It’s easy to confuse key performance indicators (KPIs) with analytics, as many people use them as synonyms. These two concepts are interconnected and appear the same at face value but are indeed different.
Let’s take a look at them individually to see the differences between them.
KPIs are metrics that can be defined quantifiably, and these metrics are used to determine the success of the strategies your ecommerce business is using to reach its objectives and goals.
Here are some examples of key performance indicators:
Return on investment: This measures the amount of profit generated in relation to the investment made.
Conversion rate: The actual number lebanon telegram screening of users that turned into customers.
Customer acquisition cost: The cost of acquiring a new customer, majorly including marketing costs.
Customer lifetime value: The revenue a single customer generates throughout their journey with your online store.
Average order value: Average amount of money spent by a customer on orders.
In other words, these metrics are benchmarks that can be used to track and evaluate performance to find areas of strength and weakness.
#2 Analytics
Unlike KPIs, analytics cover a broader spectrum of factors. It isn’t used to judge the performance of your store. Rather, it tries to understand and study current and historical market patterns, trends, and correlations along with customer behavior and tries to gain insight from it. These insights can be used to make future predictions, optimize operations, and make strategic decisions.