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E-commerce analytics –A must forgrowth of online stores

During your recent online shopping you must have noticed - changes in product display or more banners on discounts (festive days) or greater emphasis on a few product categories like electronic items. And, during your purchase process you must have noticed the “frequently bought together’’ statement that is emphasizedbelow your selected product on the check-out page. All these promotional attempts and strategies by e-commerce companies are done to entice customers to purchase more and increase the order size.

How do e-commerce companies arrive at these promotional strategies?

E-commerce analytics!

Some of the biggest e-commerce companies like Amazon (US), Alibaba (China), Otto (Germany) and Flipkart (India) to name just a few, are actively deploying e-commerce analytics to create a more meaningful and delightful shopping experience for the online shopper while ensuring the order size grows bigger.

Ever since the consumer world eagerly embraced the concept of online shopping and e-commerce gained prominence, the industry has seen a mushrooming growth of online retailers in a bid to grab a pie of the market. Add to this mix, a good number of existing offline retailers doubling up as e-commerce companies (Targets, Tescos of the world) by opening uptheir online arm–we now have a variety of e-commerce players ranging from start-ups to mid-size companies to giants andOmni-channel retailers spicing up the market.

Amidst all this, how do these players differentiate themselves?

The answer again is – E-commerce analytics.
E-commerce analytics has gripped the world of e-commerce and has become a very integral part of e-commerce industry so much so that it is impossible to separate the two. Without e-commerce analytics online stores are perhaps just platforms waiting to fade away slowly.

So what makes E-commerce so essential for a successful online business?
E-commerce analytics helps online stores in creating a great customer experience and attracts people to their platforms. Let’s observe a few areas where it helps these stores -

Information overload: Ask any online shop owner and you will know that there is loads of information gathered on a daily basis. Information on – when does a visitor land on the site to how many visit to how many selection but do not buy and how many eventually end up buying. This is just the tip of the iceberg, there is lots more information that is gathered and if e-commerce companies cannot make a sense of it all, it does more harm than good. E-commerce analytics helps categorize and analyze this information so owners can take an informed decision on what matters most and where their time and energy should be spent.

Prioritize activities: Imagine this - a start-up e-commerce can be overwhelmed by the presence of a giant and its numerous promotional activities. Does this mean it should copy the giant and go all out? Not necessarily - it could soon run of cash and steam and wind up! Analytics comes to the rescue of small and medium size companies that are looking to expand. It helps them understand on what sort of marketing activities to focus on and what demographics to focus on based on the product offerings. It can also help understand on what categories to provide offers on and on what geographic zones to focus on.

Knowledge and Insights: Analytics gives an overview or a snapshot of what activities are working and what are not. It gives an idea on what product category is more preferred and frequently bought and it even goes a step further – provides an understanding on what offers and discounts work and what do not. All of this knowledge and insights at the click of a button is a blessing for online shop owners. This provides them with an edge over competition and more importantly, helps the company streamline and prioritize its marketing and operational activities.

Funnel Analytics:Funnel analytics has caught on like a wildfire amongst e-commerce companies and rightly so. Funnel is nothing but the ‘way’ or direction a customer takes to make a purchase. One funnel could be – to approach site through social media platform, the other could be through online advertisements and yet another could be through email.

Each funnel has stages, for example – Social Media: a customer clicks the link on Facebook and lands on product page and from there moves to check-out page and finally, to the transaction page that completes the purchase process. Not every customer who clicks on the Facebook page will end up completing the purchase, people drop out at different stages and analytics captures all of this to help understand customer behavior and purchase patterns.

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