All online businesses that make sales accumulate a great deal of data. Analyzing this data can yield answers to almost any question you have about your business. It can reveal a great deal of information about your customers and about the health of your business.
The global retail e-commerce sales industry is projected to grow from $4.2 trillion in 2020 to $5.6 trillion in 2022. Recent shifts in the retail market due to the COVID-19 pandemic have only made online shopping more important to the average consumer.
What is E-Commerce Analytics?
E-commerce analytics boils down to the process of gathering data from all aspects of your online store, using this information to understand trends and shifts in customer behavior to make data-driven decisions.
E-commerce analytics are necessary because, without data, it is impossible to make the right decisions for your business. Website analytics tools like Google (News - Alert) Analytics, Adobe Analytics, and Angelfish Actual Metrics are useful in determining who is using your website, what they are doing on your site, and how various features of your site are helping or hurting sales and traffic figures.
Companies that want to sell on Google Cloud Marketplace have a particularly high need to analyze their online sales data. Understanding how Google Cloud Marketplace works is the first step toward increasing sales.
Here are four ways to analyze and understand your online sales for greater performance.
1. Understand the Customer Lifecycle
One of the most important tasks that you must perform if you want to analyze your e-commerce data is to have a complete understanding of the customer lifecycle and journey.
Creating user personas is the best way to visualize this. User personas can be put together from your visitor data, usually accessible as part of your analytics passage. Analytics packages can generally profile customers based on age, gender, geographic area, location, behavior, and interests. Come to a good working understanding of what kinds of customers use your website and how.
2. Understand Engagement Metrics
In addition to website visitor and customer data, it is important to understand social media and email engagement metrics.
Reach measures the number of people who have viewed your email or your content on social media. Subscribers and social media followers can be reached by regular campaigns to sign up for an email newsletter or follow the company on social media.
Impressions are the total number of times users saw your post. Reach measures the unique users who were exposed to your content, but impressions can reflect how many times they viewed and clicked on it.
Engagement is another hugely important metric. This encompasses the number of subscribers and followers that engage with your content. When companies get more likes and shares, they know that their message is getting through. Adequate communication with subscribers and followers can lead to better engagement.
Search volume and keyword rankings are also important data to analyze. SEO or search engine optimization should be put into play here. Make sure that your SEO strategy is fully up-to-date since today’s search engines do not reward the same brute force techniques as they did in the past.
3. Measuring Visitors and Cost of Engagement
All of the work you put in by analyzing your data will pay off when more customers visit your online store. One of the next metrics that you should consider finding is the cost of acquiring each customer. You want to make sure that you are getting the best value for your money and that if a technique is not working, that you can change it at a reasonable pace.
The click-through rate or CTR is one important data point that you should know. You should also know the cost per lead or CPL. The cost of acquiring a customer or CPA is another key data point.
Spending too much on advertising can backfire by taking away profits. If a company sets its profit margin at 50 percent but then offers a 10 percent discount and raises its advertising spend by 20 percent, only 20 percent of the sale is left for the company’s bottom line. Analytics can help you understand whether your ad dollars are working for you or whether your strategy needs to be changed.
4. Tracking User Conversion
Perhaps the most important metric in online sales is the conversion rate. Conversion means that an online visitor becomes a paying customer.
The cart abandonment issue is another problem for e-commerce websites. Sometimes customers will become distracted or change their minds after they have added products to their carts. Companies that want to encourage people to actually buy their merchandise have a number of options. Perhaps the most attractive to the customer is sending an email with a special discount code to reward them for returning to their cart and making a purchase.
5. Understanding Customer Retention
Customer loyalty is huge when it comes to e-commerce businesses. Retaining customers pays off in the long run. Acquiring new customers is always more expensive than retaining those you already have. The metrics that can measure customer retention include customer lifetime value, average customer lifespan, average purchase value, total revenue, and number of purchases.
Companies also need to be aware of their churn rate, or the number of customers they lose in a given period of time. Understanding why customers leave is as important as understanding why they stay.
Analyzing Sales and Visitor Data
If companies want to sell on Google Cloud marketplace, they should be especially aware of their metrics. These methods of analysis can lead your company to greater success. Paying attention to metrics, even if they may not seem important on the surface, means that you will run your business with better foresight and be able to compete with other companies.
