As we ride the wave of the digital revolution, the shape of global retail continues to morph and evolve. Forecasts from Forbes paint a tantalizing picture, predicting marketplace sales to eclipse the astronomical sum of $3.5 trillion by 2024. In the following five years, we’re set to witness the ascension of third-party online marketplaces, expected to become the most dynamic and dominant retail channel worldwide. Come 2027, they’ll be responsible for nearly two-thirds of all online sales. Interestingly, this is not the future for China—it’s already a reality with 80% of their online sales channeled through marketplaces.
A multi-marketplace strategy is no longer a luxury, but a necessity for every forward-thinking seller and brand. But a strategy without measurement is like sailing without a compass. So how can one pinpoint the most pertinent marketplace KPIs and craft a purposeful marketplace KPI dashboard to keep track of performance? Join us as we unravel this intriguing subject.
In the realm of business, Key Performance Indicators (KPIs) are quantifiable measures used to evaluate the success of an organization, an employee, or a specific project or campaign in achieving key objectives. With the unprecedented growth of online marketplaces, KPIs have become an indispensable tool for brands and sellers in monitoring performance, identifying areas for improvement, and making data-driven decisions.
For sellers operating within marketplaces, a myriad of KPIs — encompassing aspects such as sales volume and customer satisfaction — might be pertinent. However, the KPIs of prime importance are intrinsically linked to the unique goals and objectives that each seller establishes for their specific marketplace presence (for example Amazon, eBay, Zalando, etc.). If you’re just dipping your toes into the world of marketplace selling, the task of determining which KPIs to track can be somewhat overwhelming. To facilitate a smoother path forward, we’ve curated a list of the key KPIs you ought to be monitoring in 2023.
These represent the critical marketplace KPIs that should be an integral part of any comprehensive marketplace performance strategy:
While the aforementioned KPIs are crucial to tracking your marketplace performance, there are additional metrics that offer valuable insights:
While it’s feasible to track marketplace KPIs individually through your seller account on each platform, this can quickly become overwhelming and complex. Envision instead the power of centralizing all your KPI monitoring! Having a single location for all your KPIs from various marketplaces not only streamlines your profitability analysis but also illuminates potential expansion opportunities into new marketplaces or geographies. A comprehensive KPI dashboard holds the key to this level of consolidated oversight and beyond – feed management platforms like Lengow provide it!
A well-crafted dashboard should not only display your KPIs in a digestible, visual format but also be interactive, allowing you to drill down into each metric and analyze trends over different periods. You should also be able to compare data across various categories, such as product types, countries, and marketplaces. This granular view of your performance can guide strategic decision-making and resource allocation.
It’s important to remember that KPIs are not just about tracking successes—they’re also about learning from challenges. Evaluating collected data, reviews, and feedback is a non-negotiable part of the process. These valuable insights will help you improve your delivery service, enhance content, and devise effective advertising campaigns on marketplaces.
With a comprehensive understanding of your performance, you might be ready to take the next step. Start experimenting with new products and marketplaces. Initial experience and a satisfactory performance record are all the encouragement you need to test new product categories, opening up new avenues of growth.
In essence, these metrics are your roadmap to optimizing your distribution and adapting your marketplace strategy. They provide a clear vision of where you’re currently standing and how you can reach your destination faster and more efficiently. Remember, a well-crafted KPI dashboard is not a luxury—it’s a necessity in the digital age. It’s your compass in the complex and ever-changing landscape of online marketplaces. Use it well, and it will guide you to success.
What is a KPI in online marketplaces?
Answer: A KPI, or Key Performance Indicator, in online marketplaces is a quantifiable measure that helps brands or sellers evaluate their success in meeting their key objectives.
Why are KPIs important for online marketplaces?
Answer: KPIs are important for online marketplaces as they help to monitor performance, identify areas for improvement, and guide data-driven decision-making.
How often should I review my marketplace KPIs?
Answer: The frequency of review will depend on the specific KPI and the dynamics of your active marketplaces. Some KPIs might need daily monitoring, while others could be reviewed weekly or monthly.
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