With ever-increasing competition in the market, all brands online today are looking to gain a competitive edge and capture their market share. Almost everyone has access to data, but the constant onslaught of information also means that many brands don’t know how to monitor and process this retail media data into actionable insights.
This has brought about a need for automation and management tools and there are a lot of options to choose from. However, making the right decision is subjective to your business goals. There are a lot of variables that come into play when choosing the right eCommerce reporting and analytics tool for your business.
In this blog, we will look at the eCommerce metrics you should care about, how they will help you uncover opportunities for growth, and the top 5 eCommerce analytics tools you must know, so you can make well-informed decisions for your brand.
The eCommerce Metrics You Should Care About
Before we dive into the reporting and analytics tools you can use to measure your business, and ultimately drive growth, you have to know exactly what it is you are measuring. Economy-wise specifics like your business industry, future goals, the number of customers, and your current budget all change the metrics you should prioritize.
It can also change as your business grows, so your eCommerce advertising team should always keep this information handy. Here are 5 powerful metrics for online businesses:
1. CAC, or Customer Acquisition Costs – Simply put, the longer a customer has to be exposed to your products before deciding to invest in them, the higher your CAC. The goal here is to minimize this as much as possible, and good marketing is an effective way to convince prospective consumers and build trust.
2. Customer Lifetime Value – While this can be both historical or predictive, customer lifetime value tells you how well you can make up their acquisition costs. Depending on the data you have, this metric can help you improve profits in the long run.
3. Conversion Rate – Conversion rate optimization, or CRO, helps you attract more qualified leads, minimize advertising costs, and increase revenue all along your sales funnel.
4. Best Sellers – The products and categories that you see performing the best deserve more exposure to accelerate sales but also are the items that tend to go out of stock and get abandoned in the cart. With extra attention, they can help you skyrocket your growth.
5. Average Profit Margin – This metric is often calculated but rarely put to use. Maximizing your profit margins is the key to long-term success, and you can do this by offering add-ons, creating bundles, optimizing the manufacturing processes, and leveraging user-generated content.
“As business tighten their budgets and navigate a slowing revenue and sales growth, optimizing your paid marketing activities is even more critical than before. While it necessary to have an overview of different metrics, look out for ACOS and contribution margin as key indicators of performance. Internally, we’ve developed proprietary tools to enable us to monitor and automate the processes. If you’ve limited time and in need of an easy-to-use tool, Pacvue is a good choice.” – Nick Tuzenko, Co-Founder & Managing Director at Accel Club
Uncovering Opportunities for Growth
Now that you have pinpointed the metrics you need to keep an eye on, it’s time to understand how you can use them to find gaps in your advertising strategies and use that to your advantage. Online marketplaces like Amazon give sellers access to tons of precious first-party data. But 1 in 4 business experts give up on getting the answer because the data analysis takes too long.
The “secret” is to maintain a balance between your investments and returns on every front, and you can do that using automation tools that serve you these insights on a platter for you to take advantage of. Competitive intelligence is not a luxury in eCommerce anymore, and retail analytics is the future of ROI.
This includes in-depth research of your competitors’ strategies and previous years’ campaign performance analytics, just two examples of data logs that typically go unnoticed. By monitoring these changes, you can build a future-proof brand image and see steady growth in market share.
Most metrics are interdependent so your efforts to maximize, say your conversion rate, will automatically sweeten your profit margins too. Knowing these metric relationships can help you uncover opportunities for unprecedented growth quicker. Of course, doing any of this manually sounds like a huge waste of time, but thankfully we now have tools that will do all of this and more for you.
5 eCommerce Analytic Tools for Growth
Given the number of alternatives we have, it’s natural to feel overwhelmed by the world of management software and analytics tools. Here are 5 simple and effective options that hand you back the control of your business:
1. Pacvue Commerce
This management software relies on mathematical algorithms that do all the heavy lifting for you. Pacvue Commerce calculates profits, monitors your inventory, forecasts sales, and more. Used by companies like Duracell and Unilever, you get to integrate your business operations and receive end-to-end reports instead of bulky numbers.
With so many businesses struggling to create comprehensive reports, Glew.io offers the solution to your data aggregation problems. While it has a learning curve, the tool offers hundreds of pre-built and custom KPI reporting options and can be a worthy investment.
Hotjar is a good choice for visual learners, as it takes numbers and turns them into graphs, charts, and heatmaps so you can track your metrics with ease. It also has a free version so you can try it before deciding to invest in the paid upgrade.
Another sophisticated option for marketers who need to stay on top of a ton of metrics is Kissmetrics. With options like A/B testing, email optimization, and conversion rate calculator for multiple platforms, this may not be affordable for some teams.
5. Google Analytics
The latest integration, Google Analytics 4, deserves a spot in the top 5 for its sheer reliability. With cross-device measurement capabilities and accurate predictive analyses, this tool familiarizes businesses with efficient ways to act on calculated insights for the best results.
Managing your brand’s online presence is no doubt a complex affair, and AI-powered tools help make the job much easier for everybody. With trial-and-error being the only way forward, businesses should be ready to invest time and money into paving a secure future for the brand.
To learn more about omnichannel eCommerce success, check out the Pacvue Platform here!