E-commerce companies can use data analytics to gain insights from customer data to improve operations like predicting sales, reducing cart abandonment, providing better customer service, and doing more targeted marketing. However, companies must identify internal use cases for analytics, measure its impact, find the right talent, and ensure proper technical requirements are met to successfully adopt a data analytics program.
2. The Need for Analytics
One of the fastest growing industries in the modern age is that of the e-commerce industry. At first
glance, this industry is where giants like Amazon and Walmart reign, with others looking to grab a
piece of the lucrative pie.
Competition in this landscape is reaching a fever pitch, and without a clear edge against
competitors, many companies can easily find themselves shutting down their websites. Most
companies already have the raw material they need to find that edge, the data they generate on a
daily basis. But this data has to be transformed and compiled into meaningful insights. Data
analytics does just that, finding meaningful patterns using the mountains of raw data companies
often have on their hands.
With data analytics, e-commerce companies can find out what specific products are likely to be
bought together, find out the reasons behind their customers leaving for competitors, and even
anticipate demand for future sales and holiday seasons.
1
Scope of Data
Analytics In
E-commerce
Industry
Customer
Lifetime
Value
Marketing
Customer
Acquisition
Customer
Experience
Enhance
Business
Intelligence
Better
Price
Management
Personalized
Product
Suggestion
Customer
Churn
Prediction
3. 2
Enhanced Shopping
Pattern Analysis
Finding the purchase habits of
different types of customers to
provide information for more
targeted marketing and
discounts for particular
customers, or use the
information to create new
product combinations
altogether.
Business Need
Using Enhanced shopping
pattern analysis, e-commerce
companies can understand the
conscious and subconscious
shopping patterns of their
customers, and use these
insights to offer clearance
discounts on specific products,
display related items through
product recommendations, and
even offer loyalty rewards for
continued customers.
OutcomeApproach
Using segmentation analysis,
we can discern various details
such as customer search
history, purchase history,
customer service history, etc
and other forms of data, we
can use data analytics to find
the different patterns that
may arise with customer
browsing through.
There are definite patterns to how customers shop, and those patterns overlap depending on a
variety of factors. These shopping patterns vary for different groups of people. But this kind of
information can be fine-tuned, turned into information giving insight into how customers are more
likely to buy certain items over others.
Coupon drivenPurchase through mobile
Card payment
Write a review
about purchase
Brand conscious
purchases
Often makes
electronic
purchases
25%
20%
33%
38%
20%
35%
40%
34%
35%
34%
43% 37%
4. 3
Effective
Customer Service
A large customer base needs
appropriate customer service,
and the quality of customer
service has to scale
proportionately. The issue with
scaling customer service with
size, is that the scaling doesn’t
always equate to higher quality
customer service. Customer
service needs to cater to a
growing customer base as well
as maintain or improve in
quality.
Business Need
The outcome here would be
to understand what
customers expect from
customer service, and in turn,
use affordable scaling
options to expand and
improve the quality of
customer service.
OutcomeApproach
Using segmentation
analysis, we can separate
customers into different
buckets for what common
issues prop up. We can also
go through customer service
calls to find out how calls are
being handled on an
individual scale. With this, we
can use data analysis to glean
insights.
Customer service has recently become one of the cornerstones of business success. In this age of
hyperconnectivity, a dissatisfied customer can often mean more than just one lost sale. This is the
reason why companies are going above and beyond to give their customers the service they
expect. Customers have more reason than ever before to find new businesses to purchase from, so
businesses are constantly on the lookout to see what they can do to retain their customers to
prevent them from going back.
Eliminate data
silos
CRM and other
database
Create a single
customer view
Map the customer
journey
Increase customer
lifetime value
Higher Customer
Retention Rate
Empower cutomer
support
User details
customer
account
Web Mobile App
5. 4
Future sales operations need to
have their results predicted to
ensure that e-commerce
providers have proper stock of
all items in time for a future
event. This is to ensure that all
customers visiting the site can
purchase the products they
want, without the e-commerce
site overstocking items and
losing revenue in warehousing
costs.
Business Need
Here, it is expected to give
information into how many
products should be stocked,
and in what quantity.
Additionally, it can also show
information on slow-moving
products, which can give
e-commerce retailers an
option to provide discounts
or combo offers.
OutcomeApproach
By calculating past and
current sales trends with
sales reports, we can find out
what products are typically
sold during a specific period
in time. Additionally, we can
also look into upcoming
products and the hype for
them using social media
analysis. These methods will
provide the insights needed to
make predictions.
Predict Future
Operation Sales
Sales predictions are a vital part of any e-commerce provider, since they need to know how much
stock to keep of specific products so they aren’t over or understocked. Without proper sales
predictions, they can end up wasting valuable warehouse space, as well as risking customer
dissatisfaction
6. 5
The need here is to reduce the
number of customers leaving
the site due to difficult or
unavailable methods of
payments. This reduces cart
abandonment, and ensures
that customers can pay
through their preferred
method.
Business Need
By analyzing modes of
payment already available, and
what issues customers are
facing with existing modes of
payment, e-commerce retailers
can introduce new modes of
payment, as well as fix existing
modes of payment.
