Using emetrics to evaluate website success by Min,Li

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Using e-metrics to evaluate website success
---by Min,Li Taiwo,Jubril

• ?Introduction
• What is traditional business metrics?
• Overall corporate value
• market capitalization, price to earnings
  ratio, fixed assets
• Corporate process management
• cash flow, inventory turnover, net
  profit,etc.
• Financial expectation
• market share, revenue per customer,industry
  sector growth, etc.

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Differences between e-market and traditional
market

• e-market is real time business, managers care
  about promotion cycle on a daily basis,while
  traditional market on a monthly basis
• Reduce many transaction costs. Reducing buyers
  searching cost and seller communication cost,
  increase the frequency, rapidity and accuracy of
  communications
• Increased personalization and customization of
  product offering
• It is a critical mission for e-market to
  focus on the customers

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What is e-metrics?

• Are there any new people to your website?
• How many visitors do purchase from the online
  store?
• What makes your customers loyal?How do you
  measure their loyalty?
• How do you define the best customers and target
  other prospect to turn into best customers?
• What site behavior indicates that a prospect is
  ready to buy?
• E-metrics Metrics for measuring web site
  success

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• ?Clear different measurements
• Standard definition of core measurements
• Definitions of Hit, Page View, Visit, User
• Hits should not be used as a core metric
• Primary measurement
• Today page view
• Futurevisits, user, revenue measures
• Dual consideration of data volume and business
  value
• Taking actions based on e-metrics results
• 70change site design
• Fewer changes in promotion, product mix, etc.

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Relationship between data volume and customer
knowledge
loyalcustomer4000
10retentionloyalty
Customer Data
10conversion
Customer40,000
Business Value
Users400,000
5 visits per user
Visits2,000,000
5page views per visit
E businessData
Page views(10,000,000)
Assume 10 hits per page
Raw website data
Hits (100,000,000) 20GB Raw Data
Amount of Data
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? The customers life cycle
loyalty
Retention
Conversion
Churn
Acquisition
Attrition
Reactivation
Reach
Abandonment
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• ReachAwareness
• Advertising, potential to gain attention of your
  target audience TV,the number of people who have
  the opportunity to see your message given a
  programs total active viewership
• Percentage of the total potential market
• Total site reach
• Some companies do not consider that prospect as
  reached until the message has been delivered,read
  and acted on.
• AcquisitionParticipation
• A potential prospect takes an overt action
  expressing interest
• Conversion
• The point at which a sale has been made and the
  prospect convert into a customer

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• Retentionencouraging repeat purchases
• Assumption it is less costly to sell additional
  products or services to an existing, retained
  customer than it is to find and secure a new
  customer
• Loyalty
• www.dictionary.com the act of binding
  yourself-intellectually or emotionally to a
  course of action
• On the web, loyalty refers to site visits over
  time
• Means different for different sites

• Repeat customers at 10 popular retail site spend
  57 percent more than one time shopper.Further
  more, loyal customer appear willing to expand
  their shopping across categories.For example,
  almost 70of loyal Gap online customer said they
  would consider buying furniture from Gap
  online.---by Boston based BainCompany

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The life cycle interrupted

• Abandonment
• The overall abandonment rate is the number of
  people who commerce but do not completing the
  buying process
• Attrition
• The attrition rate is the percentage of existing,
  converted customers who stop buying from you but
  gone somewhere during a certain time
• Churn
• Churn measures how much of your customer base
  rolls overduring a given period of time. Divide
  the number of customers who attrite during a
  given time by the total number of customers at
  the end of the time period
• 1000suscribers at beginning of month, add
  100,lose 50, so at the end,1050. Churn
  ratio50/10504.8

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? Measure and characterize customers

• Recency
• Has the customer made a purchase or visited your
  site recently?---Strongest indicator of future
  behavior
• Frequency
• How often has the customer place orders or
  visited your site historically?
• Frequency means different retail experience, the
  considered purchase, the business to business
• Monetary Value
• What is the total spending and profitability?
• Duration
• Different companies have different goals for
  duration of each users stay on their site.
• Technology company, e-retailers, considered
  decision purchase