14 essential ecommerce metrics to track and grow your store

Published Wednesday 5 November 2025

Table of contents

• What are ecommerce metrics and KPIs?
• Difference between metrics vs KPIs
• How to choose the right ecommerce metrics for your business
• How often should you check ecommerce metrics?
• What's the most important KPI or metric to pay attention to?
• How ecommerce metrics can help your cash flow and forecasting
• FAQs on ecommerce metrics

Key takeaways

• Focus on three core metrics—conversion rate, average order value, and customer lifetime value—as these directly measure your revenue generation and provide the clearest picture of business performance.

• Track metrics monthly rather than daily to avoid decision fatigue from short-term fluctuations and focus on meaningful trends that guide strategic business decisions.

• Calculate customer acquisition cost and compare it to customer lifetime value to ensure you're not spending more to acquire customers than they generate in revenue over time.

• Use traffic source and device analytics to optimize your marketing spend by identifying which channels drive the most valuable customers and ensuring your store works well on preferred devices.

What are ecommerce metrics and KPIs?

Ecommerce metrics are measurable data points that track your online store's performance, such as conversion rate or average order value.

Ecommerce KPIs are specific metrics you use to set business goals and measure success against targets.

Here's how they work together:

• Metrics show what's happening: Your conversion rate is currently 20%
• KPIs set targets: You want to reach a 25% conversion rate
• Strategy follows: You build plans to achieve that 25% goal through discounts, website improvements, or simplified checkout

Next, build a plan around that KPI to reach your goal. For example, you could offer discounts or incentives for first-time buyers, improve your website usability, or simplify your payment process.

You can track ecommerce metrics through multiple sources:

• Use your ecommerce platform dashboard for built-in analytics on sales, orders, and basic performance data
• Track customer behavior and advanced metrics with Google Analytics 4
• Get deeper insights into specific areas with third-party analytics tools

Difference between metrics vs KPIs

Metrics are operational indicators

• Track day-to-day performance
• Monitor individual data points like social media reach, impressions, and engagement
• Provide raw data without strategic context

KPIs are strategic goals

• Use metrics to measure progress toward specific targets
• Span longer time periods and cross team boundaries
• Example: "Generate 100 sales through social media this month" (uses social metrics strategically)

Every KPI is a metric, but not every metric is a KPI.

How to choose the right ecommerce metrics for your business

With so many data points available, it's easy to feel overwhelmed. Focus on the metrics that align with your specific business goals. You don't need to track everything. Just focus on what's most important for your growth.

Start by asking what you want to achieve. Your goals will determine which metrics matter most. For example, you might focus on:

• attracting new customers
• increasing profitability
• improving customer loyalty

For example:

• If your goal is growth, focus on metrics like conversion rate and customer acquisition cost
• If you want to improve profitability, track average order value and customer lifetime value
• If you're building brand awareness, pay attention to reach and engagement

Choosing a handful of key metrics helps you stay focused and make decisions that move your business forward, without getting lost in the data.

1. Conversion rate

Conversion rate measures the percentage of website visitors who complete your desired action, typically making a purchase.

Common conversion actions include:

• Product purchases: Your primary revenue driver
• Email signups: Building your marketing list
• Contact form submissions: Generating sales leads
• Account registrations: Creating potential customers

The formula for calculating conversion rate (CVR) is:

Total number of conversions / total number of visitors x 100 = conversion rate

So, you might have 2,000 people visit your ecommerce store in one day, and 40 of those people purchase a product. That's a 2% conversion rate.

Why conversion rate matters: It shows exactly how much website traffic you need to hit your sales targets.

Industry benchmarks: Most ecommerce stores see conversion rates between 2.5 – 3%, though this varies by product type and industry.

2. Average order value (AOV)

This shows you how much customers are spending on one purchase.

You can calculate AOV using the formula:

Total order revenue / number of orders = average order value

Let's say your total order revenue for April is $10,000, and you had 200 orders. Your AOV would be $50.

