How to measure & boost success in e-commerce.

Before we dive into the numbers, let's recognise that success in e-commerce isn't a one-size-fits-all concept. It's about sustainable growth, whether boosting revenue, expanding your customer base, or increasing brand awareness. Start by setting clear, measurable goals—like improving conversion rates or customer retention. Align your strategies and metrics to these goals to ensure every step you take drives your business closer to its version of success.

For mishmash, success meant increasing sales considerably. And with our help, they achieved exactly that!

Keychain of metrics.

Now, before diving into strategies, let’s talk metrics. These are the lifeblood of your online shop, offering insights into what's working and what needs tweaking. Let’s get to it, shall we?

Conversion Rate: the main event.

Your conversion rate is the percentage of visitors who go from "just browsing" to "pay now." A strong conversion rate indicates that your site is effectively guiding visitors from interest to action.

With our help, mishmash increased its CVR rate to 34% and Hey Harper to 17% within just a few months.

Pro Tip: Keep an eye on this metric to spot any friction points in your user journey that might need smoothing. Baymard Institute reports that the average conversion rate across e-commerce sites is just 2.2%, so even a small tweak to your store can have a significant impact (no pun intended).

Average Order Value (AOV): maximising revenue per purchase.

The higher your Average Order Value (AOV), the more revenue you make. This metric shows how much customers spend per purchase, indicating their interest in multiple or higher-value products. With mishmash, we implemented a cross-selling strategy through elements like the navigation menu and "Best Sellers" or "You may also like" sections. By highlighting complementary items, we made the shopping experience more personalised and enjoyable, resulting in a 9% increase in AOV.

Pro Tip: Encourage cross-selling, upselling and product bundles to boost this number higher. Research shows that upselling can increase revenue by 10-30% on average, making it an effective strategy for boosting AOV.

Customer Lifetime Value (CLV): the long game.

Customer lifetime value (CLV) is a key metric that reveals how much a customer is likely to spend over their entire relationship with your brand. A higher value signals that customers love your products trust your brand and keep returning for more, driving recurring revenue and contributing to long-term revenue growth. Therefore, if you’re aiming for steady growth, keeping a close eye on CLV is non-negotiable. According to the Harvard Business Review, improving customer retention rates by just 5% can increase profits by 25% to 95%, making this a crucial focus for sustainable growth.

Pro Tip: Focus on customer retention tactics to maximise CLV. Consider utilising cross-selling and upselling strategies or offering special discounts, checkout credits and other benefits.

Customer Retention Rate (CRR): love that lasts.

Customer Retention Rate (CRR) measures the percentage of customers a company retains over a period. It's a crucial metric to evaluate how well a business keeps its customers returning. A high CRR indicates strong customer loyalty and satisfaction, which translates to sustained revenue and long-term growth. It’s also a more cost-effective strategy than constantly acquiring new customers.

Here’s how yo can calculate your CRR:

1. Determine the period of time to measure;

2. Calculate the number of customers who made a repeat purchase in your online store in that period of time;

3. Divide that number by the total number of customers you had at the beginning of the time period;

4. Multiply the result by 100 to get the percentage.

Customer Acquisition Cost (CAC): the budget balancer.

Knowing how much you’re spending to acquire each new customer is crucial. A study by Forrester found that customer acquisition costs have increased by over 50% in the past five years, highlighting the importance of optimising this metric. Test and refine your marketing channels to get the best return on investment, i.e. a low CAC.

Pro Tip: Optimise your e-commerce site to convert first-time visitors through straightforward navigation and engaging product visuals. We helped mishmash improve its product display using swipeable thumbnails, sparking more interest and curiosity.

Cart Abandonment Rate: the unfinished story.

Cart abandonment happens when customers leave your site without completing their purchases. If your cart abandonment rate is high, it's a sign something is stopping customers from completing their purchases. Baymard’s research suggests that the average e-commerce site can improve its conversion rate by 35% solely through design improvements to the checkout process. The same study shows the average cart abandonment rate is around 70%, with unexpectedly high extra costs being the primary reason customers abandon their carts during checkout.

Pro Tip: To close more deals, streamline your checkout process, ensuring transparency in costs, and include visual security signals to build trust. Such small changes can add significant improvements in conversion rates.

Bounce Rate: the one that got away.

Like Customer Acquisition Cost, a lower Bounce Rate is better. A high bounce rate suggests that visitors aren't finding what they're looking for, or they're turned off by slow load times, causing them to leave your site quickly and costing potential customers. To reduce this, focus on creating a more engaging experience—add videos, customer reviews, and interactive features. We helped Hey Harper keep users engaged by creating an interactive discount-based game. As a result, game players converted 7 times more, added products to their cart 10 times more, and had a 9% higher AOV than other users, significantly boosting their conversion rates.

Pro Tip: Improve your site's load times by compressing images, optimise your code, and consider using a Content Delivery Network (CDN) to ensure your pages load quickly. Faster load times keep visitors engaged, significantly reduce bounce rates and increase conversion rates.

Strategies to elevate your e-commerce game.

Now that you’ve got your metrics, it’s time to take action. Here are a few insights and more Pro Tips to help you move those numbers in the right direction.

Mobile first.

As mobile shopping dominates, with 91% of people making online purchases via smartphone (according to Forbes), ensuring your e-commerce site is mobile-friendly and fast is more important than ever. Start by tracking how many visitors use mobile versus desktop and ensure a seamless, responsive experience. Focus on mobile optimisation strategies like large buttons, minimal scrolling, and a streamlined checkout process. But that’s not enough—speed is crucial. Users won’t stick around if your page loads too long, especially on mobile. Prioritise quick load times to keep customers engaged and drive conversions.

