Ecommerce Optimization Tips

for Shopify users

How to make data-driven decisions and

improve your business performance.

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ECOMMERCE ANALYTICS GUIDE
#1 ANALYTICS 101 ................................................................................................................. 2

E-COMMERCE ANALYTICS BASICS.......................................................................................... 2

#2 DATA COLLECTION ......................................................................................................... 18

SETTING UP THE DATA COLLECTION RIGHT......................................................................... 18

#3 CUSTOMER ANALYTICS................................................................................................... 28

WHO ARE YOUR CUSTOMERS .............................................................................................. 28

#4 MARKETING ANALYTICS................................................................................................. 41

WHERE TO SPEND YOUR MONEY ......................................................................................... 41

#5 PRODUCT ANALYTICS ..................................................................................................... 60

HOW TO OPTIMIZE YOUR INVENTORY / PRODUCT PORTFOLIO ........................................ 60

#6 CONVERSION OPTIMIZATION ........................................................................................ 75

WHERE YOUR STORE IS LEAKING MONEY ........................................................................... 75

SUMMARY............................................................................................................................. 92

About the Author

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#1 ANALYTICS 101
E-commerce Analytics Basics

How would you feel if you were an astronaut and your team just assumed
that you’d be alright during the launch? No numbers, no tests, nothing.

They just guessed that it was a clear day and you’d be ok.

This would make you uncomfortable, wouldn’t it?

Believe it or not, many business owners fly by the seat of their pants trying
random tactic after random tactic until something works.

You’re here because you know that guessing and “faking it until you make
it” only works for so long. Real success happens when there are processes,
trends, and concrete numbers that act as your compass.

That’s the power of data.

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We rely on it to have safe flights, to have successful launches, to build
great business.

Good data helps us understand the world around us, it provides guidance
and helps us make sound decisions.

If you’re a business owner, data can either make or break your business.

Excited? Scared? A little bit of both?

Good, let’s dive into the world of e-commerce analytics.

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#2 What is E-commerce Analytics?

E-commerce analytics is a system or tool that allows you to understand

your user’s behaviour.

Although most e-commerce analytics tools focus on onsite behaviour,

e-commerce analytics goes beyond that.

Onsite, e-commerce analytics tells you where your users came from, how
much time they spent looking at a particular product, where they spend
most of their time, and much more!

In the grand scheme of things, these numbers lead to a bigger story

behind customer behaviour and buyer psychology.

WHY do you need it?

Having some sort of analytic tool is pretty much indispensable to having a

successful e-commerce business.

E-commerce isn’t like placing sports bets where you pretty much take
educated guesses.

To be successful, you’ve got to know exactly what your user is doing on

your site in order to best serve them.

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Sounds good but what exactly am I supposed to be
measuring?

Glad you asked!

Different tools offer you different measuring capabilities.

You can keep it pretty simple and track traffic sources, region, and most
visited page(s) for example.

You can also go pretty deep and know how much time your user spends
on your site, how far down they’ve scrolled on a particular page, and
which product(s) they’re intending to buy.

Think about one of your favorite brands. Look at the emails they send you,
how they communicate with you on social media, and most importantly,
how they make you feel.

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Almost feels like they know you or something, doesn’t it?

Well, that’s because they do.

They’ve set up their analytics in a way where they can track your
behaviour on their website and get a clear idea of what you’re interested
in.

AARRR for Ecommerce

Using the AARRR metrics method is one of the best ways to grow your e-
commerce business.

Many people overcomplicate business and focus on the wrong things.

With AARRR, you have a clear roadmap of the top 5 things you should be
focused on while growing a business.

AARRR stand for:

• Acquisition
• Activation
• Revenue
• Retention
• Referral

Coined by enterpreneurship guru, Dave McClure, AARR is often looked to

as THE system that drives true business growth.

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Let’s get into the different parts of AARRR:

1) Acquisition

Simply put, how you get your visitors.

Most businesses see visitors coming from search engines like Google or
Bing, social networks, and paid advertising (via Google AdWords, etc).

Source: Avinash Kaushik

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Regardless of what your user acquisition strategy is, it’s important to track
where they’re coming from and double down on the sources that feed
your website consistent traffic.

