Metrics vs. KPIs: What's the difference in eCommerce?
What is the difference between metrics and KPIs? These concepts are often confused. Metrics describe what is happening in your business. For example, how many people visited the website, how many orders were placed, what is the average order value (AOV). A KPI is a goal that is ‘measured’ and described in numbers. A metric is the actual state of affairs, while a KPI is a plan.
How can you link metrics and business goals? How can you influence this? What KPIs and deadlines should you calculate? The specialists at Halla Systems dropshipping discuss this in this article.
Why is this important?
In eCommerce, it is important not just to record data, but to understand what exactly you are measuring, why, and which figures need to be tracked. Analysing ‘everything’ can be confusing, creating the illusion of control. You will focus on the essentials if you select only those KPIs that really influence growth.
How to choose the right KPIs for eCommerce
When choosing KPIs, it is important to make sure that you can influence them and that they reflect results related to your business goals — profit, growth, customer retention. A good KPI helps you make decisions and shows whether you are moving in the right direction.
KPIs should be directly related to the business (profit, growth, customer retention). For example, if your KPI is ‘traffic from Instagram,’ you can publish more posts, run ads, or create stories with a call to action to follow the link. But if the KPI depends on external factors, such as exchange rates or weather conditions, you will not be able to control it. Such an indicator is ineffective, according to managers at Halla Systems company.
Discard the unnecessary
Vanity metrics look good on paper, but in reality, they are not linked to anything important or meaningful.
For example, social media engagement metrics — likes, comments, and reposts — are not always linked to actual sales. Similarly, a large number of video or post views does not mean that users are visiting the website or making a purchase. Such metrics may look impressive, but they do not bring any real benefit to the business. Social media followers are also a vanity metric. Out of 1,000 new Instagram followers, only 5 may turn out to be real buyers.
How to track metrics
It is enough to track metrics once a week.
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Google Analytics — for traffic and behaviour on the website.
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Facebook Ads Manager / TikTok Ads — for ROAS, CTR, and CPC.
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Shopify / WooCommerce — for AOV, orders, and returns.
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Retention tools (e.g., Klaviyo) — for LTV and repeat orders.
Which KPIs should you choose?
Not all KPIs are equally useful. Ask yourself: ‘What is most important for the business right now?’ Divide the metrics into stages of the sales funnel and select 3–5 indicators that are currently necessary for development and growth. It is better to have 3 clear and workable goals than 15 that no one remembers.
A dropshipper is constantly looking for a profitable combination of products and traffic and tracks key metrics: AOV (average order value), CAC (customer acquisition cost), website conversion (AOV) and ROAS (return on ad spend). You need to start with the main question: what do you want to achieve in the near future?
If the goal is to increase sales, then it is important to track AOV, AOV and ROAS. If you want to retain customers, it is worth monitoring the number of repeat purchases and customer lifetime value (LTV). If the goal is to grow and increase turnover without losing profit, track AOV, ROAS and the percentage of repeat sales. And if you are just testing a niche, your priorities are CAC and the first stable orders.
E-commerce funnel KPIs (dropshipping)
1. Attraction
CPM, CPC (cost per click), CTR, traffic
Reduce CPM to £5, maintain CPC ≤ £0.90 (current £0.75), increase CTR to 2%, get 15,000 visits per month
2. Conversion
CR, AOV, additions to basket
Increase CR from 1.8% to 2.2%, achieve AOV of £40 (currently £35), get 6,000 additions to basket
3. Retention
Retention rate (returning customers), repeat orders, LTV (customer value), reviews
Retention rate ≥ 30%, achieve 35% repeat orders (current level — 25%), increase LTV to $75, maintain a rating above 4.5 stars
4. Profit
ROAS, gross margin, CAC
Achieve ROAS ≥ 4.0, margin ≥ 45%, reduce CAC to $15
KPIs should be: specific, measurable, realistic (achievable), business-related, time-bound. The Halla Systems platform combines the metrics and KPIs of partner companies in one place, allowing you to control the entire funnel: from advertising to customer returns.