Our view of the right way to implement analytics for an eCommerce business:

If you're looking to elevate your eCommerce site to one where you can become data-driven allow us to guide you on a journey to implement analytics to get the results you need.

Remember, your goal is not just data collection; it's actionable analytical insights and continuous improvement/CRO. Before you dive into any tools or platforms, establish clear business objectives and define your Key Performance Indicators (KPIs).

We have seen this missed by so many clients! You have to start by asking “What do you want to achieve with your eCommerce business”? Is it increased sales, higher customer retention, brand awareness, improved conversion rates, or all of the above? These objectives will be your guiding stars throughout your analytics journey.

1. Start with a Robust Measurement Framework:

The critical first step of this process is creating a Measurement Plan. Identify the critical metrics that align with your objectives and develop a framework to track them. Consider metrics like revenue, conversion rates, average order value, customer lifetime value (CLV), and Customer Acquisition Cost (CAC) and ensure you know which system or tool will produce which data. For example, site speed is available in multiple tools but makes most sense from an analytics point of view to come from your core web analytics tool. A Measurement Plan helps you work out what not to measure and ensures you measure things consistently across multiple channels and across apps and websites.

You also need to ensure that you fully document your analytics implementation. This is much more important now that Google Analytics GA4/firebase has replaced UA – it is no longer page/session-based but event-based. You need to ensure set things up so you are tracking the correct events at the correct time. This is not an analyst job per se – whilst they should be involved, they need to work with an implementation specialist to do the best job,

Pro tip: Prioritise KPIs that truly matter to your business; don't get lost in a sea of vanity metrics. You need measures that you can do something about.

2. Tools and Platforms:

Choose the analytics platform that best aligns with your needs and budget. GA4 and Adobe are popular options, but there are many others to explore. Ensure you conduct a proper setup, including full eCommerce tracking, conversion goals and event tracking. This will ensure you configure tracking for in-depth insights into your sales funnel.

Additionally, in line with your measurement plan, integrate your analytics platform with other tools and platforms you use, such as CRM systems, email marketing platforms, and advertising platforms. This will provide a holistic view of your customer journey.

3. Segmentation is Your Superpower:

Slice and dice your data like a master data chef. Segment your audience based on demographics, behaviour, or any other meaningful dimension. By doing so, you'll uncover gold nuggets of information about your customers that can inform your marketing strategies, product recommendations, and website optimisations.

Create segments for different customer groups, such as first-time visitors, returning customers, high-value customers, and churned customers. Try to analyse how these segments interact with your site and tailor your marketing efforts accordingly.

4. Custom Dimensions and Metrics:

Don't settle for the standard metrics provided by your analytics platform out of the box. Create custom dimensions and metrics to track specific actions and behaviours on your site that matter most to your business and inform your processes. For instance, you can create custom dimensions to track product categories, coupon codes, product availability status or user roles within your eCommerce site.

These custom dimensions and metrics allow you to gain deeper insights into user behaviour and attribute specific actions to your key objectives.

5. Goal and Funnel Tracking:

Set up conversion funnels to understand where users drop off in their journey towards a purchase. Optimise these steps relentlessly to increase your conversion rates. Consider using a scenario planning tool like the Prospero Performance Gap model which shows the headline impacts of changes in funnel performance.

Create multiple funnels to track different user paths, such as the checkout process, registration flow, or product exploration journey. Analyse funnel drop-off points and identify areas where users are experiencing friction or confusion.

6. Event Tracking for Granular Insights:

While goals and funnels provide high-level insights, event tracking allows you to dive deeper into user interactions. Track events such as clicks on specific buttons, downloads of resources, video view completion rates, and form submissions. These events provide a wealth of insights into user engagement and behaviour.

When implementing event tracking, be strategic. Focus on events that directly relate to your business goals and user experience enhancements.

7. Attribution Modelling:

Embrace the complexity of attribution. Understand how different marketing channels and touchpoints contribute to conversions. Multi-channel funnels are your trusty allies in unravelling the customer journey.

