What is the Activity Level?
The activity level indicates the success level of an e-commerce business. It can be measured with website visits, order places, the average order value, and the customer lifetime value. Some other metrics include the number of customers, products sold, total revenue, order processing, online processing, advertising, public relations, customer satisfaction rate etc.
Significance of Activity Level in E-commerce
Activity level is a core element of the e-commerce business model wherein companies can determine how they will generate revenue and sustain in the long term. It indicates how well a business is performing.
- A high activity level indicates that customers actively engage with the business and its products or services. It highlights increased sales and revenue, as customers are more likely to purchase products or services they are actively engaged with.
- Activity level indicates customer satisfaction and loyalty and can lead to customer retention as well. Customers who are actively engaged with a business are more likely to remain loyal to the brand.
Prerequisites to Calculate Activity Level
The prerequisites to calculate activity level include –
- The data from relevant data sources such as customer purchase history, website visitor data, and customer service inquiries
- Consumer segmentation helps identify the customer base on the basis of their activity and identify various activity levels.
- Analyzing data to study market trends and customer shopping trends
- Monitor and track customer activity levels over time. This helps in identifying any changes in customer behaviors and lets a business adjust its strategy accordingly.
Use Case With Activity Level
Suppose a company, XYZ, wants to create personalized shopping experiences for their customers. They can use the data on their activity level and track user preferences to tailor their product recommendations, discounts, and other incentives to each individual customer.
Additionally, by tracking user activity, businesses can identify customers who are having difficulty or require assistance, quickly address their issues, and provide the best possible customer service.