What is the most important thing you can do to grow your eCommerce business?
The answer is measure everything, all the things!
You might either be feeling worried because this sounds complicated, how do you measure everything?!
Or you might feel skeptical, why is measuring everything so important?!
We are going to cover the second question first.
Why is measuring everything in your eCommerce business so important?
Let’s start with why you have an online business? If there is anything you measure right now, for sure it’s your bottomline — how much money you make at the end of the day.
So of course you want more of that at the end of each day, and how can you get more revenue?
There is a simple formula to use to understand your eCommerce business performance:
Visitors x Conversion Rate x Customer Lifetime Value = Revenue
We go over this eCommerce growth formula in more details here.
Whatever it is you need to do to get more revenue, it must improve one of these metrics — there is no other way.
Okay so for sure you have to measure your visitors, conversion rate and customer lifetime value, because once you measure them you can then have a conversation about improving them.
But why measure everything else?
Because these metrics don’t work alone! Each of them is attached to other metrics that affect them.
For example, your conversion rate can be segmented into:
- Your add to cart rate
- Your checkout rate
And your add to cart rate then can be segmented into:
- Product page views
- Add to cart clicks
Your product page views will depend on:
- Number visitors
- Bounce rate
…and so on, we go more in depth in this in the eCommerce goal map tree here.
Whether you use our guide or not, if you are not measuring your eCommerce store — find a way to get it done today, because you can’t collect historical data, you can only collect from the day you start. Why not now?
