Whether you’re starting out on the Ecommerce journey or looking to expand it’s important to remember that your web, mobile and marketing analytics aren’t a set and forget activity. Your use of analytics will change as your business does, and your approach will be dependent upon where you are in the growth phase. We see four main growth phases and outline here what you should be thinking about during each of these.
Just before we head into this, we want to highlight the importance of introducing a framework into your activities and why. A framework is important because analytics can be hard, it’s time consuming and often confusing. You can find yourself lost for days in the detail only to realise you’ve found out a few interesting facts but not actually achieved your goal. Managing change is a methodical process and having an analytics framework is essential. We recommend the following approach starting at the Learn stage:
Analytics is a many faceted area, so at any time you may be learning about what is happening online, offline and in your marketing, identifying friction points, understanding your customers as change occurs, and finding more opportunities for improvement. A plan is therefore critical so you know what you are aiming to achieve, the timings you are working to and the information you need. You may have a series of hypotheses or ideas on what you think will work or may be the reason why something isn’t working. So you need to test those. To determine whether your tests were successful or not, you need a measurement index to understand where you started from, what your targets were, the end result and then you need to debrief. Whether as part of a team or alone, analyse the results, note what influences were in play at the time and what behaviours occurred because of the change. Then repeat adjusting one criteria at a time so that you are conducting controlled tests.
The above framework applies no matter which stage your business is in. So, now it’s time to look at what’s important to consider during each of those different stages of business growth.
If you’re just starting to sell online, getting sales quickly and growing traffic will be your major focus areas. The following are the key metrics you should be looking at and running tests to learn from.
Expanding the niche
In this phase you may find that sales are good, but to expand and grow the business further you need to increase awareness. The following are the key metrics you should be looking at and running tests to learn from.
In this phase you may find that traffic is growing but sales are not growing at the same rate. You will want to understand if there is an impediment to sales and what that may be. Or, you may find that the traffic you’re attracting isn’t the right audience. There could be multiple elements to uncover in this scenario. The following are the key metrics you should be looking at and running tests to learn from.
You’re in a great position when traffic and sales are good, but this provides an opportunity to grow business profits even further. The following are the key metrics you should be looking at and running tests to learn from.
Great, but how do I actually evaluate and analyse the results?
Step 1# Get the data right
The very first thing that you need to do is to ensure the data is right. If you don’t get the correct data, or if your data has errors you can’t make good decisions. We recommend you download the Google Analytics Set-Up Checklist and work your way through.
Tag you’re it! One of the most basic requirements for an effective analytics system is to ensure that you can identify the sources of traffic to your website and how these are performing in generating sales. If you are unable to identify the sources of traffic then you are unlikely to have enough information on how to optimise these. Bear in mind, if you are using Google Analytics, GA does not recognise all traffic or campaign sources automatically. You need to check your site can track all sources and this may require some manual tagging. A large number of campaign providers automatically tag the campaigns (i.e. AdWords, SalesForce, Campaign Monitor) but many don’t – and Facebook and Twitter are two of those! A great tool is the Google URL Builder. An important Tip is to set a campaign taxonomy or tracking structure up before you start so that you get a clean, consistent campaign structure.
Another important tip is to reconcile transactions. Missing transactions are credibility killers. We aim to ensure that the difference between actual and recorded transactions in Google Analytics is less than 5%, though this can be higher depending on the site. A few key reasons for missing data may be:
As a final note, Google Analytics is NOT an accounting platform. It needs to have good data but not necessarily all data.
Step 2# Select your approach
There are two major types of analytics uses – the ‘how are we going’ use and the ‘how can we improve’ use. Used together these can be extremely effective.With the ‘how are we going’ use case, you are measuring to see if you are on track to meet your goals. As a team you identify changes in the data and then attempt to explain why this occurred. With the ‘how can we improve’ use case you use data to identify key improvement areas and then implement a structured approach to testing and measurement to see whether your improvements worked. Identifying causal effect is important. Fishbone diagrams, also called Ishikawa diagrams, are an excellent way of brainstorming the possible cause and effect relationships. In this scenario the primary cause may be the number of products, with the secondary cause being the site navigation or search function.
In another scenario, the primary cause for low visitors may be search rankings. Here is an example of a typical analysis path:
Step 3# Build a Routine
Analytics is like exercise, it is best done every day. The following section outlines our recommended approach to building a routine – spreading the tasks out to daily, weekly or monthly.
Daily tasks are all about the ‘How are we going’ question. Each day you should check that the top level metrics are within the expected range.
Compare these to the daily range for each of these metrics.
Weekly tasks are all about short term initiatives and performance. Ask yourself, are you on target?
Monthly tasks are focused on the bigger picture. Be sure to plan at least one deep dive analysis to be done each month.
We’ve covered a lot of ground in this Ecommerce Analytics 101. You should now have the foundation principles to setting up and growing your eCommerce site using analytics.
In closing, we’ll leave you with these key eCommerce Analytics tips:
If you want to know more, please contact us. We’re here to help.
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