Last Updated on September 1, 2023 by David
Guest Post by Noah Rue
The 21st-century is driven by data. Everything from your financial history to your favorite flavor of ice cream can be tracked and used in one way or another.
While big data can be turned into valuable information in a variety of different formats, the e-commerce marketplace is particularly well-suited to harvesting, analyzing, and utilizing data to increase sales — when done correctly, that is.
How Website Data Helps Your E-Commerce Efforts
Once upon a time, the majority of business owners operated brick-and-mortar establishments where they interacted directly with consumers. This enabled them to stay in touch with the wants, needs, and expectations of their customer bases.
In contrast, e-commerce business owners face challenges due to a lack of interpersonal interaction with their customer base.
Fortunately, data can help to answer that need — to a certain extent, at least — by allowing you to better understand your customers through their information.
For instance, collecting and analyzing website data provides the information necessary to segment your market into various demographics and interests. From there you can personalize the experience of each person who uses your site, tailoring each ad, and interaction to their particular interests.
This isn’t just a fun perk, either. A whopping 79% of consumers have reported that they’re only likely to use a brand’s promotions if they’re tailored to previous interactions. In other words, having and utilizing consumer’s past data can easily be the deciding factor in whether or not you make a sale.
In addition, when you take the time to gather high-quality data, it can show you what is and isn’t working in your current marketing strategy.
Image by Pexels
Using Data To Your Advantage
It’s helpful to understand why data is important, but with so many facts floating around out there, it can be overwhelming trying to come up with an effective data analytics strategy.
If you want to effectively gather and utilize data, it’s important that you adopt a policy of data-driven decision making. This doesn’t just allow data to impact your business decisions, it also provides a blueprint for what data you should collect and how you should use it. In order to adopt a data-decision making strategy, you must:
Ask Questions and Set Goals
It all starts with understanding what, exactly, you’re trying to figure out in the first place. Start by asking a few questions about what your company wants to accomplish. These questions can be both big picture and day-to-day, such as:
- What is your company’s primary goal as an organization?
- What are your financial goals for the current year?
- Do you need to address a problem or are you building on success?
- Are you looking to tweak or complement an existing strategy or do you lack an online marketing strategy in the first place?
As you answer these questions, piece together where you’re trying to get at the moment. Set goals and consider how data can help you achieve your objectives.
As an example, if you’ve found that your educational e-commerce store does very well in the back-to-school period but suffers during the Christmas season, a goal might be to build on your summer success by increasing sales over the winter.
Identifying this information gives you a target to focus on and an end goal as you go about implementing data in your decision-making.
Identify the Data
Next, take the time to target what kind of data will help you reach your goals.
For instance, you might already have steady traffic to your website but find that very few people make a purchase once they get there. If that’s the case, you may need to begin looking for ways to personalize your onsite marketing messages in order to increase sales from existing traffic.
As you look to combine your needs with the appropriate data set, here are a few of the different kinds of data that can be valuable for e-commerce websites to collect:
User experience data: User experience — the curb appeal of websites — has always been challenging. Online customer support provides a critical channel of interpersonal communication, but when it comes to actually using your e-commerce site itself, the experience can too often be lackluster. One of the most significant data points for any web design, especially an eCommerce site that is designed to sell products, whether B2B or B2C, is bounce rate. Bounce rate measures the rate at which visitors to your site leave it without visiting any other page but the one they landed on. You will never be able to decrease this rate to zero, but you can lower it significantly by knowing your rates and which pages have the highest ones.
First and foremost, focus on your main landing page. How quickly does it load for consumers? Factors such as loading time can dramatically affect user experience and should be properly measured and tested to avoid a high bounce rate on your site. The slower your landing page — and your entire site for that matter — loads, the higher your bounce rates are going to be.
Don’t forget your mobile users, either. As of 2019, 83% of internet browsers used their mobile devices to shop online, and 35% of those shopped exclusively on their mobile devices. However, mobile bounce rates increase exponentially as load times rise from one second to three to five.
Behavioral data: The tangible actions taken by people on your site can have a huge impact on how you market to them in the future. Other than bounce rate, one of the most important points of behavioral data is conversion rate. This rate is key to improving UX and thus sales — for an eCommerce site, sales are conversions, among other CTAs.
Contentsquare details how to measure conversion rates as follows:
Measuring the conversion rate is done via the following calculation: divide the total number of conversions by the total number of site visitors and multiply the result by 100%.
