KPIs and Metrics for eCommerce | Evaluate Your eComm Performance

I teach you how to measure the most important metrics & KPIs for eCommerce. Free template included.
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We learn about how to measure the most important performance metrics for eCommerce. These include things like unit economics, LTV: CAC ratio, contribution margins, and overall profit margins.
A healthy business is growing, has strong recurring revenue, profitable contribution margins relative to CAC, and generates cash flow. We do a case study to analyze the health of a Shopify store.
Sections:
0:13 goals for evaluating eComm performance
0:48 income statement analysis (sales, contribution margins, marketing, operating profits)
6:55 eCommerce unit economics breakdown (per order)
9:26 sell your e-commerce business instantly with OpenStore bit.ly/freepri...
10:52 unit economics for top-selling products
12:48 how to calculate customer acquisition cost (CAC)
16:31 using customer cohorts to understand customer retention
20:54 customer lifetime value and LTV: CAC ratio for eComm
By the end of this video, you will understand the most important KPIs for evaluating eCommerce businesses.
#ecommerceKPIs #uniteconomics #contributionmargin
*Disclaimer: this video is sponsored by OpenStore.

[@eric_andrews]

Get a free offer for your Shopify store ➡ bit.ly/freepriceopenstore

[@Aira.Padilla]

Hi Eric, I am a new ecom biz owner still getting my fit in the industry so I really appreciate these videos you are making. I've been binge-watching your video to learn all this stuff. Thank you so much for giving us all this info!

[@mussdgn]

this is legendary, god bless bro, i wish i can do more, i will do it hopfully after my company succeed

[@eric_andrews]

Thank you - I really appreciate it! Good luck with your company 🚀

[@sonerguney3225]

You are so professional Eric. Well done

[@eric_andrews]

I'm glad you're getting value out of the lectures

[@eric_andrews]

Curious - are you seeing stronger or weaker customer demand right now vs. 6 months ago?

[@abdullah_shaikh95]

You are a beast Eric. Keep them coming🔥

[@eric_andrews]

Appreciate it, more to come!!

[@mudasserjunaid8060]

very informative and helping

[@eric_andrews]

Glad to hear it

[@cherchang8481]

This is gold!🎉

[@eric_andrews]

Cheers 🙌

[@wahidalishah2785]

thanks eric for your valuable video

[@eric_andrews]

You are welcome

[@yassinemajidi]

This is very valuable information, thank you.

[@eric_andrews]

You're very welcome!

[@aminanavas2685]

wow.. great video.. valuable ..!!!!👍

[@mahmoudmohsen8105]

Nice one ! :)

[@eric_andrews]

Glad you liked it!

[@manuelgutierrez1896]

Great videl Eric! Could you make a similar video for marketplaces?

[@eric_andrews]

Hey Manuel - I'll put it on the list!

[@eric_andrews]

This might help! kzbin.info/www/bejne/jKCWpn-woppnY7s

[@tommiutriainen8061]

Hey Eric, thank you for the great content. I have one quesiton about the CAC section of the video. Since the name implies (Cost of Acquiring a new Customer), why do you calculate the CAC based on new orders and not based on new customers? It's a small nuance, but I just want to clarify this for myself (and someone else wondering the same thing)

[@eric_andrews]

Honestly new doing it with the new customers is probably more accurate in terms of the textbook definition of CAC. That said you would then need to make sure your AOV and Gross Profit is based on the customer, not the order, which kind of tricky in practice. Operationally, it's often easiest to calculate the AOV and gross profit per new order and then compare that to CAC (new order CAC) than use everything based on new customers....so in eComm we do a lot of per-order metrics because of that.

[@tommiutriainen8061]

Thanks a lot for the reply@@eric_andrews! This totally makes sense and was thinking this definitely simplifies calculations. I just sometimes get so hung up on the terms and definitions and was thinking "hmm how is it Cost of Acuired Customer and he is talking about orders" :D

[@masoodhusseyn9695]

Hi Eric, can you help us in crafting humanised KPI'S for contact centre. 1- inbound/outbound 2- chat/email I am not for too stringent KPI's, I aspire to give space to my staff, growth centric KPI'S 'yes sure', and simultaneously helping them in skill building. Win - Win stuff. *Sales are primary element but I would prefer to explore the underneath components under the sales banner of KPI'S that should push the growth. I am struggling to have those and looking for help. Grateful.

[@iostarinfotechprivatelimit2164]

Eric Its good pls advise how to get access to excel template u have designed and spoken about in your video

[@eric_andrews]

Hey sure, the link to download it is right there in the description 👍

[@mussdgn]

Hey, can you do any video on ecom marketplaces, im just breaking my head to convert this into a marketplace, because in marketplace you will have two type of customers [sellers and consumers]

[@eric_andrews]

Already have a marketplace video here: kzbin.info/www/bejne/h2rPn3t9e9eZmpY

[@mussdgn]

@@eric_andrews this is legendary, you are a legend, bro I wish I can share your videos with all founders, god bless, cheers !!

[@eric_andrews]

@@mussdgn My pleasure - here is my marketplace unit economics benchmarking video as well: kzbin.info/www/bejne/jKCWpn-woppnY7s + more to come on marketplaces I promise!

[@polinchum8947]

CAC = Marketing expense/New Customers? I see your calculation is Marketing expense/New orders

[@eric_andrews]

Yes operationally you usually can't really get new customers, usually just new orders out of the analytics. But in a perfect world it would be new customers

[@kuldeepchauhan2030]

Hi eric great video, I have't receive any file , already mail of my mail id . pls do the needful.

[@eric_andrews]

Just wait 5 minutes sometimes there is a delay...it works though i promise!

[@alihayek932]

You obviously were a consultant at some point in your career

[@eric_andrews]

I work with startups as a consultant all day long!