Understanding Ecommerce KPIs

Is your D2C brand really growing or are you just spending more to make less? Most founders think sales are the only success metric. But if you’re not tracking these 6 numbers daily, you’re not scaling, you’re surviving. 1. Customer Acquisition Cost (CAC) Every new customer costs you. If this number is rising, your profits are dying. Dial in your targeting, creative, and retention. 2. Conversion Rate 10,000 visitors mean nothing if they don't buy. Are your landing pages optimized? Is your checkout process smooth? A 1% jump in conversion = a major revenue boost. 3. Average Order Value (AOV) Want to earn more without new customers? Focus on AOV. Bundles, upsells, and time-limited deals can easily 2x this metric. 4. Customer Lifetime Value (LTV) A great D2C brand turns one-time buyers into loyal fans. Aim for LTV that’s 4–5x your CAC. If it’s not, prioritize retention strategies like loyalty programs, re-engagement flows, and post-purchase content. 5. Return on Ad Spend (ROAS) If your ads aren’t returning profit, you're just burning cash. Test daily. Better creative, sharper offers, tighter targeting. 6. Refund & Return Rate High returns = leaking revenue. Understand the why. Quality issues? Misleading product descriptions? Fix it now. Track these. Improve these. Scale smart. Which of these metrics are you ignoring today? #businesscoach #businesstips #D2C #founders

Your holiday sales are booming—but your bank account is empty. Here’s why👇🏻 It’s the most profitable time of the year…until you check your bank balance. Most Ecommerce founders miss: High revenue doesn't necessarily mean healthy cash. Let me explain. 1/ You spent cash 60–90 days ago on inventory, freight, and creative. - The revenue is just catching up now. - You’re collecting sales after paying suppliers. - Your margins look great on paper—but your bank account disagrees. 2/ Ad costs spike during peak season. - You’re competing with every brand on Meta and TikTok. - Ad platforms charge you immediately while payouts from Shopify and Amazon lag. 3/ Returns are coming. - January will claw back a chunk of December’s revenue. - If you’re using cash accounting, you can'y rely on your P&L. 4/ Delayed payouts mean an invisible lag. - Shopify and Amazon don’t pay instantly. - That delay can create a “phantom profit” gap of 3–10 days on high volume. --- Here's how I advise my clients to tackle the holiday slump: Map your cash flow, not your sales. Forecast payouts vs. expenses weekly. Know your cash conversion cycle cold. Protect Q1 liquidity before Q4 ends. Why? Profit "on paper" doesn't pay the bills. Cash does. --- What’s your biggest cash flow pain during Q4? ♻️ Repost this if a founder you know is about to hit a “broke at record sales” moment. P.S. Need help building a 13-week cash flow plan before Q1 hits? Let's make it happen → https://lnkd.in/eZ9cu5vR

I see this everywhere in Amazon seller groups. Screenshots of revenue dashboards flooding timelines. But nobody talks about what's left after the bills. The harsh reality about Amazon "success" stories: ↳ Revenue screenshots get likes, profit statements get silence. ↳ Most sellers track vanity metrics, not business metrics. ↳ Your accountant cares about cash flow, not gross sales. I see this delusion everywhere: What sellers celebrate: ↳ "Hit $50K this month!" ↳ "Scaling to 7 figures!" ↳ "Best month ever!" What they're actually running: ↳ A break-even charity. ↳ A cash flow nightmare. ↳ A business that works for Amazon, not them. The profit killers nobody talks about: Amazon fees (15% of revenue) PPC spend (20-30% of revenue) COGS creeping up (supply chain issues) Returns and refunds (3-5% of revenue) Storage fees (long-term inventory) Customer service costs Software subscriptions Accountant fees for mess cleanup |The math that matters: ↳ $100K revenue - $85K costs = $15K profit ↳ $15K ÷ $100K = 15% profit margin ↳ 15% = Sustainable business ↳ 1-5% = You're working for free The wake-up call: ↳ Revenue pays for ego. ↳ Profit pays for life. ↳ Cash flow pays the bills. I've seen sellers with $500K revenue go bankrupt. I've seen sellers with $50K revenue retire early. The difference? One focused on growth. The other focused on profit. Stop celebrating revenue. Start celebrating profit margins.

