For many businesses, eCommerce analytics gradually plays a key role in business success or failure. Because analyzing and understanding available data will help businesses understand past mistakes and find solutions, and discover new opportunities for business. And instead of just making decisions based on feelings or judgment, with ecommerce analytics business owners will have a very intuitive and scientific basis for making better decisions. 

What is E-commerce Analytics? 

Ecommerce analytics is a system or tool that allows you to understand user behavior. Ecommerce analytics is the process of gathering data from all regions that have an impact on your online store and using this information to understand trends and changes in consumer behavior to make data-driven decisions that will drive more online sales. Although most eCommerce analytics tools focus on onsite behavior, e-commerce analytics goes beyond that.  

 Onsite, e-commerce analysis tells you where your users are coming from, how much time they've spent looking at a particular product, where they spend most of their time, and more! E-commerce business analysts include metrics relevant to the entire customer journey from discovery, to transformation, conversion, ultimately retention and advocacy. 

Why do you need eCommerce analytics?

The growth in consumer demand, combined with technological innovations, will continue to drive global e-commerce sales growth. According to Statista, the number of people buying goods and services online is expected to reach 2.14 billion in 2021, up from 1.66 billion global digital buyers in 2016. 

Even more impressive is the fact that the industry is forecast to double in size within the next two years and grow from US $ 3.53 trillion in retail e-commerce analytics sales in 2019, to 6.54 trillion US dollars by 2022. 

The key drivers of success over the next decade will be centered on building a deep understanding of and connection to the empowered consumer, and the only way to understand consumer behavior is to measure and analyze. 

Data from Deloitte shows that 49% of respondents say analytics help them make better decisions, 16% say it allows for better critical strategic initiatives, and 10% say it helps them. Improved relationships with both customers and business partners. 

Yet, it seems that companies are having a hard time navigating through all the numbers. As reported by Profitero, for 51% of brands, “measuring and reporting on how eCommerce is performing as a distribution channel” is a top challenge.  

How to set up Goals in Analytics

Link: https://www.youtube.com/watch?v=2Ke3-0Jsl-I

With all reasons above, ecommerce analytics is needed. In addition, eCommerce business analyst will bring the specific discernible  benefits:

Help build a strong supply chain

Customers shop online for two reasons - convenience and better prices. This is why your supply chain needs to be strong. Do the products being advertised on your website have sufficient quantities in your inventory? Otherwise, it will lead to slower deliveries and certain customer satisfaction levels down and the long-term value of the customer will be negatively affected. On the other hand, having too many units in stock will take up space in your warehouse and increase your costs. Reaching this balance between supply and demand is difficult and this is why using analysis to forecast future sales is so important.

Analyze the information to detect fraud

Analysis plays a vital role in fraud detection. Since analytics can detect patterns based on customer behavior, it can alert you when it detects an unusual transaction. As an e-commerce business, you can send customers notifications asking if they're really trying to make a particular transaction and wait for their explicit approval before processing the delivery. 

Predict what's in store for you

Ecommerce analysis for sellers helps them identify future trends based on a number of factors including transaction size, season, product portfolio, and more. Such analysis is useful in determining how future sales will be and helps sellers determine which products they need to focus on, whether they need to recalibrate their inventory. No, what marketing tactics they need to implement to promote certain products and offer offers on different products.

Personalize recommendations for your customers

Selling to the same customer is much easier than buying a new one - any salesperson will attest. This is why when you can sell to the same customer over and over again, you are optimizing the value you can get from them. Personalized recommendations are a great way to do that. 

Every time someone clicks on a product, if they see other products featured, there's a good chance they'll want to explore and buy something beyond their initial purchase. The recommendation system is also great because when the same customer returns to the retailer's website, they can preview what's new and relevant to them, based on their previous shopping history.

Inventory forecast for the next season

As a retailer, you need to know if having a particular product on your virtual shelf is worth the cost of maintaining that product in your inventory. E-commerce analysis helps you to determine the sales volume of a particular product, the expected sales in the future, what the customer satisfaction rate is, among other factors. 

Ecommerce business analysts are very helpful in determining which products you need to continue to stockpile and which products may need to be reviewed for sale next season.

