The success of your online store depends on many factors, one of them being outstanding customer experience (CX). This post covers the top 10 key performance indicators (KPIs) for tracking and improving CX at your eComm store.
Many eager entrepreneurs believe that selling top-notch products is all it takes to land new customers. While that might often be the case, the same cannot be said for customer retention, loyalty, or referrals.
Modern e-commerce businesses also need a stellar CX tailor-made for their buyers in order to stand out. To understand what makes your store’s CX appealing and spot opportunities for improvement, you also need to know which KPIs to track.
Let’s delve into the most essential KPIs and tips for improving them. The goal is to provide an outstanding customer experience and boost your online store’s performance.
KPI #1: Weave CSAT into Product Management
Customer satisfaction, or CSAT, is widely accepted as one of the most important customer experience KPIs. It consists of many moving parts and it differs from one brand to another. So, you’ll always want to stay keenly aware of it.
You can start tracking CSAT by devising customer surveys. Surveys will allow you to collect specific data points and then measure your CSAT on a 0-100 scale.
They can be simple pop-up surveys after each one-time interaction, where customers grade you one to five stars.
Here’s how to calculate the result:
- Calculate the number of customers who are satisfied with your product and service. These are people who rated you with the top two scores available, such as 4 and 5.
- Divide that number by the total number of people who took the survey. Then multiply that number by 100.
- The final number is the customer satisfaction score.
This information is crucial for your entire product lifecycle. You can use this data to drive your technical product management forward. It also helps improve the type of products you offer based on the experience the product provides.
You can expect the score to get better slowly as you introduce changes matching your customers’ needs.
This matters whether you want to remain a smaller “mom & pop” retailer focused on the local community, or build a nationwide service franchise founded on customer appeal. Either way, customer satisfaction will significantly impact your goals.
KPI #2: Track Your Customer Churn Rate
Customer acquisition is often a tedious and costly process. Even when you’re a relatively well-established business, getting existing customers to stay and buy again is much easier and more cost-effective than acquiring new ones.
This is where measuring and identifying customers at risk of churn will help you improve. As their customer experience improves, so does your sales potential. So, start tracking the customers you lose over a defined period of time and learn why they are leaving.
That will help you understand the percentage of customers who stay (and why they choose to do so). And, you can define the number of people who no longer come back. Then you can leverage other KPIs to boost their experience and elevate retention.
KPI #3: Optimize Your Customer Acquisition Rate
It’s more cost-effective to retain quality customers through outstanding customer service to maximize their customer lifetime value (CLV).
However, there’s no denying that you need a steady influx of new customers to keep your business moving forward. Remember that customer acquisition is also important for building social proof and establishing your brand’s reputation. The more competitive your market, the more important this becomes.
Analyzing your customer acquisition rate (CAR) will allow you to optimize your customer onboarding process as well. With communication features like an automated phone system and AI-driven chatbots, you can more easily retain new customers over the long term.
There are some other AI use cases in eCommerce that can significantly benefit your business, including personalized marketing and voice commerce, which can all improve customer retention.
Then, compare the number of new customers in a specified timeframe with past acquisition periods to identify common problems. That allows your sales, customer support, and marketing teams to allocate resources toward the right acquisition channels.
You can gain insight from your CAR if you analyze it alongside your CLV, customer onboarding, and churn rate. That’s the best way to determine the overall ROI of your acquisition efforts. Your goal here is to maximize acquisition but minimize financial waste associated with each new customer.
KPI #4: Measure CES for Better Customization
Is your product considered simple to use and purchase? Is the customer journey an effortless one with no more than a few clicks or steps involved?
Customers don’t want to waste time filling out long application forms. And they certainly don’t like waiting for your service agent to get back to them.
The customer effort score (CES) tells you where you can provide a more streamlined process and offer better customer service. Look at this across the board — payment platform, product selection process, and shipping options.
Use the information to improve feature request tracking and offer customization options to new and existing customers. That way, you will make their experience simpler and quicker.
KPI #5: Learn from Your Promoters with NPS
The Net Promoter Score (NPS) is a highly valuable metric that shows you which customers value your business the most.
