What are some important ecommerce metrics to know and consider?

Here are just a few metrics to consider. Tracking the correct set of metrics can depends on your business objectives, take time to consider how you will use KPIs to achieve actionable insights.

Average Order Value (AOV)

Also known as the Average Market Basket, the AOV lets you know how much your customers typically spend on one single order. The AOV will give you a better idea about how much revenue each customer is generating.

AOV =  Total Revenue / Number of orders.

Your average order value (AOV) tells you the average amount customers are spending at one time on your online store. 

Your AOV is a great metric to track because it can help you gauge revenue and make realistic goals for new customers.

For example, if your average order value is $45, and you’re looking to bring in $10,000 in sales that month, you know that you need to bring in at least 222 customers during that time period.

Gross Profit

It is an important ecommerce KPI and helps entrepreneurs to plan ahead. It shows you the amount of profit after subtracting the costs of production and distribution.

Gross Profit = Total Cost of Goods Sold Total amount of sales.

Conversion Rate (CR)

CR is the percentage that identifies at what rate people are purchasing your products. If your conversion rate is low, you need to optimize your website.

Conversion Rate = (Total Number of Visitors on the Website / Total Number of Conversions) x 100

While we’re not ranking these in any particular order, we’ll still say that your conversion rate will be one of the most important metrics to pay attention to. Nearly 40% of ecommerce marketers polled by Databox cited conversion rate as the most important ecommerce KPI.

Your conversion rate (CR) is the number of people who made a purchase out of the total number of people who accessed your website.

Because sometimes people will start shopping and forget or decide not to make an actual purchase, the percentage of people who add a product to their cart will be larger than those who actually click Checkout. 

And the percentage of people who reach checkout will be greater still than those who actually follow through with making the purchase.

Having the full scope of your sales funnel can help you figure out if your checkout process is causing issues. For example, if you have 25% of people adding products to their cart, but only 1% to 2% are converting, it could be due to a complex checkout process or even a bug or error that’s causing issues.

Your conversion rate should remain steady, or at least increase over time. If you’re seeing major drops, it could be a good time to investigate to make sure your website is still working properly.

And if you’re wondering what makes a good conversion rate, Unbounce’s Conversion Benchmark Report 2021 discovered that the average ecommerce conversion rate is around 5.2%.

Shopping Cart Abandonment Rate (CAR)

This ecommerce KPI tells you how many visitors are adding products to the shopping cart but are not checking out or purchasing them. Reduce friction in the checkout process to improve your overall shopping cart abandonment rate.

CAR = 1 (Total Number of Completed Transactions / Total Number of Shopping Carts) x 100

No matter how high your conversion rate or how sought after your products are, there will be some consumers who simply don’t complete their purchase. This is called shopping cart abandonment—it’s when a customer adds a product to their online shopping cart but they don’t complete the entire checkout process, essentially abandoning those items.

While sad, it’s still an expected part of ecommerce. But you still want to keep an eye on your overall shopping cart abandonment rate because it can let you know of potential problems with checkout.

The average rate depends on the type of device someone was using to access your online store, but it actually falls between 69.75% and 85.65%.

So don’t be worried if you have a high shopping cart abandonment rate. It’s time to start investigating for potential issues, though, if your rate falls between 95% and 100%, as this means there could be errors in the checkout process that are keeping people from completing their purchases.

Shopping Cart Conversion Rate (CCR)

This ecommerce KPI measures how many visitors actually complete the checkout process by purchasing the products.

CCR = (Total Conversions / Total Number of Visitors) x 100

Cost of Goods Sold (COGS)

It’s the amount you’re spending to sell your product. For example, manufacturing costs, employee wages, overhead costs, and all other costs directly associated with distribution and production.

COGS = Beginning Inventory Costs (of the year) + Additional Inventory Costs (purchased during the year) – Ending Inventory (at the end of the year)

Customer Lifetime Value (CLTV)

It tells you the worth of each customer to your business. Strengthen relationships by focusing on customer loyalty to improve this number. It will help you understand your cost per acquisition.