Most Shopify stores think their tracking is “fine”… until they see how much revenue they’re actually losing. Last week, I checked a Shopify store. Tracking looked “okay”… All pixels installed… Everything firing… But inside Google Ads and GA4? They were missing 35%+ of real conversions. And this is what happens to most Shopify brands: – Wrong or missing purchase values – Duplicated events – AddToCart not firing – Server-side not set up – GA4 and Google Ads showing different numbers – Facebook Pixel blocked on iOS – No Consent Mode v2 – No data layer on checkout Here how a proper tracking look like - https://lnkd.in/gF-cS4X5 When this happens → Your ads optimize on bad data. And bad data = high CPC + low ROAS. The truth is: If you want stable scaling in 2025… Accurate tracking is not optional. So, I implement everything from scratch.. page_view, add_to_cart, begin_checkout, purchase, scroll tracking, phone click, email click, newsletter signup, contact form, view_item, view_item_list… 35+ events firing perfectly. → Facebook (Meta) Events → Google Analytics 4 Events → Google Ads Conversion Tracking → Google Ads Dynamic Remarketing → Microsoft Ads UET Tag & Remarketing This fixed: • missing conversions • wrong values • broken remarketing • under-reported purchase data Now the store has accurate tracking across all platforms and the client can finally scale without blind spots. I also recorded a full behind-the-scenes video showing the exact setup and how the funnel works. Here is the video - https://lnkd.in/gF-cS4X5 Work with me - https://lnkd.in/gi89gSBg #googletagmanger #shopify #conversiontracking

We all say we’re “data-driven.” But if the only number you track is revenue…  You’re just revenue-driven. That’s like calling yourself a chef because you know how to eat. Revenue is the scoreboard. But to actually win the game, you need to track the plays that create it. Here are a few I watch closely: 1⃣ Customer Acquisition Cost (CAC) ↳ Protects margins and reveals if growth is truly scalable. ↳ Rising CAC without rising LTV = red flag. 2⃣ Customer Lifetime Value (LTV) ↳ Shows the real worth of a customer over time. ↳ Informs how much you can afford to acquire them in the first place. 3⃣ Conversion Rate by Funnel Stage ↳ Pinpoints exactly where prospects drop off. ↳ Optimizing here often costs less than buying more traffic. 4⃣ Retention Rate ↳ Growth gets easier when your base sticks around. ↳ Higher retention means compounding revenue without compounding spend. 5⃣ Attribution Quality ↳ Without reliable attribution, you’re guessing where sales come from. ↳ Bad data = wasted budget and wrong bets. Being data-driven is about having a full picture, not just the scoreboard. Revenue tells you the “what.” The rest tells you the “why” and “how.” What’s one non-revenue metric you’d never stop tracking? ♻ Share this to help more brands go beyond “revenue-driven.” Follow me, Francesco Gatti, for more on data, retention, and ecommerce growth.

Most ecommerce founders track revenue. Few actually understand what drives it. The difference between growth and burnout? Financial clarity. This is exactly what helped me Scale and Exit Freeup. Here is a breakdown of the metrics that actually matter: 1. Core Financial Metrics → AOV, CAC, LTV, Conversion Rate, Refund Rate. → Know your ratios; not just your revenue. ️2. Inventory & Product Health → GMROI > 3 means your inventory is working. → Dead stock = silent profit killer. → Sell-through above 80%? You’re running lean. ️3. Profitability Deep Dive → Gross margin below 50%? Red flag. → ROAS ≥ 4:1 keeps you scalable. → Track Net Profit Margin; aim for 10–20%. 4. Marketing Efficiency → Compare CAC + ROAS by channel. → Don’t trust last-click; use multi-touch attribution. 5. Operations & Fulfillment → Shipping costs <10% of revenue. → Accuracy >99%. → Low CSAT often = fulfillment issues. 6. Cash Flow Management → Know your Cash Conversion Cycle. → Track burn rate and supplier terms. → Cash is oxygen — protect it. 7. Advanced Metrics → CLV:CAC ratio ≥ 3:1 = healthy. → < 12-month payback period = sustainable. → Cohorts reveal what averages hide. 8. Quick Fixes → Declining AOV? Add upsells. → High CAC? Retarget smarter. → Low retention? Improve post-purchase experience. Ecommerce isn’t just marketing. It’s finance, operations, and foresight. Track. Analyze. Optimize. Repeat. ♻️ Save this if you’re building a smarter ecommerce business. P.S. Need a Top CFO for your Ecom business? DM me with "Ecom"