2) Activation

This is when a user signs up for a product trial or for your newsletter.

The wheels are moving and they’ve started to take actions that lead to
them purchasing from you.

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3) Revenue

It’s all about the benjamins baby! 💵

This is pretty straightforward and the biggest sign of sales funnel success.

4) Retention

Just because they’ve purchased from you once doesn’t guarantee that
they will again.

That's why we need retention analysis & cohorts.

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Cohort analysis refers to the practice of studying the activities or habits of
specific cohorts over a set period of time. It's a bit like segmentation, but
focuses more on historical data—using it to spot patterns or changes in
consumer behaviour throughout the customer journey.

It’s much easier to keep an existing customer than it is to get a new one.

So how do you create repeat customers?

Understand what they need and customize offers based on that!

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5) Referral

So you have these repeat customers but how do you grow and take your
business to the next level? Through referrals!

Chances are, your customers have family and friends who could be
interested in what you’re offering and nothing is more powerful than a
referral from a family member or friend.

Word-of-mouth is one of the big reasons that took Starbucks from a single
shop in Seattle to more than 24,000 outlets around the world.

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The 4 Must-Have E-commerce Analytics Tools

1. Google Analytics

Often considered THE analytics tool, and with good reason. Free, relatively
easy to use, and it’s a Google product.

In it’s simplest form, Google Analytics helps you better understand your
customers.

It’s comprehensive analytics features give a clear picture of the

performance of your website, content, and products. It’s one of the most
commonly used analytics tools on the web and to be honest, one of the
best.

(This is Google we’re talking about, after all).

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Getting started with Google Analytics is easy.

All you need to do is go here:

https://marketingplatform.google.com/about/analytics/.

The website walks you through the features and in typical Google manner,
makes it a no-brainer to get going. You’ll also get the guide to installing
the tracking codes, creating goals, and of course how to read all of that
data.

It may look overwhelming at first but after some time, you’ll get used to it.
Bonus: It’s very customizable thus making it an attractive offer for many.

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Why do you need it?

Want to know who visited your website? Where the heck do your
customers live? Which pages perform the best on your website? How long
are people staying on your website? How many visitors are turning into
leads/customers?

If you’ve ever asked yourself any of those questions, you need Google
Analytics. It can give you detailed answers to all of these and much more.

2. Google Search Console

Coming in at #2 of the must-have analytics tools is another Google

product, Google Search Console.

This free tool allows anyone with a website to see how Google views it
and gives insights on how to improve organic presence.

Google Search Console’s tools help you to measure site’s traffic and
performance so that your website has it’s best foot forward in the search
results.

With intuitive analytics that helps you figure out which queries bring
traffic to your site to real-time alerts letting you know what needs to be
tweaked, Search Console has got you covered.

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You can access Google Search Console at absolutely no cost here:
https://search.google.com/search-console/about

Why do you need it?

Having a healthy site is crucial to your success as a website owner. A

healthy site ranks better, gets better traffic (real humans and not bots),
and generates higher revenues. Plus, this tool is FREE so you really have
nothing to lose.

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3. Hotjar

Hotjar is a quick and visual way to better understand customer behaviour

on your site.

There are a lot of analytics tools out there but Hotjar stands out due to its
visual representation of customer actions via heatmaps.

The heatmaps on Hotjar help you clearly see click heatmaps, scroll
heatmaps, download, and share heatmaps, and also move heatmaps.

Having the visual representation of your user intentions and interests is

certainly useful.

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Check out HotJar here: https://www.hotjar.com/tour

Why do you need it?

Hotjar is a great tool if you want a visual of interpretation your customer

data. The heatmaps make it simple to know exactly what’s working for
your audience and what isn’t.

4. Conversific

Having data is meaningless if you can't make proper decisions off of it.
Enter Conversific, the analytics tool that simplifies data and helps you act
on it rather than just look at it.

Unlike the tools mentioned above, Conversific analyzes the most

important data for you so that you can focus on taking action that helps
your business move forward.

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To get started with Conversific, head over here: www.conversific.com

Why do you need it?

Sometimes having the massive capabilities of a tool like Google Analytics

can lead to wasted time trying to figure it all out. With Conversific, you get
an all-in-one, user-friendly dashboard with only the most important data.
How’s that for convenience?

#2 DATA COLLECTION
Setting up the data collection right

At this point, you should have a pretty good idea of why e-commerce
analytics are important, what the best tools out there are, and general
knowledge of important e-commerce metrics.

Now, how do you actually make sure you’re collecting this data properly?

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How do you set up the necessary systems that will automate data
collection, positively impact your business, and make your life easier in the
long run?

Fixing a bad data collection set-up equals wasted time (and often money),
that could have been reinvested in other parts of your business.

Without further ado, let’s get into how you can set up a winning data
collection system properly the first time around!

The Basics: How to set up Google Analytics

One of the best guides on setting up Google Analytics comes from Jeff
Sauer, a pioneer in online analytics and an award winner who’s worked
with Fortune 500 companies and world-class entrepreneurs.

His website Jeffalytics offers a detailed breakdown of a Google Analytics

set up and how most set it up the wrong way.

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You’ll learn how to properly define objectives for your website, how to
install the Google Analytics tracking code, identify key KPI’s, and much
more.

This how-to guide is excruciatingly detailed and literally holds your hand
as you set up Google Analytics.

How to use Google Analytics views

More views, better data, more $.

Many Google Analytics accounts (if not most), are set up with the default
view and without further modifications.

While this works fine for some, it’s important to know that limited views
can also mean limited data.

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Without specific and tailored views, you could be missing out on some key
insights that could propel your business forward.

Basically, the more views you create, the more granular data you have,
which means the better you can serve your customers which then means,
more revenue! You don’t want to be leaving money on the table, do you?

This handy guide by Paul Koks at OnlineMetrics gives you all you need to
maximize your views potential in Google Analytics.

How to set up e-commerce tracking in Google

Analytics
We’ve mentioned the incredible ability that Google Analytics gives you
when it comes to understanding your audience.

Now, how do you set up custom features like e-commerce tracking?

AnalyticsMania is a great place to start for that.

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Using this guide, you’ll learn how to set up e-commerce tracking so that
you can see those oh-so-important numbers such as conversions and
revenue.

This guide will break down the various types of e-commerce reports so
that you can decide which ones are right for you.

Other than the ability to customize these reports, you’ll learn the best
ways to track your sales so that you know exactly what’s working and why
it’s working.

How to hit the trifecta of e-commerce success

with enhanced e-commerce
For e-commerce owners and enthusiasts, enhanced e-commerce data is
the stuff dreams are made of, but many business owners are passing this
incisive and FREE data up.

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Why in the world are they doing this?

Because it takes a little patience and some time to get the right systems
up and running.

But when you do set it up, you hit the e-commerce lottery of actionable
intelligence that leads to higher revenue, engagement, and clicks.

The best way to get there?

This guide by the world-renowned marketer, Neil Patel, gives you the
step-by-step way to get set up with enhanced e-commerce and
supercharge your insights (and your revenue as well!).

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Making sure you set it up correctly: The
Google Analytics checklist for E-commerce
“Ok, I get it. Google Analytics is the greatest thing invented since sliced
bread. Is there a setup checklist somewhere that I can refer to absolutely
make sure I get it up and running properly?”

Glad you asked!

Up until now, you’ve learned about all of the amazing things that Google
Analytics can do for your business.

You’ve been given an abundance of resources from e-commerce analytics

experts from all over the world and are ready to set it up the right way.

The team over at Practical e-Commerce has created this easy-to-follow

checklist to take away the guesswork and make sure you’re fully taking
advantage of Google Analytics.

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What is UTM tagging for e-commerce and
why is it important?
The Urchin Tracking Module aka UTM, are tags that you add to a URL.

When someone clicks on a URL with UTM parameters, this info gets sent
back to your Google Analytics for tracking.

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This allows you to clearly see which campaigns, pages, or pieces of
content are driving results for your business.

Google URL Builder: https://ga-dev-tools.appspot.com/campaign-url-

builder/

To dive deeper into UTM parameters and how to properly use them,
check out this ultimate guide from Neil Patel that breaks it all down.

Eliminate the guesswork from your marketing strategy and use UTMs to
have concrete data to push your business forward!