Measure your marketing

Information related to online marketing analytics is crucial for a retailer. You can pour hundreds or thousands of dollars into online marketing campaigns, but if you don't know how effective it is, you never know if your marketing strategy is working. are not.

Analytics takes care of this by measuring ad clicks, visitor engagement time on your website, funnel data, and ad effectiveness. By measuring these metrics, you can determine your return on investment and tailor your marketing strategy for the future.

Personalize customer shopping experience

Different customers interact with an ecommerce website differently. Some like to constantly watch the "day deal" while others are just looking to buy books and go straight to that section, skipping even the homepage. When a particular customer visits your website, what's the first thing you want to show them?

Ecommerce analytics helps retailers study user behavior and determine how a website should be structured based on customer interests, the product landing page most likely to attract customers. and convert them by making them buy.

Lets know your customers better

Retailers need to understand their customer types, demographics, behavior as well as churn situations. All such analysis is helpful in determining the product strategy and any restructuring needed to meet sales and business goals. Such analysis can also help you decide which promotions to launch to maximize visitor conversions to your website.

Optimize product pricing

In the eCommerce industry, the price of a product is determined based on demand for a product, its availability in the marketplace, and how competitors price the same product. You can use predictive analysis to analyze pricing trends and determine the optimal price for a product to maximize profits. Amazon is a classic example of an online retailer using predicted prices.

The use of analytics to drive business is on the rise across industries. Senior management through the Ecommerce dashboard gets insights into business goals, product managers get insights about product sales, and whether sales are there. delivering optimal returns or not, E-Commerce analysis finds favor across the entire organization.

What are the factors to be analyzed?

There’re lots of ecommerce analytics that all companies should track. There are at least a few ways to approach an ecommerce business analyst, but I will focus on just one framework for now: the AARRR metrics.

AARRR, also known as Pirate Metrics, stands for acquisition, activation, retention, referral, and revenue


Pirate Metrics was invented by Dave McClure in 2007. AARRR, also known as Pirate Metrics, stands for acquisition, activation, retention, referral, and revenue. It’s pretty much the pillar of understanding your customers, their journey, and optimizing your funnel as well as setting some valuable and actionable metric goals for your startup. AARRR is widely accepted as the five most important metrics for a startup to focus on. That is because these metrics effectively measure your company’s growth while at the same time being simple and actionable.

The basic concept of Pirate Metrics is based on five types of measurements of user behavior:

  • A: Acquisition – from what channels do users come from? This stage is your first contact with customers.

  • A: Activation – what percent of them have a satisfying initial experience? This is the stage in which your users actually try your product.

  • R: Retention – do they come back? This state's main goal is to keep customers locked to your product or service.

  • R: Referral – do they like it enough to recommend it to their friends? This stage focuses on growth.

  • R: Revenue – can you monetize your product? This stage starts when a customer buys your product or service.

Acquisition

If you don't convert or get new users or customers, your sales funnel (and subsequent metrics outlined below) won't make much sense in the end. Conversions focus on a company's ability to focus on attracting new users, and so marketers and advertisers should be very interested in how their campaigns and initiatives are performing. .

All the time and money you invest in the discovery phase is worth it if the visitors actually visit your online store. Google Analytics provides a great overview of the performance and target conversion rates of different channels.

Here are some metrics that you should have in mind related to customer acquisition:

  • Click-through rate (CTR) — the percentage of users who click on a specific link, to the number of total users who view an email or social media post  

  • Cost per lead (CPL) — 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

Activation

Just because you've managed to get new users doesn't mean they'll forever use the service - especially if it's a free service or information. Activation is the process of getting them to actually use the product. To improve your trigger stats, focus on the quality of the engagement experience. 

Retention

Not enough to get users and get them used to the platform; The company also needs to keep them coming back again and again. It costs more to buy and activate than to keep, so there are means to measure user return frequency and adoption initiatives (such as email or browser notifications) to bring them back, is of paramount importance.  

