9 Success Metrics for Every Business
The availability of data in today’s digital world has led many business professionals to become overwhelmed with analytics and performance metrics.
To stay focused on growth, however, it is imperative for professionals to choose a handful of metrics that will adequately showcase the performance of their business. Discover nine metrics that can help to measure your enterprise's success below:
1. Abandonment Rate
One of the most important metrics for e-commerce merchants to keep an eye on is abandonment rate, which represents the percentage of people who abandon items in their shopping cart before the final checkout. A high abandonment rate is likely a sign of a larger problem, such as an inefficient checkout process or the lack of a “guest” checkout option.
2. Bounce Rate
A website’s bounce rate is defined as the percentage of single-page visits divided by the total number of entries to a page. This metric is important because it basically shows how useful, interesting or engaging content actually is on a website. That said, there are other factors (like single page site design) that can make bounce rate a less accurate indicator of site engagement. This is why Google Analytics enables users to track “adjusted bounce rates,” where an event is executed or reported when users spend more than a pre-defined amount of time on a Web page.
3. Churn Rate
By measuring churn rate, digital professionals can monitor how many one-time customers they have. This metric is determined by dividing the total number of one-time customers by the total number of customers a business has. While it is pretty simple to measure the churn rate for subscription-based businesses, it can be a little more challenging for traditional e-commerce merchants, who must first select a cutoff date so they can consider customers who have not made a purchase in that timeframe a “churn.”
4. Click-Through Rate
Click-through rate is one of the most important performance metrics when it comes to marketing campaigns. This metric is defined as the percentage of people who click on an ad compared to the total number of times the ad was shown, and it essentially shows marketers how engaging their ad campaigns are. It is also important to note that a low click-through rate could mean that an ad was served to the wrong type of audience, that its creative could use improvement – or both.
5. Conversion Rate
Conversion rate shows the effectiveness of marketing campaigns. This metric is calculated by taking the number of conversions and dividing them by the number of ad clicks during the same time period. By tracking this metric, digital professionals can monitor the success of their ad campaigns and make better decisions based on conversion performance.
Monitoring the cost-per-acquisition metric helps marketers gauge the effectiveness of their ad campaigns. This piece of data is found by dividing the amount of money spent on marketing (including discounts offered and time spent) by the number of purchasing customers. To get a better picture of marketing performance, however, digital professionals can analyze the cost of acquiring customers in specific channels, such as social, paid search, organic search and display. This helps marketers identify which channels perform best so better business decisions can be made.
7. Delivery Rate
When it comes to email, delivery rate represents the percentage of emails that make it into subscriber’s inboxes compared to the total number of emails sent. This metric is important because email cannot be an effective marketing channel is messages aren’t being received. A low delivery rate could suggest a problem with the subscriber list or subject lines.
8. Lifetime Value
To determine the true value of your customers, it is important to keep an eye on their lifetime value. After all, it is easier (and cheaper) for a business to keep customers rather than acquire new ones. This metric can be found by multiplying the average number of purchases per year by both the average order value and the average lifetime of a customer.
9. Traffic Sources
Many digital professionals put an emphasis on unique visitor metrics, but it is just as important to know where your traffic is coming from. By monitoring traffic sources, digital professionals can identify the marketing channels that are providing the best return on investment (ROI) for their enterprise.