How can you evaluate the performance of your webshop?
The main business goal of a webshop owner is usually to increase the revenue and the return of investment of the webshop (achieving an optimal revenue-to-cost ratio).
However, there are a number of tools and ways to achieve these two main goals, and while reaching our goal, it is worth looking at other indicators that can show whether we are on the right track.
This blog post will show you how to recognize in time if the path you’re on isn’t going to bring the long-awaited business success – using whatever online marketing tool or tool mix.
If you are planning to start a new webshop or run your existing webshop, you can find more useful tips in our related blog articles.
Evaluation of webshop usage indicators
Before inspecting the results of your ppc ads or the business results of your entire webshop, you should first review your webshop’s general usage metrics.
Do they show an improving or deteriorating trend? What could be behind the potentially deteriorating indicators, problems on the server-side or the user-side-side, or even other problems that need to be fixed?
You should check out these webshop usage metrics:
- Purchase transaction rate (how many webshop purchases will be made from 100 webshop visits)
- Webshop bounce rate (just be careful with it!)
- Average conversion value (this is the average value of purchases made in your webshop, which is key information if you want to increase your webshop ROAS)
- Average session duration (GA3 only, not in GA4)
- Pages / session (how many pages webshop visitors viewed during a session)
Evaluation of webshop purchase indicators
To determine if your online marketing activities are heading in the right direction, you may want to look at key metrics related to webshop purchases. Attention: unless you have an emag.hu-sized webshop, it’s unnecessary to check the data daily! For a meaningful analysis, it is worth reviewing a period of at least one calendar month, paying attention if you are selling a seasonal product, then you should look at a comparison with the same period of the previous year instead of two consecutive calendar months.
You may want to review these webshop purchase metrics:
- How many new customers did you get in the period under review (because new customers are the key to growth)
- How many of your old customers purchased again in a given period (a very important question, because keeping your good customers is much cheaper than getting new ones if everyone only buys from you once, it may also indicate that they are disappointed in your purchase, especially if they express this opinion, which also greatly impairs your chances of gaining new customers)
- Average number of purchases per customer during the survey period (if only once, it’s time you used a loyalty program and marketing automation tools to take care of your best customers and encourage them to buy again)
- How successful have you been in building your database (so that you can reach your existing interested parties and customers directly, not just through paid advertisements, eg. registration, newsletter)?
- If you run online ads (Google ads, Shopping ads, Facebook ads), how did the cost of making a purchase change over the period under review?
- How did non-purchase goals accomplish (e.g. number of facebook followers, youtube subscribers)?
Evaluating the performance of webshop products
One of the key factors in the success of our webshop is the competitive product range, the right assortment of product for which there is a solvent demand, and the accessibility of actually available products.
To check if your webshop supply is suitable, you should check out the following:
- Which is the most popular product and product category (based on the number of product views and product purchases)
- Which is the most profitable product, our product category (which brings the most revenue and benefits)?
- What are your weakest performing products?
- Did seasonality affect any of your products in a positive or negative way?
- Did you have a product with which you could not meet the demand and vice versa (i.e. you would have had more purchases if the stock of the product was not finite)?
- Did you have a product you couldn’t sell any of?
- Is there a product that your competitor is selling, but you aren’t?
Business evaluation of a webshop
Since our main goal is to achieve the set business results through webshop sales, i.e. through our established e-commerce business, the evaluation of business results is very important.
To decide if it’s worth running a webshop, check out the following metrics:
- Did you achieve your sales goals?
- Were the channels in our online marketing mix growing in revenue?
- Which online marketing channel has achieved the most growth and which has the least?
- How did the ROI of each of your marketing channels develop?
- Can you use new online or offline marketing tools and channels?
- Was the suitability of the webshop adequate during the study period (in terms of load speed, conversion path, UI / UX aspects, usability)?
- Is our webshop prepared for the challenges of the next period (e.g. new online campaign and ad types, IOS restrictions, cookie removal, new website analytics – GA4)?
Evaluation of webshop ads
If you want to increase your webshop traffic with online ads, you should be aware of the main KPIs used specifically for webshop PPC ads to get an idea of their performance.
Here’s what you should look at regarding your webshop PPC ads:
- Have you reached your target KPIs (key performance indicators such as ROAS, revenue, CPA, transaction rate)?
- How did each of the specific online advertising channels perform (Facebook ads, Google ads, TikTok ads)?
- Is there a marketing channel you don’t use yet, but you should (Pinterest ads, Waze ads, LinkedIn ads)?
- Do you have all the conditions to achieve real growth in webshop traffic or ROI in the next period with your online ads?
- Is there an audience segment that has achieved outstanding sales and revenue as well as ROI in your webshop? What channel could you use to reach them even more effectively?
Financial evaluation of a webshop
Your main goal is to make a profit by operating the webshop, so the most important thing is whether you have achieved this and whether you have a realistic chance of achieving the set financial results in the next period.
To decide this, you may want to ask the following questions:
- Have you closed a financially successful period?
- Were the planned webshop revenue and profit goals achieved?
- Do you have a realistic chance of achieving them in the next period?
- Do you have real financial and other resources to meet our future growth goals (advertising budget, inventory financing, order delivery, webshop operation and development)?
Summary
Whether you want to further increase the revenue or improve the profitability of a webshop that has been in operation for years, or it’s a whole new start-up webshop, it’s basically very similar to look at whether you’re on the right track.
To evaluate the performance of your webshop, it is worth reviewing usage, visitor, purchase, product, advertising, and aggregate financial metrics.
Of course, the emphasis between these can vary depending on whether it is a completely new webshop or a “mature” webshop that has been in operation for several years.
You should always be aware of what you need to pay attention to and what key components are needed to make a webshop a success!