Gauging your wholesale business’ success is crucial for your long-term sustainability. After all, knowing where you are in terms of your goals can inform where you should invest your valuable resources and efforts. This is where B2B metrics and KPIs come in!
Tracking relevant B2B metrics gives you valuable insights into customer behavior, operational efficiency, and the overall health of your wholesale venture. However, with so many metrics to choose from, it can be challenging to know which is relevant for your business. This guide will give you a headstart. Below, we’ve enumerated the top B2B metrics every wholesaler should track.
So, let’s get right into it!
What Are B2B Metrics And Why Are They Important?
B2B metrics are concrete, quantifiable metrics used to measure performance and gauge the success of different aspects of your wholesale operations. They can give insights about your business’s financial performance, operational efficiency, customer interactions, and more.
At its core, B2B metrics are the “language” of your business. They help you:
- Make data-driven, strategic decisions: B2B metrics equip you with data-driven insights to guide your decision-making.
- Enhance your adaptability in a competitive market: With real-time data, you can make quick and informed adjustments, ensuring resilience in an ever-changing market.
- Uncover key areas for improvement: Metrics and KPIs reveal opportunities for optimization and help you identify weaknesses within your business processes.
6 B2B Metrics Your Business Should Track
Now that we understand what B2B metrics are and why they’re important, let’s explore key metrics that can help you understand and optimize your wholesale business for success.
1. Conversion Rate
The ultimate goal in B2B e-commerce is to turn your website visitors into paying customers. This makes conversion rate one of the most important B2B metrics to track. This metric quantifies the percentage of website visitors who take your desired action, whether it’s making a purchase, signing up, or engaging with your content.
Why track it: Monitoring your conversion rates gives you valuable insights about the effectiveness of your marketing and website optimization efforts.
How to calculate conversion rate:
Conversion rate = (Number of conversions / Total number of website visitors) x 100
Strategies to improve conversion rate:
Steer your customers in the right direction by creating clear and compelling call-to-actions that guide users to your desired actions. Strategically place them around your site where your website visitors can see them. To build credibility from the get-go, it’s also important to incorporate trust-building elements such as customer testimonials, certificates, or security badges.
To increase conversion rates, you’ll want to optimize the entire online shopping experience for your customers, from the moment they visit your website and register as customers to their first initial purchase. Consider implementing tools like Wholesale Suite– this all-in-one solution for WooCommerce elevates your entire B2B e-commerce website by allowing you to:
- Manage wholesale pricing and create irresistible deals for your customers
- Capture leads seamlessly with a user-friendly and customizable registration form
- Create intuitive one-paged ordering forms for effortless bulk purchases
2. Average Order Value (AOV)
Average order value (AOV) reveals how much a customer spends per transaction on your wholesale platform. A higher AOV is beneficial for your wholesale business, as it contributes to higher revenue without acquiring additional customers.
Why track it: Understanding AOV can help you tailor your marketing campaigns and deals to encourage larger transactions. It also helps you identify opportunities for upselling and cross-selling.
How to measure AOV:
Average order value = Total Revenue / Number of orders placed
Strategies to increase AOV:
You can encourage customers to spend more per transaction by offering discounted bundles and suggesting complementary products during the purchase process. Likewise, you can leverage the power of tiered pricing. This features larger discounts as customers increase the quantity of the products they purchase.
Powerful tools like Wholesale Prices Premium allow you to implement these pricing strategies easily. Tailor-made for WooCommerce wholesalers, this plugin lets you set exclusive wholesale prices, tiered pricing, percentage discounts, and more.
3. Website traffic
According to industry insights, today’s B2B buyers prefer the convenience of researching and purchasing online. This is a key reason why website traffic is one of the most important B2B metrics to track. This metric measures the volume of visitors accessing your wholesale platform within a specific period.
It also includes additional KPIs that can help you assess the effectiveness of your platform, such as:
- Traffic source: Where your website visitors come from, such as from another platform or via email.
- Bounce rate: The number of website visitors that navigate only one page on your website, and then leave.
- Unique Visitors: The number of distinct individuals visiting your site.
- Page Views: The total number of pages viewed by all visitors.
- Session Duration: The average time visitors spend on your site.
Why track it: Assessing your website traffic allows you to gauge the effectiveness of online marketing efforts. High traffic is beneficial for your wholesale business, as it means increased online visibility. More visitors means higher chances of acquiring potential new customers who are interested in your offerings.
How to measure website traffic: Platforms like Google Analytics and MonsterInsights allow you to track the number of visitors, page views, and other relevant metrics.