CLV = (Customer’s Annual Profit Contribution x Average Number of Year as Customer) – the Initial Cost of Customer Acquisition

Customer lifetime value (CLV or CLTV) is the total revenue your business could expect from a single customer throughout their lifetime (or at least the lifetime of their relationship with your business).

This number will vary based on industry and product as well. The customer lifetime value of a SaaS product that costs $25/month could be just $900 if the average customer sticks around for three years.

Whereas the customer lifetime value of a well-loved candle shop could be way more than that if customers keep coming back month after month and year after year to replenish their candle collection.

So back to our candle shop example. If the average number of $20 candles your customers tend to buy in a year is 15 and they tend to shop at your business for 10 years, you’ll multiply 20 x 15 x 10 to get a CLV of $3,000.

This isn’t an easy metric to show for most systems because it takes some analysis as the shop owner to figure out. However, it lets you know some pretty important information. You should take time to figure out your CLTV as this can help define communication strategies to build loyalty and retention programs.

For instance, knowing how much a customer is worth to your business helps you determine how much you can comfortably spend on customer acquisition and still make a profit. It can also help you pinpoint which products are most valuable to your bottom line—i.e., which products with a premium price point are popular, and how you can adjust your strategy to get more people to buy them.

Churn Rate

For an online business, the churn rate lets you know at what pace your customers are leaving your brand or canceling subscriptions.

Formula: Begin by subtracting the total number of customers remaining at the end of the month from the number of customers at the beginning of that month and divide by the total number of customers at the beginning of the month. Multiply by 100 for its percentage and further, multiply it by twelve to get the annual churn rate.

Customer Acquisition Cost (CAC)

This ecommerce KPI tells you how much you’re spending to acquire a new customer. You can measure it by analyzing your marketing spend and how it breaks down per customer. The lower your acquisition cost, the better.

CAC =  Costs Spent on Acquiring Customers / Number of Customers Acquired

Your customer acquisition costs (CAC) tell you how much it costs, on average, to get a new customer. This is another metric that you’re going to have to calculate yourself based on the marketing budget you allocate toward customer generation.

So if you spent $1,000 on a monthly ad campaign and brought in 100 new customers, your CAC would be $10 per customer.

Make sure you check in on this metric regularly to ensure it doesn’t exceed your CLV—or even get closer to it than you’re comfortable with.

If your CLV is $1,000 and you’re spending hundreds of dollars to bring even one new customer in the door, your CAC is really eating into your profits. When this is the case, you’ll need to reevaluate your customer acquisition strategy to see how you can maximize results while minimizing cost.

Repeat Purchase Rate (RPR) / Returning Customer Rate (RCR)

It tells you the number of customers that return to your website in order to make another purchase. It can help you measure customer loyalty as well as you can plan your sales strategies. A higher repeat purchase rate is generally better.

RPR = Purchases from Repeat Customers / Total Purchase

Your returning customer rate, also sometimes called repeat customer rate, is the number of customers who have made more than one purchase from your shop. 

The average ecommerce store likely sees a returning customer rate of between 20% and 30%. Anything above that means you should invest resources into expanding your customer base, and anything below means you might want to try some retargeting ads to get those past customers to come back.

Because it can cost as much as five times more to get new customers vs. returning ones, you want to make sure you’re working to get customers back in the (figurative) door just as much as finding first-time customers.

Getting repeat purchases obviously means you’re doing a great job. So if you’re struggling to improve your returning customer rate, you might want to take a look at your overall customer experience to see if there’s anything you can revamp.

Average Profit Margin

It is the percentage that represents your profit margin over a specific period of time. Ideally, you would want your average profit margin to increase as production or sales ramp up.

Average Profit Margin = Gross Profit / Revenue

Revenue per Click (RPC)

It’s simply the average revenue for each click on all of your pay-per-click campaigns. It allocates a value to every paid click.

