So, you have setup your first shareware on the Internet. You have spent months developing, months testing and months planning the launch and promotion and you have started successfully to milk the dividends of your pains and efforts through your many and satisfied customers. You are a happy and (growing) rich man. Or… aren't you?

How will you know? How will you know that your product is really making decent money and the proper return on investment and that you are really growing instead of shrinking. How will you know if your promotional efforts are producing the expected and planned ROI. How do you know the limits in what you are spending in R&D and how can you start planning your next future growth and your next shareware?

All the answers can be given by carefully monitoring your web site and cross-correlating them with your sales and marketing numbers. However, the numbers and type of data you are receiving through your web files is extremely large so it is important to separate a discrete set of values that you can monitor at intervals so you can have an image of your past, future and present status. (Don't get me wrong, the whole set of your logfiles can offer you unique information about your visitors. What we care for in this article is the overall picture of your shareware, your shareware marketing efforts and your company).

Defining the e-metrics of your shareware marketing approaches is not a simple task. It is certainly not something for which there is a consensus in the shareware marketing community. (E-metrics as such is not a closed field anyway).

The aim of the following list of e-metrics is to present the basic set of e-metrics parameters which we use for shareware marketing. Here, for the sake of simplicity we will only present the simplified 1-1-1 situation (1 website, 1 company, 1 product). Naturally for other cases more complicated e-metrics and relationships need to be setup. We must stress that the list is by no means complete, but is a basic starting point for all amateur shareware authors that wish to monitor their business and their market development.

• Total visits. By this we mean the unique visitors entering the web site over a given time period. The development of this variable can be an overall indication of the business. It can offer hints on how effective the marketing campaigns are but at the same time one must be very careful in filtering out visits from 'hijacked' graphics, robots etc.
• Total downloads. This is actually the hardest number to extract from one's data. But if done correctly it can give you a good estimate of the number of people that are actually sampling your product. This is a bit like a 'website' in a 'website' situation.
• Conversion Ratio= Purchases/Total Visits. This offers a reduced ratio on the success of your website and product in attracting customers. Monitoring this is important for keeping track of the evolution of the business.
• Download Conversion ratio = Total Downloads/Total visits. Assuming that a download is the first step towards purchasing this is the strongest estimate on how effective is your website in creating customers for you. Being able to calculate this number for each original referrer of the visitor will give you an indication on which sites and which marketing campaigns are targeted, which are not and which give you 'the right kind' of visitors.
• Purchases/Downloads. This ratio offers a good indication on the quality of your product and how much people like it (or its price). Monitor this value for things going wrong with your distribution, for existing cracks, for changes in your competitors etc.
• Cost per visit = Total marketing costs/Total visitors. The number shows whether your marketing efforts are paying off. You can monitor this for individual shareware marketing campaigns or for groups of campaigns (newsletters, banners, PPC etc.) and decide which are more expensive to you for bringing visitors in.
• Cost of Sale = Total Expenses /Sales. This can be an indicator on whether the overall expenses of your company are justified against your sales. It is very important to monitor this especially in a strong R&D phase and when you have a shoestring budget.
• Net profit = Price of Product – Cost of Sale. This can give you an initial indicator of your profits.
• Gross Margin = Net Profit / Price. Gross margin is a percentage indicating what part of your sales is a profit.
• ROI = (Price-2xCost of Sale)/Cost of Sale. The Return on Investment is a percentage that represents a strong indicator on your overall investments in marketing and total expenses for this product. The larger the number and the larger it gets as your business involves the richer you get.

Those 11 numbers offer just the initial parameters of shareware marketing in the simplest possible approach. It is important to monitor them closely and understand both its meaning and the meaning of their evolution through time. It certainly isn't the easiest possible task but is something that you will grasp by experience. By the time you have your second shareware you will be a real expert.