Strategies to increase website traffic:
There are several marketing strategies that can help you increase website traffic, including Search Engine Optimization (SEO) and content marketing. Both of these strategies require optimizing your website and content for search engines to improve visibility.
Consider conducting keyword research to identify the relevant keywords in your niche. Then, you can optimize your meta tags, descriptions, and titles to improve your rankings on search engine results. Additionally, you can use social media platforms and email marketing to drive traffic to your website.
4. Customer Acquisition Cost (CAC)
CAC measures the costs of acquiring a single customer for your business.
Why track it: This is one of the most important B2B metrics to evaluate as it allows you to gauge the effectiveness of your customer acquisition strategies. In turn, it can guide your decision-making on where to allocate your resources for maximum return on investment (ROI).
How to measure CAC:
Customer Acquisition Cost = Total costs of sales and marketing / Number of new customers acquired
Strategies to optimize CAC:
To optimize CAC, it’s crucial to gain a deeper understanding of your target market. Who are your offerings for? Identify and segment your customers based on their demographics, preferences, and behavior. Then, prioritize targeting target high-value customers that align with your business objectives and are most likely to convert. This tactic ensures that your marketing efforts are directed toward clients that resonate with your offerings the most.
Implementing solutions like Wholesale Lead Captures allows you to learn about your customers from the get-go. This WooCommerce plugin creates a user-friendly registration form for your B2B clients. Apart from giving your wholesale clients a seamless onboarding experience, it also serves as a powerful tool to collect essential information about their preferences, needs, and expectations.
5. Customer Retention Rate (CRR)
Out of the several B2B metrics you can keep track of, CRR is one of the most important. This metric measures the percentage of customers your wholesale business successfully retains over a given period of time. It provides key insights into your ability to nurture lasting relationships with your B2B clientele.
Why track it: Your customer retention rate is a key indicator of your business’s long-term profitability. Higher CRR translates to more sustainable revenue streams in the long run. Retaining customers is also more cost-effective than acquiring new clients, making CRR a crucial financial metric for your business.
How to calculate CRR:
Customer retention rate = (Number of customers at the end of a period – Number of customers acquired during that period / Number customers at the start of the period) x 100
Strategies to improve CRR:
Customer retention is directly related to how satisfied your customers are with your offerings, services, and support. To improve CRR, it’s essential to anticipate and address customer needs proactively. Provide stellar customer support and implement feedback loops to gain valuable insights about how you can enhance your products and services. You can also encourage repeat business by crafting loyalty programs and offering irresistible incentives to reward your customers.
6. Cart Abandonment Rate (CAR)
Creating a seamless experience in the fast-paced world of wholesale is paramount to staying competitive. Cart abandonment rate measures the percentage of users who add products to their virtual cart, but leave your wholesale website without making the purchase. This reveals key insights about the effectiveness of your online purchase process.
Why track it: By learning about CAR, you identify potential friction points in the online buying journey. At what point of the online purchase process are buyers dropping off? Understanding this is key to streamlining the conversion journey.
How to calculate CAR: To calculate the Cart Abandonment rate, divide the total number of completed purchases by the number of carts created. Then, subtract the result from one and multiply by 100 to get the abandonment rate. Let’s illustrate it with a simple example:
If you have 50 completed purchases on your website and 120 shopping carts created, the shopping cart abandonment rate would be 58.4% following the formula:
(1 – (50 / 120)) x 100 = 58.3%
Strategies to improve CAR:
To encourage wholesale customers to complete their orders, it’s important to provide a streamlined checkout process. Consider leveraging solutions such as Wholesale Order Form. This powerful WooCommerce plugin creates an intuitive, one-paged ordering form that makes bulk purchasing a breeze for your clients.
You’ll also want to tap into these missed opportunities. For example, you can create targeted email campaigns for abandoned cart users and create exit-intent pop-ups to encourage the completion of the purchase.
B2B metrics are the language of your business, serving as indicators of its success, health, and overall performance. Leveraging the insights from different B2B metrics can help you make informed decisions to achieve your business goals. In this helpful guide, we’ve covered six essential metrics you should track to gain valuable insights.
To conclude, let’s review these metrics below:
- Conversion rate
- Average Order Value (AOV)
- Website traffic
- Customer Acquisition Cost (CAC)
- Customer Retention Rate (CRR)
- Cart Abandonment Rate (CAR)
Integrating solutions like Wholesale Suite enhances the effectiveness of your efforts to optimize and improve these metrics. This all-in-one WooCommerce solution for wholesalers allows you to manage pricing, capture B2B leads with ease, and streamline online purchasing with order forms.
Do you have any questions about B2B metrics? Let us know in the comments section below!