Pro Tip: Use lazy loading for images and videos to improve mobile site speed. This ensures content loads only when needed (when it’s about to enter the viewport), reducing initial load times and keeping users engaged.

Make the User Experience (UX) irresistible.

Research shows that 57% of users won’t recommend a business with a poorly designed mobile site, highlighting the importance of a seamless mobile experience. A smooth and intuitive user journey can make the difference between a sale and a bounce. Your site should feel as welcoming and well-organised as a carefully curated storefront.

Pro Tip: Optimise your user interface and experience specifically for mobile users.

Make it personal.

McKinsey & Company argue that personalised shopping experiences can increase conversion rates by up to 15%, as customers feel more connected to your business. When they feel understood by your site, they’re more likely to stay and make a purchase. Additionally, if they resonate with your brand, its values, and the solutions your product offers, they’re more likely to return, fostering brand loyalty and affinity.

Pro Tip: Use personalised recommendations to connect customers with products that match their interests.

Elevate your product pages.

According to Forbes, products with customer reviews are 270% more likely to be purchased than those without, making reviews a must-have for your product pages, where key purchasing decisions are made. Moreover, make these pages as compelling as possible with high-quality visuals and detailed descriptions.

Pro Tip: Incorporate customer reviews to build trust and provide social proof.

Streamline the checkout process.

According to the Baymard Institute, 22% of U.S. online shoppers cite long or complicated checkout processes as a primary reason for abandoning their orders. The faster and simpler the checkout, the better. An intuitive, streamlined process is key to securing sales. To optimise this, minimise steps, streamline forms for quick completion, and use auto-complete and clear formatting for name and address fields. The easier and quicker the checkout, the more likely customers are to complete their purchase.

Pro Tip: Offer guest checkout and multiple payment options to keep the process hassle-free.

Harness the power of social proof.

Don’t underestimate the power of word of mouth—customers trust other customers. According to Fortune, 92% of consumers trust personal recommendations over brand messaging, making influencer marketing a valuable tool. Leverage this by showcasing reviews, testimonials, and user-generated content to build trust and credibility.

Pro Tip: Partner with influencers in your niche to broaden your reach and display customer feedback paired with “real-life” images of your products.

Enter the freebie train.

Let’s face it—everyone loves free shipping. It’s a powerful marketing strategy worth considering that can significantly boost sales and drive traffic to your site. Offering free shipping with no minimum order value attracts more customers, but be strategic about it—consider building the shipping cost into your product prices or offer it as a limited-time promotion to increase appeal.

Pro Tip: Consider offering free shipping as a limited-time promotion to create urgency and boost conversions. Highlight this offer prominently on your site to attract attention and encourage quick action from customers.

Send a gentle reminder.

Not every visitor makes a purchase on their first visit, but retargeting can bring them back. According to Spiralytics, the CTR of retargeted ads is 10x superior compared to regular display ads, effectively bringing customers back. Complement this with follow-up emails for abandoned carts during checkout, which are also highly effective. Together, these strategies increase the chances of converting hesitant visitors into buyers.

Pro Tip: Use dynamic ads and follow-up emails to remind customers what they left behind in their cart and bring them back to your site.

Pro tip sum-up.

Success in e-commerce is a journey of constant evolution. Start by defining what success means for your company. Then, focus on key metrics and apply smart strategies to turn your online store into a magnet for loyal customers. It’s all about testing, refining, and innovating to stay ahead in the fast-paced digital world. At Significa, we’re here to help you navigate the complexities of e-commerce with over a decade of experience in design and development, we’re committed to pushing boundaries and helping your business thrive. Anyhow, here’s the sum up of all the tips we shared in this article:

To improve metrics

1. Conversion Rate (CVR) — Monitor your conversion rate to identify and fix any friction points and improve the user journey for better results.
   
   

2. Average Order Value (AOV) — Use cross-sells, upsells and bundles to raise this number higher.
   
   

3. Customer Lifetime Value(CLV) — Focus on maximising customer by offering special discounts, checkout credits or early access to limited editions.
   
   

4. Customer Retention Rate (CRR) — Measures how effectively a company keeps customers returning. A high CRR signals strong customer loyalty, leading to sustained growth and lower costs compared to acquiring new customers.
   
   

5. Customer Acquisition Cost — Design your e-commerce site to convert first-time visitors by prioritising clear navigation and using engaging, swipeable product thumbnails to spark interest and curiosity.
   
   

6. Cart Abandonment Rate (CAR) — Streamline checkout processes with visual security cues and extra cost transparency to increase confidence and conversions.
   
   

7. Bounce Rate — Reduce bounce rates by improving your site’s load time through performance optimisation, compressing images, optimising code, and using a Content Delivery Network (CDN).

To elevate your e-commerce game

1. Mobile First — To speed up your mobile site, use lazy loading for images and videos. This reduces initial load times by loading content only as it enters the viewport, keeping users engaged.
   
   

2. Irresistible UX — Optimise your user interface and experience for mobile users.
   
   

3. Tailored Offers — Use personalised recommendations to connect customers with products that match their interests.
   
   

4. Seamless Checkout — Simplify the checkout by offering guest checkout and multiple payment options.
   
   

5. Word of Mouth — Partner with influencers in your niche to broaden your reach and leverage from user-generated content.
   
   

6. Free Shipping — Offer free shipping as a promotional strategy and prominently feature it on your site to attract attention.
   
   

7. Cart Reminders — Use dynamic ads and follow-up emails to remind customers of items left in their cart.