RPC = Revenue / Total Number of Clicks

Purchase Frequency

It measures the average number of orders your customers made during a specific period of time. A great KPI to measure customer loyalty and to highlight under performing products or categories.

Purchase Frequency = Total Number of Orders / Total Number of Unique Customers

Time Between Purchases

It shows how long a customer goes before making a purchase from you again. It is a good ecommerce KPI to know as it allows you to tailor your campaigns as per their behaviors.

Time between Purchases = Purchase Frequency / 365

Inventory Turnover

Inventory turnover is an important KPI and financial ratio that ecommerce store owners can use to determine the number of times their inventory is sold throughout the course of the year. They help you see whether your business has excess inventory as compared to its overall sales levels.

Inventory turnover = Net Sales / Average Inventory at Selling Price

Holding Inventory Ratio

This ratio or ecommerce KPI can be used to determine the average cost of holding inventory before you sell it. Your holding costs usually consist of storage, labor, security, and the equipment that you use to store the inventory. In most cases, your holding costs are between 25-30% of your inventory value.

Holding Inventory ratio = Holding costs/ Average Inventory Value

Revenue Per Visitor

This is an important ecommerce metric that you can use in order to determine the average revenue you generate per visitor. For instance, if your income for the last quarter was $50,000, and you received 200,000 visitors on your ecommerce store, your revenue per visitor will be $0.25 per visitor.

Revenue per visitor = Total income / number of visitors over a specific period of time

Net Profit Margin

This is one of the most important ecommerce KPIs that measures your store’s profitability. It’s the margin of profit you generate after making all the deductions, including taxes, operational expenses, and others. Your net profit margin indicates how much money you make after all deductions.

Net profit margin = (Revenue – cost)/ revenue

Website Traffic

Your website traffic refers to the total number of people who visit your ecommerce website.

Average Session on the Website

It is the average amount of time a visitor spends on your website during his single visit.

Avg. Sessions = Total Session Duration / Total Number of Session

Pageviews per Session

It refers to the average number of website pages a visitor views during each visit. If it takes too many clicks for your visitors to find the right product, then you must revamp your design. A higher pageview per session is not good for your store.

Pageviews per Session = Total Number of Pageviews / Total Number of Visitors

Bounce Rate

This ecommerce metric tells you how many visitors leave your website after viewing only one page. Keep this number as low as possible.

Bounce Rate = Total Number of One-page Visits / Total Number of Entries to a Website

Bounce rate is a metric that anyone with any kind of website needs to pay attention to, not just ecommerce sites. Your bounce rate tells you the number of people who landed on your website and then left it again without taking any action, whether that was clicking to another page, filling out a form, checking out a product, etc.

Your bounce rate can be found under Audience > Overview in your website’s Google Analytics. Take a look at the screenshot below; you can find bounce rate in the bottom row:


An average bounce rate for an ecommerce website is between 20% and 45%, so try to keep it around that benchmark (or even lower if you can). To reduce bounce rate, make sure you have an easy-to-navigate website and an attractive design, and that people can tell what you sell immediately upon landing on your site.

Email List Growth Rate

Another one of those important ecommerce metrics which requires your keen attention. You can calculate the growth list of your email list with this metric.

Email List Growth Rate = [(Total Number of New Subscribers Total Number of Unsubscribes) / Total Subscribers ] x 100

Email Bounce Rate

It is the percentage of emails sent that were not successfully delivered to the recipient’s inbox. If your email bounce rate is high, you may want to switch to another email hosting service provider.

Email Bounce Rate = (Total Number of Emails that Bounced / Total Number of Emails Sent) x 100

Email Open Rate

It is the percentage of email recipients who open your email. This usually has to do with subject lines; come up with catchy subject lines in order to improve your open rate.

Email Open Rate = (Total Number of Unique Open / Number of Total Emails Sent Successfully) x 100

Email Click-Through Rate (CTR)

It is the percentage of email recipients who clicked on the links you provided in your email. If your email CTR is low, it’s imperative that you revisit and determine the placement of links in the email template.

