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TechnologyJan 21, 2010

eCommerce Metrics and Analytics – Business Objectives

Katherine Moffitt

An important initial activity in planning for a new or redesigned eCommerce website is to define the specific business goals for the site and the measurements that will be used to track progress toward the goals. Collaboration throughout the organization is needed to first define the target audiences, then define and prioritize specific objectives for each audience.

__Step 1: Define the target audience(s) for the website

__Knowing the audience(s) that you want to reach will help you define specific objectives for each audience. The more detailed the audience definition, the more specific the business objectives for the audience can be. For example, an athletic clothing manufacturer may identify “athletes” as a target audience. However, a more granular definition of athletes may be “female, adult, recreational runners ages 30-45.”

__Step 2: Define the business objectives specific to each target audience

__An eCommerce website can provide many qualifiable and quantifiable benefits, such as improved customer service, extended reach, increased brand awareness, internal efficiency, and revenue growth. The key to defining specific objectives for each audience is to make them SMART, meaning they are specific, measurable, achievable, relevant, and time framed. Expect that the organization will be held accountable to measure and meet the defined objectives.

Examples of SMART objectives:

  • Increase new sales for female customers ages 30-45 by 10% within 6 months

  • Increase percentage of sales for existing female customers ages 24-29 by 15% within 5 months

  • Increase average number of repeat customer sales to 4 transactions annually within 18 months

  • Grow number of daily visitors to the eCommerce site to 10K within 4 months

  • Obtain email addresses from 20% of new visitors to the eCommerce site through customer registrations

  • Achieve 15% of total revenue in online sales within 12 months

__Step 3: Prioritize the business objectives

__Once the business objectives have been defined, they must be prioritized. You may find that all of the objectives that have been identified cannot be met at the same time or that certain objectives may provide greater benefits than others.

__Step 4: Measure the business objectives

__The objectives and goals begin to come alive when you decide how to measure them. Web Analytics tools with a variety of features are available to help you track specific metrics related to your eCommerce site and measure progress toward your website business objectives.