Ecommerce is about data management as much as it is about having a great product or brand.
Today, ecommerce success is all about analytics, otherwise known as the process of finding and studying data patterns. Through this scientific approach, you can delve into the inner workings of a business to find out precisely how it is performing, then optimize accordingly. This forms the core of data-driven ecommerce. Additionally, if you are wondering how to choose the right ecommerce platform, you can check this guide.
It’s no surprise that marketers today spend up to 80% of their time poring over data. They understand that the even the smallest of tweaks in a strategy can have a massive effect.
But if you find the idea of that level of technical analysis incredibly daunting, you’re not alone. Considered in isolation, the sheer scale of data available is intimidating, and can make the prospect of embracing analytics quite scary for an SME lacking the resources to spend a huge amount of time on it.
But analytics needn’t be so scary, and most certainly has something to offer for even the smallest of businesses. It’s just a matter of scale, priority, and smart automation.
Let’s run through everything your SME needs to know about data-driven ecommerce.
Identify Strategic Blocks: Find Out Where To Make A Difference
Since the following point can be a bitter pill to swallow, and is particularly relevant for SMEs, I figured it made sense to address it first:
Founding or running a company, or holding power within one, does not make all your ideas brilliant or creative; it doesn’t even guarantee that they’re decent.
Where a larger organization will have more delegation of direction as a practical necessity, an SME can often be severely bottlenecked in its development by the opinions and conclusions of those who are firmly set in their ways.
Is your growth being blocked by stale strategies?
Adopting an approach that places emphasis upon data-driven ecommerce is an efficient way of determining whether those ways actually work, as well as providing a clear way to measure the potential of alternative methods. Data won’t lie, and can stop you from going ahead with schemes that are bound to be unsuccessful.
Here are a few core areas that all SME ecommerce businesses should be focusing on:
- Conversion rate optimization: it’s cheaper and more efficient to improve conversion rates, rather than constantly upping traffic to your store
- Increased personalization: try to make elements of this automated and improve your customer experience at-scale
- Re-engagement strategies: seek to constantly re-engage and win over customers via referral program, social ads, and the like
- Improving customer lifetime value: for an SME, even a small increase in CLV can make a big different to profitability.
All of the above strategies hinge on data management and analysis.
Cheap To Pursue: Drive Down Your CPA
Web and ecommerce analytics aren’t expensive. The real value will come from making strategic decisions about the data — but data harvesting won’t cost you a lot.
Free analytics tools like Google Analytics and paid-for ones like Hotjar will give you plenty of opportunities to analyze, and eventually drive down, your costs per acquisition. Combine open-source tools and data with paid-for tools to get the most out of your analysis.
Set up funnels that will tell you precisely when your users leave your store, and create conversion goals to assign monetary values to all actions you consider worthwhile (like downloading a brochure, for instance).
This data can then tie in to your PPC campaigns, allowing you to make use of efficient tactics like remarketing. Remarketing focuses relevant ads on people who’ve already visited your site, helping to pick up sales from those who came close to buying before leaving.
Additionally, if you happen to run a store through an established ecommerce service, you’ll no doubt be able to find an assortment of free and easy analytics apps or plugins to choose from. Shopify in particular has some free options that are still powerful but far more user-friendly than the Google Analytics interface, but frameworks like WooCommerce also have basic plugins that will get the job done adequately well.
Free apps and plugins are extremely effective ecommerce tools.
As such, even if you don’t have a massive budget to commit to analytics, you can still make great use of it. What’s more, the skills you pick up along the way will serve your business extremely well in the long run.
Warning: Data Without Context Isn’t Very Useful
Data is only meaningful and actionable when fully considered over a suitable period of time and placed in an appropriate context. If you can’t do that, you should disregard it entirely until you can.
Why is this important to accept? Well, think back to the intimidation factor I mentioned earlier. How much of it was based in the fear of being lost in an unending torrent of data, unable to fully grasp it but feeling compelled to respond to it somehow?
In truth, there probably isn’t a business in the world that obsesses over every last piece of data, no matter how many resources it can afford to commit to the issue. And that’s sensible, because some data-derived connections are essentially meaningless.
Without knowing the context, this data is meaningless.
Proper scientific studies look at representative sample sizes, and account for variability, and make alterations in isolation to see how they affect results. This is because scientists know that studies are only worthwhile if carefully formulated.
Imagine that you bought an established business entirely at random and immediately pored over its analytics data with no awareness of the circumstances that produced it; what would you possibly be able to glean from the peaks and valley? You’d be at a loss to say anything significant.
So if you start moving towards a data-driven strategy for your ecommerce store, be very careful that you don’t start to believe that simply recording some stats constitutes doing something useful, or that peaks and valleys are inherently meaningful.
Getting the right data, putting it in context, then tweaking, testing and accurately assessing your ecommerce mechanisms; that’s what will yield results in the end.
Whether you’re looking to grow your business, or simply optimize it at its current size, you should find some time to carry out some basic data-driven analysis. It will give you more insight into performance, inspire some ideas for improvement, enable you to carry out meaningful tests, and equip you with some skills that may prove invaluable.