{"id":7078,"date":"2023-03-17T07:38:45","date_gmt":"2023-03-17T07:38:45","guid":{"rendered":"https:\/\/www.binfire.com\/blog\/?p=7078"},"modified":"2023-03-17T07:38:45","modified_gmt":"2023-03-17T07:38:45","slug":"online-marketplace-metrics-track","status":"publish","type":"post","link":"https:\/\/www.binfire.com\/blog\/online-marketplace-metrics-track\/","title":{"rendered":"Online Marketplace Metrics: How to Track"},"content":{"rendered":"<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">An eCommerce marketplace is a platform that connects buyers and sellers. The marketplace model has grown in popularity for two reasons: It allows companies to tap into new markets outside of their traditional reach and reduces some costs associated with operating an online store.\u00a0<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">However, running an eCommerce marketplace involves more than just setting up a platform for others to sell on;\u00a0<a href=\"https:\/\/oroinc.com\/oromarketplace\/blog\/top-21-b2b-e-commerce-marketplace-kpis\/\" target=\"_blank\" rel=\"noopener\">online marketplace metrics<\/a> matter if you want to stay ahead of the competition.<\/span><\/p>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">In this post, we will look at some of the most critical KPIs every eCommerce marketplace operator should evaluate (along with their definitions) so you can start tracking your performance against these metrics over time.\u00a0<\/span><\/p>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">We&#8217;ll also explain why they matter so much\u2014and what impact they can have on your company&#8217;s overall success or failure.<\/span><\/p>\n<h2><span style=\"font-family: helvetica, arial, sans-serif;\"><strong><span style=\"font-size: 14pt;\">Online marketplace metrics\u00a0 \u00a0<\/span><\/strong><\/span><\/h2>\n<h3><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\"><strong>Organic traffic<\/strong><\/span><\/h3>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">Organic traffic is the number of visitors that visit your site through search engines. Measuring this metric is essential because it indicates how well you&#8217;re getting people to find and click on your listing in search results.<\/span><\/p>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">An excellent organic traffic number should be much higher than the other metrics because it doesn&#8217;t rely on paid ads or other external sources. If your organic traffic numbers are low, there are a few things you can do:<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<ul>\n<li><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">Increase the number of keywords in each category (for example, if you sell shoes, try adding &#8220;women&#8217;s sneakers&#8221; or &#8220;men&#8217;s sneakers&#8221;). This will help increase relevance for those searches and improve ranking over time as more sites add these terms to their content<\/span><\/li>\n<\/ul>\n<h3><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\"><strong>Paid traffic<\/strong><\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/h3>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">Paid traffic is an excellent way to test your marketing strategy. You can use it to target new customers, existing customers, and specific keywords or products.<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">Paid search is an easy way to find new customers interested in your product or service, but you&#8217;ll need to be careful not to run afoul of Google&#8217;s guidelines for paid ads.\u00a0<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">When you&#8217;re targeting existing customers with paid search ads, make sure there&#8217;s a clear benefit for them in clicking through&#8211;and that this benefit isn&#8217;t available elsewhere on the site (like free shipping).<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<h3><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\"><strong>Buyer-seller ratio\u00a0<\/strong><\/span><\/h3>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">The buyer-seller ratio is the number of buyers who visit your marketplace relative to the number of sellers who sell on it. This can be calculated using this formula:<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<ul style=\"list-style-type: square;\">\n<li><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">[Buyers] \/ [Sellers] = BSR<\/span><\/li>\n<\/ul>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">For example, if you have 100,000 unique visitors per month and 2,500 active sellers on your marketplace, your BSR will be 0.025 (or 2%). A good BSR is between 1% and 3%.<\/span><\/p>\n<h3><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\"><strong>Conversions<\/strong><\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/h3>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">Conversion rate is the percentage of visitors who complete a desired action on your site. It&#8217;s calculated by dividing the number of conversions by the total number of visits, and it can be used as a benchmark for measuring the effectiveness of your website.\u00a0<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">For example, if you have 100 visitors and 20 completed orders, your conversion rate would be 20%.<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">Conversion rates vary depending on industry and product category but are generally between 2% and 5%.<\/span><\/p>\n<h3><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\"><strong>Fill rate<\/strong><\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/h3>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">The fill rate is the percentage of orders that were filled. It&#8217;s a measure of how well a marketplace performs and can be calculated for each product category or market. For example, if you have a 10% fill rate and 10 orders are placed, only one charge will go unfilled (9\/10 = 0.9).<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">A high fill rate indicates enough sellers to fill all orders; conversely, low fill rates suggest there aren&#8217;t enough sellers or products available to meet demand (or both).\u00a0<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">If your business has an exceptionally high number of unfilled orders relative to total sales volume&#8211;say 15%-20%&#8211;you may want to consider adding more specific filters so potential buyers can find what they&#8217;re looking for faster or increasing inventory on popular items being sold by vendors who aren&#8217;t meeting demand quickly enough.<\/span><\/p>\n<h3><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\"><strong>Take rate<\/strong><\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/h3>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">The take rate is a good indicator of how many products are being sold on your marketplace. It measures the percentage of orders accepted by sellers and can be used to compare different marketplaces. A higher take rate means more sellers are interested in selling their products on your site, and therefore more people buy them.