informed Decisions
Tracking the data points above not only helps assess performance, but can also assist with making the best decisions possible to drive future success. For site owners specifically, these decisions often focus on when and where to push resources to deliver maximum benefits. Ecommerce site owners can harvest these vital data points to help determine the best content to reach consumers, which elements may be lacking in a website and so much more.