Why e-commerce KPI should be outward driven and not inward?

To identify the metrics that help your online business grow is the key to improve your business and marketing decisions. Measuring those KPIs (Key Performance Indicators) can track your progress and help you reassure you are proceeding in the right direction. This is the reason why most successful e-commerce businesses are metrics obsessed and they regularly monitor the website. These metrics must be outward bound and not inward bound. By saying outward bound i mean being customer-centric that are decided by factors outside your organization and not inside your organization.

Firstly, for selecting the right e-commerce KPIs, you have to define the right questions. These right questions are based on a few factors like how many are outward bound and how can you capture these. The answers to these questions will help you discover the metrics that make the most sense for your business and its specific goals.

Basic e-commerce KPI metrics to focus on

Recognizing outward driven KPIs that are customer-centric is an advantageous approach for your business. If you can identify, track and measure the right KPIs, this can enhance your business and marketing choices phenomenally. Here is a summary of important metrics to consider that can help you grow your online business:

New Customer Acquisition
Customer Lifetime Value
Visits
Unique visitors
Conversion rate
Orders
Time on website
Bounce rate
Traffic sources
Customer attrition
New customer acquisition
Cost per acquisition
Shopping Cart Abandonment

Making decisions for your e-commerce business must be based on certain strong and reliable indicators. Using these metrics to build a loyal customer base can support you in creating effective marketing campaigns and more importantly to drive sales. They are fundamental to your business development. They give clarity about what is working, what isn’t, and the rate of development for your e-commerce business. More importantly, if optimized, these metrics can fetch positive outcomes from time to time. In the next blog we shall delve deeper into various KPIs offered by Magento and shall look deeper into the aspects of how each KPI addresses a problem.

Why e-commerce KPI should be outward driven and not inward?

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