Top 5 Omnichannel KPIs for Retail
Implementing an Omnichannel strategy means you have a huge load of data. Hence, you need to update the KPIs (Key Performance Indicators) to measure the omnichannel performance and its progress towards your objectives.
Al Sambar from Managing Partner Retail and Consumer Group suggests the following flow and relevant KPIs.
Awareness:
Typical Omnichannel KPIs for this stage are traffic generator and visit rate.
Traffic generator records the numbers of unique visitors to a website, store, social channel, and so on.
Visit rate, on the other hand, calculates how many times one unique visitor views those channels in a period of time.
At the age of multi-channel approach, these key performance indicators are recorded separately.
However, with omnichannel retailing, store owner demands to know the behavior when a customer visits and revisits touch points before she or he makes another action.
Engagement:
There are many key performance indicators that can demonstrate how successful a customer engagement strategy is.
As recommended by Al Sambar, some KPIs worth applying are: Product recommendations and offers per visit; Conversion rate on product recommendations; and Length of visit.
First, to attract customers to not only one, but many items in the catalog, suggestions are widely used in today’s ecommerce. Length of visit is another simple indicator to reflect the level of involvement a customer expresses to a channel.
It shows how suitable and customized the content is to each individual shopper.
One important feature of this indicator is that it can show the conversion rate from a channel to another one. For example, a customer received a discount code for a nice dress after finishing a purchase in a webstore.
However, she doesn’t buy it immediately but goes to the nearby store to check if it fits her body.
If the retailer in this situation is operating multi-channel strategy, that girl will be a completely new customer when going to try the dress on.
Conversely, an omnichannel retailer can identify that customer, based on her account. In this situation, conversation rate among channels is well performed.
Conversion:
Some typical omnichannel KPIs to measure the success of this stage are: Cross-channel conversion rate; Cross-channel basket size.
Conversion rate from visitors to customers is the most common and consistent indicator for any e-commerce business.
However, in omnichannel marketing, the focus point is on “cross-channel”.
With this business model, omnichannel retailers can track what is the real contributors for final purchasing decisions and the pattern of their habit.
Loyalty:
Advocacy is a KPI showing the satisfaction of customers.
This can be scored through ratings of customers via many channels.
Lifetime customer value (LTV) is another indicator, showing the total revenue of a customer in his “life time”.
To simplify, this key performance indicator calculates the sum of all purchases that he can make.
Therefore, higher LTV means that customers re-purchase many times in his life.
While Lifetime value of customers can indicate the loyalty of one customer, customer retention rate is a KPI showing generally the loyalty of all customers. It is calculated as the ratio of remained customers after a period.
Retention Rate = ((CE-CN)/CS)) X 100
CE = number of customers at end of period
CN = number of new customers acquired during period
CS = number of customers at start of period
Retention rate is more than just a simple formula. To have an accurate retention among channels, it needs a solid omnichannel tool and process.
There are other domains of KPIs that an omnichannel business can adopt, including supply chain management, channel performance, other alternative channels, and pricing. The standard KPIs varies according to the businesses’ goals and products.