Sellers, does this look familiar? Sales Price: $25 Expected profit: $15 Reality: under $7 The difference? Amazon fees. Let’s break them down with a real example. 🔶 Selling plan fees Individual sellers pay a fee per item ($0.99 for the US market). Professional sellers pay a monthly subscription of $39.99. Most growing businesses choose Professional because it allows bulk listing, advertising, and detailed reporting that are not available on the Individual plan. 🔶 Referral fees Amazon takes a percentage of every sale. The rate varies by product category, ranging from 6% to 45%, with most categories at 15%. Since it is not a single fixed amount, most of the Amazon categories have a minimum fee of $0.30 per item. It protects Amazon from losses on very low-priced products. 🔶 Fulfillment fees (FBA) For sellers using FBA, Amazon charges based on product size and weight. This covers picking, packing, shipping, returns, and customer service. 🔶 Storage fees Inventory in Amazon’s warehouses is charged by space used: $0.78 per cubic foot (Jan–Sep) and $2.40 (Oct–Dec). 🔶 Other fees Prep, labeling, removals, disposal, and refund processing. Small individually, but they add up. How do Amazon fees work in practice?   Every time you make a sale, Amazon automatically deducts these fees from your revenue before sending you the payout. You never see the gross total in your bank account. Your real margin is the difference after all Amazon fees are applied. Here is a simple example. You sell a digital kitchen scale for $25 on Amazon US using FBA. The box measures 9 × 7 × 1.5 in (≈ 94.5 cubic inches, or 0.055 cubic feet). -> Referral fee (15% for Home & Kitchen): $3.75 -> Fulfillment fee (Small Standard, 8–12 oz): $3.72 -> Storage fee: 👉 Non-peak (Jan–Sep, $0.78 per cu ft): 0.055 × $0.78 = $0.04 / month 👉 Peak (Oct–Dec, $2.40 per cu ft): 0.055 × $2.40 = $0.13 / month -> Other minor fees (labeling, returns, prep): $0.25 If the product sells in the same month outside of peak season, your Amazon fees are about $7.76. If it sits in storage during Q4, that rises to around $7.85. So with a product cost of $10, your net margin is not $15 ($25 − $10). It is closer to $7.20 after all Amazon fees. On paper, the business looked profitable. After fees, the margin tells a different story. ❗Important to note: the profit above is before applying advertising costs, which will reduce the margin further. Can you reduce these fees? Yes. Referral rates vary by category. Two similar products can face 15% vs 12%. By requesting a move to the correct but more favorable GL category, you lower costs without changing price or packaging. Amazon fees are not a penalty. They are the cost of reaching millions of loyal Amazon customers. Sellers who ignore them struggle. Sellers who master them grow faster and keep more of their revenue. How do you factor Amazon fees into your pricing decisions? #AmazonSelling #AmazonFBA #EcommerceTips #AmazonSellers 

Your customers have already told you why they’re buying...or why they’re not. You’re just not using the data. Most brands are sitting on a goldmine of customer feedback...but instead of using it to drive more sales, they’re out here throwing money at ads and guessing what customers want. Buried inside your reviews, emails, and order history are patterns that show you exactly: Why people hesitate before buying What product tweaks could increase conversions Which products are frequently bought together (aka, easy upsell opportunities) Instead of guessing, here’s how to use AI to extract these insights and turn them into more revenue: Step 1: Collect Customer Feedback & Purchase Data Export customer reviews (Shopify, Trustpilot, Amazon, etc.) Pull support emails & live chat transcripts (people ask what they’re unsure about) Look at order data—what products are customers buying together? Step 2: Plug This Into ChatGPT (Along with your customer feedback!) Prompt: "Analyze this customer feedback and purchase data for recurring objections, buying patterns, and conversion barriers. Identify common concerns stopping people from purchasing, trends in frequently bought products, and messaging gaps that could increase sales." Step 3: Look for Patterns & Take Action 🚀 If people hesitate because of price → Your value messaging isn’t strong enough. 🚀 If customers buy one product and come back for another → Create an upsell or bundle it upfront. 🚀 If customers keep asking the same pre-purchase questions → Your product descriptions need work. 🚀 If certain products are always bought together → Feature them as “frequently bought together” or offer a bundle. This takes 10 minutes...but it’s the difference between guessing and scaling smarter. Your customers are already telling you how to sell to them. AI just helps you see it faster. Try this and let me know what insights you uncover. Bet you’ll find something you weren’t expecting.

