The significant growth witnessed by the E-commerce industry in the recent past is expected to continue in 2017 and beyond. The ecommerce economy has opened doors of endless opportunities for businesses and enabled them to reach out to a wider audience. Therefore, more and more people are combining their traditional business with the digital commerce technology and improving their business bottom line. Consequently, there has been rise in the number of outsourcing e-commerce development agencies too.
Now that you own an e-store, you must find out how profitable it is. Here we are considering following three metrics:
Conversion rate, in brief, is the percentage of your site visitors that complete a transaction and it is often very low. While so many people visit your site, only 2-3 percent of visitors end up making a purchase and rest just leave without buying anything. There could be many reasons including:
- Technical issues
- Dissatisfied with the shipping options or cost
- Unable to find the desired product
- Inadequate product information
- Not feeling secure to share personal details
Since conversion rate is an obvious metric to determine the success of your e-store, you must find out solutions for the aforementioned factors. Choosing the right platform and a proficient ecommerce development specialist can also play a decisive role in the success of your e-store by reducing technical issues.
Customer acquisition cost (CAC)
The CAC metric is important for your ecommerce company as you can determine the profitability of your business by calculating the difference between how much money you can extract from your customers and the costs (CAC) of extracting it. This metric has been growing in use as today companies can engage their customers in highly targeted campaigns and track them via analytics tool as they progress from interested leads to loyal customers.
Being an online shop owner you understand how difficult it is to attract customers to your e-store. And you would definitely want them to return to your web shop again and again. If you could provide your shoppers an interactive and pleasant experience with persuasive product descriptions, informative images, preferred payment options and seamless checkout process then you can retain your customers and build a loyal customer base.
Customer loyalty can be measured by customer lifetime value (CLV), which is basically a measure of CAC against value of purchases made by customers during their course of relationship, minus customer retention costs.
You can make the most of your web presence by taking the right approach and measuring your level of success at regular intervals. We have focused on 3 different methods of measurement, viz. conversion rate, customer acquisition cost and customer loyalty. Which metrics would you like to consider for measuring your online store’s success? We are very excited to know!