{"id":1172,"date":"2019-05-05T20:15:43","date_gmt":"2019-05-06T03:15:43","guid":{"rendered":"http:\/\/www.agiliron.com\/blog\/?p=1172"},"modified":"2025-11-20T16:03:09","modified_gmt":"2025-11-21T00:03:09","slug":"a-guide-to-using-data-to-improve-your-businesss-ecommerce-strategy","status":"publish","type":"post","link":"https:\/\/www.agiliron.com\/blog\/a-guide-to-using-data-to-improve-your-businesss-ecommerce-strategy\/","title":{"rendered":"A guide to using data to improve your business\u2019s eCommerce strategy."},"content":{"rendered":"

Consumer Metrics & Insights You Should Track for Total eCommerce Success<\/strong><\/h2>\n

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\"ConsumerImage credit: <\/i><\/b>\u2019Man with Headphones Facing Computer Monitor\u2019, Bruce Mars (<\/span><\/i>source<\/span><\/i><\/a>)<\/span><\/i><\/p>\n

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\u201cBig data is at the foundation of all of the megatrends that are happening today, from social to mobile to the cloud to gaming.\u201d \u2013 Chris Lynch<\/span><\/i><\/h3>\n

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The <\/b>evolution of eCommerce<\/b><\/a> means that today\u2019s consumers are more empowered than ever before. Nowadays, online shoppers can access information, connect with their peers, and make purchasing decisions seamlessly wherever they are in the world, at any time of day or night.<\/b><\/p>\n

While this 24\/7 access to eCommerce services offers a wealth of opportunities for budding brands to expand their reach and increase profitability, to compete on today\u2019s digital battlefield, it\u2019s vital to connect with your customers on a personal level.<\/span><\/p>\n

If you want to reach out and offer your audience genuine value and deliver the kind of communications that will not only increase conversions but also encourage brand loyalty, you need to harness the power of big data.<\/span><\/p>\n

By using the wealth of digital data available at your fingertips and utilizing it to make informed business decisions, you stand to deliver content that resonates with your prospects while developing strategies that will result in continued growth and evolution.<\/span><\/p>\n

Here, we explore the power of big data in eCommerce and the essential consumer metrics you should track for maximum success in today\u2019s competitive marketplace.<\/span><\/p>\n

Let\u2019s get started.<\/span><\/p>\n

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The importance of big data in eCommerce<\/b><\/h2>\n

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Recent studies suggest that retailers who leverage the maximum potential of big data could boost their operating margins by up to <\/span>60%<\/span><\/a>.<\/span><\/p>\n

By drilling down into the consumer data that is most valuable to your business\u2019s aims and goals, you\u2019ll be able to make your business more cohesive, focused, intelligent, and sustainable. These are the key ingredients of eCommerce success.<\/span><\/p>\n

Big data provides a comprehensive snapshot of your business\u2019s various operations by using <\/span>key performance indicators (KPIs)<\/span><\/a> to measure (and improve) your processes, practices, and strategies in specific areas.<\/span><\/p>\n

Big data-driven KPIs \u2013 or insights \u2013 empower business owners to identify trends, spot strengths or weaknesses, and ultimately implement initiatives that will help make your eCommerce empire bigger and better than ever before.<\/span><\/p>\n

By drilling down into past, present, and predictive data, you can <\/span>improve your digital marketing strategy, enhance your <\/span><\/i>customer experience (CX)<\/span><\/i><\/a> offerings, predict future trends, and improve your internal processes.<\/span><\/i><\/p>\n

Experts predict that by 2022, the revenue generated from the big data analytics market will rise to <\/span>$260 billion<\/span><\/a> worldwide \u2013 a testament to the power of big data in the digital world. <\/span><\/p>\n

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Essential consumer metrics & insights you should track<\/b><\/h2>\n

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\u201cData really powers everything that we do.\u201d \u2013 Jeff Weiner<\/span><\/i><\/h3>\n

We\u2019ve established the power of big data in the contemporary world of eCommerce. Now, we\u2019re going to explore the consumer insights and metrics you should track to not only enhance but also preserve your success year after year.<\/span><\/p>\n

Average order value<\/b><\/p>\n

If you can increase the value of your average customers’ order, you stand to boost your bottom line in a big way.<\/span><\/p>\n

The average order value (AOV) metric tracks the average amount spent in your primary currency every time a customer places an order through your website or mobile app. To calculate your AOV, you can divide your total revenue by the number of orders.<\/span><\/p>\n

This particular consumer insight matters as by understanding what your average customer is willing to spend on your products, you\u2019ll be able to optimize your pricing strategy and understand where you can improve your <\/span>content marketing<\/span><\/a> efforts to offer increased value to your prospects.<\/span><\/p>\n

Ways you can boost your AOV include cross-selling or upselling your products, creating discounts or coupons, and offering your customers free shipping.<\/span><\/p>\n

Customer retention rate<\/b><\/p>\n

Eighty-six percent of consumers<\/span><\/a> will pay more for a seamless customer experience. That\u2019s a lot of potential conversions.<\/span><\/p>\n

If you provide an exceptional level of consumer support, you will encourage brand loyalty and repeat business. As a result, you will see your customer retention soar.<\/span><\/p>\n

Attracting new customers to your business is expensive, typically costing around five to <\/span>25 times<\/span><\/a> more than it takes to retain an existing consumer. Moreover, <\/span>research<\/span><\/a> shows that the most successful eCommerce businesses enjoy more than 50% of their revenue from loyal repeat customers.<\/span><\/p>\n

Your customer retention rate is a consumer-based performance metric that you need to track at all times.<\/span><\/p>\n

Here\u2019s how to work out this essential consumer metric:<\/span><\/p>\n

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  • Customer Retention Rate <\/b>= ((CE \u2013 CN) \/ CS)) x 100<\/span><\/li>\n
  • CE = Quantity of customers at end of period<\/span><\/li>\n
  • CN = Quantity of new customers acquired during period<\/span><\/li>\n
  • CS = Quantity of customers at start of period<\/span><\/li>\n<\/ul>\n

    To put this into a practical perspective, here\u2019s an example:<\/span><\/p>\n

    If you kick the month off with 1,000 customers, and by the end of the month, 150 people have moved on, but you’ve managed to gain 200 fresh prospects, you now have 1050 customers. Here’s your retention rate as a percentage:<\/span><\/p>\n

    ((1050\u2013200)\/100) X 100 = 85%<\/b><\/p>\n

    If your customer retention rate drops over time, you\u2019ll be able to find the source of your issues (whether it\u2019s your content and marketing communications, your website functionality, your service levels, etc.) and make changes in these vital areas. Once you\u2019ve done so, you\u2019re likely to see your retention rates rise again and make more profit.<\/span><\/p>\n

    Customer lifetime value<\/b><\/p>\n

    Your customer lifetime value (CLV) refers to the overall worth or value of your business to your consumers throughout the entire relationship with your brand.<\/span><\/p>\n

    As you now know, encouraging customer loyalty is a critical component of ongoing eCommerce success. The probability of selling your products to a new prospect is 5% to 20%, whereas the likelihood of selling to an existing customer is around the <\/span>60% to 70%<\/span><\/a> mark.<\/span><\/p>\n

    Having a concise understanding of your CLV will help you plan your future marketing initiatives in an informed, targeted, results-driven way, improving your future customer interactions across all touchpoints \u2013 from website to mobile app and beyond.<\/span><\/p>\n

    To help you understand how to calculate your CLV, here\u2019s a quick video tutorial for your viewing pleasure:<\/span><\/p>\n