Ecommerce is a data-driven industry, even if at a surface level it’s about drawing in customers and convincing them to make a purchase.
So if you run a shopping site, what are the types of data which should be on your watch list, and what makes them so significant to your long term success?
Revenue from sales
It may seem obvious, but if you aren’t on top of your sales revenue, you’re missing a vital piece of the ecommerce puzzle.
Bear in mind that this isn’t just about the volume of goods you’re shifting, but the actual amount of money that this is generating for your business, and how this plays out with regards to profitability.
Gross profit
Speaking of profitability, you must investigate the difference between what you spend to supply products to customers, and what they pay back in return.
Revenues might rise sky-high when you’re running an attractive series of offers and discounts. But gross profit will reveal just how stable and sustainable your operations are.
Conversion rates
On an ecommerce site, a conversion is usually counted when a visitor arrives from elsewhere and makes a purchase.
The better your conversion rate, the better your ROI for things like digital advertising, social media marketing and so on. Low conversion rates imply issues with things like landing page copy, product descriptions, site UX, and even images.
Fitment data for auto, motorcycle, or RV parts
This sounds like a niche-specific type of data, but info on the fitment of components for vehicles of all kinds matters a lot. If something isn’t right, customers could order an incompatible part accidentally.
That’s one of the benefits of eBay fitment data, for example, since this provides ample info on tens of thousands of cars, bikes, RVs and more. You can also use third party plugins and tools to augment this further and guarantee customer satisfaction.
Churn
Another somewhat unique piece of data to take into account is churn, meaning the number of customers who are leaving your service compared with those who are signing up.
In the case that you run a subscription-based ecommerce site rather than one which handles individual purchases, taking care to track churn will give you a picture of customer satisfaction levels, and could hint at shortcomings which need to be addressed.
Ideally you’ll be asking any customers who cancel their subscription to give a reason, for example. This feedback is invaluable in shaping your strategies going forward.
Average order value
AOV is exactly as it sounds; a measure of what a typical customer basket looks like in terms of the cumulative price of products ordered in one fell swoop.
For some retailers, it makes sense to try and drive the AOV upwards, because it’s more cost-effective for them to ship items in unison, rather than dealing with different orders in a piecemeal fashion. That’s why you’ll see recommended purchases to accompany certain products on sites like Amazon when you go to the checkout.
Customer acquisition costs
A more complex yet no less relevant data point for ecommerce operators is the amount it costs on average to acquire a new customer.
This is linked with conversion rates, and should be used to tell you which sources are producing the most value in terms of winning over newcomers.
Final thoughts
All of these types of data are important for ecommerce sellers for the simple reason that they give you actionable insights into the ins and outs of your business as it stands today, and how it has performed over time.
Without this information, it’s impossible to achieve growth or make decisions that positively impact the trajectory of your organization.
Hernaldo Turrillo is a writer and author specialised in innovation, AI, DLT, SMEs, trading, investing and new trends in technology and business. He has been working for ztudium group since 2017. He is the editor of openbusinesscouncil.org, tradersdna.com, hedgethink.com, and writes regularly for intelligenthq.com, socialmediacouncil.eu. Hernaldo was born in Spain and finally settled in London, United Kingdom, after a few years of personal growth. Hernaldo finished his Journalism bachelor degree in the University of Seville, Spain, and began working as reporter in the newspaper, Europa Sur, writing about Politics and Society. He also worked as community manager and marketing advisor in Los Barrios, Spain. Innovation, technology, politics and economy are his main interests, with special focus on new trends and ethical projects. He enjoys finding himself getting lost in words, explaining what he understands from the world and helping others. Besides a journalist, he is also a thinker and proactive in digital transformation strategies. Knowledge and ideas have no limits.