CTR = (Total Number of Individuals Clicks / Total Number of Email Opens) x 100

Email Conversion Rate

It refers to the email recipients who completed a purchase by clicking through the links provided in your email campaigns. Your email conversion rate indicates the effectiveness of your marketing campaigns in terms of profitability (which is not always the goal for building email lists, by the way).

Email Conversion Rate = (Total Number of Conversions from Emails / Total Number of Emails Sent) x 100

Average CTR

It is the total click count divided by the total impression amount. It determines how well your title tags or meta descriptions drive traffic to your website.

Average CTR = Total Number of Clicks That an Ad Receives / Total Number of Impressions

Social Media Engagement

It tells you how actively your fans or followers are interacting with your brand on social media. You can measure it by the number of likes, comments, and followers.

Subscriber Growth Rate

It tells you how fast your subscriber list is growing.

Subscriber Growth Rate = [(Current Subscribers – Past Subscribers) / Past Subscribers ] x 100

Pay-Per-Click (PPC)

It shows you how much you’re spending each time anyone clicks on any of your ads. You can use this ecommerce KPI for search engines as well as for social media advertising campaigns. You can also call it Cost-Per-Click (CPC). It’s one of the most common ecommerce metrics to track.

PPC = Total Advertising Cost / Total Number of Ads Clicked

Cost Per Conversion (CPC) / Cost Per Action (CPA)

It is the money you spend to turn a visitor into a customer. This includes all advertising costs and placement expenditures. Essentially, it’s the total cost you pay for an advertisement that eventually drives a successful conversion.

CPC = Total Cost for Generating the Traffic / Total Number of Conversions

Referral Sources

It helps you identify which sources are forwarding the most visitors to your website. It may be via organic efforts, PPC ads or social media searches.

Customer Retention Rate

It is the percentage of customers from a specific time who return to your website and buy. This is one of the most important ecommerce metrics that help you figure out whether customers are returning or not.

Customer Retention Rate = [(Number of Customers at the End of a Period Total Number of New Customers during That Period) /  Total Number of Customers at the Start of That Period] x 100

Marketing Efficiency Ratio

Marketing efficiency ratio measures the high-level success of your marketing campaigns: total sales revenue divided by total marketing spend (both from the same time period). It is also known as marketing efficiency rating or blended ROAS.

But unlike ROAS, MER isn't meant to guide advertising decisions at the ad or campaign level. Instead, MER helps you understand how efficient you need to be in your marketing in order to achieve your target profitability. In short, it shows how responsible you are with spending your marketing dollars. 

Although it’s common to see a 3x MER referenced as “good” (likely a carryover of the 3x benchmark for LTV to CAC Ratio), a good MER is entirely dependent on your business size, what you’re selling, your strategy, and your profitability goals. 

In other words, it is an individualized metric. 

One business that has a 5x MER might be much less profitable than another brand with a 3x MER, and another brand could have a much lower MER while still succeeding with flying colors. 


MER = Total sales revenue (over a period of time) / Total marketing spend (over the same period of time, across all channels)

Marketing revenue attribution

This is an important ecommerce KPI that will help you track how much revenue your marketing is bringing into the company. You can categorize it to determine how much revenue each of your different marketing strategies are bringing, such as content marketing or influencer marketing.

Traffic to Lead Ratio

The traffic to lead ratio will give you better insights into how your traffic is performing. Keeping close tabs on the main sources of traffic is very important. The traffic to lead ratio will give you a better idea about pages that have the highest bounce rate, so you can make changes to those. The traffic to lead ratio will also tell you how much of your traffic is actually showing interest in your product or service.

Lead to Customer Ratio

This is fairly self-explanatory – it shows how many leads you are able to convert into customers. It’ll also help you understand the performance of your sales team.

