The Importance of Digital Marketing Analytics

SOURCE: CUSTOMER THINK

Over the past decade, the impor­tance of dig­i­tal mar­ket­ing has mea­sur­ably expand­ed in almost every indus­try. With the right dig­i­tal mar­ket­ing strat­e­gy, your eCom­merce enter­prise can sig­nif­i­cant­ly extend its reach, oper­ate more effi­cient­ly, and move clos­er to achiev­ing its long-term finan­cial objectives.

While the ben­e­fits of dig­i­tal mar­ket­ing are read­i­ly appar­ent, know­ing if your team’s spe­cif­ic approach has been work­ing pos­es a much more dif­fi­cult chal­lenge. Instead of look­ing for an approach that “seems” to be pay­ing off, you will be much bet­ter off look­ing for quan­ti­ta­tive evi­dence that sup­ports what you’ve been doing.

For­tu­nate­ly, the world of dig­i­tal mar­ket­ing ana­lyt­ics has been able to keep up with a rapid­ly chang­ing mar­ket­ing envi­ron­ment. There will be many dif­fer­ent angles your eCom­merce busi­ness can look at what you’ve accom­plished; the one that makes the most sense for you will depend on the spe­cif­ic nature of your business.

In this arti­cle, we will dis­cuss why eCom­merce account­ing depart­ments, and pro­fes­sion­als of all vari­eties, need to take dig­i­tal mar­ket­ing ana­lyt­ics seri­ous­ly. We will also focus on some of the spe­cif­ic indi­ca­tors that are like­ly to be relevant.

What are the benefits of digital marketing analytics?

As is the case with seem­ing­ly every com­po­nent of your busi­ness, if you are run­ning any sort of dig­i­tal mar­ket­ing cam­paign (or are sell­ing in the eCom­merce space), con­duct­ing ana­lyt­ics will be very impor­tant. With­out ana­lyt­ics, you are doing lit­tle more than sim­ply guess­ing and hop­ing that things will go well.

The benefits of digital marketing analytics include:

– Deter­min­ing which chan­nels have the low­est cus­tomer acqui­si­tion cost and which chan­nels can reach the widest audience

– Iden­ti­fy­ing the ben­e­fits and costs of each of your campaigns

– Know­ing your company’s dig­i­tal strengths and dig­i­tal weaknesses

– Find­ing oppor­tu­ni­ties to increase your day-to-day prof­it margins

– Rec­og­niz­ing which cus­tomers are repeat cus­tomers, will­ing to spend the most, and are will­ing to refer your busi­ness to their friends

– Indi­cat­ing which cam­paigns will be worth expand­ing and which cam­paigns can ulti­mate­ly be scrapped

With a proven body of data by your side, mak­ing your next deci­sion will be sig­nif­i­cant­ly eas­i­er. Using an oppor­tu­ni­ty cost framework—which can be sup­port­ed through the use of hard ana­lyt­ic data—you can decide where your next mar­gin­al dol­lar can be most effec­tive­ly spent.

How can I measurably know how my business is performing?

With mul­ti­ple ratios, reports, and ana­lyt­ic tools to choose from, there will be many dif­fer­ent ways for your busi­ness to tan­gi­bly mea­sure your busi­ness’ over­all per­for­mance online. While it will like­ly be worth your time to at least take a look at many dif­fer­ent eCom­merce indi­ca­tors, over time, there will like­ly be a few that your busi­ness favors over others.

– Traf­fic by Chan­nels will help you iden­ti­fy where the vis­i­tors to your eCom­merce web­site are actu­al­ly com­ing from. This will make it much eas­i­er to deter­mine if social media, organ­ic search­es (Google, etc.), or direct vis­i­tors have had the largest impact.

– Clicks per Visit/Time Spent on Site will help you see if your web­site is actu­al­ly capa­ble of con­nect­ing with your tar­get audi­ence. The more time that some­body spends on your web­site, the more like­ly they will con­vert into a purchase.

– Rev­enue per Vis­i­tor helps you deter­mine how effi­cient your web­site actu­al­ly is. Efforts that increase your rev­enue per vis­i­tor will be even more valu­able than efforts to increase your total num­ber of visitors.

– Cost per Con­ver­sion will help you deter­mine your over­all prof­it margins—companies with costs that are greater than rev­enues will almost always need to make a change.

– Lead to Close Ratio indi­cates how many “almost buy­ers” become actu­al buy­ers. This may have a major impact on the way you tar­get each of your poten­tial leads.

– Return on Invest­ment is a broad met­ric that can help you eval­u­ate the over­all val­ue of your mar­ket­ing efforts. When all else is equal, any­thing that increas­es your return on invest­ment will be worth pursuing.

Tak­ing the time to eval­u­ate these essen­tial met­rics on a weekly—or even daily—basis will help you deter­mine ways your eCom­merce efforts can be more pro­duc­tive.

How can I improve my eCommerce digital marketing efforts?

Now that you have the hard num­bers in hand, you will nat­u­ral­ly want to know what to do with them. Even if you have decid­ed that increas­ing your rev­enue per vis­i­tor is a top pri­or­i­ty, you will still need to decide how to actu­al­ly do so.

For­tu­nate­ly, there are many things your busi­ness can do that will imme­di­ate­ly make a difference.

– Hire an eCom­merce part­ner: hav­ing access to top exper­tise and pro­fes­sion­al resources will help your busi­ness make pro­duc­tive changes.

– Sort your busi­ness into mul­ti­ple “com­part­ments.” By nar­row­ing your inter­pre­ta­tion of eCom­merce ana­lyt­ics, you will be able to make more pre­cise decisions.

– Track changes over time. Instead of sim­ply gen­er­at­ing a “snap shot” of where your busi­ness stands in the sta­tus quo, it will be much more use­ful to track these fig­ures as they play out into the future.

Suc­cess­ful­ly con­duct­ing an eCom­merce mar­ket­ing cam­paign will involve mul­ti­ple cycles of tri­al and errors. In order to max­i­mize the val­ue of your enter­prise, you will need to be will­ing to make a few changes.

Conclusion

As long as your busi­ness is com­mit­ted to suc­ceed­ing in the eCom­merce space (and there are plen­ty of rea­sons why this is a good idea), you will need to take advan­tage of pre­cise dig­i­tal mar­ket­ing ana­lyt­ics. The more you can know about where your busi­ness stands, the eas­i­er it will be to make objec­tive­ly ben­e­fi­cial decisions.