In the fast-paced world of e-commerce, success is often determined by data-driven decisions. In 2022 eCommerce in the US grew 7.7% YOY and topped $1 trillion (1). Monitoring and analyzing key metrics is essential for understanding the health and growth potential of your online business. Whether you are a seasoned e-commerce entrepreneur or just starting out, here are the top 9 key metrics that can guide you towards running a successful e-commerce business.

Conversation Rate

Conversion rate is the percentage of visitors who take the desired action, such as making a purchase. Monitoring this metric helps you assess the effectiveness of your website design, user experience, and product offerings. A higher conversion rate indicates that your site is effectively turning visitors into customers. The conversion rate varies by product category, but a good conversion rate should be around 4%. More importantly, review this metric to determine keyways to improve the percentage.

Customer Acquisition Cost (CAC)

Commonly referred to as CAC, this represents how much you spend on average to acquire a new customer. This metric is crucial for evaluating the efficiency of your marketing efforts. To ensure profitability, your CAC needs to be lower than the lifetime value (LTV) of a customer. Initially, most eCommerce businesses start with a higher than acceptable CAC, to attract customers to the brand. This strategy needs to correlate with the financial wherewithal to sustain the lower margin. Many brands find themselves in financial trouble as the CAC does not fall below the LTV.

Customer Lifetime Value (CLTV or LTV)

LTV measures the total revenue a customer generates throughout their engagement with your brand. This metric helps you identify your most valuable customers and informs decisions on marketing spend, retention strategies, and personalized offerings. The success of your business will be determined by what percentage of customers return to make additional purchases. The goal should be in the 30% plus range.

Cart Abandonment Rate

This metric reflects the percentage of users who add items to their cart but do not complete the purchase. A high abandonment rate signifies potential issues in your checkout process, pricing, shipping costs or transparency with delivery time. By addressing these issues, you can minimize lost sales opportunities. Cart abandonment rates vary dramatically by product or category with the average being in the 60% percent rate and the successful business in the 20% range.

Inventory Turnover

Inventory turnover indicates how quickly you sell and replace your inventory. Striking the right balance between stock levels and demand is crucial for maintaining cash flow and avoiding overstock or stockouts. The higher the turnover rate, the better. The product category will determine what a good target number is with the average rate across eCommerce being in the 4 to 6 range (I.e., your inventory turns over every 2 to 3 months).

Delivery Time Happiness

Consumer expectations have changed in recent years. Leading up to the pandemic, consumers continued to push expectations to same day, next day delivery. Post pandemic we have seen the numbers taper off, with 90% of today’s consumers expecting two-or three-day deliveries (2). It is more important for consumers to have clear visibility to the tracking information and update the expected deliveries. If consumers are informed up front on the average delivery time, they are more likely to have a positive experience.

Net Social Sentiment (NSS)

NSS is a metric that measures the overall sentiment of a brand, product, or service on social media platforms. It is calculated by analyzing the opinions expressed about a specific category or topic on social media platforms and then determining the net value of all those opinions. The net sentiment is calculated by subtracting the percentage of negative comments from the percentage of positive comments and then multiplying the result by 100. The total count of terms (positive + neutral + negative terms) is used as the denominator in this calculation. NSS is simply the percent of positive sentiments minus the percent of negative sentiments.

Customer Reviews

As products begin displaying reviews, conversation rates escalate rapidly. The purchase likelihood for a product with five reviews is 270% greater than the purchase likelihood of a product with no reviews (3). Additionally, from the same study, reviews have a greater impact on higher priced items. They found that when reviews were displayed for a lower-priced product, the conversion rate increased 190% versus 380% for a higher priced product.

Omnichannel Customer Support

Omnichannel customer support is an approach that integrates multiple communication channels to provide a seamless and consistent experience across all touchpoints. Customers can interact with brands through various methods such as phone, web chat, live chat, SMS, email, and social media. The sweet spot for customer review is between 3.7 to 4.6 and managing customer reviews is critical to the success of your business. 

Running a successful e-commerce business requires a comprehensive understanding of key metrics that provide insights into your operations, customer behavior, and overall performance. By regularly monitoring and analyzing these top nine metrics, you can make data-driven decisions that drive growth, improve customer satisfaction, and lead to e-commerce success. The relationship between these metrics is particularly interesting since it looks at pre-purchase and post-purchase indicators. Remember, it is not just about collecting data, but about translating that data into actionable strategies that enhance every aspect of your business.

As our name implies, Speed Commerce knows how successful eCommerce business’s function. We go beyond the traditional 3Pl to provide added value services both in fulfillment and customer service. As an example, we can monitor your social media and manage your response. We provide phone, live chat, email communication and phone support. Additionally, we can support a great client experience before the purchase by making recommendations and answering questions. We review the feedback from your customers and provide you with the information to drive and scale your business. Want to learn more? Visit us at for additional information and to set up a call with one of our team members.