Ever wondered why your recent purchase on Amazon felt so ‘easy’ and comfortable? You must have been surprised when a product you just browsed about on one of those e-commerce sites sort of ‘appeared’ on your Google or Facebook page or perhaps even in your email?
The internet seems to know everything isn’t it? Well, almost everything!
Welcome to the world of big data and analytics, a heavily data driven world that is fast making e-commerce companies more efficient in their operations while bringing them closer to their customers.
Why has analytics become so important for E-commerce companies?
While e-commerce in itself is a popular concept and has begun to hsee roaring success, it has had support in the form of e-commerce analytics. Analytics is the differentiating factor helping companies curtail costs, increase efficiencies, and build better customer relationships.
Let’s observe why analytics is important for e-commerce companies:
Increasing online shoppers: Through the millennium decade up until now, the number of online shoppers has grown exponentially prompting e-commerce companies to ramp all their operations from – product procurement to logistics, order booking, delivery and after sales service. A report by Statista shows that by 2019 the number of digital or online shoppers in the United States of America is set to touch 224 million from 198.2 million in 2014, a 13% growth.
Another report by Pew Research states that roughly as on date (2016), 8 out of 10 Americans shop online and over half (51%) of them bought things through their mobile phones.
Innumerable online shopping patterns: If the number of shoppers is one aspect of study, their online shopping patterns or behaviors is another; a lot of information can be gathered on each shopper along the sales funnel from website visit to purchase. There are several insights gathered from each visit of a shopper and each insight when auctioned brings companies a step closer to the shopper. Insights such as—why a customer left the website only after a few seconds, why she selected a product but did not buy, how long she was on the site before making a purchase—are things that will help e-commerce companies understand prospect’s behaviors and convert them to customers.
Social Media advantage: Nowadays social media platforms like Facebook, Twitter, etc., are abuzz with customer activity; it isn’t only about socializing any more. Buyer behavior, thoughts, likes, dislikes, and opinions can be gathered from social media activities and analytics play a vital role in this. Analytics gather relevant data and based on that help companies advertise or promote relevant products on the social media pages of customers enticing them into the sales funnel, gradually. In many cases this works well as customer is enthused and prompted to make a purchase due to these well targeted promotions.
Customer browsing experience: E-commerce companies are not manufacturing companies, rather they are platforms connecting buyers with sellers and so they have work on two fronts. One, to provide a fantastic and comfortable browsing experience to customers who could be ‘lost’ in the sea of exhibited products, and two, help sellers become more efficient and effective in selling their merchandise. Analytics help create a better visitor experience and help merchants or sellers run efficient operations while giving them an opportunity to increase volumes.
Competitiveness of E-commerce ecosystem: The second millennial decade has intensified the competition among e-commerce companies. Every online company now has a great looking website, a superb user interface, thousands if not millions of products, multiple product variants, and so on and so forth. The fight between companies has moved from the front end to the back-end, and data analytics is central to effective and efficient back-end processes that range from – product check-in to payment gateway to delivery to after sales service. E-commerce is no longer just about helping buyers purchase products online it is more about the experience and enticement provided to the customer which in turn results in better customer relationships and higher sales volumes.
Rise of knowledgeable customer: Customer is King; the adage has never been more reinforced and more relevant than it is now, as far as retail sector is concerned. The consumer/customer of today is more knowledgeable, is crunched for time and has less patience—a deadly combination to appease to. Analytics help understand customer in-depth, providing deep insights into behavioural patterns while ensuring the time constrained customer is enticed into purchase through clever product placements and offers.
From a global perspective, the number of online shoppers is increasing by the day – thanks largely to consumer awareness, fast internet, and a wide choice of product range. As per a UN report, the number of online shoppers is set to increase by about 50% from 1.08 billion in 2013 to 1.62 billion by 2018. The report talks about E-commerce status in 130 economies and finds that countries from East Asia, in particular, are poised for bigger growth from among these economies.
With changing retail dynamics and changing consumer habits, the retail sector definitely has a great future. The sector however, needs some technological innovation and technology in the form of retail analytics is a huge shot-in-the-arm for e-commerce companies helping them both understand and attract customers in a very smart and time efficient manner!
Sr. Manager, Marketing, Digital Services at Happiest Minds. With 10+ years of experience in marketing, she likes to seek challenging position that needs innovation, creativity and dedication. Her areas of expertise lie in Digital Marketing, Marketing Communication and strategy, Content Marketing, Sales Enablement, Lead Generation and Vendor Management. In her free time, Pragya likes to paint, write and travel.
