Trying to understand your ecommerce metrics? With so many reporting tools available at our fingertips from Google Analytics to your storefront dashboard, it can be a little overwhelming.
Information overload, without anything to compare all this data too, might have you asking yourself:
Are these results good?
What does my competitors’ data look like?
How do others in my industry perform?
That’s where benchmarks come in. They can be a handy tool when you’re trying to make heads or tails of your own data.
Ecommerce Benchmarks can be help you turn your data into actionable insights. They allow you to better understand your own results, by stacking them up against industry averages.
First things first, here’s a quick data terminology recap.
What is a Metric?
A metric is the quantifiable, defined measurement of data.
It’s the number you see when you look at things like:
- Average Order Value
- Conversion Rate
- Visitors To Your Website.
These are examples of a defined measurement. These are all data sources that record quantifiable data, that you can then take and interpret to make decisions about your business.
What Metrics Should I Care About For My Ecommerce Business?
Every business’s marketing strategy is different, and the metrics you look at will depend on the channels you use and your marketing goals.
However, for every ecommerce business, there is a set of core metrics that will help you to understand your businesses performance.
These core metrics for running a successful ecommerce store can be broken down into 3 buckets:
- Average Order Value (AOV)
- Conversion Rates
- Micro to Macro Conversion Rates
Metrics For Channels:
- Cost Per Acquisition (CPA)
- Email Marketing
- Social Media Engagement
- Organic Acquisition Traffic
- Facebook – Basic Benchmarks
- Instagram – Basic Benchmarks
- Google Ads – Basic Benchmarks
Business Planning Metrics:
- Ecommerce Churn Rate
- Customer Retention Rate
- Repeat Customer Rate
- Refund and Return Rate
- Customer Lifetime Value (CLV)
Average Order Value
An Average Order Value (AOV) is the average price of the cart value your customers are checking out with.
It’s an important metric to leverage, as increasing your AOV can have positive impacts on your return from marketing spend.
But what is the benchmark?
AOV is highly dependent on what type of product you sell. A store selling homewares is going to have a lower AOV than a store that sells custom built PCs.
Across the APAC (Asia Pacific region) the Average Order Value is around $106.
Conversion Rate Benchmarks In Australia
Conversion rate is the percentage of users who purchase after visiting your website. Conversion rates are calculated by dividing the number of orders/sales by the total amount of sessions to your store.
This crucial metric can help you determine the amount of traffic you need to achieve your sales or revenue targets.
Note: Looking at your entire store’s conversion rate only paints part of the picture. Not all channels are equal, so it’s important to review your conversion rate through a few different lenses.
A few key ways to review your conversion rate:
- By Channel: Eg. SEO, Google Ads, Facebook, Email – Each channel is going to have a different conversion rate depending on the strategy you’re using.
- By Campaign type – Different campaigns within each channel will have different conversion rates. For example, Facebook Top of Funnel awareness Ads will have a much lower conversion rate to Google Shopping Ads. But all campaigns factor into the wider performance picture.
- By Product Category – Think about your product offering, are there product categories that are more popular than others? Categories will have different conversion rates to others.
So how do you take this all into consideration when making decisions?
Aim to optimise your sales conversion rates in your campaigns: If a channel or category is performing well, consider putting more budget behind it. If something is underperforming, maybe there’s a fix that would improve it, or perhaps the campaign should be terminated — sometimes it’s best to cut your losses. Conversion Rate Optimisation (CRO) can maximise growth for a campaign
But what are the benchmarks for ecommerce conversion rates?
The average ecommerce conversion rate across all industries in Australia is 1.83%
When you break this down by industry, you get the following average conversion rates:
- Luxury & Jewelry – 1.46%
- Multi-Brand Retail – 2.34%
- Fashion, Accessories, and Apparel – 3.57%
- Pet Care & Veterinary Services – 3.41%
- Beauty & Personal Care – 4.05%
- Consumer Goods – 4.8%
- Food & Beverage – 6.26%
- Home & Furniture – 4.94%
Cart Abandonment – Ecommerce Benchmarks in Australia
Cart abandonment is the measurement of how many people leave your site without purchasing after starting the checkout process.
