What Are the Most Important eCommerce KPIs in 2024?

Everyone knows (or should know) what a conversion rate is and how important it is to track for eCommerce businesses. That's a given.

In reality, conversion rates are just one of the many eCommerce KPIs you need to track in 2024.

In this post, we'll learn what eCommerce KPIs are, the top 20 KPIs you need to track, and how to analyze them all in one place.

It's a lot to cover, so let's get right to it!

What is a KPI in eCommerce?

A Key Performance Indicator, or KPI, is a way to track how your business is doing in a specific area. It's a metric that helps you measure your progress and see if you're hitting your targets.

KPIs can be used to track all sorts of things, from sales and marketing to operations and customer engagement. They're designed to give you a quick and easy way to see how you're doing in a certain area, so you can make adjustments as needed.

In the context of eCommerce, KPIs are used to track and evaluate the performance of an online store, such as its sales, traffic, and customer engagement.

One of the best things about KPIs is that they're highly customizable. You can make them specific to your business and what you want to track. You can set goals and targets and then use KPIs to see if you're on track to hit those goals.

The most important thing is to make sure your KPIs are meaningful and relevant to your business. You want them to be a good reflection of what you're trying to achieve. And, of course, they need to be measurable. If you can't accurately measure a KPI, it's not going to be much help to you.

Before we dive into KPIs to track, you should start thinking about the goals you have for your eCommerce store. If you're unsure how to set realistic goals, the SMART method is a great place to begin.

The term SMART means that your goals are specific, measurable, attainable, relevant, and time-bound.

Let's break it down:

• Specific: Your goal should be clear and specific so you know exactly what you're working towards. For example, instead of saying, "I want to make more money," you might say, "I want to increase my monthly sales by $10,000."
• Measurable: Your goal should be something you can track and measure. That way, you'll be able to see your progress and make sure you're on the right path. For example, you could track your monthly revenue to see if you're on pace to hit your $10,000 target. This is where the KPIs come in.
• Attainable: Your goal should be something that you can realistically achieve. It should stretch you but not be so far out of reach that it's impossible. For example, if your current monthly revenue is $50, a goal of $10,000 in 1 week might be a bit unrealistic.
• Relevant: Your goal should fit into your overall business plan.
• Time-bound: Your goal should have a deadline so you have a clear endpoint in sight. This helps you stay motivated and focused and makes sure you don't let your goal drift indefinitely. For example, you might set a deadline of 6 months to reach your $10,000 income target.

Once you have a goal in mind, you can then find KPIs that will help ensure you're on track to meet it.

Why is tracking KPIs so crucial?

As we explained above, tracking KPIs is an incredibly important part of running an eCommerce store because it helps you see how your business is doing and what's working (and what's not).

If all that wasn't enough to convince you, there are several other reasons why it's mission-critical:

Keeping your business plans on track: If you're not looking at the data, you can easily fall short of even the best-laid business plans. If you're tracking your website traffic and you notice it's been slipping, you might need to change your marketing strategy to get more visitors and help fill your funnel.

Identifying areas for improvement: Tracking KPIs can help you see where you're strong and where you need to improve. If you're tracking your customer satisfaction score and you notice it's lower than you'd like, you might need to work on improving your customer service. 

(P.S we also have a fantastic guide on eCommerce ad strategies if you’re in need of a tune-up)

Ensuring you're making data-driven decisions: While there is a place for gut instincts in business, continually making decisions without any basis is bound to land you in trouble. Instead of guessing, you can use the data from your KPIs to make smart choices for your business.

Giving you a way to measure progress: If you're trying to lose weight, you probably want to measure yourself every so often to see if you're progressing with your plans. The concept is the same for businesses and KPIs.

Helping you stay focused: With so many facets to running an eCom store, it's easy to get sidetracked. Tracking KPIs helps you stay motivated and keeps you from getting derailed with vanity metrics (i.e., metrics that look 'good' but ultimately don't affect your bottom line).

Making it easier to communicate with others: When you monitor these data points, you have a clear and simple way to communicate your results to others. For example, if you're trying to get additional funding for a marketing campaign, being able to show solid numbers and data on your ROI can be a more persuasive argument than what numbers you think you can achieve.

In summary, tracking KPIs helps you stay on target, identify areas for improvement, make data-driven decisions, measure progress, stay focused, and communicate with others in your organization.

Suffice it to say, if you're not already tracking KPIs, now's the time to start!

What kinds of KPIs exist in eCommerce?

The exact KPIs you use for your eCommerce business can vastly vary depending on your department, job title, and goals. However, there are some very common KPIs that you'll see in a traditional eCommerce organization.

Even if your role is only involved with the marketing/sales side of things (more on those in a second), it's important to familiarize yourself with the following eCommerce metrics of other positions as they have a big impact on your messaging and marketing strategy.

Customer service/customer success KPIs

Customer service is a critical component of any business—after all, if you don't have any customers due to poor support, chances are you may not be in business much longer anyway 😅

• First Contact Resolution (FCR) Rate. FCR measures the percentage of customer service interactions that are resolved during the first contact with the customer. A high FCR rate indicates that customers are getting their issues resolved quickly and efficiently (which everyone loves).
• Customer Satisfaction (CSAT) Score. Your CSAT score measures how satisfied customers are with the service they receive. A high CSAT score indicates that customers are happy with the service they receive, while a low score can indicate areas for improvement.
• Average Handling Time (AHT). AHT refers to the average amount of time it takes for a customer service rep to handle a customer's request from start to finish. A low AHT indicates that customers are getting quick and efficient service, while a high AHT may indicate a need for process improvement, employee training, or additional staffing.
• Net Promoter Score (NPS). NPS dives into the almighty customer loyalty side of the business and is based on the question, "How likely are you to recommend our company to others?" A high NPS indicates that customers are happy with the service they received and are more likely to recommend the company to others, especially on social media. This is integral for turning your customers into repeat customers and brand advocates.

eCommerce store management KPIs

Just like with brick-and-mortar stores, you'll also find store managers for eCommerce businesses. Typically an eCommerce store manager's job (or online retailer’s job) is to oversee all the sales activity happening on the retail side of the brand.

While the KPI list for this position is incredibly long, there are a few big metrics that deserve a shoutout.

• Conversion Rate. As a marketer, you should be pretty familiar with this term as it relates to your own campaigns. In this context, we're talking about the number of visitors that view the website and make a purchase. A high conversion rate indicates that your website is effective at converting visitors into customers.
• Average Order Value (AOV). AOV is a heavy hitter in eCommerce metrics. It represents the average amount of money spent by a customer in a single transaction. A high AOV can indicate that customers are purchasing more items (add-ons, etc.) or higher-priced items.
• Gross Merchandise Value (GMV). This KPI measures the total value of all products sold on your website, excluding any returns or cancellations. GMV is an important metric for evaluating the overall performance of your eCommerce store.
• Shopping Cart Abandonment Rate. Abandoned shopping carts are one of the major pitfalls for any eCommerce company, with nearly 70% of carts being abandoned on average, making it one of the most important things to track. This metric refers to the percentage of customers who add items to their shopping cart but do not complete the purchase. A high shopping cart abandonment rate can indicate a problem with your checkout process, shipping or handling fees, lack of trust in giving you payment information, or too many form fields to fill (among other things).
• Customer Lifetime Value (CLV). Any good eCommerce store manager should have this metric in their toolbelt. CLV is the total amount of revenue a customer will generate for your store over their lifetime. A high CLV indicates that customers are loyal and are making repeat purchases, which is important for the long-term success of your eCommerce store.

Now that we're familiar with the types of KPIs that exist in other roles at eCommerce organizations, we can cover how to pick the right ones for marketing and sales departments.

How to choose the right eCommerce KPIs for your business

In reality, there are as many metrics in an eCommerce business as there are pieces of grass in a hay bale. (That might be an overstatement, but surely you can forgive a writer for her gross use of similes)

That being said, choosing the right one for you isn't as difficult as it may seem. Here is my personal playbook for choosing the right KPI:

1. Identify your business goals with the SMART method above. Start by defining what you want to achieve with your eCommerce store. This could be increasing sales, improving customer engagement, or reducing costs, among others. Once you have identified your goals, you can choose KPIs that align with these goals and help you measure your progress toward achieving them.
2. Look at industry benchmarks. It's difficult to know what you should be looking at, especially if you're just starting out and learning this for the first time. If you find yourself in this situation, reviewing the KPIs used by other successful eCommerce businesses in your industry can be a great starting point.
3. Take a high-level view of your current business analytics. When you're sick, the doctor will always ask what pain you're experiencing and where it hurts. The same can be said for trying to find the right KPIs for your business.
   For example, if your 'pain' is revenue-related, you'll want to take a look at your sales and website traffic data. If you find that your website traffic is made up of mostly mobile users, and your mobile conversion rates are low, you would want to add mobile conversion rate to your list of top-priority KPIs.
4. Make sure your goals are trackable. Once you've figured out what KPIs you need to use, you then have to be able to find accurate data to measure them. If you don't have the data required to track a particular KPI, you may need to invest in tools to collect and analyze it.
5. Prioritize your KPIs. Choose a limited number of KPIs to focus on, as too many KPIs can be overwhelming and make it difficult to track progress and make meaningful improvements.

How often should you monitor your eCommerce KPIs?

Once you have chosen your KPIs, it's important to regularly track and analyze them to see how your business is performing.