You can use your AOV to guide your sales strategy – for example, you could set a minimum spend amount to increase your average order value or create bundles with top products.

AOV varies based on product and business type. A low order value may not be an issue for ecommerce businesses with a large customer base and low-priced items. So make sure you use average order value (AOV) in combination with other ecommerce metrics to get a true picture.

3. Customer lifetime value (CLV or CLTV)

This shows you how much revenue can be expected from a single customer over the length of time they might reasonably purchase from you.

The formula for calculating CLV is fairly simple:

Average order value (AOV) x average number of purchases = customer lifetime value

So, if we use the AOV from the previous example ($50), and multiply that by the average number of purchases per customer (let's say it's 15 purchases), we get a customer lifetime value of $750.

When you understand individual customer value you can set a realistic acquisition and retention budget. For example, if you're spending $800 to acquire each customer, but they're only generating $750 each, you might need to rethink your strategy.

4. Customer acquisition cost (CAC)

This metric tells you exactly how much it costs to land a new customer.

All of these activities cost money and contribute to your customer acquisition cost (CAC).

You can calculate the true cost of acquiring a new customer with this formula:

Cost of sales and marketing / new customers acquired (in a set period) = customer acquisition cost

So, if you spend $5,000 on sales and marketing over six months and gain 50 new customers, your customer acquisition cost is $100 per customer. You might set an ecommerce key performance indicator (KPI) of maintaining a customer acquisition cost (CAC) of $100 or less for the next six months.

5. Shopping cart abandonment rate

Customers can make it to your checkout, and still not purchase a product. Your shopping cart abandonment rate shows you the customers who almost complete a purchase with you.

Here's how you can calculate this rate for your store:

Total number of purchases / total number of shopping carts created x 100 = shopping cart abandonment rate

If your rate is particularly high, consider adjusting your payment process or shipping cost to improve your conversion rate.

6. Bounce rate

Bounce rate is a useful metric for ecommerce.

Bounce rate refers to the number of visitors who leave (bounce) after visiting your site or a particular page. Perhaps they read your blog post but don't click through to any further pages. Most ecommerce metrics dashboards include bounce rate in their analytics. You can also add bounce rate to your reports in Google Analytics.

7. Impressions

Impressions represent the number of times your content is displayed on a website, search engine results page, or on social media.

Impressions tell you how often your content has been displayed, not how often it has been engaged with. Your ad might appear on a user's social media, but they may not click it.

8. Reach

Reach and impressions are similar, but there's an important distinction. A single person could see your content multiple times, creating multiple impressions. Reach is the number of individual viewers who see your content.

This is a useful ecommerce metric to judge how effectively your content is being distributed. Low reach could suggest there's more you could do to get your products in front of fresh eyes.

9. Engagement

Engagement tells you how much your audience is interacting with your content – through clicks, likes, comments, and shares. So a good engagement rate for paid ads would mean lots of people are clicking on your advert. A good engagement rate for social media would mean lots of people are liking, commenting, and sharing your content.

You'll be able to find your engagement rate for specific social media profiles in the analytics section of each platform.

10. Click-through rate (CTR)

Click-through rate measures the number of times someone clicks on your webpage, advert or social media content.

A high click-through rate tells you your webpages, ads, and content are doing their job – getting more people onto your site, checking out your products. Industry benchmarks vary, but for social media a typical click-through rate is around 1%, and paid Google Ads is 1.66%.

Achieving a high click-through rate is about making your content—whether it's webpages, social media, or ads—compelling. Highlight the benefits of your product or business in the text, and keep it concise.

You can find your click-through rates on Google ads, through your social media platforms, and on your ecommerce platform.

11. Store sessions by traffic source

Understanding how customers find your store can help decide where to market your business.

