The Three Metrics That Will Make or Break Your eCommerce Business
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The Three Metrics That Will Make or Break Your eCommerce Business By: Justin Spring Cofounder BringShare.com AdeptMarketing.com
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Transcript of The Three Metrics That Will Make or Break Your eCommerce Business
The Three Metrics That Will Make or Break Your eCommerce Business
By: Justin SpringCofounderBringShare.comAdeptMarketing.com
Word Of The Day:
LAG
Word Of The Day:
LAG metricThe metric that is the end-result of a lot of
other metrics
Lead vs. Lag Metrics
Lead Metric
Lead Metric
Lead Metric
LAG METRIC
The Three LAG Metrics That Will Make or Break Your eCommerce Business
By: Justin SpringCofounderBringShare.comAdeptMarketing.com
The REAL presentation title:
The Three LAG Metrics That Will Make or Break Your eCommerce Business
By: Justin SpringCofounderBringShare.comAdeptMarketing.com
… and the lead metrics that impact them.
The REAL presentation title:
LAG Metric #1
Unconversion Rate
Average: 98%
Unconversion Rate
Top Landing Pages
Conversion Funnel
Traffic Quality
Unconversion Rate
Lead Metrics
1
1 Unconversion Rate1a: Top Landing Pages Bounce Rate
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Unconversion Rate1b: Conversion Funnel Exit Point
Page 1
High Exit %
Find the leak and plug it!
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Page 2
Page 3
Conversion Page
Unconversion Rate1c: Traffic Quality by Source
1
Unconversion Rate1
Landing Page Exits Conversion Funnel Exit Traffic Quality by Source
LAG Metric #2
12-Month Customer Value
12-Month Customer Value
% of Repeat Purchasers
Average Order Value
$ Value of an Email Address
12-Month Customer Value
Lead Metrics
2
12-Month Customer Value2a: Average Order Value
2
12-Month Customer Value
Free Shipping Threshold
2
2a: Average Order Value
12-Month Customer Value
Cross Selling
2
2a: Average Order Value
12-Month Customer Value
REWARD
2b: % of Repeat Purchasers
2
12-Month Customer Value
How much is each email address worth to you?
• Send more often
• Send more promo/reward offers
• Invest in list building
• List segmentation
2c: $ Value of an Email Address
2
12-Month Customer Value
Avg Order Value % Repeat Purchasers $ Value of Email Address
2
LAG Metric #3
Paid Traffic CPA(Cost Per Acquisition)
Paid Traffic CPA
Can you buy customers for less than they are worth? If so, spend aggressively NOW!
• 12-Month Value = $250
• 70% Gross Margin = $175
• Breakeven CPA = $175
3
Paid Traffic CPA
Conversion Rate by Source
Cost Per Click
Paid Traffic CPA
Lead Metrics
3
Paid Traffic CPA
• All advertising can be broken down into a CPC– For CPM campaigns, demand to know the average
CTR for advertisers in your industry
• 1000 Clicks @ $1.00 = $1000 Spend
• Conversions as 2% = 20
• Break-even CPA: $175
• Paid Traffic Cost Per Acquisition: $50
• Gross Profit: $125
3a: Cost Per Click
3
Paid Traffic CPA
• Align everything:
– Ad Placement > Ad Content > Landing Page
• Test and remove low converting traffic sources
3b: Conversion Rate By Source
3
Paid Traffic CPA
Cost Per Click Conv. Rate by Source
3
Lead vs. Lag Metrics
Unconversion Rate
12-Month Customer Value
Paid Traffic CPA
SALES INCREASE
Remember…
• Lag metric goals are just the beginning of your goal planning
• Use lag metrics to identify the lead metrics that are most important
• Little tweaks to 2-3 lead metrics will have an exponential effect on the corresponding lag metric
Thank youJustin[at]bringshare.com