Smart businesses know the value of loyal customers. Ability to retain customers paying dividends for a long time. Always have in mind that acquiring new customers is way more expensive than retaining existing ones. On top of that, increasing customer retention rates by 5% increases profits by 25% to 95%, according to research done by Frederick Reichheld of Bain & Company.

Referral

Assuming you have an amazing product or information and people are using it with regularity, perhaps the best metric to indicate success is how many other people they tell. In years past, the print industry even used what is known as the "pass-along" metric (which often tripled the number of reported views of their publications).

Revenue

There is no more important metric than revenue. Analysts can talk themselves in circles and show stakeholders any metric they want, but if revenue isn't growing, nothing much else matters - not the volume of acquisitions, not activation, not retention nor referral rate.

Must-Have E-commerce Analytics Tools

#1. Google Analytics

With Google Analytics, you can track all of your online traffic sources

Google Analytics is a valuable ally in the e-commerce war for consumer money. The detailed information it provides contains a lot of information about your website, your visitors and where they come from. All of this information can be used to find new customers and increase conversions. 

You can't bypass google analytics for your eCommerce store. It's free, easy to use, and with Google's free demo account you can use the tool before deploying it on your website. Google analytics also comes with a search dashboard tool, making it a great package for eCommerce entrepreneurs. Google Analytics can help you drill down into richer metrics that can be used to make decisions in marketing your business. Here’s what you can look out for: 

  • Free tool

  • Custom graphs and reports

  • Enhanced eCommerce analytics

  • Customer lifetime value

  • Conversions

  • Customer Personas

Why do you need Google Analytics? If you own an actual storefront, you are likely to see your customers. You can see their habits firsthand and talk to them. Without eCommerce analytics and related KPIs, websites leave you blind to a lot of the visitor and customer information you often see.

With Google Analytics, you can track all of your online traffic sources. Understanding where your website traffic is coming from is crucial in running an online business. Installing Google Analytics right from the start of a new website is essential to start collecting traffic data. Identifying the different traffic sources and understanding why and how much traffic is appearing on your website allows you to track the benefits of your strategies.

See how people find your website the cornerstone of a great online strategy to grow. Quickly seeing your growing traffic according to their sources allows you to make data-driven decisions about how to grow your business online. Is your website driving more traffic from social media than Google search? Seeing the difference allows you to understand which channels are most profitable for you. Improving your traffic generation methods starts with identifying the best traffic channels. Google Analytics measures and separates online traffic into channels that define their main source:

  • Organic – Traffic from Search engines

  • Social – Traffic from social media platforms

  • Referral – Traffic from websites that links to yours

  • Direct – Directly accessed traffic (Bookmarks, auto-filled, writing the domain, etc. )

  • Email – Traffic from Email marketing

  • Paid Search – Traffic from search engine marketing such as Google Ads.

  • Display – Traffic from display advertising.

  • Other – Traffic from custom campaigns

Traffic source and channel analysis reports can be accessed in Google Analytics Conversions. Combining a user's location data like city or country with traffic data helps you understand where your users are mostly coming from. 

#2. Google Search Console

Google Search Console helps you check on your SEO performance/rankings and the technical structure of your site

 It is true that the first step to helping people find and browse an e-commerce site is “clearly publish all the products for sale” either in-store or online or in both places, because this “will help Google to index information and show it to users looking for products to buy”.

 In general, “this means creating pages on the site that explain the product to sell”, or the classic PDP – Product Detail Pages or product pages – that can be improved respecting some best practices.

So, What’s the difference between Google Analytics and Google Search Console? Today we have completed a lot of plans. Bottom line: Google Analytics will help you understand who is using your website, how they found it, and what they're using your site for. It's a great way to understand if your online efforts are working and what you can improve on. 

On the other hand, Google Search Console helps you check on your SEO performance/rankings and the technical structure of your site. Together, they provide a whole lot of insight into what’s working well and what’s maybe not working so well, allowing you to better update and cater to your website for the best possible SEO and content creation strategy.

Google Search Console helps analyzing the site’s performance: After setting the pages and verifying that they are indexed, the next step is to monitor their performance: Waisberg suggests to use the Performance Report, offering some specific tips for e-commerce and, in particular, four ideas to start with for the analysis of data patterns.

