How To Drive Value From Ecommerce Metrics

We are living in an age of Big Data. Marketers and business managers have never had so much data to work with. Today, the question is no longer about where marketers and managers can derive value, but how to get quality insights that drive value from ecommerce metrics. 

Use the Right Metrics

Different kinds of businesses have different qualities and needs. For instance, a Software-as-a-Service (SaaS) has different needs, resources and staffing to a Business-2-Consumer (B2C) retailer such as sneaker trader Hype 24/7. They, therefore, have to measure different things and use different metrics

One great example is the contribution margin (CM), which is a wonderful metric for many ecommerce apparel retailers. CM is important for them because it is a more accurate reflection of their profitability than gross margin. So what they optimize is not their gross margin, but their CM. 

Another example is of a food and drug retailer, which may spend a lot of time on traffic, clickthrough rates, average order values, wallet spend, and omni-flow trends. 

One Thing

The ultimate purpose of a business is, to quote Peter Drucker, “to create and keep a customer”. Businesses, however, have specific goals, a “one thing” that they are created to achieve and which acts as the organizing principle of everything they do. Metrics have to serve this principle, in order to bring the business closer to realizing their goals.

Metrics have to measure the business’ performance, as well as how the ecommerce platform is performing from a technical point of view, all with the purpose of helping the company achieve its one thing, its absolute goal. This is done by establishing objective and key results (OKRs) and then prioritizing metrics and processes. 


That one thing is the thing from which everything else is derived. Once you have a clear goal, you can then establish objectives for various aspects of their business. Then,

  1. Choose the metrics that will help you measure the key results that emerge from your objectives. At a lower level, you can pick key performance indicators (KPIs). 
  2. Observe how these metrics perform in real-time.
  3. Use a balanced scorecard in your key operating segments to see if they are helping your business achieve its goals.
  4. View the customer journey and look for weaknesses, for pain points to make sure that your clients have a seamless, pain-free journey.
  5. Look for areas where your business can optimize its technical sides. For instance, you could conduct a search engine optimization (SEO) audit to see how your website and web pages are performing.
  6. Conduct an overview of the health of your ecommerce systems.

The Customer is Everything

Jeff Bezos has often spoken about Amazon’s obsession with the customer. The customer is the heart of your business. The customer should be the center of every aspect of your business. So ultimately, when you make decisions, or assess parts of your business, you should ask yourself how this helps or affects the customer. Many businesses have come to realize this and employ many customer engagement metrics. 

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