Knowing why they choose to stay loyal helps you provide a better experience to other customers and improve the overall customer health score.
(Also, positive feedback can be a terrific morale booster for your company. Who doesn’t like hearing that customers are happy with the work everyone has done?)
A high NPS score indicates that your customers are highly likely to recommend your business to their friends and family. On the other hand, a low score is a red flag that signals, “Improve your CX!”
To see the bigger picture, track your video marketing metrics and other marketing KPIs along with your customer experience KPIs. That tells you a lot about your promoters and brand ambassadors.
What do they like? What do they respond to? Then combine that data and devise a marketing strategy to grow your business and profitability using their loyalty.
This is especially important if you are engaged in e-commerce. So, again, carefully watch your customers’ NPS numbers. Keep this highly potent resource working for you rather than against you.
KPI #6: Focus on Your Retention Rate
Your NPS shows part of you how well you do with retention, at least among people who purchase regularly.
However, you also have “passive” buyers who don’t necessarily recommend your business but buy from you regularly.
For example, even a 5% increase in customer retention can increase profits by 25-125%.
They, too, define your retention rate. Use the retention rate data to learn how you can leverage customer experience for other buyers. A boost in retention usually means improved profitability.
But if it is the opposite, using customer engagement software can be helpful to identify areas where retention may be declining and provide insights into customer behavior.
KPI #7: Gather Useful Insights from Your Net Emotion Score (NES)
Your Net Emotion Score measures the positive and negative sentiment regarding a product, service, or brand. It allows companies to gauge the performance of their products from an emotional standpoint. That’s crucial for sensing the demand for those products within the community or marketplace.
NES can affect numerous other metrics, such as NPS, CLV, word of mouth, brand reputation, social proof, and more.
Many factors influence NES, from the quality of promotional material to the product features. Also, this is where outstanding customer care can make a big impact.
For example, if you host product videos on different platforms, and those platforms have a lot of ads or are intrusive in any way, visitors can develop a negative sentiment. That’s why Vimeo alternatives have become popular for B2B and B2C companies.
(Companies that use video marketing are generally always sensitive to building a positive sentiment around their brand.)
You can calculate your NES by subtracting the average of negative emotions from the average of positive customer emotions.
While CES, NPS, and NES are important sources of customer experience measurement, they don’t replace personal insight from first-person feedback. In-person interaction often helps deepen a marketer’s understanding of the numbers.
KPI #8: Go Effortless with Your Average Resolution Time
In addition to focusing on an effortless customer journey (CES), pay attention to problem resolution time, or PRT.
No matter how brilliant your product or solution is, you will inevitably encounter dissatisfied customers.
Measuring and tracking your average issue resolution time will help eliminate problems and provide quick solutions. You might introduce chatbots or create a better FAQ page, but any form of faster resolution will ultimately improve the customer experience.
KPI #9: Don’t Neglect Cart Abandonment
Once again, there’s much to learn from metrics focused on the negative aspects of customer experience. This is where cart abandonment makes a big difference. It shows you exactly when and why customers decide to give up on their purchase.
As you collect cart abandonment data through surveys and other feedback, you can resolve or eliminate issues that push people off your site.
Over time, your cart abandonment rates will dwindle. That’s because improved customer service helps your customer retention soar as you boost the best aspects of the customer experience.
KPI #10: Monitor Pages Per Visit and Heatmaps
Monitoring pages per visit and page heatmaps can tell you a lot about the overall experience of your customers on your website.
How fast are they scrolling? How long are they lingering, and where? Also, how many pages do they visit per session?
These are pretty good indicators of the kind of experience your site is creating.
These indicators help gauge the popularity of products, too. They can help you deprioritize projects and features that are no longer in high demand. You can replace them with new, more appealing offerings.
Analyze these metrics to identify which pages are performing best and which you can start to phase out your catalog.
Over to You
Customer experience defines your ability to keep customers happy, inspired, and bringing more business your way.
To understand fully how customers interact with your brand, you need to measure and track key customer experience KPIs (and others specific to your niche).
Let these performance indicators provide you with the necessary customer intelligence to transform ordinary customer experiences into extraordinary ones.