Customer visits your site > Customer adds a product to their cart > Customer leaves without finishing the purchase (Abandoning their cart).
The number of completed purchases is divided by the number of shopping carts created within that same period.
There are plenty of reasons for a user to abandon their shopping cart, from struggling with using the site to simply being distracted and forgetting to come back and finish the purchase.
We go through in detail in a separate post about Conversion Rate Optimisation.
But what are the benchmarks?
In Australia and the APAC region, cart abandonment rates sit as high as 82% on average over a 12 month period across all industries.
Per industry, this rate will vary. You can find a breakdown of cart abandonment rate by industry here.
Hard and Soft Conversions – Micro & Macro Conversions
Not every conversion is equal. Hard vs soft, micro vs macro, whichever terminology you use, both mean the same thing.
Hard/Macro conversions = Purchases. Interactions that end in revenue.
Soft/Micro conversions = email newsletter signups, PDF downloads. Interactions that eventually lead to larger hard/macro conversions.
These actions have different levels of importance and together they make up the larger marketing picture. They allow you to measure activities that feed into your marketing funnels. It’s a more holistic way of looking at your marketing.
Metrics For Channels:
Cost Per Acquisition (CPA) Benchmarks Australia
Cost per acquisition (CPA) is the price for getting a first time customer. It’s the total cost to acquire a new paying customer aka, a purchase on your website.
This metric is used to understand your performance at a campaign or channel level.
Cost Per Acquisition is used in the following paid marketing mediums:
- Social Media
- Content Marketing
Every campaign and industry will have a different CPA. Similar to conversion rates, the cost per acquisition will be higher for awareness campaigns, but lower for bottom of funnel campaigns.
There’s no universal benchmark in ecommerce for a “good” CPA. Your target CPA will depend on your margins, prices and operating expenses. Understanding these factors, calculating how much you can reasonably afford to pay to obtain a new customer and determining your own target CPA will be the most beneficial for your bottom line.
Factors that can affect your target CPA are:
- Business Stage: What stage is your business at? Are you in a growth stage? Are you well known? Are you well-established? The stage of your business can impact your CPA. For example, if your business is new, and you’re focused on brand awareness, then your CPA will inevitably be much higher than a business that’s well known and focusing more on the bottom of funnel campaigns.
- Budget: Can you spend more to acquire a customer? Do you need to be conservative? CPA can vary depending on your campaign structure.
- Advertising Medium: PPC, Display, Affiliate, Social Media and Content Marketing all have different CPAs. But they all have different roles to play in your marketing. Content might convert fewer users, but it can be important for brand awareness and capturing users in different mediums.
The CPA feeds into your larger Customer Acquisition Cost (CAC), which takes into account your marketing costs plus the costs of producing, storing and shipping the items that a customer purchases.
Email Marketing Benchmarks For Australia
Email marketing is a great way for ecommerce businesses to keep their customers engaged post purchase.
Targeted automations prompting users to come back and purchase again, or timely email campaigns with seasonal sales, email marketing can help you get the most value out of every customer. It’s something every ecommerce business should build into their marketing strategy to get a better Customer Lifetime Value and help to get the most out of your marketing spend.
But what is a good open rate?
A good click through rate?
How do I tell if the customers on my email marketing lists are engaged?
What Are The Benchmarks?
Average Email Opening Rates In Australia
Email open rate is the percentage of subscribers on your email mailing list who open your email after receiving it in their inbox.
The average email open rate for Australia and APAC is 20.6%
But take this with a grain of salt. With the release of Apple’s privacy features, not all email opens will be accounted for.
Email Click-To-Open Rates In Australia (CTOR)
Out of the people who opened your email, what percentage of those users went on to click a link within the email you sent.
The average email click-to-open rate for Australia is 14.8%
Click-Through Rates In Australia
Your click through rate is the next step from CTOR. It gives you insight into how many of your total subscribers are visiting your website and ultimately convert through email.
