Tuesday, 15 November 2011

How much was the visit worth?

In retail there are a few core KPIs such as Inventory turnover ratio, Sales per square foot, average spend per footfall, etc. From the store manger, merchandiser and the marketing personnel's point of view it the average spend per customer footfall that explains if the store is attracting the right target audience and after they have made the visit to the store the customer has found the product that he/she is looking for, it is priced right and it has inspired or motivated the customer to part with the money and take the product home.

Technology has not fundamentally changed the essentials; we still need to eat, clothe and shelter ourselves. How we do that and the other needs of safety, education, comfort, etc has gone through revolutionary changes. 

In my experience working in ecommerce websites , I find that this one KPI of Revenue per Visit sums up all the other KPIs very well and provides everyone with an actionable metric. It quintessentially measure the money that the website makes every time a customer enters your ecommerce store. Then add further dimensions such as 

- Revenue per visit based on frequency of visit of the customer
- Revenue per visit split by demographic data such as age, region, etc
- Revenue per visit by first referrer visit, by last referrer, all 28 day referrer visits
- By product category
- By visitor loyalty
- By Devices ( like smart phones, tablets, etc.)
- Revenue per visit by marketing channels/ landing pages
- Revenue per visit with relation to customer satisfaction rating scores

The product team looks at the revenue per visit on the page and combines it with page view bounce rate, page view conversion report and in relation with the product's importance in portfolio decide on whether the product is meeting it's expectation or not.

Revenue per visit in view with the competitor price index/ position gives us what the pricing team need to do to make the product/ product category more competitive and compelling for the customers.

The promotions team looks at the uplift in revenue per visit to the cost incurred on promotions. 

The merchandising team can optimize based on the positive or negative change in this metric on the performance of the new zones/ pages they have created.

Above all to the top management it provides in a snapshot the health of the business and with every footfall the customer makes to the website or ecommerce store, what was the bottom line or top line impact. In short what is the worth of every visit the customer makes to the website through their desktop, iPad, smart phone, online kiosks, smart TV or any other device that is going to enter the market and how much he transacts with the company/ brand.

1 comment:

  1. Thank you for sharing valuable information. Nice post. I enjoyed reading this post.
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