Google Analytics: 10 KPIs for your Ecommerce website
Do you want to increase sales and revenue on your eCommerce website? Focusing only on these two metrics will not be enough to understand how your website works. As an e-retailer, it is necessary to set goals and monitor them through suited Key Performance Indicator (KPIs).
For several months now, I have had the opportunity of working as a Web Analyst for an eCommerce website. In order to analyze the daily performance of our website and optimize our marketing strategies, we track different KPIs using Google Analytics. Free and very easy to use, it is a great tool to monitor the efficiency of your website.
In this article, I will explain the ten eCommerce metrics that, from my own experience, you need to track on Google Analytics and relay the advice that I have received. This list will be separated into the three stages of the website customer journey: Audience and Acquisition — Behaviour — Conversion.
Let’s start with the audience and acquisition KPIs that will help you get to know your visitors better.
Acquisition channels
The acquisition channels are the first Key Performance Indicator to take into account since it will allow you to understand the sources of traffic, or in other words, where your visitors and potential customers come from. Do they come from social networks? Have they clicked on an advertisement? Have they done an organic search? How many of them have clicked on an email newsletter? You will then be able to measure and compare the efficiency of these different channels and therefore adjust your acquisition budget.
Most common keywords
The most common keywords are the keywords entered in the search engines by the users in order to get to your website. Knowing these keywords would notably improve two acquisition channels: SEO and SEA. For SEO, the knowledge of the natural keywords entered will help improve your organic search ranking and thus obtain better visibility. For SEA, a good understanding of your keywords will help you to know which product to place your advertising campaigns (Search ads, Google shopping, etc.).
Device types
In terms of audience, the main indicator to monitor is the type of device. Knowing the device used by your visitors will allow you to adapt your website to each of media used (i.e. using the responsive design method). Usage patterns change quickly, so following new trends is highly recommended to improve your performance. In particular, we are noticing that the use of mobile phones is growing, unlike tablets or computers. The different mobile uses are also to be taken into consideration in eCommerce: a user on a mobile website and a user on an application will probably not have the same navigation path.
Once your audience has been analysed, you should follow the behaviour of your internet users on your website.
Bounce rate
The bounce rate is the percentage of visits for which the number of page views is equal to one. In other words, visits during which Internet users leave your site after seeing only one page. A low bounce rate means that most users are browsing through your site, they have seen more than one page. Conversely, a high bounce rate can have several meanings: an unpleasant design, poor accessibility, or users immediately find the information they were looking for. This is a KPI to watch very closely because Google takes it into account when ranking your website on certain keywords.
New visitors / Returning visitors
Identifying new and returning visitors is very helpful since these two types of users often behave differently on websites. The relationship new and returning visitors have to a website is influenced by several factors: the industry, the marketing channel responsible for the initial first contact, the user’s intention, and many more. A large number of returning visitors means that your content is rather interesting and engaging. A large number of new visitors means that your online brand and acquisition strategy is working well. This metric is tracked by Google Analytics through cookies.
Customer Lifetime Value (CLV)
Customer lifetime value (CLV) is the projected revenue that an average customer would spend on your store during their lifetime. This is a crucial KPI to assess whether your customers are earning more for you than you have spent to acquire them. For instance, if you spend €100 to acquire a customer, you will have to ensure that this amount is paid back by the customer through his spending over the course of the next year. Calculating CLV will help you make decisions in your acquisition strategy.
Pageviews
As its name suggests, page views refer to the pages viewed by visitors during their visit. Identifying which pages are most and least viewed will help you understand your visitors’ expectations and preferences. In the same report, you can also check the frequency and time spent on these pages. Cross-referencing metrics on the same page can be greatly valuable to distinguish new trends.
Let’s finish with conversion KPIs, used to monitor the business performance of your e-commerce site.
Shopping Cart Abandonment Rate
The final KPI to keep in mind is the shopping cart abandonment rate. On an eCommerce site, this refers to visitors who have added a product to their shopping cart but have left the site without completing the purchase. It is a relevant indicator that should not be overlooked. They are numerous reasons for shopping cart abandonment: unexpected delivery costs, an error page (404, 500, etc.), a complex process checkout, or a too high price. Therefore, it is important to continuously monitor the order funnel to avoid these issues. This rate is usually very high: according to the Baymard Institute, the average abandonment rate on eCommerce websites is close to 70%.
Products purchased
The products purchased are also a metric to be considered. Knowing the different products purchased is essential to understand the needs of our customers. On an eCommerce site, this indicator is very useful to track which products are liked and disliked, and therefore highlight them either on our site or on search engines, via ads. It is also valuable to set up recommendation systems and to suggest to your customers products that resemble the ones they are interested in, or are often purchased together.
Conversion rate
The conversion rate refers to the percentage of your visitors who take an action on your website. It should be considered according to the conversion goals you have previously set in Google Analytics. On an eCommerce site, making a purchase is often the desired action. By monitoring a conversion rate, you will know if your final goal is achieved. For that reason, it is very useful to understand this rate and know if your different pages encourage action or they do not. A page with high traffic but a very low conversion rate will need to be improved in order to increase conversions. The average conversion rate of online buyers is around 3%.
About this article
This article has been written by a student on the Grenoble Ecole de Management’s Advanced Masters in Digital Business Strategy. As part of a content creation assignment, students are given the task of writing articles based on their digital interests and disseminate the articles online. Articles are marked but we make minimal changes to the content. Thanks for reading! James Barisic, Programme Director, MS DBS.
