Analytics is a key part of any marketing strategy. It’s important to know how customers are engaging with your product and what they want from you.
In this post, we’ll go over some of the most common analytics tools available for eCommerce companies and how they can be used to drive more online sales.
To grow your business, it’s imperative that you have an understanding of what metrics matter most in driving conversions and revenue—and which need improvement.
This article will provide a guide on how to use data-driven insights as a starting point for making informed decisions about improving conversion rates. Customer satisfaction levels, and ROI on marketing spending.
As time goes by, marketers have access to more sophisticated data than ever.
What Is eCommerce Analytics
Ecommerce analytics is the process of gathering data from all areas that have an impact on your online store and using this information to understand how consumers are changing their behavior.
This includes metrics related not just purchasing decisions, but also things like time spent browsing or item pages after clicking through from Google searches for certain products – it’s important because if you don’t know what people want then they’ll go somewhere else!
The 5 Key eCommerce Metrics
The number of available eCommerce metrics can be overwhelming for companies looking to make informed decisions about their business.
To avoid this mistake, you should always consider gathering as many real insights from customers and market researchers, before making any significant changes in direction or strategy.
Ecommerce metrics are important to track, but you need the right ones for your business, and understanding them can be overwhelming.
Luckily we’ve sorted it all out in 5 pillars that will help give clarity on what information is really worth looking at when improving sales velocity or managing inventory levels with ease!
1) Discovery
To get started, you need to gather information for your audience and create awareness that will lead them straight to the online store.
In Google Analytics, there are data on the age and gender of visitors but also geographic location as well as interests in different areas such as entertainment websites like Netflix or Instagram amongst many others!
Here are the basic metrics you should be paying attention to.
Reach
This is the number of people who have seen your content.
Whether that’s from an email you sent, or a post you shared on social media.
To improve your reach, consistency is key. Get more people to subscribe to your newsletter or follow you on social media.
Impressions
When you share a post on Facebook, it is usually the number of times that individual person sees their screen when they open your social media page.
Unlike reach where we are talking about unique users who see our content but for impressions, each one gets multiple views because there could be someone else viewing those same posts and pages as well!
It’s important to note here how much more engaging an audience will become if we changed from giving them only raw numbers like “total” or “reached” into something with personalities including ‘in’,
Engagement
Another vital metric is the number of followers and subscribers that engage with your content. Getting likes, shares or comments are all rewarding feelings when you communicate regularly with consumers across channels!
2) Acquisition
Knowing how to measure the success of your marketing campaign is key if you want it to be successful.
First, Google Analytics should give an idea of what channels are performing well and where conversion rates may need some work.
Next, move forward with these strategies in future stages or phases. This will help ensure that money isn’t wasted by investing too much time/energy into certain areas when they aren’t bringing results!
In order to get the most out of your customer acquisition efforts, make sure you are keeping an eye on the following metrics.
Click through rate (CTR)
This is the percentage of people who click on a specific link, to the number that views an email or social media post.
Cost per lead (CPL)
This is the average cost of generating new business leads.
Cost per acquisition (CPA)
This metric goes one step further and measures the average cost of acquiring a customer.
3) Conversions
Now that you’ve managed to bring visitors and potential customers into your eCommerce store, it’s time for conversion. Unfortunately, not everyone who visits is going to click the add-to-cart button on their own accord – which means we have our work cut out of us!
Interested in how you can improve your online shopping experience? The eCommerce conversion metrics below will help!
80% of shoppers change their minds before completing an order. To keep them on the website, use a call to action button that prompts people with questions about purchases or returning items; these actions also increase trust between customer and business (more sales!).
Sales conversion rate
This is the percentage of visitors who make a purchase on your online store; increasing the traffic to your website will help you reach your target sales.
Average order value (AOV)
This is the average amount of money spent when a customer places an order on your website
Cart abandonment rate
This is the percentage of shoppers who add products to the shopping cart but abandon your store before completing the purchase
4) Retention
Loyal customers are gold! Smart businesses know the value of loyal consumers and never lose sight that retaining them pays dividends in times to come.
Research shows us how boosting customer retention rates by 5% can increase profits between 25%-95%.
Here are some of the metrics that can help you measure customer retention:
Customer lifetime value (CLV)
This represents the total amount of money a customer is expected to spend in your business, during their lifetime; one of the main goals for every company is to increase this value
CLV = Customer value (CV) x Average customer lifespan (ACL)
ACL = Total customer lifespans / Number of customers
CV = Average purchase value (APV) / Average purchase frequency rate (APFR)
APV = Total revenue / Number of orders
APFR = Number of purchases / Number of customers
Customer retention rate vs. churn rate
Customer retention rate represents the percentage of customers the company has retained over a given period.
Opposite to that, the churn rate is the percentage of customers a company has lost over a specific period.
5) Advocacy
Your customers are the most valuable assets you have. They’re telling their friends and family about how great your company is, so it’s important that they feel welcomed when coming into contact with a new store or website!
This is a very important stage in the lifecycle of your customers. Metrics from this pillar will make or break how successful you are as an eCommerce business, so it’s crucial that you know what they mean and take action accordingly!
Net promoter score (NPS)
To find out how willing your customers are to recommend you, simply complete the survey. Your responses will be categorized into three groups and this knowledge can help in future marketing efforts as well!
- Promoters — your most loyal customers
- Passives — customers that are satisfied with your service but not happy enough to be your brand ambassadors
- Detractors — red flag, unhappy customers who are not just unlikely to buy from you again, but they may even discourage others from doing so.
One of the best ways to measure brand advocacy is by looking at metrics like newsletter subscriptions and the number of participants in your loyalty programs.
This will give you an accurate idea about how many people feel connected with a particular company, product, or service that they offer which can help guide future decisions made on behalf of them as well!
9 Benefits of eCommerce Analytics
Online shopping is a competitive sport.
You can’t just hope that the customer will buy from you because they like what’s on your page, you have to offer something more than just good design and clear copy!
Customers are looking for convenience, price comparison features that allow them to customize purchases based on their needs (ease of use), as well as product reviews before making any decision at all.
Understanding this behavior helps brands stay ahead by giving customers everything they need right when it matters: while browsing through products online or deciding between two similar ones in store–all without sacrificing quality content so readers know exactly who’ll be providing them throughout every step of whatever journey happens next.
Here are nine benefits that you can get out of eCommerce analytics.
1) Data-Driven Product Development
With the growing number of choices, customers have higher expectations. Companies will need to dramatically improve their capabilities in order to keep up with these accelerating desires for variety and control from consumers.
By leveraging evidence on what attracts or repels people through research into our own preferences as well as those we know about them–such is key when creating products that meet customer needs!
2) Good Inventory Management
When you know where your products are and when they’ll be in stock, it’s easier to plan for the future.
You can take a load off by automating inventory management with an eCommerce solution that will help forecast what needs replacing so there isn’t any stress during peak seasons or order delays because of low quantities on hand!
3) Cross-sell and Up-sell To Your Existing Customers
Companies often underestimate the power of cross-selling and up-selling to customers.
As reported by Forbes, it can cost five times more than attracting a new client but only one-third as much in retaining them through repeat business or returning with their friends! On top of that 65% comes from your existing customer base so using eCommerce data for retargeting strategy is not just smart – it’s a goldmine when you know how best to tailor-make promotions specific towards an individual’s interests.
There are many reasons why companies would neglect this opportunity: fear of appearing too salesy (which skews perception); believing they already have enough information available about previous buyers for example.
4) Gather Behaviour Data
It’s important to stay on top of rapidly changing consumer preferences and expectations.
The best way is by gathering user behavior data, understanding their demands or expectations from the product you are developing in order for it to be relevant enough that they will continue using your brand over time if necessary – but also when there isn’t an upgrade available yet.
This allows companies like yourselves more room with what consumers want rather than just cranking out another release without considering anything else other than numbers alone (though those can always change). A great example would include adding features based on survey responses
5) Personalized Shopping Experience
Personalization is the key to consumers’ hearts.
Epsilon research shows that 80% of shoppers are more likely to make an online purchase when brands offer a personalized experience, and 90 percent indicate they find personalization appealing.
In this new world full of options for customization-you must take extra care in order not only to customize assortment assortments but also tailor customer needs accordingly using eCommerce analytics!
6) Engaging User Experience
The new brand currency is customer experience.
The way you keep customers interested and coming back for more than one visit can be as simple or sophisticated, depending on your goals with the website design process- from making it easy to find whatever information they need right away so that users don’t bounce out after browsing just one page down briefly at best (a big no!).
You should also pay attention not only to what kind of content performs well across platforms but when people stop scrolling because there are ads that interrupt their scroll session–this could mean an ad has been placed too close together.
7) Optimized Product Portfolio
You need to have a well-structured product portfolio or else it will be unorganized.
You can’t just have “zeros” and then some random item that might not even make sense for your business, so don’t do this!
There needs more consistency in what you offer as far as customers go if they want something from each one of those pages on their website—and there are many different products people could want to base off analytics data points like best sellers list (which ones sell most often), etc., which makes analyzing easy because everyone has access to all these numbers now plus social media updates about new releases
In order to be successful, you need a strategy for allocating your limited shelf space. The more product variety and diversity there is on the virtual shelves of customers’ minds who are interested in buying from you – whether they’re actually physically present or not–the better!
8) Maximize Return On Ad Spend (ROAS)
But how do you know if your ads are working? You can use eCommerce analytics to find out.
This will help ensure that the money spent on advertising is not wasted, but rather put towards a winner!
9) Satisfied Customers
The data collected by eCommerce analytics can be used to understand customers and create products that meet their needs.
This information is invaluable for any company, as it allows them an opportunity of getting ahead in the marketplace with new innovations!
eCommerce Analytics: Best Practices
Online shopping is a $1.2 trillion industry, and data analytics can help you make the most out of every customer click.
Here are five best practices that will put your focus on things worth knowing about users’ eCommerce preferences:
1) Gather Data Across Platforms
The feeling of being overwhelmed by your data can make it hard to focus.
You have all this information stored in different places, but you may not be able to put together a clear picture of what’s going on with sales or which channels are most effective for reaching customers because they live everywhere!
Your paid ad information is spread across Facebook Ads and Google Ads.
Your eCommerce data is stored in Google Analytics, trying to get data out of Facebook and Instagram isn’t worth thinking about.
Copy/pasting all that information from native analytics platforms or dozens of CSVs can be a real nightmare.
Imagine a world where you can have all your marketing data in one place.
Instead of spending hours trying to consolidate and extract different pieces from various sources, our dashboards and pre-built widget make it easy by pulling information directly from each platform!
You’ll save time on consolidating often tedious tasks while still being able to analyze how campaigns are going overall with pinpoint accuracy – no need anymore juggling between platforms either because everything is right there at your fingertips.
With smart eCommerce analytics, you can have a better understanding of your data and boost productivity.
“Productivity is about getting more done in less time,” so if that’s what business agility means for an organization then it should be one goal among many others!
2) Understanding the Numbers and Your Customers
It is important to have the right data and understanding of it so you can make informed decisions. There are many marketing tools that offer what seems like limitless amounts of information, but they’re not built for cross-channel reporting
It’s often easy enough just having a large number of collected facts at our disposal without really knowing how they fit together or if there’s any correlation between them all – then again this could also be considered one big waste of time because we don’t take anything into account other than sheer volume (number).
The goal should always remain “What do consumers want? How does my business best serve those needs?”
You can’t see the big picture when you’re looking at data in isolation, and it’s easy to make mistakes. But as your marketing stack grows with all that information stored conveniently for one place – we’ll give you clear pictures of users’ behavior so any areas needing improvement will be visible quickly!
3) Know When To Act
eCommerce success is all about being ahead of the curve.
By tracking specific products or categories when they’re performing well, you can react accordingly in order not to miss any opportunities while also keeping your customers happy with fresh inventory!
You can double down on things that are working well and eliminate campaigns that aren’t bringing the results you were looking for.
With custom alerts sent directly to your inbox, there’s no need to wonder when it would be a good time anymore – just act now!
4) eCommerce dashboards
Once you have all the data in place. Instead of creating reports manually, you can generate a pre-built report at the click of a button. Whenever you need to.
Besides saving you time and energy, automation minimizes any room for mistakes. This will help you create a data-driven culture, where you reduce reporting time and focus on the analysis and insights.
5) Share Analytics Between Team Members
Companies have a lot of different platforms they use for team communication, but with all these options it can be difficult to find the right one.
If you want your company’s knowledge and data shared efficiently across departments then centralized sources are what will make sure everyone is on board!
Conclusion
eCommerce analytics can provide insights that will guide your company in optimizing the customer experience across discovery, acquisition, and conversion.
These data points also help you retain them longer by understanding their needs better so they’ll continue coming back for more of what makes it great – like free shipping or easy returns!
Ready to gather all your marketing metrics in one place and simplify your eCommerce analytics?
