The Definitive Guide to Ecommerce Analytics

You’re spending a ton of money on ads, but sales aren’t increasing proportionally. Budgets dictate you have to shift gears and reallocate your ad budget based on performance to stop bleeding money—but how do you decide which channels to cut?

With information. Specifically, in the ecommerce world, with data—also called ecommerce analytics. 

Ecommerce analytics help you understand your customers and their journey better, letting you make smarter decisions that provide a superior shopping experience to customers and generate lifelong loyalty.

Analytics become more important when you take the competition into consideration, with ecommerce sales set to cross $5 trillion globally in 2022. People today have more options than ever before when shopping online. To stand out from the crowd, you need to compete on the shopping experience in addition to price and quality. 

What is ecommerce analytics?

Ecommerce analytics is the science of collecting, processing, and leveraging data about your ecommerce store for greater optimization and growth. Analytics help you measure how well your store is performing, what’s working and what isn’t, and how you can optimize elements of your store to improve on your strengths. 

Ecommerce analytics covers your processes to gather data, the visualization techniques to represent insights from data, and the mechanism to report those insights.

Your ecommerce sales data, platforms like Google Analytics, online consumer surveys, email open rates, and Excel worksheets—every data repository down to the last paper-based form—are all part of the process.

The more and better data sources you incorporate into your analytics software and the deeper you go to interpret them, the better your chances of benefitting from the data and leveraging it for ecommerce success.

Do you even need to obsess over ecommerce analytics? 

Yes. Ecommerce analytics is crucial not just to succeed, but simply to survive in the modern ecommerce space.

User experience is the deciding factor when it comes to the present and future of ecommerce domination. You obviously have to offer the best products at the best value but the real differentiation happens during the journey, not the destination. A 2020 survey showed that 97% of customers tend to drop a purchase due to an inconvenient shopping experience. Analytics help you avoid that unpleasant experience for your customers.

‍

Still not convinced? Here are some practical and tangible benefits of analytics:

• Catalog Optimization: Analytics tells you how visitors are behaving on your website, the pages they’re visiting the most, and specific actions they’re taking. You can use this information to highlight your bestsellers and improve sales of stagnant products.
• Tightened Marketing: Analytics gives you a comprehensive understanding of your marketing efforts—it helps you turn strategies into quantifiable results. Based on such insights, you can improve on metrics like ROAS (return on ad spend) by figuring out which marketing and advertising efforts are working best.

• Retargeting: Customer data is an advantage of ecommerce stores. However, a lot of times, the data doesn’t get used properly. With analytics, you can understand why a visitor abandoned their cart, the way they interacted with your store, and more. With this, you can generate repeat purchases from your loyal customers through up-selling, cross-selling, and retargeting strategies.

3 Tips For Structuring Your Ecommerce Analytics For Success

To put together an efficient analytics machine from the ground up, make sure you’re keeping in mind the following guidelines:

1. Bring all your data to a central platform

Spending hours manually collecting data from all kinds of sources won’t leave you any time for analysis, let alone reach any actionable insights.

You’ll need to take stock of all data sources in a single place. This includes data from Shopify, platforms like Magento, ad data from Facebook, Google Ads, and Instagram, your Google Analytics Enhanced Ecommerce data, CRM platforms, and email providers.

Next, you need to bring all your data to a centralized platform like Google Analytics or more advanced tools like Triple Whale. With Triple Whale, you can integrate all your different data sources and visualize everything from your customer journeys to marketing performance and product trends in one place.

‍

 2. Automate and Visualize

Analytics is an ongoing activity and needs to be fed with data every week, if not every day. Manually collecting such data every other data can eat up a significant amount of time. Instead, you can make your analytics platform do that for you.

Triple Whale can integrate with your favorite ecommerce and marketing platforms to pull data regularly from each of them—automatically.