The average email click-through rate for Australia is 3%
Unsubscribe Rates In Australia
Your unsubscribe rate is the percentage of users who unsubscribe from your email marketing lists. It may sound counterintuitive, but removing unengaged users is actually a good thing! Email performance can be skewed by lots of users who never open your emails. So make sure to routinely clean your email marketing lists.
The average unsubscribe rate for Australia is 0.3%
Email Marketing Benchmarks By Industry
Email Open Rates By Industry:
- Advertising & Marketing – 20.50%
- Agriculture, Forestry, Fishing, Hunting – 27.30%
- Consumer Packaged Goods – 20%
- Education – 28.50%
- Financial Services – 27.10%
- Restaurant, Food & Beverage – 18.50%
- Government & Politics – 19.40%
- Healthcare Services – 23.70%
- IT/Tech/Software – 22.70%
- Logistics & Wholesale – 23.40%
- Media, Entertainment, Publishing – 23.90%
- Nonprofit – 26.60%
- Other – 19.90%
- Professional Services – 19.30%
- Real Estate, Design, Construction – 21.70%
- Retail – 17.10%
- Travel, Hospitality, Leisure – 20.20%
- Wellness & Fitness – 19.20%
Email Click-Through Rates By Industry:
- Advertising & Marketing – 1.8%
- Agriculture, Forestry, Fishing, Hunting – 3.4%
- Consumer Packaged Goods – 1.9%
- Education – 4.4%
- Financial Services – 2.4%
- Restaurant, Food & Beverage – 2.0%
- Government & Politics – 2.8%
- Healthcare Services – 3.0%
- IT/Tech/Software – 2.0%
- Logistics & Wholesale – 2.0%
- Media, Entertainment, Publishing – 2.9%
- Nonprofit – 2.7%
- Other – 2.6%
- Professional Services – 2.1%
- Real Estate, Design, Construction – 3.6%
- Retail – 0.7%
- Travel, Hospitality, Leisure – 1.4%
- Wellness & Fitness – 1.2%
Email Click-To-Open Rates By Industry:
- Advertising & Marketing – 9.0%
- Agriculture, Forestry, Fishing, Hunting – 12.5%
- Consumer Packaged Goods – 11.1%
- Education – 15.7%
- Financial Services – 10.1%
- Restaurant, Food & Beverage – 10.5%
- Government & Politics – 14.3%
- Healthcare Services – 13.4%
- IT/Tech/Software – 9.8%
- Logistics & Wholesale – 11.7%
- Media, Entertainment, Publishing – 12.4%
- Nonprofit – 10.2%
- Other – 13.2%
- Professional Services – 11.1%
- Real Estate, Design, Construction – 17.2%
- Retail – 5.8%
- Travel, Hospitality, Leisure – 8.7%
- Wellness & Fitness – 6.0%
Email Unsubscribe Rates By Industry:
- Advertising & Marketing – 0.2%
- Agriculture, Forestry, Fishing, Hunting – 0.3%
- Consumer Packaged Goods – 0.1%
- Education – 0.2%
- Financial Services – 0.2%
- Restaurant, Food & Beverage – 0.1%
- Government & Politics – 0.1%
- Healthcare Services – 0.3%
- IT/Tech/Software – 0.2%
- Logistics & Wholesale – 0.3%
- Media, Entertainment, Publishing – 0.1%
- Nonprofit – 0.2%
- Other – 0.3%
- Professional Services – 0.2%
- Real Estate, Design, Construction – 0.2%
- Retail – 0.1%
- Travel, Hospitality, Leisure – 0.2%
- Wellness & Fitness – 0.4%
|Industry||Open Rates||Click Through Rates||Click-To-Open Rates||Unsubscribe Rates|
|Advertising & Marketing||20.5%||1.8%||9.0%||0.2%|
|Agriculture, Forestry, Fishing, Hunting||27.3%||3.4%||12.5%||0.3%|
|Consumer Packaged Goods||20%||1.9%||11.1%||0.1%|
|Restaurant, Food & Beverage||18.5%||2.0%||10.5%||0.1%|
|Government & Politics||19.4%||2.8%||14.3%||0.1%|
|Logistics & Wholesale||23.4%||2.0%||11.7%||0.3%|
|Media, Entertainment, Publishing||23.9%||2.9%||12.4%||0.1%|
|Real Estate, Design, Construction||21.7%||3.6%||17.2%||0.2%|
|Travel, Hospitality, Leisure||20.2%||1.4%||8.7%||0.2%|
|Wellness & Fitness||19.2%||1.2%||6.0%||0.4%|
Business Planning Metrics
Customer Lifetime Value (CLV)
Your Customer Lifetime Value (CLV) is the total revenue your business generates from an individual customer over time. It takes into account all of their orders.