Customer satisfaction (CSAT) Score

You can measure this significant ecommerce KPI by customer responses to your surveys. For example: “How satisfied are you with your experience?” The answer comes from a numeric scale from 1 to 5/10.

CSAT = Sum of all Scores / Total Number of Respondents

Net Promoter Score (NPS)

This KPI gives insights into your customer relationships by informing you how likely are customers to recommend your brand to someone in their circle.

NPS = % of Promoters % of Detractors.

Your net promoter score (NPS) measures overall customer loyalty and customer satisfaction. This metric is calculated by surveying your customers at checkout by asking one simple question: “On a scale of 1–10, how likely are you to recommend us to a friend or family member?”

Those responses are then broken down into three categories:

  • Promoters: Customers who gave a rating of 9–10
  • Passives: Customers who gave a rating of 7–8
  • Detractors: Customers who gave a rating of 6 or less

Obviously, the higher the score, the better. 

So if you have 80% promoters, 15% passives, and 5% detractors, you would calculate 80 - 5 to get a net promoter score of 75.

A net promoter score can range anywhere from -100 to 100, with a negative number occurring when there are more detractors than promoters. However, it’s not likely that any companies have ever had a score of 100. And, in fact, our sample score of 75 is still extremely high.

According to Inc., any score over 0 is considered “good,” scores of over 50 are considered “excellent,” and a score of more than 75 would be considered “world class.”

So if you’re seeing an NPS of around 20 or so—don’t fret. You’re still doing great. Here is a annual tracking website so you can benchmark your industry NPS

Customer Service Email Count


It refers to the number of emails your customer support team receives from your customers.

Average Complaint Resolution Time

This KPI for ecommerce is the amount of time it takes for your customer support to resolve a customer issue, starting from the point where your customer first reached out to you with a problem. These ecommerce metrics help ensure that your customer service is answering promptly.

Avg. Complaint Resolution Time = (Number of Customer Service Requests Total Number of Unresolved Request) / Total Number of Requests Received

Refund/Return Rate (RR)

If your refund or return rate is too high, it means you’re unable to fulfill customer expectations on your product pages or in your checkout process.

RR =  [(Current Value Original Value) / Original Value] x 100

Cycle Time

It identifies the manufacturing time of a single product. This ecommerce KPI allows you to improve production efficiency with valuable insights.

Yield

A straightforward ecommerce manufacturing KPI, Yield is the number of products that you’ve manufactured.

First Time Yield (FTY) & First Time Through (FTT)

FTY is also referred to as First Pass Yield. It is a quality-based ecommerce KPI which tells you how wasteful your production process is.

FTY = Divide the Total Number of Successfully Manufactured Units / Total Number of Units That Started the Process

Budget

Your budget is the amount of money you allocate for your project. You must ensure your budget is realistic. Also, there may come a few minor adjustments to your project budget as per its planning and execution.

Return on Investment (ROI)

This ecommerce KPI tells you how much your efforts have earned your online business. This KPI accounts for all of your expenses and earnings. To keep things simple, the higher this number, the better.

Cost Variance

This KPI refers to examining your total cost against your predicted cost. It helps you understand where you need to hold back and where you should invest more.

Cost Performance Index (CPI)

The CPI, like the ROI, tells you the worth of your resource investment.

Click-through rate

Your click-through rate (CTR) is the rate at which someone clicks on an email campaign, ad, social media post, etc., and lands on your website.

To calculate click-through rate, use the following formula:

CTR = (# of Clicks / # of Views/Impressions) x 100


Your email marketing platform or ad platform should offer this up in your analytics or reporting dashboard, making it easy to gauge the overall success of your digital marketing campaigns.

For Google ads, the ecommerce industry tends to see a CTR of 1.66% for search ads and 0.45% for display ads. However, for email campaigns, the CTR is more like 2.01%. (Also, ecommerce email open rates are around 15.68%.)

All in all, click-through rates are likely to be pretty low numbers. If you’re seeing a CTR of 2% or higher, you’re doing pretty well.