A01 chaf6542 06 se fm indd

performance 

  drivers

 or critical success factors for e-commerce, such as the costs for acquisition and 

retention, conversion rates of visitors to buyers to repeat buyers, together with churn rates. 

Note that to maximise retention and minimise churn,  service-  quality-  based drivers need to 

be evaluated.

There are three main parts to this scorecard:

1 

Attraction. Size of visitor’s base, visitor acquisition cost and visitor advertising revenue 

(e.g. media sites).

2 

Conversion. Customer base, customer acquisition costs, customer conversion rate, num-

ber of transactions per customer, revenue per transaction, revenue per customer, cus-

tomer gross income, customer maintenance cost, customer operating income, customer 

churn rate, customer operating income before marketing spending.

3 

Retention. This uses similar measures to those for conversion customers.

The survey performed by Agrawal et al. (2001) shows that:

companies were successful at luring visitors to their sites, but not at getting these visitors 

to buy or at turning occasional buyers into frequent ones.

Agrawal et al. (2001) performed a further analysis where they modelled the theoretical 

change in net present value contributed by an e-commerce site in response to a 10% change 

in these performance drivers. This shows the relative importance of these drivers, or ‘levers’ 

as they refer to them:

Attraction

● 

Visitor acquisition cost: 0.74% change in net present value (NPV)

● 

Visitor growth: 3.09% change in NPV.

Conversion

● 

Customer conversion rate: 0.84% change in NPV

● 

Revenue per customer: 2.32% change in NPV.