In the fast-paced world of Amazon selling, staying on top of your business performance is crucial. One of the best ways to measure success and identify areas for improvement is by tracking Amazon Key Performance Indicators (KPIs). These metrics offer valuable insights into how well your products are performing, how efficient your advertising efforts are, and where you might be losing money due to hidden costs like Amazon fees.
What are Amazon Key Performance Indicators (Amazon KPIs)?
Amazon KPIs are measurable metrics that help sellers evaluate the effectiveness of their sales and marketing efforts on the platform. From advertising performance to customer engagement and profitability, these KPIs provide a clear picture of what’s working and what needs adjustment.
Why are Amazon KPIs Important?
Tracking the right KPIs can make all the difference when it comes to scaling your brand. Without a data-driven approach, you risk overspending on ads, missing out on sales opportunities, or failing to identify areas where costs can be reduced. Understanding these metrics helps sellers make informed decisions that lead to increased profitability, better customer engagement, and more efficient use of resources.
The 5 Most Important Amazon KPIs
1. Advertising Cost of Sale (ACoS)
ACoS measures the effectiveness of your Amazon advertising by comparing your ad spend to the revenue generated. It’s calculated using the formula:
ACoS = (Ad Spend / Ad Revenue) x 100
A lower ACoS indicates that your campaigns are efficient, while a high ACoS may suggest the need for better targeting or bid adjustments. Tracking ACoS helps sellers understand if their ad budget is being used effectively and whether adjustments are needed to improve profitability.
How Seller Margins Can Help: Seller Margins provides detailed breakdowns of your ACoS, highlighting areas where ad spend can be reduced and profitability increased. The platform’s insights help you make data-driven decisions to improve your ad efficiency.
2. Return on Ad Spend (ROAS)
ROAS is the inverse of ACoS and measures how much revenue you generate for every pound spent on advertising. The formula is:
ROAS = Ad Revenue / Ad Spend
A higher ROAS means your campaigns are bringing in more revenue relative to your costs. By monitoring ROAS, sellers can determine which campaigns are driving the best return and allocate their budgets accordingly.
How Seller Margins Can Help: Seller Margins tracks ROAS across different campaigns and provides insights into which strategies are delivering the best returns, allowing you to refine your advertising approach for maximum profitability.
3. Impressions
Impressions measure how many times your product listings or ads are seen by potential customers. A high number of impressions indicates strong visibility, but it’s important to ensure these impressions are translating into clicks and conversions. If impressions are high but clicks are low, it might be time to revisit your product titles, images, and descriptions to improve click-through rates.
How Seller Margins Can Help: Seller Margins helps you identify trends in impressions and analyse which keywords or listings are driving the most visibility, ensuring your products reach the right audience effectively.
4. Click-Through Rate (CTR)
CTR measures the percentage of people who click on your product after seeing it in search results or an ad. It’s calculated as:
CTR = (Clicks / Impressions) x 100
A low CTR suggests that your product listings might not be compelling enough to attract buyers. Improving elements like product images, pricing, and titles can help boost CTR and drive more potential customers to your listings.
How Seller Margins Can Help: Seller Margins provides in-depth reports on your CTR performance and highlights areas where improvements can be made, such as ad copy, images, or keyword targeting.
5. Conversion Rate (CVR)
Conversion rate is one of the most critical KPIs to track, as it tells you how many visitors actually make a purchase. The formula is:
CVR = (Orders / Clicks) x 100
A high conversion rate means that your product pages are convincing and relevant to customers. A low CVR may indicate issues with pricing, reviews, or product presentation that need to be addressed.
How Seller Margins Can Help: Seller Margins helps pinpoint which factors are impacting your conversion rates by analysing pricing strategies, customer feedback, and page engagement metrics.
Full List of Amazon KPIs to Track
While the above five KPIs are some of the most impactful, other important Amazon KPIs worth monitoring include:
- Amazon Advertising Cost of Sales (Amazon ACoS) KPI
- Amazon Total Advertising Cost of Sales (Amazon TACoS) KPI
- Amazon Return on Ad Spend (Amazon RoAS) KPI
- Amazon Cost Per Acquisition (Amazon CPA) KPI
- Amazon Click-Through Rate (Amazon CTR) KPI
- Amazon Average Order Value (Amazon AOV) KPI
- Amazon Ad Conversion Rate KPI
- Amazon Organic Conversion Rate KPI
- Amazon Percent of Sales New to Brand KPI Amazon
- Inventory Performance Index KPI
- Amazon Order Defect Rate (Amazon ODR) KPI
- Amazon Perfect Order Percentage KPI
- Amazon Glance Views KPI Amazon Product Conversion Rate KPI
- Amazon Percentage Buy Box Fast Track KPI (for vendors)
- Amazon Replenishable Buy Box Fast Track KPI (for vendors)
- Amazon Percentage Replenishable Out of Stock KPI
- Amazon Views on non-replenishable items KPI (for book vendors)
- Amazon Late Shipment Rate (Amazon LSR) KPI
- Amazon Pre-fulfilment Cancellation Rate KPI
- Amazon Valid Tracking Rate (Amazon VTR) KPI
- Amazon Unit Session Percentage Rate KPI
- Buyer-Seller Contact Response Time (CRT) KPI
- Amazon Product Ranking KPI
How Seller Margins Can Help
Keeping track of all these KPIs manually can be time-consuming and overwhelming. This is where Seller Margins comes in. Our advanced eCommerce analytics platform takes the guesswork out of Amazon selling by providing in-depth insights into your sales performance, advertising effectiveness, and hidden costs like Amazon fees. With Seller Margins, you can:
- Monitor ACoS, ROAS, CTR, and CVR effortlessly.
- Gain clear visibility into your true profitability.
- Identify areas where costs can be cut to improve margins.
With Seller Margins, you get accurate, actionable data that helps you make smarter business decisions, ultimately growing your brand and increasing profits.
Conclusion
Tracking Amazon KPIs is essential for success in today’s competitive marketplace. By focusing on key metrics like ACoS, ROAS, impressions, CTR, and conversion rate, sellers can fine-tune their strategies and boost their bottom line. Tools like Seller Margins make it easier to stay on top of these crucial metrics and take your Amazon business to the next level.