TAKE ADVANTAGE OF eCOMMERCE METRICS TO CALCULATE ROI
Calculating the return on your eCommerce investment is an ongoing task that requires time and effort; but when done correctly, your analysis will provide you with valuable insight into the effectiveness of your marketing and sales campaigns, SEO, product data, and overall customer experience.
Many businesses don’t take into account the different variables involved in determining ROI. It’s not just about how many sales you make through your website; it’s also about who visits your site, how they get there, and what they do once they’re there. The only way you can find this information is by utilizing analytical tools that provide detailed reporting tailored to relevant metrics for your business. An ongoing ROI analysis can show you what is working best for your company, what needs improvement, and which campaigns are the most impactful.
Read this white paper to learn, through the way of metrics, how your business can get the most out of analytics tools to track your site’s efficacy.
For those new to eCommerce or analytics, your website can speak volumes if you know how to “listen.” Every page click and on-site search by a visitor is trackable and measurable, essentially telling you each person’s step-by-step movements on your website. It doesn’t take a lot of work to enable this basic site tracking, but there are best practices you can employ that will best benefit your eCommerce efforts.
START WITH THE CORE METRICS
In order to obtain a true gauge of your eCommerce site’s performance, you need to monitor the most relevant and significant indicators. Only through regular review of your key performance indicators and analytics will you be able to determine if you’re running a successful eCommerce business, or if you need to change your strategy. Three metrics that play a major part in your ROI include:
Traffic: Make sure you’re looking at the right traffic – and know the differences between your different traffic sources. The biggest mistake you can make is to look solely at overall traffic to determine your ROI. While there are different ways people come to your site, the most common types of B2B traffic include organic, paid, direct, and campaign.
Organic, or natural, traffic includes those people who arrived at your site after performing a Google search of your company name, products, or services. Paid traffic consists of visitors who clicked on your paid ad that took them directly to your site. Direct traffic entails all visits to your site by users who type your website address directly into their browser. Campaign traffic, while a type of direct traffic, is based on specific sales or marketing campaigns that get visitors to your site. Examples include promoting new product launches or advertising pricing promotions through e-blasts or social media that link to the site.
Tracking and analyzing these different traffic sources is the only way you’ll know which ones are helping your bottom line and which aren’t worth the continued effort. It also gives you the ability to measure how visitors are interacting on your pages so that you can measure conversion rates effectively.
Conversions: Many consider conversions to be people who go to a website and made a purchase. However, conversions can also include people who register on your site, fill out a lead form, or sign up for your e-mail newsletter. Your conversion rate is one of the most important metrics for measuring the effectiveness of your overall marketing efforts, as every conversion is considered a quantifiable win. You can measure conversions on your site directly, depending on how it’s built, or you can set up a goal in Google Analytics to track your progress. Average conversion rates for B2B sites can run anywhere between 2% and 5%, but a 10% conversion rate is achievable. Low conversion numbers for your website could be the result of different factors, such as not being able to navigate easily through your site, not offering the products people are looking for, or not having the right content to keep visitors interested enough to stay on your site.
Average order value: Average order value (AOV) tracks the average dollar amount spent each time a customer places an order on your website. While it doesn’t tell you how much profit you are making or your profit margin, AOV can be helpful in determining what revenue can be expected from a certain number of visits. And because many transaction expenses remain the same whether a customer spends $20 or $200, raising your AOV can increase your profitability. To calculate your company’s average order value, simply divide your total website revenue by the number of orders.
B2B businesses have the ability to compare AOV historically with other points in time, as well as on an individual level and in comparison with offline orders placed by the same customer. This metric also shows whether you are able to capitalize on the cross-sell and up-sell potential that an eCommerce platform has to offer over other sales channels.
An ongoing ROI analysis can show you what is working best for your company, what needs improvement, and which campaigns are the most impactful.
USE THE RIGHT ANALYTICS AND REPORTING TOOLS
To capture the most accurate and up-to-date metrics from your eCommerce site, rely on reliable software tools like Google Analytics. This free resource provides timely data with the ability to create custom reports around your key metrics. In addition, Google Analytics helps you analyze visitor traffic and paint a complete picture of your audience and their needs. It has the ability to track data from your web pages, including the time users spend on your site, which internal links were clicked, the geographic location of the visitor, and other valuable information. Consider these integral reporting tools offered by Google Analytics:
- Conversion metrics are separated out by your different traffic sources, making it easy to identify each channel’s effectiveness. Conversion reporting is customizable so you can determine what you want to achieve by traffic source and find the visitor actions most likely to help you meet your objectives.
- eCommerce reporting helps you gain insight into the customer’s path to purchase, visitor interest in your products, and the performance of your shopping campaigns. You can also view enhanced eCommerce reports to see when customers added items to their shopping carts, started the checkout process, and completed a purchase.
- Lifetime value reporting lets you understand how valuable different users are to your business based on lifetime performance across multiple sessions. This analysis can compare users acquired through different traffic sources to see which method brings higher-value users. Unlike B2C companies where the majority of sales are from new customers, B2B high-value users are returning customers with whom they’ve developed long-term relationships. Customer lifetime value, or CLV, can help locate and identify those best customers, so you can focus your efforts on building loyal, repeat customers, rather than on maximizing short-term sales.
The data collected from Google Analytics helps you determine exactly what items your customers want and need. Once you understand your visitors’ needs, you’re able to tailor your marketing and site content for maximum impact on your ROI. With all the benefits Google Analytics offers, Unilog has integrated the tool into its flagship eCommerce platform, CIMM2, giving businesses a detailed and customized view of their key metrics in a convenient, all-in-one system.
If you’re looking for additional reporting, Matomo (formerly Piwik) is another analytics tool that differs from Google Analytics in that it is hosted on your own server and the data is tracked inside your open-source database. Used as an alternative to or add-on with Google Analytics, more B2B companies are finding Matomo is a great resource for eCommerce sales tracking.
CONTINUALLY MONITOR YOUR METRICS
Reviewing your eCommerce metrics can be a time-consuming process, but regular monitoring is the only way to get an accurate gauge of the success of your digital marketing campaigns and overall eCommerce strategy. Rely on tools like Google Analytics to develop custom reports that give you a clear, actionable view of your website’s effectiveness. Let metrics help you better understand your visitors’ needs so you can refine your tactics, make changes where needed, and end up with a profitable, lead-generating site that provides the best ROI for your business.
Contact Unilog today for help with all your eCommerce and analytics needs. Our CIMM2 software helps B2B companies build a powerful digital marketplace that integrates with your existing back-end systems and provides an intuitive, user-friendly customer experience.
Unilog is a global technology company that delivers powerful, affordable eCommerce solutions for the B2B marketplace. Our cloud-based eCommerce platform and product data enrichment services help distributors, manufacturers, and wholesalers increase online sales, reduce cost to serve, and enhance their digital channel. Unilog is an ISO 9001:2008- and ISO 8000-certified company with North American headquarters outside of Philadelphia, PA and international headquarters in Bangalore, India. For more information, visit www.unilogcorp.com.