Ecommerce Analytics in India – An Overview
Ecommerce is an active and budding industry in the Indian market. Thousands of Indians buy and sell products online every day. Here, we’ll discuss what ecommerce analytics is and how it can promote better results for online store owners in the country. The ecommerce industry in India has been growing exponentially for the last few years. Many Indians prefer online shopping and home deliveries, be it groceries, electronics, furniture, or high-end items. According to IBEF (India Brand Equity Foundation), the Indian ecommerce market is expected to reach 350 billion USD by 2030. We currently have 125 million online shoppers and another 80 million are estimated to add to the count by 2025. The Digital India program has nudged many businesses to expand their stores to electronic marketplaces. With such growth in the ecommerce industry, it’s no surprise that business owners are investing in online analytical tools to derive useful insights from data and make better decisions to boost sales. SMBs and large online retailers are partnering with ecommerce analytics service providers to digitally transform their businesses and increase ROI. In this blog, we’ll read more about e-commerce analytics and its role in the Indian markets. What is Ecommerce Analytics? Ecommerce analytics is the process of collecting, analyzing, and interpreting data from online marketplaces, digital stores, electronic transactions, etc., to make data-driven decisions. The data is collected from various internal and external sources like website traffic, social media reactions, ad clicks, online sales, product/ brand searches, and much more. There are many tools for Ecommerce analytics providing in-depth insights and graphical reports for retailers and store owners to easily understand customer behavior and market trends. From creating a robust marketing strategy to forecasting market demand, analytical insights can help an ecommerce business in many ways. While tools like Google Analytics are helpful, an ecommerce business needs tailor-made solutions to derive actionable insights in real-time. Partnering with reputed Ecommerce development companies in India helps business owners streamline their data (and data sources), create seamless workflows, automate recurring tasks, monitor daily activities, and enhance customer experience Types of Data Used in Ecommerce Analytics Data is crucial for analytics. In the ecommerce industry, four types of data are used by businesses to gain a deeper understanding of the target audience, markets, customers, and competitors. Zero Party Data Zero-party data refers to the data a business directly collects from the target audience. It could be in the form of surveys, quizzes, feedback, etc. The audience voluntarily shares this data with the business, which is then analyzed using an ecommerce tool. First Party Data First-party data belongs to the ecommerce business and is extracted from website traffic, in-store visits, interactions with customers (online and offline), etc. The customers are aware that their data (preferences, behavior patterns, interests, etc.) are collected by the business. Second Party Data Second-party ecommerce data is collected and owned by other organizations which share the data with the businesses. This includes data from affiliates, business partners, etc., and provides a sneak peek into customer behavior, purchase habits, and market demand for different products. Third-Party Data Third-party data is collected by organizations that are not connected or affiliated with the ecommerce business. It includes market research firms, analytical service providers, data brokers, etc., who sell customer data to businesses. KPIs for Ecommerce Analytics When implementing data analytics in ecommerce and retail, KPIs (key performance indicators) have to be selected carefully. These metrics help store owners know how their business is performing and find ways to improve the results. While an ecommerce business has many KPIs to track, the following is a must. Discovery Rate The discovery rate is the percentage of users who discover or visit the ecommerce website for the first time. It shows whether the efforts to attract new customers are being successful. It also helps determine which channels are delivering the expected results and where the business can find more opportunities. Acquisition Rate Acquisition rate is another important KPI for digital commerce analytics. It shows the number of visitors who completed the necessary actions on the website. It is derived by dividing the total number of people who became customers from the total audience. This puts the customers in the sales funnel. Conversion Rate In some instances, the conversion rate is the same as the acquisition rate. However, conversions are considered subjective, while acquisitions have specific criteria. This changes from one marketing campaign to another and what the business wants. Customer Retention Rate As the term suggests, the customer retention rate is the percentage of customers who remain with the business and initiate multiple purchases over time. ecommerce analytics helps find ways to improve the retention rate by creating customer loyalty programs, referral schemes, etc. A higher retention rate implies greater success. Use Cases of Ecommerce Analytics Customer LTV By using the analytical tools of ecommerce, businesses can process customer data to determine their value over their lifetime (interaction with the store). A high-value customer is someone who generates more sales and repeat purchases and adds value to the business. Retailers can create highly targeted campaigns, deals, and offers for such customers. Customer Behavior Customer behavior analytics deals with understanding how a customer interacts with the business – website visits, products they check often, factors that influence their decisions, CTAs (call to action) they respond to, and so on. It helps in product development, better marketing strategies, and showcasing the right product to the right customer. Customer Segmentation Segmenting customers based on demographics, interests, age, gender, purchasing habits, etc., can be done through ecommerce analytics. It helps in developing personalized marketing campaigns for each segment and reaching out to them through their preferred choice of communication channels. Sales Performance By investing in the best sales analytics software, businesses can get comprehensive insights about the sales generated for the given period, estimate sales for the coming times, the difference between targets and achievements, and how to improve sales. Fraud Detection ecommerce analytics is also helpful to minimize the risk of fraudulent transactions by analyzing customer and sales data. The software will send alerts for potential risks, which help in devising strategies to safeguard the business and the interests of genuine customers. Revenue Management ecommerce businesses can rely on the best revenue analytics software to track their earnings and expenses. Store owners can get insights about where most money comes from and where it is being spent, the soft areas for improving MRR,
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