Have you invested in good buying experiences?    

If you are in charge of an E-commerce site, you know how it is like to invest (perhaps even vast amounts) in marketing activities to attract potential customers.
 
However, have you invested in converting the visitors you attract into customers? Have you invested in providing customers with good buying experience that makes it smooth and pleasant to buy your products?

How to calculate your improved business metrics     

The business results of good buying experiences are improved conversion-, retention-, average purchase rates and lowered administrative costs.

It is expensive to attract visitors to your site. And if your hit rate in converting these visitors into customers is too low, your marketing investments do not pay off.

Below are three key factors you can use to calculate your business metrics:

Conversion rate
No. of orders / No. of visitors * 100 = conversion rate
 
Retention rate
No. of orders / No. of orders by existing customers * 100 = retention rate
 
Average order size
Total revenue / total No. of orders = average order size

A calculated example      

By combining figures from your financial system with statistics from your online tracking tool, you are able to calculate the improved business metrics. 

Consider this example. An E-commerce site has the following current data:

Annual revenue Conversion rate Retention rate Average order size Number of orders Number of visitors

= EURO 10.000.000  = 2,75% = 10% = EURO 500 = 20.000 = 727.273

Results
We make the company's E-commerce website more customer-centered by improving the website's usability, design and business logics, ultimately to achieve the following results:

• The conversion rates increases from 2,75% points to 2,90 % points
• The retention rate increases from 10% points to 12% points  
• The average order size increases from EURO 500 to EURO 525

Our improvements will increase their revenue substantially: