Customer behaviour constantly evolves in eCommerce, and competition is fierce. Gone are the days of going on gut-feeling – intuition and guesswork simply don't cut it. Being able to make informed decisions is critical for success.
This is where Business Intelligence steps in; translating vast amounts of information into actionable insights that drive profitability. Analysing key business data gives eCommerce businesses a deeper understanding of their customers, as well as providing them with a deep-dive into their operations and the effectiveness of their marketing.
Equipped with everything they need to make data-driven decisions at their fingertips, brands that make use of the data available to them see the most growth.
Data analytics involves the collection, organisation, and analysis of data to extract meaningful patterns and trends. In the context of eCommerce analytics, this data can come from various sources, including:
Website visits, product views, search queries, clicks, abandoned carts, and purchase history.
Click-through rates, conversion rates, and customer acquisition costs.
Stock levels, demand forecasting, and product performance.
Likes, shares, comments, and brand sentiment.
With so much data analytics and data analytics tools available to you across so many sources, what do you actually analyse and look to optimise? We covered the 10 key metrics for tracking and improving profitability in our recent article, which you can read here.
Various techniques, such as statistical analysis, machine learning, and data visualisation, enable eCommerce businesses to uncover valuable data insights about their store’s performance to enable them to:
Identify customer preferences, purchasing patterns, and possible pain points. This informs product development, marketing strategies, and opportunities to improve the customer experience.
Analysing customer behaviour and competitor pricing allows you to set optimal product prices that boost demand and maximise profitability.
Recommend products based on browsing history and purchase behaviour, tailor marketing messages to individual customer segments, and create a more engaging shopping experience all round.
Forecast demand more accurately, reduce stockouts, and optimise storage space. This can lead to cost savings and increased customer satisfaction.
Analysing customer lifetime value (CLV) enables you to identify your most profitable customers and tailor your marketing and retention strategies accordingly. Rewards, anyone?
Track the performance of your marketing campaigns across different channels and optimise strategies to maximise ROI.
Identify customers at risk of churning and implement targeted retention strategies to win them back.
Here are some practical examples of how eCommerce businesses can use data analytics to drive successful, profitable decisions::
These are just a few examples of how ecommerce analytics can help you make the best decisions for your brand – but the possibilities are truly endless! By embracing their data and seeing it as the superpower it is, eCommerce businesses can gain a competitive edge and unlock new pathways to profitability.
To truly reap the many benefits of data, brands need to foster a data-driven culture. They can do this by:
Implementing data analytics platforms, BI tools and recruiting individuals with expertise in data analysis and interpretation.
Encouraging all levels of the organisation to use data to find data insights, and inform their decisions.
Training employees on how to read and understand data.
Ensuring data is accessible and readily available across different departments within the organisation.
The future is data-driven. eCommerce analytics tools and business intelligence tools are crucial for eCommerce businesses that fail to use the analytic data available to them risk falling behind the competition. By embracing data, businesses can gain a deeper understanding of their customers, optimise their operations, and ultimately achieve profitability and sustainable growth.
Start by investing in data analytics and building a data-driven culture within your organisation. The insights you unlock will pave the way for a more informed, customer-centric, and ultimately, profitable future.
Want more? These resources are helpful for exploring how to use your store’s data to your advantage:
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