OutcomeApproach
By analyzing what modes of
payment are commonly used
on the site, customer
feedback on these modes,
cart abandonment details,
and payment related issues or
failures, we can understand
the friction experienced by
customers.
Ease of Online Payments
Today, there are a multitude of methods to pay for goods online. E-commerce providers have
realized that giving customers more methods to pay have resulted in fewer customers leaving their
shopping cards just because their preferred method of payment isn’t available with that particular
site.
Web UI Shopping Cart
ShoppingCart
Abandonment
EASY TO ACCESS AND
COMPLETE
DIFFICULTY IN
COMPLETING
Checkout
Abandonment
Checkout Payments
7. 6
The need here is to find out
why shoppers leave their
shopping carts with items and
not proceed to checkout.
Business Need
With Cart Abandonment
Analysis, we can realize why
customers are abandoning
carts, and using methods like
optimized and personalized
recommendations, discounts,
and loyalty bonuses, we can
reduce cart abandonment rate.
OutcomeApproach
Using shopping cart data
from the e-commerce sites,
we can see what items are
frequently abandoned, what
the total bill was, what they
bought together, and other
data to find out the patterns
behind cart abandonment.
Cart Abandonment
Analysis
Customers on e-commerce sites frequently have a habit of abandoning their carts and removing
items from their carts once they get to the checkout page. This can be due to a number of reasons,
sometimes they were never really interested in buying the item, sometimes the overall price is too
high, or they might want to buy it at a later time.
Cancel Continue
Shopping Cart Abandonment
8. 7
By providing more focus on
micro-moments with targeted
marketing efforts, e-commerce
retailers can understand how
to target specific products to
specific customers, thereby
improving the likelihood of a
sale.
Business Need
By improving micro-moment
marketing efforts, the overall
sales value for each customer
can be improved, as well as
improving customer
satisfaction and loyalty.
OutcomeApproach
By understanding what their
customers regularly shop
through, individual profiles
can be built, and using that
data, e-commerce sites can
launch small marketing efforts
personalized to each
customer
Increased Focus on
Micro-Moments
Micro-moments are small instances between the time when a user scrolls through the product
listings to the time they enter the checkout page. These are time spaces, or spaces in your website,
where e-commerce providers can connect with their customers and increase the probability of a
sale for a specific product related to the customer.
I-want-to-know
moments
I-want-to-try
moments
I-want-to-test
moments
I-want-to-buy
moments
When consumers are
exploring or
researching, but
they are not
necessarily in
purchase mode
When consumers are
showing interest by
choosing their
preference brand,
color, designs, size etc.
When customers are
convinced to make a
purchase but they are
evaluting it through
reviews and feedbacks
When consumers are
ready to make a
purchase and may
need help in deciding
what to buy and how
to find the right one
In moments like these, consumers want what they want, when they want it-and they are drawn to
brands that deliver on their needs
9. 8
The Process of
Analytics Adoption
Adopting analytics requires a stage of forethought and planning. Sometimes, lack of
implementation doesn’t mean e-commerce companies don’t want to do it, but they have a few
obstacles in the way before adopting analytics.
• Identifying internal use cases
• Measuring analytics
• Finding required talent
• Technical requirements
Finding Required Talent Technical Requirements
Identifying Internal Use Cases Measuring Analytics
Data analytics needs people with
specialized skills to implement and monitor
properly. Different retailers will have differing
requirements in finding this talent. That’s when the
e-commerce provider needs to ask some questions.
Can they afford to have an in-house team working on
analytics?
Do they need a permanent analytics team in-house all
the time?
Can they use an analytics firm to fulfil their needs?
By asking these questions, a company can understand
what kind of analytics requirement they can employ.
In e-commerce, this means understanding that certain
departments will benefit a lot more with data analytics
than other departments. Different areas will have
different impacts, providing a better ROI than
compared to in-store marketing efforts.
But it also doesn’t mean certain departments should
be ignored altogether. The list should be topped with
areas that have the most value, and end with areas
that don’t have a high ROI on the analytics investment.
The next step is to measure the impact. This means
asking a few key questions.
-What are the performance goals after deploying the
solution?
-How are these goals going to be measured?
-Does our organization have the tools necessary to
measure them?
This will provide valuable insight into finding out
whether or not the deployed solution is actually
performing as intended, or if it’s having any unintended
consequences.
These kinds of measurements help the
e-commerce provider understand how
their process changes have actually made
an impact.
The final thing to consider when looking
into analytics is learning what are the
technical requirements for the analytics
results you’re looking for different
technical requirements, and it’s imperative that
companies looking to employ analytics solutions have a
clear idea of what they need, what they already have on
hand, and what they need to acquire.
10. We hope this gave you better insight into how Data Analytics can help your company accomplish
new business goals. If you have any questions, please contact us using the details below.
Thank You
PositiveNaick Analytics Ltd. No177,1st floor,
LM Tech Park, 1st Main Rd, Nehru Nagar, Kottivakkam,
Chennai, Tamil Nadu 600041.
Email: customercare@positivenaick.com
Website: www.positivenaick.com
Phone: +91-44 4857 6162
