Getting the E-commerce Analytics cart going
Early-stage e-commerce founders often grapple with issues like marketplace setup, establishing partnerships, attracting traffic, tracking user journeys, order fulfillment, SEO/SEM and so on. The more early-stage the start-up, the more the time a founder spends on various aspects of the business.
Many of these critical tasks can be made easier for start-up founders, by building a solid Data foundation. Start-ups that build simple foundations, tend to scale faster than others. They spend just enough time, putting in place just the right amount of Analytics effort. What founders need at this stage is:
1. A quick view of business performance
2. Identification of performance ‘gaps’
Many start-up founders we meet tell us – “We use Excel, that gives us answers”.Sure it does… at the cost of precious time. Instead, imagine being able to bring data together in immediately consumable form, within minutes. That’s the power of building a single view of business.
Once a ready-to-view solution is available, it acts as the founder’s daily compass to scaling. It helps founders decide priorities, energies, efforts. In case of seed-stage start-ups, such a solution can even help reduce cash burn, by optimizing SEO/ PPC/ Ad Words spends. Real scaling happens when data is managed well enough to track key business shifts; and investor conversations are backed by latest data.
Getting transaction-level,partnerships & SEO/ SEM data onto a single platform is the biggest cost-saver that an e-commerce start-up founder can invest in.
Many analytics tools masquerade as ‘comprehensive’. However, they focus on onsite behavior ;whereas e-commerce analytics requires more. E-commerce analytics should be able to tell founders where users come from, how much time they spend perusing a particular product, where they spend most of their time, and much more.
Eventually, e-commerce analytics is meant to show founders, the‘helicopter view’… while allowing for issue-specific zoom-in’s. This helps the founder get a clear read on buyer psychology and its impact on onsite behavior.
At the bare minimum, there are two tools that provide all raw data required. This raw data needs to be analysed for easy, bite-sized insights:
Free and relatively easy to use, Google Analytics (GA) is often considered the ultimate analytics tool. In its simplest form, Google Analytics provides onsite behavior insights.
For e-commerce start-ups invested in SEO/ SEM, Google Search Console is a free web service by Google that enables SEO/ SEM strategy development. In other words, the tool allows site-owners to check indexing status and, optimize website visibility and make the website more discover-able in Google Search results. An SEO-healthy site ranks better, gets better (human) traffic and generates higher revenues.
Having said that, GA can be an overdose of data and a lot of it can be entirely irrelevant. Unless one knows what is looking for, they can end up wasting a lot of time on GA. Getting the most of GA in quick time requires consistency rather than comprehensiveness.
Pick a small set of key e-commerce metrics consistently; than obsessing about all metrics, too frequently.
Here are 5 essential metrics, for early-stage e-commerce start-ups to track daily/ weekly:
· Number of first-time/ repeat users / customers / visitors
· Cost per acquisition (CPA) or Cost per customer (CPC)
· Return on Ad Spend (ROAS)
· Bounce Rate
· Cart Abandonment Rate (CoAR)
These 5 metrics are a great start to track basic lead indicators impacting revenue.With growth comes the need to track metrics that impact recurring revenue eg. CLTV (customer lifetime value), AOV (average order value), Conversion rates. Such metrics can indicate you how to grow or scale year over year.
All in all…
Analytics tools for early stages are just that… tools dumping humongous (at times,irrelevant) raw data. End of day, such data must be available to founders on custom-made dashboards. That is what helps separate superficial metrics from the ones that matter, saving precious time for time-challenged founders.
ThinkBumblebee understands that no two start-ups are the same. For a ‘no fine print’ conversation on how your start-up can build a solid data foundation within no time, reach out at Umar.Amin@thinkbumblebee.com or Anisha.Ajmani@thinkbumblebee.com.