  • Checking on the queries bringing the most traffic to the site: Are people looking for the name of the business, specific products, or the generic type of product offered by the site? Having this information allows you to improve the content in certain areas of the site and optimize the performance in the Search for the queries we want to focus on.

  • Checking the CTR of the most important product pages: It is important to keep an eye on the Click-Through Rate for the main product pages: if it is low, it means that users are not clicking on our search results, and so it may be the case to write descriptions or better titles or add structured data.

  • Checking the pages that do not give product results: If a specific group of pages does not generate product results, this may be an opportunity to improve the implementation of structured data. For example, Waisberg says, “you may find that some products are not producing multimedia results, which may depend on a specific template that lacks structured data”.

  • Checking the display in Search: Lastly, it is always useful to check the search appearance so as to understand at a glance the volume of traffic coming to the website through multimedia product results.

#3. Hotjar

Hotjar helps you analyze which content or offer is keeping them engaged

Hotjar is a tool that calls itself “all-in-one”, as it includes both analytics and gathering feedback from users. This tool is intended to help you understand what your visitors do on your website. Hotjar's highlight is that it combines, on a single platform, an array of essential analytical functions with user feedback tools. 

Before Hotjar existed, we needed different platforms to access this set of features, each adding to the cost and complexity of your optimization toolkit. Hotjar brings together different analytics, CRO and user feedback functions on a single platform (and at a fairly affordable price).

For an eCommerce business to be successful, it is imperative not to make decisions based solely on assumptions. Hotjar is one tool that is extremely valuable to modern online merchants and helps in improving the on click-through and conversion rates of their websites. With Hotjar you can view heatmaps of your website along with real-time recordings of your visitors. 

For an eCommerce business to be successful, it is imperative not to make decisions based solely on assumptions. Hotjar is an extremely valuable tool for modern online merchants and helps improve their website's clickthrough and conversion rates. With Hotjar, you can view heat maps of your website along with real-time logs of your visitors. 

Hotjar lets you:

  • Find out whether your visitors are clicking your CTAs

  • Analyze which content or offer is keeping them engaged

  • View heatmaps and recordings

  • Identify key areas of improvement

While it's nice to see that Hotjar includes form analysis as part of its platform, it doesn't provide the depth of analysis provided by specialized form analysis tools. For example, Formisimo tracks nearly 60 metrics to track form performance, while Hotjar tracks only nine metrics. For example, Hotjar reports are also not intuitive: they don't allow you to divide data by date range or view trends by week and month.

Like Hotjar's conversion funnel reports, their form analytics can give you an overview, but it's not enough to help you identify the causes of your problems and fix them as quickly as possible. You will always need a second tool to further analyze the problems you discover. 

#4. Conversific

Conversific is a new kind of analytics tool for Shopify & WooCommerce 

Conversific is a new kind of analytics tool for Shopify & WooCommerce that helps you optimize your traffic and conversion, gather better data, and grow online sales.  

When you own an ecommerce store, there's a lot of data you should use to grow your business. So you are compelled to pay someone to analyze it or worse, spend hours understanding it for yourself. (I sometimes feel there is a direct correlation between trying to understand data and being upset.)

Whether you are a global brand or just starting your e-commerce business, with Conversific you can easily understand the invaluable context of your data. 

The 4 pillars of Conversific  

  • Reports - see all your important store metrics in one place; 

  • Benchmarks - compare your store's performance against peers in your industry; 

  • Insights - tailored recommendations based on your data; 

  • Analytics - dig into product & customer insights that drive revenue growth; and much more, all while enriching user profiles.

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In conclusion, eCommerce analytics is a key component of the digital transformation of businesses. It makes it possible to track the customer journey across omni-channel touch points and build a comprehensive view of what drives revenue. This insight informs better business decision-making. With eCommerce analytics, businesses can better manage all phases of inventory, from vendor management and manufacturing to pricing and delivery. It also makes it possible to detect fraud, enhance marketing, and deeply understand customer expectations. 

If you have any questions regarding e-commerce or about, please contact us via https://cmsmart.net/support_ticket/  for a free consultation.