If you run an online business, you need to continuously evaluate its performance to understand whether you are doing good. For ecommerce, there’s a bundle of specific metrics – ecommerce KPIs – that helps you calculate and measure the success of your marketing and overall business efforts.
In this post, we’ll cover the top 20 ecommerce KPIs that cover the main aspects of online business management and help analytics specialists keep track of resource allocation and monitor ecommerce business profitability. And take measures if anything goes wrong.
So, here the 20 ecommerce KPIs are:
Revenue
Revenue is the total amount of money your store generates from sales over a given period. It is one of the first KPIs teams look at because it shows top-line business performance. On its own, though, it does not tell you whether the business is profitable.
Formula: Revenue = Number of Orders × Average Order Value
Example: 2,000 orders × $45 AOV = $90,000 revenue
Conversion Rate
Conversion rate measures the percentage of website visitors who complete a purchase. This ecommerce KPI helps you understand how effectively your marketing campaigns or the whole site turns traffic into customers. A low conversion rate may suggest problems with product pages, pricing, trust signals, or checkout. To estimate the Conversion Rate, the total number of conversions is divided by the total number of visits.
Formula: Conversion Rate = (Orders ÷ Sessions) × 100
Example: 150 orders ÷ 5,000 sessions × 100 = 3.0% conversion rate
Related Products
What kind of actions should be treated as conversions depends on your goals. You may set up various ecommerce goals (add to shopping cart, completed sign-up form, number of pages viewed, etc.) and track their Conversion Rate separately.
Average Order Value (AOV)
A simple and well-known ecommerce KPI, which is calculated as revenue received from sales divided by the number of orders taken. AOV shows how much customers spend per order on average. This is useful because increasing AOV can grow revenue without increasing traffic. Common levers include bundles, upsells, and minimum thresholds for free shipping.
Formula: AOV = Revenue ÷ Number of Orders
Example: $25,000 revenue ÷ 500 orders = $50 AOV
Customer Acquisition Cost (CAC)
CAC shows how much money you spend to acquire one customer from the whole group of customers. It is critical for judging whether your marketing and sales efforts are efficient. To calculate CAC, divide total customer acquisition costs by number of customers acquired.
Formula: CAC = Total Acquisition Spend ÷ New Customers Acquired
Example: $12,000 marketing spend ÷ 300 new customers = $40 CAC
To get actionable insights from this ecommerce KPI, evaluate traffic channels (organic, paid, social, referral) and online campaigns (discounted offer by email, co-branded webinar, giveaway) separately.
Customer Lifetime Value (LTV or CLV)
Customer Lifetime Value estimates how much a customer is worth over the full relationship with your brand. It helps you understand how much you can afford to spend on acquisition and retention. A strong LTV usually reflects repeat purchases and healthy retention.
Basic Formula: LTV = Average Order Value × Purchase Frequency × Customer Lifespan
Example: $50 AOV × 4 purchases per year × 3 years = $600 LTV
Cart Abandonment Rate
Cart abandonment rate shows the percentage of visits during which a user has added item to the shopping cart, but hasn’t reached the check-out point. The metric is calculated as a division of the number of orders placed by the number of shopping carts created. It is useful for spotting friction before the final purchase. High abandonment often points to shipping costs, unclear pricing, or weak purchase intent.
The metric is calculated as a division of the number of orders placed by the number of shopping carts created.
Formula: Cart Abandonment Rate = [(Carts Created − Completed Orders) ÷ Carts Created] × 100
Example: 1,000 carts created, 300 purchases completed → (1,000 − 300) ÷ 1,000 × 100 = 70%
Checkout Abandonment Rate
Checkout abandonment rate measures the percentage of shoppers who begin checkout but do not complete it. This ecommerce KPI is more precise than cart abandonment because it isolates drop-off closer to payment. It can reveal issues with forms, payment methods, shipping surprises, or technical bugs.
Formula: Checkout Abandonment Rate = [(Checkout Starts − Completed Orders) ÷ Checkout Starts] × 100
Example: 400 checkout starts, 260 completed orders → (400 − 260) ÷ 400 × 100 = 35%
Gross Profit Margin
Gross profit margin shows how much of your revenue remains after subtracting the cost of goods sold. It is essential because strong sales do not matter much if your product margins are weak. This KPI helps guide pricing, discounting, and product mix decisions.
Formula: Gross Profit Margin = [(Revenue − COGS) ÷ Revenue] × 100
Example: $80,000 revenue, $48,000 COGS → ($80,000 − $48,000) ÷ $80,000 × 100 = 40%
Return on Ad Spend (ROAS)
ROAS measures how much revenue your ads generate for every dollar spent. It is one of the most important KPIs for paid acquisition channels like Meta, Google, or TikTok. It helps compare campaign efficiency and decide where to allocate budget.
Formula: ROAS = Revenue Attributed to Ads ÷ Ad Spend
Example: $20,000 ad-driven revenue ÷ $5,000 ad spend = 4.0 ROAS
This means you generated $4 for every $1 spent.
Traffic / Sessions
Traffic or sessions measure how many visits your ecommerce store receives. This tells you how much opportunity your site has to generate orders, but traffic only matters if it is qualified. It should almost always be analyzed together with conversion rate and channel mix.
Formula: Usually tracked directly in Google Analytics
Example: Organic = 8,000 sessions, Paid = 5,000, Email = 2,000 → 15,000 total sessions
Bounce Rate
Bounce rate measures the percentage of visitors who leave after viewing only one page. It can indicate poor landing page relevance, slow load times, or low-quality traffic. A high bounce rate does not always mean failure, but it often signals that users are not engaging.
