The point of ecommerce

Posted: 10 December 2009

What's the point of ecommerce?

Before you think I’ve lost the plot completely, perhaps I’d better clarify the question. If you have an ecommerce site, what should you measure to judge its success? And if you have a web designer or SEO specialist to hand, what do they think is most important?

There are lots of easy (and wrong) answers: you can measure traffic, you can measure length of visitor stay, you can measure how often people come back to your site. But interesting as these, and countless others are, they are simply stepping stones to the one metric that really counts.

But you’re ahead of me already. It’s revenue – the more you sell the better the site, so, thankfully a really simple one to measure. Well, nearly, but not quite. Revenue itself is great, but only if its profitable. So what you actually need to be measuring is profit.

Unfortunately measuring the profit from an ecommerce operation isn’t quite so straightforward – particularly if parts of the operation are shared with non-ecommerce routes to market, and you then have to apportion their costs fairly.

However, even if you can’t calculate the figures exactly, keeping the focus on the concept of profit, rather than any of the other technical metrics, will stand you in good stead. That’s the point of ecommerce.