Analyse which channels, such as organic search, paid advertising, email marketing, or social media, play a significant role in driving conversions. Experiment with various attribution models, such as first-click, last-click, or linear attribution, to gain a more comprehensive view of attribution across your marketing mix, until you understand what drives performance.

8. A/B Testing and Experimentation:

Analytics will drive your testing & experimentation activities so you can implement A/B or MVT experiments to optimise your site continually. Test different elements, such as page layouts, calls-to-action, product recommendations, and checkout processes, to identify what resonates best with your audience and drives higher conversion rates.

Create a structured Testing Plan that includes hypotheses, test variations, success metrics, and a schedule for implementation. Use A/B testing tools to monitor test performance and make data-driven decisions about which changes to keep and which to discard.

9. Heatmaps and Session Recording:

To gain a visual understanding of user behaviour, use tools like Hotjar, Crazy Egg, or ContentSquare to visualise user interactions on your site. Heatmaps reveal where users are clicking, scrolling, and dropping off. Session recordings offer qualitative insights into user behaviour by allowing you to watch individual user sessions.

Use heatmaps to identify areas of high user engagement and bottlenecks where users are getting stuck. Session recordings provide valuable context by showing how users navigate your site and interact with specific elements. You can use clips from these to convince your CxO team of changes that need to be made.

10. Customer Surveys and Feedback:

Don't forget the human touch in your analytics journey. In our view, it’s essential to collect customer feedback through surveys, user interviews, and usability tests. No matter how well-aligned you and your team appear to be with your customers, this qualitative data will always provide valuable context to your quantitative findings and uncover issues that might not be evident from data alone.

Implement tools like Qualtrics, Google Forms, SurveyMonkey, or UserTesting to gather user feedback and insights. Craft surveys that focus on specific aspects of the user experience, such as checkout satisfaction, product preferences, or website usability and incorporate the results in your next tests.

11. Real-time Reporting:

Stay agile and responsive to anomalies & changes by setting up real-time dashboards or alerts that allow you to monitor crucial metrics as they happen. Real-time reporting is particularly valuable during marketing campaigns, flash sales, or product launches when immediate insights can drive timely adjustments to your strategies. AI-built into analytics will help to spot anomalies.

Tools like Google LookerStudio, Salesforce Tableau, or PowerBI (on a PC) can help you create custom dashboards that display real-time data from various sources. Ensure that your dashboards are designed for quick decision-making and prioritise your KPIs.

12. Data Hygiene and Governance:

To maintain the integrity of your data, establish data hygiene practices and governance protocols. Regularly audit your tracking tags to ensure they are correctly implemented and up-to-date. Remove redundant tags from old vendors when they cease to be a provider to you. Monitor data quality to identify issues such as duplicate transactions, missing data, or outliers.

Document data collection processes and responsibilities within your organisation. Implement data retention policies to comply with data privacy regulations. Keep an eye on data sources and data flows to maintain data accuracy and consistency.

13. Build the right capabilities:

Consider creating a dedicated data and analytics team or partnering with experts to ensure ongoing analysis and optimisation. It makes no sense to spend £200k+ on an analytics solution and not employ analysts. Encourage a culture of data-driven decision-making within your organisation, where insights from analytics inform marketing, product development, and customer experience enhancements.

Summary:

Analytics is the way to power your actionable insights but remember, is not a one-time effort but a continuous journey of learning and optimisation that will power your eCommerce business. Regularly review your data, run experiments, and iterate on your strategies & tactics.

As ever, let us have your thoughts and feedback.

Cracking eCommerce: 13 tips for how Data-Driven insights can be set up to catapult your online sales.

See all blogs in the Blog index page

Also in this series:

The Multi Channel Success Podcast series - Season 1 Introduction & Overview - a 1 minute read

Independant thought - its rarer than you think - a 2 minute read

Why do so many Headless projects fail - 8 key reasons - a 4 minute read

Elements of this article were created using ChatGPT, all edited by a human.

Image from Fodor.