CLV helps provide a picture of your businesses long-term financial viability. High CLV can give you an insight into average customer satisfaction, loyalty and a brand’s viability.
Every business CLV will be dependent on a number of factors so there are no specific benchmarks for this metric.
Instead, it is more valuable to your business if you calculate its ratio to customer acquisition cost (CAC).
A good CLV ratio to aim for is 3:1.
For example, if it costs $150 to acquire your customer, you should aim for a CLV of $450.
This indicates a high ROI from your marketing efforts, and means there are ⅔ of your gross revenue to invest back into the business.
Repeat Customer Rate Benchmarks
Repeat customer rate is the rate existing customers come back to purchase again.
Measuring and improving your repeat customer rate means lower CPAs, lower CACs, a better CLV and more revenue in your pocket.
Every business is different, with your repeat customer rate depending on your industry and customer happiness.
VP of Growth at Facebook Alex Schultz, does suggest “If you can get 20-30% of customers coming back every month and making a purchase from your store, you should do pretty well”.
Customer Retention Rate Benchmarks
Your customer retention rate is the percentage of customers you continue to keep over a long period of time. The higher the number the better, as it means you have happy customers.
Your retention rate can vary depending on industry and the type of product you offer.
On average, data shows that online retailers have a repeat customer rate of 28.2%.
By industry, this can vary:
- Cosmetics: 25.9%
- Apparel: 26%
- Supplements: 29.1%
- Coffee 29.6%
- Pet products: 31.5%
According to Moran Khoubian, Senior Director, Ecosystem & Community at Yotpo, “Average ecommerce retention rates differ based on industry, size, and business model, but they typically sit somewhere between 15% to 30%”.
Ecommerce Churn Rate
Your churn rate is a metric used to track the turnover of your customers. While Customer Retention rates track how many customers you keep, churn rate tracks the number of users lost over a period.
Your churn rate will depend on your marketing strategy and industry. For example, if you are only focused on shorter sale cycles, you might have a higher churn rate than a business that qualifies their leads and nurtures them post purchase.
Keeping your churn rates low is good for business, since marketing to existing customers costs less than acquiring more, and you get more out of your marketing efforts.
Ecommerce Churn Rate Formula
[(revenue from customer at the beginning of the time period – revenue from customers at the end of the time period) / revenue from customers at the beginning of the time period] x 100 = revenue churn rate (%)
What Are The Benchmarks?
Churn rates vary from industry to industry, but on average, they can be broken down into the below averages by industry:
|Beauty & Fitness||62%|
|People & Society||63%|
|Food & Drinks||64%|
|Books & Literature||69%|
|Pets & Animals||70%|
|Home & Garden||75%|
|Toys & Hobbies||77%|
|Apparel & Clothing Accessories||79%|
|Gifts & Special Events||82%|
Refund and Return Rate
Your product return rate is the frequency at which customers return products.
On average, studies suggest a quarter of all consumers return between 5% and 15% of all the items they buy online.
This will vary depending on your industry. For example, users bracketing their orders will skew your return rate when it comes to clothing.
Calculating Product Return Rate: The Formula
The formula for calculating product return rate is relatively straightforward. Simply divide the number of products returned by the number of products sold, then multiply by 100.
Return Rate = Products Returned / Products Sold x 100
Product Return Rates By Industry
Based on report by Loop, return rates vary wildly by industry: