eCommerce is one of the newest business models, allowing businesses to buy and sell products or services online. Therefore, as it happens on the internet, there is more to lead generations and conversions that companies should look after. Another aspect to consider is the standard criteria for running a business online. But what are they, and why do they matter?
1. Website Traffic
The first aspect to consider is website traffic, an essential requirement for a successful digital business. Every business should look after website traffic, as digital marketing is closely related to a company’s profit. Your website traffic is the foundation of most of your advertising channels, including social media and email marketing.
In running an online business, you need a sizable number of visitors to your website. If your company does not have them, there is a chance to become unsuccessful because a high bounce rate can lead to a loss of potential customers.
2. Retention Rate
The second criterion is the retention rate. The retention rate is the proportion of visitors who return to the website after visiting it. It is a crucial aspect to consider, as it is a critical metric that shapes the performance of your advertising campaigns.
Also, a high retention rate means more traffic (which we have mentioned before). In addition, it means that your advertising campaign is performing well, so the chances of your business succeeding are significantly higher.
3. Cart Abandonment Rate
The third criterion is the cart abandonment rate. Also known as shopping cart abandonment, this is the percentage of visitors who put products into their cart but do not complete the checkout process. Therefore, it is a crucial metric to consider, as it can influence your revenue significantly.
A high cart abandonment rate means that your company loses potential revenue, as customers are not converting. That is why it is crucial to manage it and reduce it.
4. Cost Per Acquisition
The fourth criterion to consider is the cost per acquisition. Also known as CPA, this is a measurement that companies can use to estimate the effectiveness of their campaigns. It is also considered a crucial aspect to look after, as it can help you determine the value you are getting from your advertising budget.
However, the CPA is not always a good indicator, as it is influenced by many factors, including the competition, history, and business type. In addition, when the CPA is high, it does not mean that you have a terrible campaign because there might be large sales volumes.
5. Bounce Rate
The last criterion is the bounce rate. It is not a criterion, but it is an essential aspect of your company’s performance, so you need to understand your bounce rate and adjust your strategy accordingly.
Bounce rate is the number of users who see one page on your website or click a link on your website but do not visit another page afterwards. It is calculated by dividing the number of single-page visits to your website by the total number of visits.
Conclusion
There are several elements that you need to consider when it comes to running your online business. Therefore, it is crucial to find the source of your web traffic, as, without it, you will not be able to grow your company. But make sure that you keep an eye on all other criteria that we have mentioned, as they are crucial.
The eCommerce Accountant is an online accounting firm based in Australia. Our goal is to offer eCommerce accounting solutions to businesses needing help managing their company’s finances. Hire an accountant for eCommerce today by booking an appointment through our website.