Nowadays, competition in eCommerce is fierce. That’s why if you want to be successful and stand out from your competitors you need to optimize your store. Having the right plugins and the best themes will help but if you want to build a strong position in the market, you’ll need more than that.
What do the most successful WooCommerce stores have in common? They’re data-driven. And you should do the same because data is what will allow you to grow. Why? Because if you don’t measure your main metrics, you don’t know what’s working and what’s not.
Even though this may sound complex, the truth is that you don’t need to optimize every single metric or Key Performance Indicator (KPI) for your site but focus on the main ones. So how do you know which metrics you should monitor? Although this may change depending on your website and industry, some key metrics are good indicators of how your eCommerce is performing. Today we’ll have a look at the 7 WooCommerce metrics that you should be tracking in your store.
7 WooCommerce metrics that you should be tracking
1. Conversion rate
Conversion rate is one of the most important metrics in eCommerce. It’s the percentage of visitors that purchase in your store. This means that if you receive 100 visitors and 6 of them purchase from you, your conversion rate is 6% (6 divided by 100).
Conversion rates vary depending on the industry but in most eCommerce sites it’s usually between 2% and 3%.
The overall conversion rate is a good performance indicator but to make the most of it, you can break it down into more specific metrics. You could analyze conversion by traffic source, device, product, and so on to understand some of the following:
Do users that come from Google convert better or worse than referrals?
Do mobile customers convert as much as desktop users?
Does my Product A convert more or less than my Product B?
If you want to go one step even further to understand the whole user funnel, you could also monitor the percentage of visitors that give you their details. And then what percentage of those end up buying.
This type of segmentation will allow you to fully understand what’s working and what’s not working in your WooCommerce store so you can adjust what’s needed.
2. Average Order Value
The Average Order Value (AOV) indicates the average revenue that each order generates. This is the sum of the value of all the orders divided by the number of orders you received during that period.
The AOV is a key element to determine your CLTV and it’s one of the most important elements for growth in eCommerce.
3. Customer Life Time Value (CLTV)
The Customer Life Time Value (CLTV) is another key metric that every online store should track. It’s the revenue that a customer will generate during their lifetime as a customer.
Let’s say your average order value is $50 and that every customer purchases from you an average of 10 times. This means that the CLTV is $500, this is $50 x 10.
It’s important to analyze CLTV because it’ll give you an indication of how much you can spend to acquire and retain a user. CLTV is closely related tocustomer loyalty so the more users come back and buy from you, the higher CLTV you’ll have.
4. Customer Acquisition Cost (CAC)
Customer Acquisition Cost (CAC) is another key metric you should track if you want to be successful. CAC represents all the costs of gaining a customer. It includes all the marketing and sales expenses associated with converting a visitor into a client.
It’s important to note that CAC and CLTV should be tracked closely. If your CAC is greater than your CLTV it means that for every customer you get, you lose money.
Shopping cart abandonment is the percentage of users that add an item to their cart but then leave the store without buying anything. Shockingly, this affects more than 75% of shoppers so you must work to reduce cart abandonment as much as possible.
As you can imagine, this has a huge impact on conversion rates. That’s why you should improve the checkout process and make the most of each visitor that comes to your store.
6. Net Promoter Score (NPS)
Nowadays, online users are bombarded with ads so word-to-mouth has become more and more important. That’s why the Net Promoter Score (NPS) is a crucial metric that you should track.
The NPS is an index that indicates your shoppers’ satisfaction with your business. It measures how likely are customers to recommend your store to their friends and family and it ranges from -100 to +100. Depending on users’ responses, it classifies them into promoters, passives, and detractors.
But what’s a good NPS? Any negative score means that there’s room for improvement while a positive one is considered ok. However, as a general rule, an NPS between 30 and 49 is considered good, from 50 to 69 is excellent, and 70 and above is world-class.
Please keep in mind that these are standards. You should check your industry average to know where you stand. According to Satmetrix, the average score for eCommerce stores is 45 (while the overall average was 23).
7. Returning customer rate
The returning customer rate is often overlooked but still key to track. Websites usually put all their efforts into acquiring new users but they usually forget that selling to an existing client is easier and cheaper than selling to a new one.
Returning customer rate is the percentage of shoppers that purchase from your store again and again over the total. And why is it so important? Because not only does it help you measure customer loyalty but also improve your CLTV.
It’s true that there are many other metrics that you could measure. The traffic that comes to your site, bounce rate or time on site are just a few examples. However, tracking these 7 on a weekly/monthly basis is a great start and will give you a good overview of your business’ performance. This will help you identify what’s working and what’s not working in your WooCommerce store to help you grow.
It’s worth noting that before you start tracking your main metrics, you need to define those KPIs you’re going to focus on and set goals for each of them. This will allow you to have a benchmark for each metric that will help you understand the actual performance.
What other metrics are you analyzing? Please share your experiences with us in the comments below!