As a digital commerce marketer, you are caught in a paradox of choice when it comes to metrics and performance. On the one hand, you have no shortage of metrics to measure. On the other hand, when you focus on one metric, you might analyze it in isolation without understanding the whole story of performance. It’s the equivalent of reading one chapter in a book and confidently proclaiming to understand the whole plot. The Gartner hierarchy of digital commerce marketing metrics encourages marketers to look at the interdependencies between metrics, rather than looking at each metric in isolation.
The hierarchy of digital commerce marketing metrics is a tiered system of metrics used to define relevant business metrics at many levels to improve digital commerce marketing effectiveness:
- Level 1 focuses on business outcomes for executives to assess the overall health of the business. Example metrics include revenue and profitability.
- Level 2 focuses on strategic levers for executives and directors to understand common strategic levers defining business outcomes. Example metrics include cost per visitor and retention rate.
- Level 3 focuses on operational levers for directors or managers to illuminate conversion and sales efficacy across customers and products. Example metrics include new vs. repeat customer mix and top sellers.
- Level 4 focuses on tactical levers for channel managers to gain visibility into channel effectiveness. Metrics include channel-level traffic and conversion metrics.
It’s the interplay among the metrics, however, that enables all levels of marketers to make effective trade-off decisions.