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.
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.