In case you missed it, our CEO, Mike, wrote about Natural Rate of Growth in his weekly newsletter last week. In short, OpenView Labs recently featured a new SaaS metric…
Video: Shopify Ecommerce Dashboard
In building Visible and working hands-on with companies and investors from around the world, we have learned the importance of customization when it comes to what metrics your company tracks and how you track…
In building Visible and working hands-on with companies and investors from around the world, we have learned the importance of customization when it comes to what metrics your company tracks and how you track those metrics. For example, a late stage venture-backed Ecommerce company has different needs and goals than a 10 person online store. Both, however, have stakeholders who need to know how the business is performing and what they can do to help the business grow.
Thankfully, for every type of business, there are a ton of resources to help you understand what to track and how to track it. With Visible Templates, we have partnered with the creators of these resources – top VC investors, high growth companies, and successful entrepreneurs – to make it easy for you to build a metrics framework and a business dashboard that suits your company.
The Visible Shopify Ecommerce Dashboard
Shopify is one of the world’s largest Ecommerce platforms and a huge supporter of small businesses and Ecommerce startups anywhere. With thousands of companies of all shapes and sizes using the platform to build online stores and sell their products, Shopify truly has domain expertise when understanding what Ecommerce metrics are most important and how they can be applied to help you grow your business.
What Ecommerce metrics should I be tracking?
This template was initially inspired by a post from Mark Hayes, Shopify’s Director of Communications where he outlines 32 of the best Ecommerce metrics for a company to track. In the videto above, we have talked through a few of our favorites. Below, we jump in even further to three of the most important Ecommerce metrics your company can start using today: Net Promoter Score, Average Order Value, and Conversion Rate.
Net Promoter Score (NPS)
In the past, we’ve written about Net Promoter Score as a way to gauge how likely your current investors are to refer you to other investors, partners, and key employees. The same concept holds true for measuring Ecommerce Net Promoter Score, which asks current customers a simple question on a scale of 1-10: How likely is it that you would recommend our company to a friend or colleague?
Because competition is high in the Ecommerce space and switching costs are low for many consumers, successful companies must take a customer-centric approach to growth. This mean embracing NPS as a holistic measure of business performance. Like all important business KPIs NPS doesn’t live in a bubble, it directly impacts other important Ecommerce metrics:
- Lifetime Value of a Customer (LTV) – customers who fall in the 7-10 range on the NPS scale are likely happy with your product offering, have an affinity for the brand you have built, and can be expected to continue returning to purchase from your site (if you keep delivering on your company promise, of course).
- Viral Coefficient aka K Factor – Your K factor or viral coefficient measures how many new, secondary users, an individual new user helps you acquire over their lifetime. Happier users refer more new business.
Total Orders and Average Order Value (AOV)
Running an Ecommerce business, you have two levers you can pull with regards to bringing money in the door (Revenue). The first is doing more volume, or in other words, increasing the total number of orders placed through your site. The second is Average Order Value (AOV), which is a measure of the size of each order placed on your site.
Increasing your Average Order Value can be accomplished in a number of ways, including offering future discounts, bundling similar products, or offering specials on shipping.
How effectively are you moving people from the top of the funnel (Visitors) to the bottom (Customers)? This is a core question you must ask yourself as you are designing your product as well as your marketing plan for your Ecommerce company.
At a high level, your Ecommerce conversion rate is simply the Number of Total Orders / Number of Visitors. As you get more sophisticated, you can begin tracking more steps in the Ecommerce funnel and honing in on how your conversion rates differ depending on lead source, purchase type, or even time of day.