Formula: Bounce Rate = (Single-Page Sessions ÷ Total Sessions) × 100
Example: 2,200 single-page sessions ÷ 5,000 total sessions × 100 = 44%
Repeat Purchase Rate
Repeat purchase rate shows the percentage of customers who buy more than once. It is a key retention ecommerce KPI because repeat buyers are usually cheaper to monetize than new buyers. A high repeat purchase rate often signals satisfaction, loyalty, and a strong post-purchase experience.
Formula: Repeat Purchase Rate = (Returning Customers ÷ Total Customers) × 100
Example: 180 returning customers ÷ 600 total customers × 100 = 30%
Refund and Return Rate
This ecommerce KPI measures how often customers send products back or request refunds. A high rate can hurt profitability and often points to product quality issues, sizing problems, or misleading descriptions. Tracking it helps improve both merchandising and customer experience.
Formula: Return Rate = (Returned Orders or Items ÷ Total Orders or Items Sold) × 100
Example: 45 returned orders ÷ 900 total orders × 100 = 5%
Net Profit
Net profit is what remains after all costs are deducted from revenue, including product costs, marketing, operations, shipping, salaries, and taxes. This is one of the clearest indicators of whether the store is truly healthy. A business can grow revenue while still losing money if expenses rise too fast.
Formula: Net Profit = Revenue − Total Expenses
Example: $100,000 revenue − $82,000 total expenses = $18,000 net profit
Customer Retention Rate
Customer retention rate measures how well your business keeps customers over time. It is useful because keeping existing customers is usually cheaper than acquiring new ones. Strong retention often supports better LTV, stronger word of mouth, and more stable revenue.
Formula: Retention Rate = [(Customers at End of Period − New Customers Acquired) ÷ Customers at Start of Period] × 100
Example: Start with 1,000 customers, end with 1,150, acquired 300 new customers → (1,150 − 300) ÷ 1,000 × 100 = 85%
Email Marketing Revenue
This KPI tracks how much revenue your email campaigns generate, whether from newsletters, promotions, or automated flows like abandoned cart emails. It helps you evaluate one of the most efficient owned channels in ecommerce. Strong email revenue usually reflects good segmentation, timing, and creative relevance.
Formula: Email Revenue = Sum of Revenue Attributed to Email Campaigns
Example: Campaign A = $4,000, abandoned cart flow = $2,500, welcome flow = $1,500 → $8,000 email revenue
Inventory Turnover
Inventory turnover shows how quickly stock is sold and replaced during a period. It is important because slow-moving inventory ties up cash, while very fast turnover can create stockout risk. This ecommerce KPI helps balance purchasing, warehousing, and demand planning.
Formula: Inventory Turnover = COGS ÷ Average Inventory Value
Example: $120,000 COGS ÷ $30,000 average inventory = 4.0 turnover
This means inventory was effectively sold through 4 times in the period.
Fulfillment Time
Fulfillment time measures how long it takes to process and ship an order after it is placed. It directly affects customer satisfaction and can influence reviews, support tickets, and repeat purchase behavior. Faster, more reliable fulfillment usually improves trust in the brand.
Formula: Fulfillment Time = Shipment Date/Time − Order Date/Time
Example: Order placed Monday at 10:00, shipped Wednesday at 16:00 = 54 hours fulfillment time
Cost per Order
Cost per order tracks the average operational cost to process and fulfill each order. This often includes picking, packing, shipping subsidies, packaging materials, and warehouse labor. It is especially important when scaling, because rising order volume does not always improve efficiency.
Formula: Cost per Order = Total Fulfillment and Processing Costs ÷ Number of Orders
Example: $9,000 fulfillment costs ÷ 600 orders = $15 per order
Site Speed / Page Load Time
Site speed measures how quickly your pages load for users. It matters because slow sites can reduce conversion rate, increase bounce rate, and hurt mobile performance in particular. Even small improvements in speed can have a measurable impact on revenue.
Formula: Usually tracked as average page load time or core web performance metrics
Example: Product page average load time dropped from 4.8 seconds to 2.9 seconds; if conversion rises from 2.1% to 2.8%, speed likely contributed to better performance.
The list is by far is not exhaustive and does not contain many specific, smaller mertircs. However, these 20 ecommerce KPIs could be a good starting point. If you’d like to find out more about business metrics which ecommerce store may use, please leave your feedback and suggestion in the comments below. Monitor your Magento store KPIs using the advanced reporting tool.
Frequently Asked Questions
A key performance indicator, or KPI, is a measurable value that shows how effectively a business is achieving a specific goal. KPIs help teams track progress, identify problems early, and make better decisions based on data rather than guesswork. In simple terms, a KPI tells you whether an important part of the business is performing well or needs improvement.
In e-commerce, KPIs are the main metrics used to measure the performance of an online store. They track areas such as sales, marketing efficiency, customer behavior, retention, profitability, and operations. Common e-commerce KPIs include conversion rate, average order value, customer acquisition cost, cart abandonment rate, and customer lifetime value.
KPIs are important in e-commerce because they turn store activity into measurable insights that can guide action. They help businesses understand what is driving growth, where money is being lost, and which parts of the customer journey need improvement. Without KPIs, it is much harder to optimize marketing, improve conversion, increase retention, and grow profitably.