Keeping track of your e-commerce business activity is essential when you want to spot some mistakes and make improvements. There is no “by the book” rule to generate strong sales, and most of the time, you’ll have to be flexible enough in order to adjust your marketing strategy. If you want your online store to perform at its peak, then you’ll definitely need to take into account these four must-have e-commerce store reports.
Sales conversion rate
On top of the list, we have the sales conversion rate, simply because it represents the percentage of visitors who made a purchase. Keeping track of this metric is essential, and according to Marketing Sherpa, a good conversion rate would be between 1-5%. As long as you stay in that range, you’re on your way to success. Fortunately, there are plenty of analytics tools that can analyze your conversion rate at any given time. Still, if you want to calculate it manually, you simply divide the number of people who made a purchase by the total number of visitors.
Customer lifetime value
This is a metric measuring the total amount earned from any given customer throughout their life. To provide you with a simple example, if you make $30 over six transactions from a customer throughout their life as your customer, that would mean the customer lifetime value (or CLV) is $150 (out of which you’ll need to subtract the acquisition cost). It won’t be a great deal to keep track of your CLV, given that you can find plenty of calculators online. It’s important to mention that there are three main methods to calculate this metric, so if you want to learn more on this topic (as you should), feel free to check online for more info.
Revenue by traffic source
Unfortunately, not all traffic sources will improve your online store’s sales and performance. It’s your job to monitor how each of them performs over time, and in order to do that, you can use the revenue by traffic source metric. Not all traffic is equal, so make sure you understand how much traffic comes from each source you use. If you calculate and continuously monitor this variable, it will be easier for you to save a lot of money and use it for advertising on other profitable platforms.
Customer acquisition cost
Obviously, in order to acquire a new customer, you’ll have to spend some money. Ideally, the customer acquisition cost should be less than your average order value. Keeping track of it will help you understand when you are not allocating capital efficiently enough. As a result, you’ll need to take the required actions such as improving the store for conversions (i.e., conversion optimization), optimize paid ads, or investing in other marketing channels.
Some Final Words… Do you own an online store of some kind? Then you probably know how challenging it is to keep your clients satisfied and avoid unnecessary, long, and time-consuming disputes. To learn how you can prevent those disputes, read our review of the Purchase Guard mediation platform