How To Use Data to Grow Your Ecommerce Business
Today’s smart companies use data to help improve their online businesses. According to a Gartner Marketing survey, 85% percent of companies plan to take more decisions based on data analytics. However, many ecommerce owners assume that analytics is outside of their budget. After all, how can a small business owner access complex IT systems and data scientists that large enterprises have?
I want to assure you that you don’t need a big budget to start your business's ecommerce analytics. In this article, I show you how to gather small quantities of targeted information straight from your website. I also recommend various tools you can set up to analyze marketing data and improve your online store's performance.
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What Is Analytics in Ecommerce?
Ecommerce analytics studies data about your website's traffic and effectiveness. You can analyze a wide range of metrics to get a complete picture of your business. For example, you can find out about:
- Discovery- How efficiently do customers find products they want?
- Acquisition- What brings visitors to your website?
- Conversion- What makes your site visitors make an actual purchase?
- Retention- What motivates your buyers to become loyal customers?
- Advocacy- Are customers telling others about your store?
Such metrics tell who your customers are and the trends and patterns in your buyer’s shopping and buying journey. You can use them to make thoughtful changes to improve your customer experience.
Why Is Ecommerce Analytics Important for Your Business?
In a shopping mall, retailers compete with a limited number of similar operations. For online stores, the competition can seem unlimited. Online businesses must use data collection and interpretation to succeed between competition and low-profit margins. Ecommerce analytics can help you to make course corrections to build and grow your business. For example, you might see that few buyers return to buy again. Also, a cart abandonment pattern might exist for a particular product line. By finding out why these patterns exist, you can make changes that help.
How Is Data Analytics Used in Ecommerce?
You can use data analytics in ecommerce as follows:
Research by Deloitte shows that strategic price management can increase company profit margins by 2% and 7% in 12 months. You can use ecommerce analytics to price your products appropriately. For example, you might discover that people visit your product information pages but don't buy. They object to high prices or shipping costs. You could respond by lowering the cost or changing the item’s description to help customers see you offer more value than competitors. In another scenario, you might see seasonal buying trends for specific product categories. You may be able to raise prices during high demand periods and reduce them when business is slow for those items.
Manage Inventory Effectively
When ecommerce data shows shopping patterns, you can improve your marketing strategies and manage inventory optimally. For example, perhaps you see certain products sell best during summer. With this information, you can either reduce stock during the other seasons or find ways to market the merchandise differently so they sell all year round. You might also consider increasing prices slightly during the summer to maximize profits.
An excellent tool for gathering information on your website’s trends is the Semrush trends tool. By noticing shopping and sales trends, you can use strategy to add to your bottom line.
Measure Your Marketing Effectiveness
You can use ecommerce data to measure the returns of your marketing spend. For example, you can analyze your Facebook and Instagram ad campaigns to see which channel needs more attention. On the other hand, your data may show that people find your website through YouTube and you can spend more on video marketing. If you realize you don't get repeat buyers, you might decide to develop an email marketing campaign geared to people who have bought before. After all, loyal customers become advocates, and every business needs them!
Reduce Cart Abandonment Rates
If people find your website, like what they see, and start a cart, you've done lots of things right. Therefore it can be very frustrating to see those carts abandoned. Reasons for cart abandonment vary—long shipping times, insufficient payment options, or limited product range. You must find out the exact reasons why people stop the buying process so that you can reduce abandonment rates.
Now that you know several use cases for data analytics, you might be wondering where you can collect your ecommerce data from. Let’s explore.
Where Can You Get Your Ecommerce Data?
There are several sources for data collection such as:
- Emails, messages, and other customer communication
- Requesting customers to fill out surveys and forms
- Polls on your product page or search results page can capture statistics from site visitors.
- Customer feedback and testimonials
How to Convince Customers to Give You Information
Customers are often reluctant to share their experiences. I spoke to some experienced ecommerce sellers and would like to suggest some ideas that worked for them!
#1. Email Your Customers
You can send emails several times to new customers so they feel connected to the business. Learn some examples below.
After A Purchase
Smart business owners routinely contact people to thank them and ask for feedback. Customer feedback immediately after their buying experience will help you tweak anything not working perfectly. For example, you might find out a buyer was disappointed in the packaging.