This is the formula for conversion rate:
Conversion rate = (conversions / total visitors) * 100%
For example, if there were 8,055 visitors on your site which yielded 1,003 conversions, the conversion rate is 12.45%.
Conversion rates can often be influenced by external forces outside the control of the consumer. Our current physiological climate is one example of this. The coronavirus pandemic shifted eCommerce conversions from wants to needs in a matter of weeks. In one week in March, traffic to online grocery stores rose 84%. In the same week, the number of completed transactions fell 15% because of increased demand. The online marketplaces were unable to keep up with the behavior of their customers.
When customers’ immediate needs are not met by eCommerce sites, they either bounce off the sites to a different vendor, or they reach out to customer service for help. According to research by Re:amaze, 92% of consumers look to in-app or online support options for help so they can continue to engage with their shopping experience. These online support options cultivate a virtuous circle for your eCommerce site that leads to customer engagement to conversions to sales and back to increase customer engagement.
Geographic data: Geographic segmentation of data can be done along more than one line. Data can be segmented by actual geographic areas such as city, state, and country. Or it can be segmented by socioeconomic areas such as suburban, urban, and rural.
The location of a website user can often have an impact on how you approach your marketing. Geographic segmentation can increase your ability to personalize the communications you offer your customers. Consider the examples offered by SurveyGizmo:
- If your company sells clothing for both warm and cold weather, logic dictates you segment your target markets into two halves: the two hemispheres. For customers in the Northern Hemisphere, marketing could be rotated between hot and cold weather efforts depending on the seasons. In the Southern Hemisphere, marketing could focus year-round on warm-weather wear.
- Consider if your company sells different types of bicycles. You have researched different geographic markets and have concluded that urban dwellers prefer lightweight, single-speed bikes for weaving in and out of traffic. Suburbanites want comfy, long-distance, stylish cruisers for family rides, and rural riders look for heavy-duty mountain bikes. Thus, both product development and marketing strategy can be customized for your different customers living in different areas.
You can also target pay per click (PPC) ads in different geographic areas. On the flip side, if you are a local business, you can ensure that your website traffic is actually coming from consumers that can patronize your business.
Demographic data: Much like geographic data, demographics such as age, gender, or common interests can help you understand where to allocate your marketing dollars. Millennials and GenXers spend six hours a week shopping online. Baby Boomers and seniors spend less than five. But the latter groups spend more on single purchases, while the former spend more in total.
How then do you use this data to market your products? You can’t market to every demographic. An online video game store is unlikely to appeal to most Baby Boomers, while its target markets of GenXers, Millennials, and Gen Y will appreciate customized shopping experiences. And depending on your product, you may consider targeting men with your marketing, as research has found that men actually spend more online than women. Men are more likely to purchase higher-priced items such as electronics and they buy in bulk because they prefer to spend less time shopping online. Offering discounts for bulk purchases, especially within a specific time frame, can be a highly efficient means of capturing men’s dollars.
While there are numerous kinds of data that can be harvested, the important thing is that you identify which pieces of said data will help you reach your objectives.
Collect, Analyze, and Decide
Once you’ve pinpointed your goals and chosen the data you should collect, it’s time to set up a tool like Google Analytics or Facebook Pixel to track and analyze the data you’re pursuing.
Once you’ve done that, it’s time to make a decision. Look at your objectives, weigh them against your data, and consider what the best option is for each business decision that has to be made.
Using Data to Boost Your Bottom Line
Whether you’re addressing an ongoing problem or simply trying to build on past success, understanding and utilizing website data in your business decisions can be an incredibly powerful tool. It provides feedback for current efforts as well as direction for future marketing endeavors.
However, simply using data as a magic bullet won’t do much. You must take the time to identify your needs, set goals, choose the right data, gather and analyze the data, and only then make an informed data-driven decision. If you can do that, you’ll be able to reap the rewards of data analytics for the foreseeable future.
About Re:amaze
Re:amaze is a modern helpdesk and customer messaging platform designed to help eCommerce businesses boost customer happiness and revenue. Re:amaze allows all customer-oriented teams to work together in a shared inbox through email, social, SMS, voice, and live chat. Re:amaze also comes packaged with automated messaging and chatbots so eCommerce brands can succeed at the front lines of conversational commerce.
About Noah
Noah Rue is a journalist and content writer, fascinated with the
intersection between global health, personal wellness, and modern
technology. When he isn’t searching out his next great writing opportunity,
Noah likes to shut off his devices and head to the mountains to disconnect.