<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">&#8220;Take rates&#8221; depend on several factors: quality of products offered (better products tend to have higher take rates), seller reputation (good sellers have better chances at earning higher take rates), marketing efforts made by both sides (if you promote your marketplace through ads or email campaigns then you&#8217;ll attract more new customers who will eventually become buyers).<\/span><\/p>\n<h3><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\"><strong>Customer acquisition cost<\/strong><\/span><\/h3>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">Customer acquisition cost (CAC) is the total cost of acquiring a customer, including marketing and acquisition costs. The CAC can be calculated as follows:<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<ul>\n<li><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">Average Cost Per Acquisition (CPA): The average amount spent to acquire each new customer. This metric helps compare different marketing strategies or channels. For example, if one campaign costs $10 to generate 10 leads while another generates 20 leads at a lower cost of $5 per lead, then you should use that second campaign because its higher CPA means it delivers more value than the first campaign with its lower CPA.<\/span><\/li>\n<\/ul>\n<h3><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\"><strong>Average cart size<\/strong><\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/h3>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">Average cart size is the average value of items in a customer&#8217;s shopping cart. It&#8217;s a good indicator of how much a customer is willing to spend, and it can be used to evaluate how well you are converting customers to buyers.<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<ul>\n<li><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">How do I calculate the average cart size?<\/span><\/li>\n<\/ul>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">To calculate the average cart value, divide the total value of all orders by the number of active shoppers:<\/span><\/p>\n<ul style=\"list-style-type: square;\">\n<li><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">(Total Value of Orders\/Active Shoppers) = Average Cart Value<\/span><\/li>\n<\/ul>\n<h3><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\"><strong>Average order value<\/strong><\/span><\/h3>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">The average order value (AOV) is the average amount spent per order. It&#8217;s a good indicator of the health of your business and a metric to track over time.<\/span><\/p>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">If you have an online store, this can be calculated by dividing total orders by the number of customers who made purchases during that period.<\/span><\/p>\n<h3><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\"><strong>Customer lifetime value (CLTV)<\/strong><\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/h3>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">Customer lifetime value (CLTV) is the estimated value of a customer over their lifetime. It&#8217;s calculated by multiplying the average order value (AOV) by the number of orders per year, which allows you to understand how much revenue you can expect from each customer.<\/span><\/p>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">For instance: If your average order value is $100 and your customers place two orders yearly, CLTV would be $200 ([100 x 2]\/12).<\/span><\/p>\n<p><strong><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">Inventory<\/span><\/span><\/strong><\/p>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">Keeping track of inventory in a business is extremely important. Many businesses fail due to lax inventory control. It is also important to understand\u00a0<a href=\"https:\/\/www.lightspeedhq.com\/blog\/inventory-reconciliation\/\" target=\"_blank\" rel=\"noopener\">what inventory reconciliation is<\/a> and how to manage it. As most retailers know usually the inventory record and the actual inventory do not match.<\/span><span style=\"font-size: 14pt;\">\u00a0\u00a0<\/span><\/span><\/p>\n<h3><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\"><strong>Online Marketplace metrics can take a lot of work, but these KPIs can help you evaluate eCommerce marketplace metrics.<\/strong><\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/h3>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">The most important thing to remember is that only some KPIs will work for some businesses.<\/span><\/p>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">For example, if you&#8217;re selling a physical product and your customers can try it on before they buy it, then the speed of delivery is likely essential.\u00a0<\/span><\/p>\n<p><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\">If your products are digital or intangible (like an ebook), then speed may not matter as much because the customer isn&#8217;t waiting for anything.<\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/p>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">So don&#8217;t just blindly copy these KPIs from another company; instead, use them to create a list of metrics that makes sense for your business.<\/span><\/p>\n<h4><span style=\"font-family: helvetica, arial, sans-serif;\"><span style=\"font-size: 14pt;\"><strong>In conclusion<\/strong><\/span><span style=\"font-size: 14pt;\">\u00a0<\/span><\/span><\/h4>\n<p><span style=\"font-family: helvetica, arial, sans-serif; font-size: 14pt;\">With this post, we aimed to help you better understand the metrics that matter most in your\u00a0<a href=\"https:\/\/www.digitalsilk.com\/branding-agency\/ecommerce-branding\/\" target=\"_blank\" rel=\"noopener\">ecommerce branding<\/a>. We\u2019ve identified\u00a0 KPIs that will help you evaluate your platform\u2019s performance and ensure it\u2019s on track for success.\u00a0<\/span><\/p>\n<p><span style=\"font-size: 14pt; font-family: helvetica, arial, sans-serif;\">These KPIs can be used as benchmarks against competitors or other marketplace platforms to see where they stand in growth or decline over time. Using these metrics, we hope you&#8217;ll identify trends sooner than later and take proactive measures as needed.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>An eCommerce marketplace is a platform that connects buyers and sellers. The marketplace model has grown in popularity for two reasons: It allows companies to tap into new markets outside&hellip;<\/p>\n","protected":false},"author":4,"featured_media":7080,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,47],"tags":[202],"class_list":["post-7078","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-project-management-2","category-project-management-software","tag-online-marketplace-metrics"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.7 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Online Marketplace Metrics: How to Track - Collaboration Corner<\/title>\n<meta name=\"description\" content=\"Running an eCommerce marketplace involves more than just setting up a platform for others to sell on;\u00a0online marketplace metrics matter if you want to win\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.binfire.com\/blog\/online-marketplace-metrics-track\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Online Marketplace Metrics: How to Track - 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