Understanding eCommerce KPIs – What to Track and Why

Key Performance Indicators (KPIs) are metrics that help businesses measure progress, identify areas for improvement, and make informed decisions. By tracking the right KPIs, eCommerce businesses can better understand customer behaviour, optimise marketing efforts, and drive sustainable growth.

eCommerce KPIs to pay attention to:

Conversion Rate

One of the most critical KPIs is conversion rate – the percentage of website visitors who complete a desired action, such as making a purchase. A low conversion rate may indicate issues with site design, product pages, or checkout processes.

Order Value

Average Order Value (AOV) is another important metric. It reveals how much customers typically spend per transaction. Strategies like product bundling or upselling can help increase AOV and overall revenue.

Acquisition and Value

Customer Acquisition Cost (CAC) tracks how much it costs to acquire a new customer. When compared with Customer Lifetime Value (CLV) – the total revenue expected from a customer over time – it gives insight into profitability. Ideally, CLV should significantly exceed CAC.

Other Useful Metrics

Other key metrics include cart abandonment rate, which highlights potential issues in the checkout process, and return rate, which may signal problems with product quality or customer expectations.

Monitoring traffic sources also helps determine which marketing channels are most effective, whether organic search, paid ads, or social media.

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