The world is heading towards global digitization. You own an online business for which you invested a huge chunk of money. Now imagine, you make one bad marketing decision and your company might have to face all the consequences.
Business owners can’t afford to take a loss, especially if they have just started a business. Many businessmen rely on the trial and error method to make marketing decisions, it can help them float for a while but making decisions without relying on facts and figures will be like going for a war blindfolded.
In the era of online businesses, one needs to stay ahead of the competition. And to stand out of the crowd, you need to have cutting edge growth strategies.
This is why the need for eCommerce analytics is soon becoming the need of the hour. If you haven’t heard the term before then read along, in this guide, we will dive deep in the realm of eCommerce analytics and why you, as a business, need it.
What Is eCommerce Analytics?
eCommerce analytics is a process that gathers data from multiple, relevant areas from your online website and quantifies it for deciphering. This powerful tool enables marketers to gain informative and actionable insights.
It helps a business to make concrete decisions based on facts, numbers and data. With the help of eCommerce analytics, it becomes easy for a brand to layout an enriching customer journey.
This system allows one to understand customer behaviour, their likes, dislikes, interests, how much time they spend on a product and search activities based on metrics like views, conversions, acquisition and advocacy.
Importance of eCommerce Analytics
Think of eCommerce analytics as a companion in your business’ growth journey. This tool will answer all your queries pertaining to your website activity. This being said, let’s dive into why you really need to bother with it.
You will know what’s working for you
You probably know for a fact that you have a limited number of resources at your disposal. Marketing requires a budget to function. Having eCommerce analytics will give you detailed insights on areas that are reaping benefits as well as those that are lagging you behind.
Having a direction will allow you to allocate your budget in the right places in order to thrive.
Benefits of eCommerce Analytics
Data is powerful
Have you ever heard of the revolution of ‘Big Data’? It’s revolutionary because it is powerful. Let me give you an idea. According to Statista, global online sales is expected to grow by 4.1 trillion by 2021. This statistic was presented in 2018, ever since then the number of people and online stores have rapidly. It’s important for businesses to understand consumer behaviour just the way a multinational company would understand consumer behaviour. This isn’t an easy feat but eCommerce data can make this simple for you by giving you insights on your consumer’s behaviour so that you may get the opportunity to expand, connect and sell.
It all boils down to the insights of data.
Bring higher conversions your way
Having data at your fingertips will allow you to get a starting point for experiments on your website. Once you know what’s working for you, then you will be able to plan strategies that work in the favour of your website. For example, if emails don’t work for you, then you can experiment with social media. If your website has a high bounce rate, then you can play with user-friendly design interfaces or include add ons like a chatbox, pop-ups, videos, visually appealing headers or so on. Data helps you to read your customers and their likes and dislikes. Once you figure out what they like, you can strategically place marketing campaigns that will lead to conversions.
Create funnels for your customers
Website activity will show you a few things:
- The audience that loves your website
- The audience that just purchased something on your site and then forgot about you
- The audience that stumbled across your site
- The audience that doesn’t even know that they need your products
This activity further bifurcates your audience based on location, gender, purchase history, search activity, cart details etc.
Having all this data will help you to create segments which you can bifurcate into important targeting funnels. By giving each audience what they need, you will be able to create a personalised experience.
Take yourself as an example, the emails and sponsored posts that you receive, don’t they make you feel like the brand knows you personally? That’s the magic of data.
Key eCommerce Metrics that You Must Be Tracking
Every metric has a story to tell. Every click, every view, every impression, every conversion leads to something. What you really need to do here is understand the numbers that your website is trying to tell you. You can do so by keeping an eye on key metrics like:
This is precisely the most important metric. Sales conversions are what you have to focus on the most. All your marketing strategies should be directed towards growing this single metric.
You have to keep an eye on net sales, refunds, average revenue by day, month, year etc.
Emails are as crucial for eCommerce as the sun is for plants. You need email marketing to GROW. Higher email open rates lead to higher sales conversions and this is a fact.
