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3 Ecommerce Metrics You Need to Be Tracking (But Probably Aren't)

Posted by Ethan Giffin on Jul 7, 2016 9:00:00 AM

You've got all the best and newest gadgets plugged into your site, and you're ready to take your ecommerce marketing into overdrive. There's just one problem: despite how loaded up on information you are, there are probably a few key metrics you're leaving out.metrics_tools.png

Chances are you've already learned that ecommerce success requires more than visits, page views and search results. There's a lot to keep track of, and a lot of ongoing improvements to make your ecommerce site an efficient ROI machine. With so much going on, it's easy to overlook some key performance indicators that could be hiding the secret to your current success and your future growth.

These three metrics are routinely ignored, but can help you better understand your customers, your products, and their interactions.

Unique Purchases

The "Unique Purchases" metric on Google Analytics tells you how many times a product or set of products has been part of a purchase. It's not a measure of transactions, and it's not a measure of units sold. It's a measure of how many times a particular product (or set of products) was part of a transaction.

For example, say a customer buys one apple. That's one transaction, one unit sold, and one unique purchase.

If the customer buys five apples, that's one transaction, five units sold, and one unique purchase—only one product (apple) was sold.

If the customer buys five apples, three bananas, and one orange, that's one transaction, nine units sold, and three unique purchases—three different products (apple, banana, orange) were part of the transaction.

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Image credit: OptimizeSmart 

This metric lets you see if customers are buying lots of each product at one time, if they're buying a little bit at a time and making frequent purchases, or if there are other trends in their purchasing behavior when comparing unique purchases to total transactions. You can use this to find opportunities to upsell before a checkout, to adjust the frequency of your marketing emails, to offer deals on larger bulk purchases, and more.

Frequency

One half of the "Frequency & Recency" report, found in the Audience > Behavior section of your Google Analytics dashboard, "Frequency" tells you how many of your website's visitors over a defined period (the default is the past month) have visited your site since their very first visit. That is, it doesn't tell you how many times they visited during the report's time period, but how many times they've visited overall.

You'll get a count of how many visitors came by on their 1st visit to your site, their 2nd visit, and so on. Create a segment containing only visitors who made a purchase, and you'll be able to see how many visits it takes on average to see a conversion. You can also drill into other demographics and see where you're getting conversions on fewer visits—focusing your marketing towards those niches could mean a major revenue boost, lower acquisition costs, and other contributions to your bottom line.

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Looking at the frequency of visitors who didn't make a purchase can also be useful. Keep in mind that you probably see a lot of first time visitors who didn't make a purchase, so don't worry too much about a spike there. But do you see a big cluster of second and third-time visitors who don't convert, and hardly any non-purchasing customers with 4, 5, 6 visits or more? You might be attracting the wrong kind of customer with your marketing.

On the other hand, if you see loads of people visiting five times and more without making a purchase, you're attracting the right kind of customer but might try tweaking your product pages and/or checkout to get more conversions.

Recency

The other half of the Frequency & Recency report recency tells you how long it's been between each visitor's most recent visit and their last one. More accurately, it tells you how many visitors in the defined time period last visited one day ago, two days ago, and so on. Again, you're likely to see a high number of visitors with zero days since their last visit—first time visitors, same as the visitors with a "frequency" of 1.

Recency tells you how how "sticky" your site is with your audience. If you see a lot of visitors with a recency of 1, 2, and 3—visitors who are coming back every few days or so—your marketing is definitely attracting some interested customers. If you see a lot of visitors coming back only once or twice a month, it could be that most of your customers are interested in regularly replenishing items that run out.

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Of course, you'll get a much clearer picture if you look at the segment that purchased and the segment that didn't purchase separately, and set purchase thresholds to compare your higher value. How recently do customers making large purchases visit your site? Are there lots of people with very recent visits who didn't make a purchase?

Interpreting this data needs to take place in the context of your business and your other metrics. If you're getting a lot of high value purchases with visitors who don't have recent prior visits, that's a sign you've built strong trust and are probably enjoying some nice recurring income—which could point you towards creating better subscription offers and otherwise increasing value to your customers and yourselves. If your highest value customers are visiting within a few days of making a large purchase, you're probably doing great when it comes to converting first time visitors; make sure you have a system in place to keep them coming back!

Using frequency and recency in tandem gives you incredible insight into your customer behavior, as well. Are paying customers coming back frequently but with large gaps between visits? Again, this could be a strong sign of customer loyalty, and could also suggest an opportunity to encourage greater engagement with visits that take place more regularly.

Are non-converting visitors coming back with low frequency and high recency? You’re getting them on the hook, but failing to reel them in—check with your marketing to make sure it's properly targeted and your site to make sure it's properly optimized.

Making the Most of Your Metrics

There's no such thing as the ONE most important metric—or even the three, or the dozen. If you're only looking at a handful of metrics, you're only looking at a piece of the puzzle. Unique Purchases, Frequency, and Recency are important and often overlooked, but shouldn't be the end of your metrics measuring.

Use these three to start peering deeper into your data, and keep in touch for the latest ecommerce news and actionable tips!

Topics: HubShop.ly