5 best eCommerce insights: How to make data-driven decisions

Knowledge is power—but only if you know how to apply it. With the right information, brands can tackle their analytics and gain valuable insight into their organization.

Successful businesses consistently make decisions based on data. Learning more about what is happening in the eCommerce industry today tells us which metrics to focus on. Here at Profitero, we’re always watching the current trends in global eCommerce metrics. It helps us do what we do, which means updating you on the best eCommerce insights you should be tracking.

Is eCommerce growing?

The eCommerce industry continues to experience steady growth, as it has for many years. Still, the numbers tell us eCommerce growth will slow down in the coming months (when compared to last year). Using the right data to make intelligent decisions is more important than ever. 

But even if shoppers begin returning to traditional brick and mortar stores, eCommerce still retains its impact on digital purchasing. Thus, we also need to measure eCommerce sales growth as a key channel for driving physical store sales. Thinking holistically about eCommerce growth is essential to understanding the overall trajectory of digitally influenced purchases. 

It’s not only about online marketplaces—it’s also about the way shoppers interact with digital content. The eCommerce industry is continually evolving and driving brand sales through both online and in-person channels.

People know they can get anything they need from their nearest device. This flexibility has leveled the playing field for brands of all sizes. The industry continues to push forward in terms of creativity and innovation. Using eCommerce insights and strategic planning, brands can position themselves to expand and leverage this growth trend.

What are the current trends in eCommerce?

Gaining insight into eCommerce trends allows us to make educated business moves. At this point, eCommerce has cemented its status as an accessible shopping solution. The market is seeing an influx of creative sellers with new product offerings. As the selection continues to grow, it’s more important than ever to determine what’s coming next for eCommerce so you can stay ahead of the curve. 

Here are five current trends on the rise in eCommerce:

1. Loyalty programs. More brands are offering loyalty programs for their customers. Program members receive rewards for being repeat customers.
2. Sustainability. Brands are leaning into eco-friendly options when it comes to packaging and shipping.
3. Augmented reality (AR). Augmented reality is climbing in popularity. It changes the shopping experience by allowing customers to see, in context, the products they want to purchase. 
4. Custom shopping experiences. Sellers use eCommerce insights to create personalized experiences for their customers. AI tools give buyers personalized product recommendations and tailored customer support.
5. Expanded payment options. There are now more payment options than ever when shopping online. If customers can’t use their preferred method, they may be inclined to abandon their order. Increasing the number of options offered at checkout works to the seller’s advantage and the customer’s convenience.
   
   

Top 5 best eCommerce insights to use to your advantage

Now that you know what’s happening in the worldwide market, analyze your company’s metrics—the stronger your numbers, the better your ability to make strategic moves. The most successful brands base their decisions on concrete data. 

If you want the ultimate solution for tracking eCommerce insights, Profitero can help. With our software, you don’t have to worry about following trends and crunching numbers. Profitero takes away the guesswork. Our platform cuts through the noise of tracking metrics and hands you the actionable insights you seek.

Here are the top 5 best eCommerce insights Profitero can help you track and measure. 

1. Average Order Value (AOV)

Average order value (AOV) is the average dollar amount a shopper spends when placing an order on your site. This metric is essential. It lets you know what your return on marketing efforts looks like. 

To calculate AOV:

1. Divide the total revenue over a defined period by the total number of orders fulfilled during that period. 
   

For example, if you sell $25,000 today and that came from 125 orders, you can calculate your AOV using the following equation:

$25,000 (Total sold) ÷ 125 (Total number of orders) = $200 (AOV) 

In this scenario, today’s AOV would be $200.

2. Conversion Rate (CR)

It’s crucial to stress the importance of tracking your conversion rate (CR) and understanding how it relates to other insights.

Your conversion rate is the number of customers who purchase after visiting your company’s site rather than just bouncing to another site. Tracking this metric provides insight into whether your products are enticing people to buy after browsing. Several factors play into conversion rates, such as: 

• Store interface
• Brand perception
• Product listings
• Product photos 
  

To calculate your CR:

1. Take your total number of conversions and divide that by the number of ad interactions you can track to the conversion over a period of time.
   

Here’s an example: 

50 (Conversions) ÷ 1,000 (Ad interactions) = 0.05 = 5% (CR)

To improve your CR, look at your company’s overall shopping experience and product offerings. Identify areas where you can improve and streamline the experience for the brand’s customers.

3. Customer Acquisition Cost (CAC)

The customer acquisition cost (CAC) is the total amount spent to gain a new customer. The process of doing so is typically expensive and time-consuming. 

Investing marketing resources to attract your target demographic is vital to the health and success of your company. Knowing what you have to put into the process allows you to assess the payoff of resources and efforts.

To calculate your CAC:

1. Divide your total sales and marketing costs for a defined period by the number of new customers acquired during that time. (If you’re wondering which costs you should consider when it comes to marketing and sales, the answer is all of them.) 
   

Here’s an example: 

$3,000 (Total sales and marketing costs) ÷ 200 (New customers) = $15 (CAC)

Keep a close eye on this metric, as it provides essential insight into marketing efforts and what it takes to gain a new customer. 

4. Customer Retention Rate (CRR) 

Repeat customers are a lifeline in the sea of chaos that is eCommerce. It costs more to acquire a new customer than to retain an existing one. If customers are leaving as quickly as they’re arriving, you’ll need to fix something. 

The customer retention rate (CRR) showcases your company’s ability to keep customers once you bring them on.

To calculate your CRR:

1. Subtract the number of new customers acquired from the number of customers at the end of a period.
2. Divide the result by the number of customers you had at the beginning of the defined period. 
3. Multiply your result by 100.
   

Here’s an example: 

1120 (Total customers at the end of the period) - 200 (New customers) = 920

920 ÷ 1000 (Total customers at the beginning of the period) = 0.92

0.92 x 100 = 92% (CRR)

Using this formula, you can access one of the most critical eCommerce insights. Since this number is directly related to the satisfaction and loyalty of your customers, you can’t underestimate it. 

5. Cart Abandonment Rate

This metric shows the percentage of shoppers who add products to their cart and then abandon them, leaving without making a purchase. Once you know how many people are leaving with items in their cart, take steps to optimize the checkout experience. 

There are actions you can initiate to reel these customers back in, but first, consider why these customers are abandoning their carts in the first place. Abandonment could be happening due to:

• High shipping costs or additional fees
• Lack of a guest checkout option
• Concerns about payment security
• Poorly constructed interface or process
• Exhausting checkout experience
  

Take a look at the numbers and your company’s user experience holistically and decide what can be improved. 

To calculate your cart abandonment rate:

1. Divide the number of finished checkouts during a defined period by the total amount of loaded carts in that period.
2. Multiply your answer by 100.
   

Here’s an example:

150 (Total finished checkouts) ÷ 275 (Total loaded carts) = 0.55

0.55 x 100 = 55% (Cart abandonment rate)

Cart abandonment is an especially actionable eCommerce insight. If you find you can optimize and streamline the checkout experience, that can lead to more sales.

Gain visibility into your eCommerce analytics with Profitero

It’s easy to feel overwhelmed by the numbers, but with the right tools and resources, you can make these metrics actionable. Profitero provides the best eCommerce insights you can strategically use to make decisions for your brand. From our diagnosis phase to our action phase, we’ll guide you every step of the way. Remove the stress of tracking metrics and use Profitero to get the most critical action-oriented insights. If you want to make data-driven decisions in your organization, reach out and request a demo today.