KPI’s – or Key Performance Indicators – are used to track and measure your company’s success at reaching its targets. They are measurable values which demonstrate how well your company is meeting its objectives, and monitoring them helps retailers evaluate their progress in sales, marketing and customer service.
A “performance indicator” is a measurement used to judge performance in relation to a goal which has been set. For some goals there could be more than one performance indicator – or in some cases, many – so retailers often narrow them down to just two or three, known as key performance indicators or “KPI’s”.
For example, the goal set could be to boost sales by 50% in the next year, KPI’s would then include site traffic, conversion rate and daily sales.
Organic Traffic – This is the traffic coming to your site from unpaid keyword searches. Traffic can fluctuate on a day-to-day basis, so monitoring your organic traffic weekly gives you a better representation of your traffic situation, but also allows you to make any adjustments if the numbers are not looking steadily good.
Organic goal conversion – This shows how much of your organic traffic leads to whatever goal you’re trying to reach. This could be product purchases, downloads, newsletter signups, account registrations etc.
Organic conversion rate – This will tell you the number of people visiting your website through organic traffic that convert into sales.
Keyword rankings – Keywords are an essential part of your business, so every retailer should be tracking their keyword performance. You can use Moz.com to retrieve seach engine rankings for your store, pages and keywords so you can compare and measure them to see if/how a change in your seach engine ranking affects your traffic.
Bounce rates – Find out how many people visit your site and leave immediately instead of clicking through to other pages. This is helpful for identifying whether you’re attracting the wrong type of visitors to your site, or if you’re not giving your visitors what the want when they reach you.
You should track your sales on an hourly, daily, weekly, monthly, quarterly and annual basis to ensure that you have a good idea of your performance over time and can adjust your strategy accordingly before it’s too late.
Average size of customer orders – how many items they are buying, how much they are spending.
Conversion rate – how many browsers are you turning into buyers? If the number seems low, you can always A/B test product pages to see whether it’s your website that is putting visitors off.
Rate of cart abandonment – how many customers are leaving your site with items in their basket? You can use software which will automatically email customers reminding them that they were going to purchase something, or minimize the steps in the checkout process to prevent cart abandonment.
Returning customer sales Vs. new customer sales – how many of your weekly sales are from new customers? Repeat customers?
Inventory levels – which stock is regularly running low? It might be worth setting reorder levels for these so you don’t end up out of stock and disappointing your customers.
General site traffic – record this on a weekly, monthly, and annual basis.
Unique visitors and returning visitors – how many of your visitors are new? How many are old customers thinking of repurchasing? What can you do to convert new visitors and entice old ones?
How long visitors are spending on your website.
How many pages visitors view before leaving? What is the bounce rate?
Sources of traffic – does it mostly come from SEO, PPC, organic, social media? Identify which areas you need to focus on.
Number of followers on social media sites – Facebook, YouTube, Twitter and so on.
Newsletter signups and blog followers. How many blog subscribers do you have? How many newsletter signups per week/month/year? What can you do to persuade visitors to sign up and subscribe?
What time of day users visit your site.
How many emails do you get a day? How many can you answer in a day?
How many calls do you get a day?
How many live chat sessions do you have a day?
How many of these are resolved? What is the average resolution time?
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