Improve your store's conversion rate, retention rate, and overall profitability within 30 minutes. No clickbait, I promise. Product performance analysis is one of the least used strategies in DTC marketing. Here are my steps to do product performance data without any additional tools - Using Shopify, Meta & Google Analytics 1. Go into Shopify Analytics and pull "Sales by product" for revenue 2. Download the "Product orders and returns" report for the return percentage 3. Go into GA4 and pull the Ecommerce purchases report for items views, items added to the cart, and items purchased. 4. Go into Meta and pull the Catalog ads product report by ad spent and purchases to find product level CAC. 5. Find the margin on the products, or use the Shopify "Profit by-product" report if the margin was available in the reporting. Merge all the above reports either on SKU or product name to a single report. It should have -  Product name Revenue Gross Margin % Return Rate % Meta Catalog Ads CAC for product GA4 Item View-To-Purchase Conversion Rate GA4 Item Cart-to-View Conversion Rate Remove or fix -  - Least profitable or low-margin products - High CAC products - High return products - Low view to conversion products Promote aggressively -  - High-margin products - Low CAC products - Low return products - High conversion rate products It's best not to look at a single metric but to get to the contribution margin at the product level. Single Product Contribution Margin = (Unit Revenue * (1- Return %)) - (Meta CAC) - (Unit Shipping + Payment Costs) It's a simple formula, you can increase complexity with more variables. The goal is to do a comparative analysis. Using Pareto principles, 80% of sales will be coming from 20% of the products. Use this information to align your inventory and sales projections. Most DTC brands have a higher count of SKUs than needed. Trim your SKU count. You can use ROI Hunter & Reveal by Omniconvert for in-depth product analysis. Both tools have fantastic reports for doing product analysis. In Reveal, you can get the product level NPS, segment performance analysis, and retention rate per product. Again, it's a simple analysis that needs to be done once a quarter. It will help you remove the dead weight. #dtc #ecommerce I am Rahi Jain I use my PCC (Product, Customer, Communication) framework to maximize growth and profitability for ecommerce brands. Have helped generate $34M+ for 50+ ecommerce brands. Built a $20M ecommerce store.

Shopify analytics reports misleading data. Pay attention to these: 1/ AOV That number will be wrong if you process a lot of zero-dollar orders (samples, warranties, 100% discounts, etc.) Exclude those from your AOV analysis to have a better understanding of your real AOV. Plus, it only considers Gross Revenue - Discounts (no Shipping Collected). That matters if you want to test Free Shipping vs. Shipping Threshold -> AOVs will not be comparable. 2/ Conversion Rate Firstly, CR includes both returning and new customers. If your retention rate goes up in a particular month (a really lucrative promo or offer that pulls customers from your email flows), your CR will not be meaningful. Secondly, CR displayed in Shopify only relates to SITE conversions. Any orders processed through the live chat, drafts, or other integrated channels, will not be included. Take those conversions into account as they go through a customer journey too. Lastly, if you drive bot traffic to your site, that will skew your sessions and misstate CR. Ashburn is one of the biggest sources of bot traffic (Amazon servers). Filter random "small" cities with high session counts out of your total figure for a more accurate CR. 3/ Total Sales I mean, this one is outrageous -> this figure reports net sales + SALES TAX COLLECTED... No idea who at Shopify thought that it was a smart idea to calculate it that way AND place it on the main dashboard, but they haven't fixed it. Always go to Shopify reporting and exclude collected taxes to understand how much sales you actually generated. --- Understanding these shortcomings will help you make better financial decisions and look behind the data. Ideally, build your own financial model and paste Shopify data into it to generate more accurate metrics and insights. P.S. Need help with understanding financial metrics reported in Shopify and acting upon them? Let's talk! #ecommerce #d2c