How to Use Data to Grow Your Business

You can follow the steps outlined in my previous article, 7 Ways to Create Loyal Customers With Your Ecommerce Site, in order to lay the foundation for online success. However, to establish long-term revenue growth, you must collect and analyze data to drive your future decisions. Capturing the right information from your ecommerce site and your visitors is essential to growing your business. Below I’ve outlined what data you should collect and how to use that data to grow your business.

Collecting Data

There is a lot of data you could collect from your ecommerce site. The best way to capture the data is with the right tools. Here are a few options.

Website Analytics

  • Google Analytics
  • Adobe SiteCatalyst (Omniture)
  • KISSmetrics
  • IBS Coremetrics

Search Engines

  • Google Search Console (formerly Google Webmaster Tools)
  • SEMrush
  • Moz
  • WebCEO
  • Conductor Searchlight
  • Google AdWords
  • Bing Ads

Testing & Heat Mapping

  • Optimizely
  • Convert
  • Monetate
  • Adobe Target
  • Crazy Egg
  • UserTesting

Top Metrics to Track

When collecting data, there are a number of metrics that should be tracked and reported for ecommerce websites. This list of key performance indicators (KPIs) provides a good high-level measurement of overall ecommerce health. Be sure to track and analyze these metrics year over year (YOY) and month over month (MOM).

  1. Visits: Number of visits (sessions) to your site.
  2. Bounce Rate: Percentage of visitors who left the site from the entrance page. Compare to Average Time Spent on Page to determine if visitors are engaging with your content, even if they are not diving deeper.
  3. Transactions: Total number of orders placed.
  4. Conversion Rate (CVR): Rate at which visitors are converting = Transactions ÷ Visits.
  5. Average Order Value (AOV): Average value of a customer’s total order = Revenue ÷ Transactions.
  6. Revenue: Total dollar amount earned.
  7. Revenue per Visit (RPV): Amount of revenue generated by each visit to your site = Revenue ÷ Visits. This determines the value of each visit to your site.
  8. Cart Abandonment: Rate at which shoppers abandon after an item has been placed in the cart.
  9. Checkout Abandonment: Rate at which shoppers abandon after beginning the checkout process.

 

Metrics to Report

This is the just the beginning – the basics. There are a number of other metrics you should track, such as Average Order Quantity, Return/Exchange Rate, Customer Service Calls/Chats, etc.

The top website metrics should also be analyzed for different segments:

  • Traffic Source: paid, organic, direct, email, referral, social, etc.
  • Visitor Type: new, returning
  • Device Type: desktop, tablet, mobile

Plus, each marketing channel that you use will require deeper analysis. Keep your audience in mind when deciding what to report and who to report it to.

  • Executive: high-level website metrics that show overall business/site health
  • Management: high-level website metrics and marketing channel metrics, based on the type of manager
  • Specialist: detailed metrics for each marketing channel, based on the type of specialist

Always Test and Measure

Ecommerce marketers understand that in order to improve KPIs such as conversion rate or average order value, you must try new things. An efficient way to achieve this is to test website features or other updates on a small scale.  Select the KPI you’re trying to improve, hypothesize an update you believe will improve that KPI and plan and execute an optimization test to prove or disprove your theory. Develop an optimization testing plan with your prioritized list of items and execute on this consistently. Typical ecommerce website tests might include items such as on-page offers/promotions, headlines, Call-To-Action (CTA) buttons, banners, and pricing. Use the data you’ve collected to determine what aspects of your site are performing poorly and test ways to improve them.

Make Data-Driven Decisions

If your gut or instinct tells you something, use data to back it up and confirm before taking action. For instance, 63% of retail leaders use data as the driving force behind their decisions. Collecting data is the first step, but analyzing and interpreting that data is essential to making data-driven decisions. Be sure to look for trends and seasonality and be careful not to make rash decisions based on the outliers.

If you’re looking to grow your business, it is essential to collect data from your ecommerce site and your visitors. This will allow you to establish long-term revenue growth and provide you with insight for making future decisions. With the right set of tools, you can take your site to the next level.

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