If yours is like most small to mid-sized e-commerce companies, then you don’t have any time to waste. You need to solve problems quickly and get the most out of your traffic, and you need an efficient way to filter all of your analytics data so you can do those things in real time.
After all, we can’t all have our own traffic and analytics teams like Amazon or Walmart.com…
So what should you be looking for? According to a piece in Gigaom, something as innocent as “time on site” could be a more important factor than you ever realized — but it’s not quite as simple as that.
It’s the dollars per minute metric that small to medium e-commerce companies should be obsessing over, says analytics start-up Sumall.
According to Sumall, the mom and pops of the web tend to focus on isolated variables that don’t really explain the bigger picture. Traffic sources, average order values, and traffic volume are all important pieces of the puzzle. But just because you’re getting good traffic, for example, that doesn’t mean your site’s optimized.
Your average order value can be sky high, but if you only get a couple sales a week, you’re going broke.
If you divide your revenue by the amount of time customers spend browsing your site, you’ll get a sort of bellwether metric that will help you notice when things are going extraordinarily well, or extraordinarily crappy.
When you think about why Sumall likes this formula so much, it’s easy to see why money/minute is a superior metric for e-commerce sites. If any of your other metric as slipping, such as average order value, it will be reflected in this metric.
In a similar way, we’ve been focusing more attention on overarching metrics here at Digital Marketer. Instead of simply focusing on immediate customer value, click throughs, or conversion rates (all important), we like to look at those in terms of EPCs.
Oftentimes, this helps us from getting too impressed with the performance of a particular offer or promotion, allowing us to step back and make better overall decisions.
Precisely because we don’t have unlimited time and resources to make sense of every little piece of data we collect, it’s helpful to use these bellwether metrics as a guide, instead of getting tunnel vision.