When Amazon founder Jeff Bezos, offered to sell
advertising on ecommerce marketplace, it was considered to be not so good idea.
He approved the idea and now, Amazon advertising is worth almost $2.2 billion
and is one of the best multi vendor ecommerce marketplaces. Bezos approved the
idea mainly because it was proved by data.
Key performance metrics help you to measure success
of ecommerce business in achieving its goals. To measure your multi seller ecommerce
platform success correctly, its
best to form set of metrics on basis of your goals.
Business
growth and profitability
Many KPI to evaluate business development in
ecommerce, following are fundamental for online shopping marketplaces.
Gross
Merchandiser Volume (GMV)
It’s equivalent to total order value and is
measuring the dollar value of items sold in online marketplace over a given
period of time. It’s the fundamental KPI for ecommerce multi seller
marketplaces. It helps to measure business growth and usage of virtual
marketplace website by sellers.
Etsy
online marketplace equivalent of GMV point.
The indicator is showing the ecommerce marketplace growth which is up to 14.5 % in 2017 compared with year 2016.It’s calculated prior to deduction of any expenses, shipping fees, refunds, returns must be excluded. It’s most useful as comparative measures over time and is tracked on monthly and yearly basis.For service online shopping marketplaces, it’s very important to take into account the difference between “contracted” and “delivered” GMV figures. In some service internet shopping concepts, there can be delay between two which can make incorrect GMV, if “Contracted” figures are computed.
Average
Order Value
It denotes how much customers spend for every order
they make, sales per each order. This metric helps to view virtual ecommerce
marketplace growth by reflecting average transaction value and profit increase.
Average
Order Value (AOV) = Total revenue/number of transactions
By increasing AOV, you can increase Return on
Marketing Investment (ROMI)
Revenue
It measures income that multi vendor ecommerce
platform receives, in the form of transaction fees, listing fees and seller
services. It helps to track efficiency of virtual multi vendor marketplace
concept and to break down revenue streams to analyze components.
Multi
vendor shopping cart revenue streams has two parts
Ecommerce marketplace store transaction fee and
listing fee
Fulfillment rates reflects percentage of times when
your online ecommerce marketplace delivers goods or services
Supply
side development
Quantitative
growth
It doesn’t reflect performance directly connected with
ecommerce marketplace store main goals and is useful when actively embracing
market category or scaling online ecommerce platform.
Qualitative
growth
These KPIS help to view ecommerce marketplace
performance growth and insights on what is influencing the growth.
Demand
side development
Quantitative
growth
Qualitative
growth
Customer Acquisition
Cost (CAC)
Those are fundamental metrics that’s vital in measuring the main points of your multi vendor ecommerce marketplace platform performance accurately. If you want to launch your own multi vendor marketplace, contact our experts today.
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