Ecommerce analytics for online retailers is critical to operate long-term. Why? Because data-based decisions drive success in your ecommerce company.
The more data you can collect as a retailer, the smarter decisions you can make. It’s that simple!
These days, though, the ecommerce analytics landscape is growing.
It’s no longer a world where retailers can collect data once a year for their tax return.
Now, many online retailers are asking for accounting and data analytics together, looking for accounting professionals who can provide expertise in ecommerce analytics.
Some simple applications of ecommerce analytics in your practice might include: What is your ad spend? What are your fees and shipping costs? Can you save money in any area of your business?
And you guessed it – all of these questions are answered by data. Data analytics in retail is critical. You’ll find that moving the needle on your ecommerce analytics will, in turn, move the needle on your financial sustainability and success.
The more you look at your financial data, the better decisions you can make about how you spend and save money in your ecommerce business.
Financial data about your ROI on marketing spend or conversion rates, for example, show you how well you’re reaching your target audience. If you’re not doing well, you know that you need to dig deeper and analyze data on your customer base.
In the spirit of “the more you know,” check out this clip from our recent ecommerce panel discussion to learn more about:
- Uptick in demand for ecommerce analytics from sellers
- Partnering with A2X to get good data out of Amazon
- Ways to optimize your ecommerce practice using data analytics
- Using data analytics dashboards in your company
- The importance of having your data in one place
Scott Scharf: Philip, you brought up some other topics, not just data analytics, but a few other things that you think are kind of critical for these businesses to be successful and work long-term.
Philip Gossling: Yeah, besides brand building, I think another thing we discussed was data, which I know is really important to a lot of you. I know A2X is big on getting data out of Amazon. That is worthwhile to be able to be gathering that data and be able to use it to help make these decisions.
So, for example, in just the few that we’ve mentioned here, like ad spend and what are my fees, my shipping costs, can I save on those?
All of these are soon fast becoming more of a data question. And so the more data that retailers can begin to collect to understand and become more of a data-centric company, the more it’s gonna help them make better decisions in the future moving forward. So definitely something that is worthwhile is getting the dashboards together, start stepping into that if you’re not yet and walk that path.
Jamie Shulman: Actually, I had a quick thought, Philip, which is one thing that we’ve seen at, A2X is the demand from the direct sellers/the merchant sellers to A2X has increased since last year. But it’s evolved a little bit and it actually is about that question.
Like the inquiries are a little more specifically about analytics and “can I get an accountant or bookkeeper an expert who can help me?” As opposed to, previously it’d been more like “I just need the data to get my tax return done.” It was more compliance-focused.
So, we’re seeing that, and we’ve launched an enhanced directory where we have firms like Acuity in there and the merchants come in and we’re seeing many more of them asking for help from an expert. So your services are gonna be needed more and more as things get more challenging.
Scott Scharf: That’s great.
Jermaine Brown: When I had my ecommerce company, on the data thing, we noticed that data was in a variety of different systems. So it’s really hard to understand exactly what’s going on when you’ve got customer relationships here, inventory data there, financial data here, some other stuff here, some other stuff there.
So as ecommerce companies become larger and more complex and more sophisticated, it becomes really important to get all that data into one place so you can start to marry it together and to understand what’s happening. And so you can make decisions, to Phillip’s point, based on data. Because it gets to a point where these owners can’t have their finger on the pulse of what’s going on. Like, it’s just too complex.
You need to use the data to understand what’s happening and to catch things earlier. You don’t wanna be a month later getting your books done and you’re like, oh my gosh, we lost a ton of money. You probably want to be seven days in looking at that on a weekly basis. However, frequently you can do it…to say, oh wow, “we’re not trending in the right direction this month. Let’s make some changes so that we can still hit our objective.”
So, to Phillip’s point, the data becomes really important, and having those dashboards as an owner or a manager becomes critical. And I think that more people are going that direction now, but I knew many e-commerce sellers that would wait til the 10th of the following month to be like, yeah, I don’t know how we did. Which was, which was crazy to me.
- Jamie Shulman, Head of Accounting at A2X
- Philip Gossling, Co-Founder of DoMyOwn.com
- Jermaine Brown, Partner at Outlander VC
More Resources For Your Ecommerce Practice
One thing’s for sure: the future of ecommerce analytics is secure. So, why not secure your business’ future, too?
Whether it’s helping prepare your business for a global pandemic or an economic recession, the future of data analytics for ecommerce companies is not only to stay competitive but to remain standing through various crises.
Detailed, accurate financials are key to making great data-based decisions in your ecommerce business. We’re here to help! Get started today and book a call with our team.
We also offer more resources on our blog! Learn ad prices for online platforms, such as Facebook, Twitter, and YouTube are on the rise, and how exit strategies affect the value of your company.
Ecommerce Analytics FAQs
Q: What is data analytics?
A: Data analytics is the process of collecting raw data and organizing it into a piece of information that can be analyzed to increase efficiency or performance.
Q: Is data analytics hard?
A: There isn’t really a cut and dry answer to this question. Data analysts are key roles in certain companies; however, using dashboards and tools, such as Google Analytics, help to crystalize data and deliver analytics that should make sense.
Q: Why is data driven analytics of interest to companies?
A: Data driven analytics is important to companies because at the core of data analytics is efficiency of processes. Data analytics should shed light on processes or practices that are high performing as well as those that aren’t, showing companies what they need to do in order to become or stay successful.
Q: What are the options for filtering data in Google Analytics?
A: There are tons of ways to filter your data in Google Analytics! However, we recommend using these 6 filters:
- Here are 3 filters to make sure your data is accurate: internal traffic filter, excluding your IP filter, and spam filters.
- Here are 3 filters to measure how effectively your website is performing: average time on page filter, monthly views filter, and a filter for engaged visitors.
Q: What is financial data analytics, and why is it important for ecommerce companies?
A: Financial data analytics is a subcategory of data analytics that provides detailed insights into the financial performance of a business.
At Acuity, we recommend that ecommerce entrepreneurs track 8-10 key performance indicators (KPIs) on their financial dashboard. More than 10 gets messy and can make you lose sight of important ecommerce analytics.
For the top 5 KPIs you should track, check out this video from Acuity Co-Founder Matthew May.