What Makes Analytics Powerful in eCommerce?
Powerful analytics can help online businesses to make data-driven decisions, improve customer experience, optimize operations, and ultimately increase sales and revenue. Here are some examples of analytics in the online retail industry :
- Customer analytics: This type of analytics can help store owners understand their customer’s behavior, preferences, and needs. It includes data on customer demographics, purchase history, browsing behavior, and more. These valuable insights are fundamental to personalizing your marketing and sales strategies, improving customer service, and enhancing the overall customer journey.
- Sales analytics: Sales analytics provides insights into sales performance, revenue, and customer acquisition. It can help identify which products are selling well, which marketing channels are generating the most revenue, and which customer segments are most valuable. By analyzing this data, online merchants easily optimize their sales strategies and increase revenue.
- Website analytics: Website analytics tracks website traffic, user behavior, and conversion rates. Thanks to these actionable details, you can identify which pages on your website are performing well and which are not, which marketing campaigns are driving traffic, and which user experience factors are contributing to cart abandonment. Therefore, business owners and marketers will optimize their website design, user experience, and marketing campaigns.
- Inventory analytics: As its name suggests, inventory analytics tracks inventory levels, sales velocity, and stockouts. After interpreting the data, you come up with ideas on how to better your inventory management, reduce stockouts, and avoid overstocking. As a result, you will see improved cash flow, reduced storage costs, and increased customer satisfaction.
- Fraud analytics: Fraud analytics is critically important as it identifies and then prevents fraudulent transactions. Why is it so powerful? Well, it makes use of machine learning algorithms to detect patterns in data that are indicative of fraudulent activity. Hence, merchants can minimize chargebacks, protect their reputations, and reduce unexpected losses.
Now you understand why all eCommerce brands need analytics, right? Overall, it reflects a deeper view of your customers, helps you improve operations, and increases revenue. By investing in analytics tools and expertise, eCommerce businesses can gain a competitive edge in today’s digital marketplace.
Top 7 eCommerce Analytics Tools for eCommerce Growth
There are many analytics tools available for digital stores to help grow and enhance operations. Here are 7 eCommerce analytics tools that are currently used by leading brands:
Figure 1. Google Analytics 4 allows you to get an understanding of a single (anonymous) user’s journey through your site. (Source: Digital Debrief)
Google Analytics is a free web analytics tool that tracks website traffic, user behavior, and conversion rates. It provides eCommerce businesses with insights into their website’s performance, including which pages are popular, how visitors navigate the site, and which marketing campaigns are driving traffic and revenue.
Figure 2. Mixpanel Dashboard (Source: Mixpanel)
Mixpanel is a comprehensive analytics tool focusing on app user behavior and engagement. If your brand has a mobile app, don’t miss this one. It tracks user interactions within the app including clicks, swipes, and other actions. It also provides insights into how users engage with a website over time. Some questions you will quickly find answers to with Mixpanel include:
- How is my website performing?
- Where and why do users drop off?
- Which users/customers stick around and for how long?
Figure 3. Hotjar heatmaps (Source: Hotjar)
Hotjar is a website behavior analytics tool that tracks user interactions with the website, including clicks, taps, and scrolling behavior. It also provides heat maps, recordings, and feedback tools to help eCommerce businesses understand how users interact with their sites and make improvements.
Figure 4. Shopify Analytics Dashboard (Source: Shopify)
Shopify Analytics is a built-in analytics tool for Shopify merchants that tracks sales performance, traffic, and customer behavior. It provides insights into which products are selling well, which marketing campaigns are driving traffic, and which customer segments are most valuable.
Figure 5. SEMrush is a familiar name in website and social media analytics (Source. SEMrush)
SEMrush is a comprehensive marketing analytics tool that provides insights into website traffic, keyword rankings, and social media engagement. It can help you optimize your marketing campaigns and improve your website’s search engine visibility. Thus, your site will gain higher ranking positions on SERPs, which drive more traffic and conversions later.
Search & Collection Analytics by Boost Commerce
Figure 6. Search & Collection Analytics by Boost Commerce (Source: Boost Commerce)
Unlike traditional site search analytics tools, the Boost Product Filter & Search app captures all customer search actions – even before they press the search button – and displays them on your analytics page. As a result, you can investigate their hidden requirements and prepare in advance of rivals.
Furthermore, you can use the report Total sales produced by the app to assess the performance of the current app settings and compare them to earlier results to make necessary adjustments.
NoFraud Fraud Protection
Figure 7. NoFraud helps eliminate chargebacks, manual review decisioning and false declines (Souce: NoFraud)
NoFraud has helped hundreds of satisfied business owners in different industries to develop their brands without fear of fraud. NoFraud Protection integrates with several eCommerce platforms including Shopify, WooCommerce, Magento, and BigCommerce to provide an exact pass/fail judgment for each transaction. Also, NoFraud Checkout boosts sales by providing a gorgeously designed checkout experience that prioritizes trustworthy customers.
Common Myths About eCommerce Analytics
There are several common misunderstandings about eCommerce analytics that can lead to misinterpretation of data or poor decision-making. Let’s check them out and see if you have one of them in your mind.
Myth 1: More data is always Better.
Reality: More data is only sometimes better if it’s relevant to your goals. It is essential to focus on the metrics that matter to your eCommerce business and avoid being overwhelmed by irrelevant data.
Myth 2: Analytics is Only Useful for Tracking Sales.
Reality: Analytics can provide insights into many aspects of eCommerce business operations, including customer behavior, website performance, inventory management, and marketing effectiveness.
Myth 3: Analytics is Too Complicated for Small eCommerce Businesses.
Reality: Analytics tools are available for businesses of all sizes, and there are many resources available to help small eCommerce businesses understand and implement analytics.
Myth 4: Analytics is Only For Technical Experts.
Reality: While analytics can involve technical aspects, many tools provide user-friendly interfaces and can be used by non-technical staff with some training and guidance.
Myth 5: Analytics is A One-time Task.
Reality: Analytics should be an ongoing process, with regular review of metrics, setting goals, and adjusting strategies as needed.
Myth 6: All Analytics Tools Are Created Equal.
Reality: Not all analytics tools provide the same level of insights or functionality. It is important to evaluate tools based on their features, cost, and compatibility with your eCommerce platform.
Myth 7: Analytics Can Provide All The Answers.
Reality: While analytics can provide valuable insights, keep in mind that you should also consider other factors such as customer feedback, industry trends, and competitor analysis when making decisions.
Now you understand the importance of analytics to your success. Depending on your demands and budget, you will find out which analytics tools suit your business best. Start getting familiar with them to know what points need improving and what to maintain to achieve your business goals.