Cart Abandonment Emails
In 2022, online shoppers abandoned 71.2% of filled carts, and it's vital to know why. Sending an email to the shopper could save the sale or tell you why they left. You can use a cart abandonment tool or extension on your website to get a detailed report of who abandoned carts. Then generate an email list from the report and send everyone a simple-to-answer question like" What made you stop before completing your transaction?" You could provide a few options for them to mark off or leave the question open-ended for a long-form answer. These are harder to quantify but might give you deeper insights.
For example, you could determine that customers object to some extra charges or realize they are missing vital facts about the items that interest them. Once you know the answer, you can strategically plug that hole in your ecommerce store.
#2 Implement Feedback Polls
Feedback polls provide insights about your buyers. Polls are shorter than surveys but usually include a list of questions. Get feedback about your store, so you can make appropriate changes to improve it. There are three types of polls—visitor, search results page, and product page polls.
Visitor polls pop up automatically when site visitors browse your ecommerce store. You can come up with 5 to 7 questions to ask and make them as insightful as possible to engage people. For these short surveys, you can use software tools from companies like Qualaroo to conduct a brief poll among current clients.,
Search Results Page Polls
Install a single-question poll on your search results page. You can ask them - "Were you able to find what you were looking for?" - "Yes" or "No" and ask for feedback about their experience and the things they seek. From this ecommerce data, you can see how well your site search works. You can also use tools like Hotjar to record visitor responses. This kind of polling could potentially improve your SEO as well.
Product Page Polls
You can implement polls on your product page, too. For example, the question "Is the product description giving you all the information you need about this item?" can help you improve sales through better descriptions. For example, adding better pictures or missing information could elevate you above your competition.
#3 Give Rewards for Feedback
Everyone’s busy and concerned with their own lives, so getting feedback through polls or emails can be tough. Statistics show than only 5%-30% customers respond to B2C surveys.However, incentives can increase the number of responses you will receive for your feedback survey. Successful business owners often entice shoppers and customers with coupons.
Incentives bring two benefits:
- They get you the data you need to improve your website and increase sales.
- Customers feel rewarded for their efforts and develop loyalty to your brand.
Once you have collected some data, it is time to analyze it. Let’s explore how!
How Do You Analyze Customer Data?
Data analysis actually begins before customers respond. It starts with your questions and survey design.You should always set objectives before collecting information. That way you can decide if you want quantitative data, which gives you raw numbers or qualitative data, which provides you with text information about buyers and long-form explanations about buyer actions.
You can also use data analysis tools to collect website visitor behaviour data automatically in the background. For example, Hotjar reports gives insight into how your visitors use your website. Kissmetrics ties information to individual people, and Google Analytics tracks anonymous information. Semrush Audience Intelligence provides you with everything you need to know about your target audiences, like demographics, interests, online habits, purchasing behavior, and even their mindsets.
I have presented a comprehensive discussion of how to use data for your ecommerce business. Hopefully you can adopt some strategies right away. And now to summarize!
Unlike a brick-and-mortar operation where business owners can observe shopping trends and personally engage with shoppers, online stores are mostly anonymous. Therefore, you must uncover your customer’s motivations and experience using data collection tools. Ecommerce data analytics answers the question, "How can I improve my ecommerce store and make more money?” You can analyze marketing data to solve existing problems, optimize pricing, improve inventory management, and generate more sales. You can get started right away by installing Semrush Trends on your e-commerce website today!
People also ask
What is ecommerce data?
Ecommerce data is the different website metrics and feedback you collect from visitors and customers of your website. It includes data like conversion rate, sales revenue, profit, time visitors spend on each page, and cart abandonment rate. E-commerce data also includes customer experiences about your website like ease of checkout, product description details and customer opinion on pricing.
What are the different kinds of marketing analytics?
There are three main types of marketing analytics—descriptive, prescriptive, and predictive. Descriptive analytics describe a particular pattern or trend in your ecommerce business. Prescriptive analytics suggest data-based solutions to existing problems. Predictive analytics predict future outcomes if you make specific changes.
What is ecommerce analytics software?
Ecommerce analytics software are the tools you can use to automatically collect and analyze website data. You can integrate the software in your website as a plug-in or software add-on. The ecommerce analytics software then collects data in the background while your users interact with the website. For example, it may log the time a visitor spends on a page and also record which products they click on the most.
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Now that you have discovered the importance of ecommerce analytics, why not get started with Google analytics for your ecommerce website? In this artice, we outline the 5 steps to set up Google Analytics and start taking advantage of your small data today!