It can automate the entire process from data collection to processing to visualization. Without visualizing your metrics and reports, your mind cannot instantly make sense of the data. Visual representation makes it easier to digest the information and take action.

3. Share Data Across The Organization

Data sharing with your team members and even across departments is absolutely essential, especially when companies today are trying to establish shared revenue goals for each department.

Having an overarching analytics solution makes it easier to share reports with stakeholders, thanks to standardized formats and common metrics to track for every department. 

Which ecommerce metrics should you track? 

There is no limit to what you can track when you get down to it. But there are a set of metrics that should be part of every analytics charter, corresponding to each stage of the conversion funnel: 

1. Are you attracting enough customers? (Discovery Metrics)

The first stage of the customer lifecycle is awareness. Demographic information like age, gender, geographic location, and more from Google Analytics can give you an initial understanding of your brand awareness, so you know if you need to increase investment in paid ads and organic marketing.

You should also track the following advanced metrics pertaining to the discovery stage:

• Reach: Number of people you’re reaching across all social platforms. You can attract more followers with relevant and quality content. This reach translates into organic traffic to your store later.
• Engagement: The number of likes, comments, and shares determines your engagement, indicating if your followers are actively interacting with your content. 
• Traffic: Number of visitors to your ecommerce store as a result of your reach and engagement discussed above. 
• SEO Rank: Track metrics like keyword rankings, traffic from search queries, and content metrics like time spent per read or scroll depth to know how to improve your SEO.

2. Are customers landing on your store? (Acquisition Metrics)

The next stage is customer acquisition. Acquisition metrics show you if your marketing efforts are reaping the desired rewards and customers are considering buying from you.

You should track the following metrics for this stage:

• Click-Through Rate (CTR): Ratio of users who actually clicked on a specific link compared to the ones who saw it.
• Customer Acquisition Cost (CAC): The per-customer cost you had to spend to acquire a new customer.
• Media Efficiency Ratio (MER): How effective were your paid ads in driving overall revenue to your store (not just revenue directly from the paid ads)? As a result, MER is also called Blended ROAS.

‍

3. Are customers buying from you? (Conversion metrics)

Next, you need to study whether your customers are going through with purchases as much as you want them to. If not, you’ll need to optimize your cart abandonment strategies to increase your conversion rate.

You should track the following conversion metrics:

• Sales Conversion Rate: Number of conversions as a fraction of the total number of visitors to your store.
• Average Order Value (AOV): The average purchase amount a customer spends on your store.
• Cart Abandonment Rate: The number of customers that do not go through with the purchase after adding one or more products to the cart.

4. Are customers coming back to your store? (Retention Metrics)

Retention metrics indicate whether you’re able to turn customers into loyal customers, generating increased value from them over the customer lifecycle.

For measuring retention, track the metrics below:

• Customer Lifetime Value (LTV): The total amount a customer is expected to spend on your business during their entire time with you. 

• Customer Churn Rate: Percentage of customers lost by your business during a given period.
• Customer Retention Rate: Percentage of customers retained by your business during a given period.

5. Are your customers promoting your brand? (Advocacy Metrics)

Advocates are your best customers. They spread the word about your brand and products to friends and family and help you acquire new leads and revenue.

Measure the following metrics to determine advocacy:

• Net Promoter Score (NPS): How many customers are advocating your brand to others? You can then classify them into categories such as promoters, detractors, and passives.
• Loyalty Program Customers: The number of customers part of your loyalty program is also a good metric indicative of your brand advocacy.

Master Your Data with Triple Whale

Ecommerce analytics is your secret to unlocking scale and sales. It gives you insights into every single aspect of your business—from your ad sales to on-site customer behavior.

You need to manage not just the task of collating data from multiple sources, but also process the insights you derive—for easy consumption.

If you’re still collecting and analyzing data manually, you’re losing out on time to use the data. eComOS makes the process seamless from start to finish. Discover how you can unlock the power of your data to make better decisions and scale faster.

‍