Key Performance Indicators (KPIs) Online Sellers Must Track Monthly

Key Performance Indicators (KPIs) Online Sellers Must Track Monthly 

Running an online store is more than just selling products—it’s about making data-driven decisions to improve profitability and efficiency. Tracking key performance indicators (KPIs) monthly ensures you stay on top of your business's financial health and growth. Here are the essential KPIs every online seller should monitor: 

1. Revenue & Profitability Metrics 

These metrics help sellers understand how much money they’re making and how profitable they are. 

• Total Revenue – The total sales generated in a month before any deductions. This is your top-line number and gives an overall picture of sales performance. 

• Gross Profit Margin – Formula: (Revenue - Cost of Goods Sold) ÷ Revenue × 100  

  This tells you how much money remains after accounting for the cost of the products sold. A higher margin means more efficiency in pricing and cost management. 

• Net Profit Margin – Formula: Net Profit ÷ Revenue × 100  

  This is the percentage of revenue that turns into profit after deducting all expenses (COGS, marketing, salaries, rent, etc.). 

• Average Order Value (AOV) – Formula: Total Revenue ÷ Number of Orders  

  A higher AOV means customers are spending more per transaction, which helps improve profitability without increasing customer acquisition costs. 

2. Customer Metrics 

These KPIs measure customer behavior and help assess the effectiveness of marketing and retention strategies. 

• Customer Acquisition Cost (CAC) – Formula: Total Marketing & Sales Costs ÷ New Customers Acquired  

  This measures how much it costs to acquire a new customer. If this number is too high, profitability could be at risk. 

• Customer Lifetime Value (CLV) – Formula: Average Order Value × Purchase Frequency × Customer Lifespan  

  CLV estimates the total revenue an average customer generates over their entire relationship with your business. The goal is to have CLV significantly higher than CAC. 

• Customer Retention Rate – Formula: ((Customers at End of Month – New Customers) ÷ Customers at Start of Month) × 100  

  This measures how well your business retains existing customers. A high retention rate indicates customer satisfaction and strong brand loyalty. 

3. Traffic & Conversion Metrics 

These metrics assess how well a website is attracting and converting visitors. 

• Website Traffic – The total number of visitors to your site.  

  You can track this using tools like Google Analytics to see where visitors are coming from (organic search, social media, ads, etc.). 

• Conversion Rate – Formula: (Number of Sales ÷ Total Visitors) × 100  

  This measures how many visitors complete a purchase. A low conversion rate may indicate poor site design, slow load times, or ineffective product pages. 

• Cart Abandonment Rate – Formula: ((Number of Initiated Checkouts - Number of Completed Purchases) ÷ Number of Initiated Checkouts) × 100  

  This shows the percentage of customers who add items to their cart but don’t complete the purchase. If this rate is high, it may indicate issues with pricing, shipping costs, or checkout process friction. 

4. Inventory & Fulfillment Metrics 

Efficient inventory management and order fulfillment are key to maintaining customer satisfaction and profitability. 

• Inventory Turnover Ratio – Formula: Cost of Goods Sold ÷ Average Inventory  

  This shows how often inventory is sold and replaced within a given period. A low turnover rate could indicate slow-moving stock or overstocking issues. 

• Stockout Rate – Formula: (Number of Stockouts ÷ Total SKUs) × 100  

  If products are frequently out of stock, you risk losing sales and customers to competitors. 

• Order Fulfillment Time – The average time it takes from when an order is placed to when it’s delivered.  

  Faster fulfillment leads to higher customer satisfaction and better reviews. 

5. Marketing & Advertising Metrics 

These KPIs track the effectiveness of marketing efforts and help optimize ad spend. 

• Return on Ad Spend (ROAS) – Formula: Revenue from Ads ÷ Cost of Ads  

  A ROAS of 4:1 means you earn $4 for every $1 spent on ads. If ROAS is too low, your ad strategy may need adjusting. 

• Email Open & Click-Through Rates  

• Open Rate measures how many recipients open your marketing emails. 

• Click-Through Rate (CTR) measures how many people clicked a link in your email. 

  These metrics help determine the effectiveness of email campaigns. 

• Social Media Engagement – Tracks likes, shares, comments, and follower growth.  

  High engagement means your audience finds your content valuable, which can lead to more conversions. 

Summary

Tracking these KPIs monthly allows online sellers to make data-driven decisions, improve profitability, and scale their businesses efficiently. 

Take Control of Your Numbers Today! 

Tracking these KPIs consistently is the key to making smarter business decisions, increasing profitability, and growing your online store. If you’re unsure how to interpret your numbers or need help optimizing your financial strategy, I can help! 

Schedule a consultation today to get expert guidance on maximizing your profits and making data-driven decisions for your eCommerce business. Let’s take your store to the next level! 

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