You might see that social media-driven store sessions are slow, despite your target market spending time on social media. In which case, you could invest more in your social strategy and content to attract potential customers.

12. Store sessions by device type and by location

Your customers' device types and locations can have a huge impact on how they shop with you. If your customers prefer to shop on their mobile devices, but your store isn't optimized for mobile, you could be missing out on sales.

Location can also impact where and when you should be marketing. If your target market is in the southern hemisphere, but you're posting time-restricted discount codes during US hours, your key customers could be missing your content. Keep an eye on the location analytics in your ecommerce platform and on social media, so you know when to show up.

13. Month-end inventory

Using the month-end inventory ecommerce metric helps you plan stock levels more efficiently. If you find you have excess inventory at the end of every month, it could suggest you're overpurchasing. If you're running low before the month ends, you might need to change your purchasing schedule.

Some businesses experience seasonality too – so tracking month-end inventory over the course of a year can help you predict your annual stock requirements.

14. Refund and return rate

Refunds and returns are a natural part of ecommerce. Customers want to be sure your product is right for them before they commit.

If you notice a high number of returns and refund requests, it may be a sign to review your product quality, customer satisfaction, or advertising alignment.

Keep your product listings accurate and detailed. Use high-quality photos, include a size guide, and encourage customers to contact you if they're unsure about purchasing.

How often should you check ecommerce metrics?

Check your ecommerce metrics monthly to understand your business performance.

Why monthly tracking works best:

• Smooth out daily fluctuations to avoid misleading spikes from successful posts or campaigns
• Show true trends by revealing consistent patterns in customer behavior
• Reduce decision fatigue by preventing overthinking based on short-term variations
• Maintain perspective by focusing on meaningful business changes, not daily noise

You should check more frequently after major changes like product launches, marketing campaigns, or website updates to measure immediate impact.

What's the most important KPI or metric to pay attention to?

The three most critical ecommerce key performance indicators (KPIs) for every business are conversion rate, average order value, and customer lifetime value. These directly measure revenue generation.

Choose additional KPIs based on your business stage:

Starting out:

• Track your conversion rate (target: 3.5% or higher to establish sales momentum)
• Confirm your product-market fit and sales process

Expanding reach:

• Track traffic source diversification and customer acquisition cost
• Reduce dependency on single marketing channels and control growth costs

How ecommerce metrics can help your cash flow and forecasting

Ecommerce metrics help you decide where, what, and when to invest for maximum return.

How metrics improve cash flow management:

• Timing investments: Know when to spend based on sales patterns and customer behavior
• Optimizing spend: Identify which marketing channels and strategies generate the best ROI
• Predicting revenue: Use conversion and order value trends to forecast income
• Reducing waste: Stop spending on underperforming channels and tactics

Customer journey insights help you:

• Find more customers through successful acquisition channels
• Improve sales processes based on conversion data
• Increase order values through behavior analysis

You can use Xero accounting software for ecommerce and online businesses to integrate with popular ecommerce platforms. Your transactions and inventory stay synchronized in Xero, so your cash flow reports and projections are always up to date and reliable.

FAQs on ecommerce metrics

Here are common questions and answers about ecommerce metrics for your small business.

What are the 3 most important ecommerce metrics?

While every business is different, most ecommerce stores should start by tracking three core metrics: conversion rate, average order value, and customer lifetime value. These give you a clear view of your sales performance, how much customers spend, and their long-term value.

What are the 5 C's of ecommerce?

The five C's are a framework for building a successful online business. They are content (engaging material), community (building a loyal audience), convenience (an easy shopping experience), conversion (turning visitors into buyers), and customer care (excellent support). Tracking your metrics helps you see how well you're performing in each of these areas.

How do ecommerce metrics help with business strategy?

Ecommerce metrics turn data into actionable insights. They help you understand what's working, so you can make smarter decisions about your marketing spend, product offerings, and customer experience. This allows you to build a strategy based on real performance, not guesswork.