This is an umbrella metric that naturally covers different aspects of customers. You need to keep an eye on things like:
- Customer lifetime value- this predicts the amount of revenue you can gain from the customer before he churns.
- Customer acquisition rate- the cost of acquiring a new customer.
- Churn rate- the number of customers that are at the end of their cycle.
- Average Revenue- The average revenue that you get from the customer based on day/month/year.
- RFM- customer profile based on recency, frequency and monetary aspects.
Products are your core offerings to the customers. It doesn’t matter whether you have a single product or multiple, what matters is how your product is performing. Hence, you need to follow:
- Top products
- Worst performing products
- Quantity sold per day
- Average revenue from product sales
- Frequently bought together
Transaction insights tell you the behaviour of your audience during the time of purchase. It tells you how our business is performing and how you’re exactly earning.
- Fees incurred on transactions
- Taxes paid for a set date range
- Total amount
- Total transactions
Subscription metrics help you determine key insights on third party subscriptions and SaaS metrics like:
- MRR- the normalised recurring earning from all your active subscriptions
- LTV- the earnings from a customer’s lifetime. Average Revenue Per Paid User / User Churn Rate
- ARPPU- average revenue per paid user
- Churn rate- the customers you are losing
- Revenue churn rate- the revenue that you are losing on churned customers
- Revenue- the total and average revenue per subscription
Audience insights focus on visitors that have come across your website and their potential of becoming a customer. To decipher the same, you need to look at:
- Click-Through Rate
- Popular search terms
- Popular pages
Google Analytics Can Help You
In the world of eCommerce, Google Analytics is considered as THE analytics tool for insights. With its user-friendly interface and comprehensive analytics feature, it has simply become one of the best integration tools for websites. Let’s not forget that it’s completely free!
It’s easy to connect GA with your website. You have to integrate and enable the system to set up tracking. First, you need to set up your Google Analytics account and enable it across your website and mobile application.
- Google has explained the entire process very comprehensively on their website. Here is the resource: Getting Started With Google Analytics
- Next, you need to set your Analytics account for eCommerce tracking and reporting: Set Up eCommerce Tracking
Just follow the steps mentioned and you should be good!
Google Is Great, But It Lacks Something…
Although Google Analytics is great, it still leaves a lot to desire. It is comprehensive, yet not comprehensive ENOUGH for an eCommerce company.
Need for customer analysis
We can’t specify the importance of customer profiling enough. An eCommerce business runs solely on what the customer needs and demands. Hence, having insights into your audience’s online behaviour is crucial.
Google Analytics tracks only the location and time of a customer’s visit. It doesn’t give you detailed insights on the customer’s activities or profile. This will later become a hindrance for small owners and it might lead them to make wrong marketing decisions that would be directed based on only geographic.
Need for product analysis
Products are your bread and butter. As an eCommerce business owner, knowing how your products are performing should be a routine task. You need to have insights on the products that are driving your business and the ones that are lagging you behind. If you launch something new, then you need to keep an eye on its performance for at least a few months until you decide to remove it. Google Analytics gives you only basic products reports. There is a lot that you’re missing out over here.
- GA has a tendency to calculate either extra or less data, it creates issues and gives you an error when you count total sales or total products.
- It does not calculate refunds. Refunds are an important part for any eCommerce website and if those don’t get calculated then you may end up with haywire profits.
- For your subscription business, you need important metrics like LTV, MRR, churn rate etc. Google Analytics does not provide you with any of the above.
- GA does not allow integrations with third party businesses like PayPal, Stripe, Braintree, Etsy, WooCommerce etc. This becomes limiting for businesses that rely on these third party tools.
Need for conversion tracking
Won’t you be amazed if someone showed you how you achieved conversions? Conversion analytics is basically tracking of conversions and the details pertaining to it. What Google Analytics does is that it shows you the number of conversions that you have received on your marketing campaigns. What it fails to do is show you the revenue that you’ve generated on those conversions or which audiences were converted.
If this handy information is available, it can turn into a handicap for business owners.
But don’t worry there are tools crafted to help you.
There are various third-party tools available in the market that can easily replace Google Analytics. These tools don’t just provide you with standard eCommerce analytics data but also give you insights on audience, conversions, products and so on.
Mixpanel is primarily an analytics platform that has built-in tracking features for conversion rates and data. It measures customer actions which are defined as ‘events’ and accumulates data for your viewing.
Kissmetrics is a paid analytics platform that has a user-friendly and easy to track customer conversion process. With this eCommerce analytics tool, you can find out where you’re acquiring customers and the areas that need adjustments.
Heap is a great conversion tracking tool that accumulates customer actions from website and mobile applications and aggregates them. It provides you with retroactive analysis and displays every type of action that a user takes on your website.
These tools are pretty handy to manage your data.
But What If You Get All This And More In A Single Platform?
Putler is an eCommerce analytics platform that cumulates data from every single area of your eCommerce website and converts it into actionable insights that help you make business decisions.
At Putler, we have worked with numerous clients who required help with data. We make a conscious decision to understand our clients businesses. Many a time, they find it tough to decipher the data that their website has collated even after using eCommerce analytics tools. Hence, with all their pain points in mind, we make a conscious effort to equip Putler with all the features that an eCommerce business may need.
With Putler you get the following analytics and reports:
Know your customers in and out with the help of Putler’s customer tracking. Now you can find all types of customers like new,returning, lost, average LTV, top 20% customers, refunded customers etc
Putler doesn’t just segment customers for you, it does it based on customer activities like recency, frequency and monetary among other factors like location, time, date etc. With this, you’ll be able to decipher most profitable customers, customer profile, curbed customers etc and create funnels that suit your campaigns.
Get a detailed sales report based on date, day, month, year, audience etc. Putler creates your own sales heatmap for you to decipher. You can look at sales trends, net sales, refunds, average sales etc.
Know which products are performing well. Filter data as per your need and understand what your customers like and don’t like. Putler’s product report will give you minute actions that are taken for every product. This way, you can keep a track of everything.
Audience report will not just give you insights on your audiences profile but also on their actions. Putler assimilates every action done by an audience whether its visits, clicks, conversion process, impressions, click through rates, position, profitability, popular pages etc. You can also find the amount of revenue that audiences generate for your business.
Subscription report dives deep into SaaS metrics that we mentioned above like LTV, MRR, ARPPU, user churn rate, revenue churn rate, growth rate, revenue refund, total subscriptions, subscription statuses etc.
Putler dives deep into transactions that happen on the website like fees, taxes, refunds, revenue etc.
We don’t just measure, we help you forecast your performance based on current metrics. We forecast revenue and sales, customer acquisition, conversion targets, churn etc. You literally have your very own time machine.
How would you feel if you asked for a slice of pizza but got the whole itself? Putler does more than reporting, we give you relevant insights based on holiday season sales, daily average, ARPU, visitors, best holidays etc.
Have more than a single store to manage? No stress! Putler can aggregate data from all your stores and converts it into comprehensive actionable insights by using a single dashboard. So you will have multiple stores but a single tool to handle each.
Putler can integrate with multiple businesses like PayPal, Stripe, Braintree, Etsy, WooCommerce, Gumroad, Mailchimp, Shopify, EDD etc.
eCommerce analytics is not rocket science, it doesn’t have to be tough at all! You can rely on Putler to make things easier for you. Putler is your ‘one-stop’ solution for ecommerce. Okay I know it sounds cliche but that’s the truth!
You can literally find every action on Putler, it has the ability to convert boring data into graphs and charts for analytics. You can make important marketing and business decisions for your firm’s growth.
Don’t forget to stay up-to-date with the latest eCommerce trends or you might end up lagging behind in the world of technology. We can help you make the most of your business.