That being said, how often you monitor your eCommerce KPIs will depend on several factors, including the size of your business, the complexity of your eCommerce operations, and the nature of the KPIs you are tracking.

Here are some general guidelines for monitoring eCommerce KPIs:

Daily monitoring: For things like website traffic, sales, and conversion rates, daily monitoring is appropriate. This allows you to quickly identify trends and respond to any changes in performance.

Weekly monitoring: Metrics like return on ad spend (ROAS) and average order value (AOV) would typically fall into the weekly monitoring bucket.

Monthly monitoring: For KPIs that take longer to impact, such as customer acquisition cost (CAC) or customer lifetime value (CLV), monthly monitoring may be sufficient. This allows you to see the bigger picture and track progress over time.

That being said, the answer can be completely different from marketer to marketer. In fact, some of you reading this may hold different opinions than the ones posted above. In my opinion, those directly connected to revenue need to be monitored very closely (especially as it relates to paid advertisement).

The top 20 eCommerce KPIs you must track

We've learned a lot in this article, but we're not done just yet.

If you're still unsure of what eCommerce KPIs to track, I've compiled this master list of all the general KPIs that you need to track in 2024.

Without further ado, here we go!

1. Website Traffic: The number of visitors to your website over a given period of time.
2. Bounce Rate: The percentage of website visitors who leave your site after only viewing one page.
3. Traffic Sources: The breakdown of where your website traffic is coming from, such as organic searches, referral sites, and paid traffic.
4. Product Views: The number of times a product page is viewed.
5. Product Add to Cart: The number of times a product is added to a shopping cart.
6. Conversion Rate: The percentage of website visitors who take a desired action, such as making a purchase or filling out a form.
7. Mobile Conversion Rate: The percentage of mobile users who take a desired action on your website.
8. Revenue: Total sales generated by your eCommerce store.
9. Average Order Value (AOV): The average amount spent per order, calculated by dividing the total revenue by the number of orders.
10. Customer Acquisition Cost (CAC): The cost of acquiring a new customer, including advertising, marketing, and sales expenses.
11. Customer Lifetime Value (CLV): The total value a customer will bring to your business over the course of their relationship with you, calculated by multiplying the average value per transaction by the number of transactions over the lifetime of the customer.
12. Cart Abandonment Rate: The percentage of website visitors who add items to their cart but do not complete the checkout process.
13. Return on Ad Spend (ROAS): The return on investment for your marketing and advertising campaigns, calculated by dividing the revenue generated by the cost of the campaign.
14. Gross Margin: The difference between your revenue and the cost of goods sold, calculated as a percentage of revenue.
15. Cost per Click (CPC): The average cost per click for an online advertising campaign.
16. Cost per Purchase (CPP): The total cost that went into generating a single purchase.
17. Total Ad Spend: The total amount of money spent across all your advertising channels.
18. Repeat Purchase Rate: The percentage of customers who make more than one purchase from your store.
19. Marketing Efficiency Ratio (MER): The overall outcome of your marketing efforts, calculated as total revenue divided by total ad spend. This is also known as a blended ROAS.
20. Net Profit: The amount of revenue earned after all costs (advertising, product costs, shipping, etc.) have been paid.

How to track all your KPIs in one place

Since we've gone through all the trouble of finding out which KPIs we need to track, it would be pointless if we didn't follow through and actually take a look at those numbers.

What you might find when you do this, however, is that your data is scattered around multiple platforms, each with its own terminology, attribution, and reporting tools.

If this sounds (and feels) like a migraine waiting to happen, you'd be right.

At Madgicx, we know a thing or two about KPIs and how difficult it can be to track them all in one place. Thus, we created One-Click Report—your one-stop eCommerce KPI dashboard.

This innovative tool was created to streamline the analysis and optimization of your Facebook, Google, and TikTok ad data, Shopify store performance, and Google Analytics, all in one place. With One-Click Report, you can quickly and effectively adjust your marketing campaigns in real time, avoiding the typical delays and financial losses that come with a lengthy analytics process.

One-Click Report comes with 11 pre-made templates that cater to all your Meta, Google Ads, TikTok, website, and Shopify analytics needs, and these templates can be easily shared with others, including clients who do not have access to your Madgicx account. The report builder allows for customization through simple drag-and-drop options and even allows you to build reports from scratch if you want full control.

What's more, One-Click Report offers excellent value for money, starting at just $29 a month for 5 reports, and you can try it out with a 7-day free trial.

Conclusion

Today we've learned what KPIs are, what sort of eCommerce KPIs you'll find in a typical organization, listed the top ones you need to track, AND have given you a tool to do just that - One-Click Report.

With this knowledge in hand, you're now ready to find, create, monitor, and improve your own eCommerce KPIs in no time.