How to make Google <3 You: The guide to

setting up Google Search Console
In Chapter #1, you learned about Google Search Console and how it helps
to make your website shine in Google search results.

You learned that you can find out things like how many people have
visited your website, the various places your visitors came from, and even
the devices (mobile or otherwise) that most of your users have used.

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As one of the leaders in the SEO space, Moz has put together an in-depth
article to show you how to squeeze the most juice from Google Search
Console.

In this guide, you’ll learn everything from how to add and verify a site on
Google Search Console, adding an HTML file, and how to check a
robots.txt file.

All of the things you’ll learn here are designed to make your website as
search engine friendly as possible and to give you the clearest data
possible.

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#3 CUSTOMER ANALYTICS
Who are your customers
Now that you know how to set up data collection the right way, it’s time
to get into the weeds of that data.

The best place to start? Nailing down who your customers are.

The importance of knowing EXACTLY who buys from you cannot be

overstated.

Customers, especially repeat customers, are the lifeblood of EVERY SINGLE

business on this planet.

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Even top companies with billions of dollars in revenue understand the
importance of customer data because it helps them plan campaigns and
programs that will keep their current customers while also attracting new
ones.

Before all of that, you need to be familiar with some important customer
metrics.

Using buyer personas in e-commerce

In order to get the maximum return on investment from your marketing
and ad spend, you first need to build out a laser targeted buyer persona.

This goes beyond demographic information such as age, location, income

range, etc.

A detailed buyer persona goes deep into the psychology of your ideal
customer.

You’ve got to know their lifestyles, their concerns, the common objectives
they’ll have while comparing your products to others, their interests, and
more.

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A little creepy? Kinda.

Look, I’m not suggesting stalking them to see how they carry on about
their day or anything like that.

It’s about having a very good idea about your customer’s interests and
mindset when it comes to your product and similar ones.

The best brands in the world know their customers so well that their
marketing and advertising feels like a conversation with a friend rather
than a sales pitch.

One of those brands is Shopify! They’ve come up with a detailed

breakdown of how you should be building your buyer persona here.

You’ll first learn how to broadly define your ideal customer and then niche
it down to specifics.

More importantly, you’ll learn how to keep this buyer persona template
open because customers evolve and change over time and you need to
adapt to those changes.

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Audience Reports in Google Analytics
Google Analytics boasts 9 different reporting sections under “Audience.”

These subcategories include Overview, Demographics, Interests, Geo,

Behaviour, Technology, Mobile, Custom, and Users Flow.

Whew, that’s a lot.

But hey, it’s not as complicated once you spend a little time understanding
each subsection.

Thankfully, the team over at Social Media Examiner have put together this
insanely helpful guide on how to use Google Analytics Audience Data.

Remember, the better you understand your visitors, the better you can
serve them.

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How to use geographic and demographic
data to optimize our campaigns?
Knowing the age range and location of your visitors are some of the most
important of all audience data.

Imagine building a loyal tribe of repeat customers that tell their friends,
their friends of friends all about how this incredible company (that’s you)
just KNOWS them.

Top companies get to this almost cult-like admiration because they’ve

been able to build a community of people that essentially doubles or
triples their marketing efforts through word of mouth

How to Use Facebook Audience Insights for

Better Targeting
I mentioned Facebook earlier and that’s with good reason.

Facebook is one of the largest social media networks in the world and it is
easily #2 (after Google) in the digital advertising space.

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With almost 2 billion accounts, and over $40 billion (that’s with a giant B)
in ad spend in 2018, you can imagine how you could reach just about
anybody using Facebook.

With this incredible data, you could maximize your campaigns using built-
in tools like Audience Insights.

Using this tool, you get to add and delete as many data points as you want
and target. Well, just about anyone that you want.

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Of course, you run the risk of niching too much or casting too wide of a
net if you don’t know what you’re doing.

Lucky for you, social media leaders Sprout Social have put together this
helpful resource to help you harness the power of Audience Insights.

Customer segmentation in e-commerce

If you’ve ever received email offers for the best retirement homes and the
top power drinks at the same time, you probably know why it’s so crucial
to properly segment your audience.

The best businesses know how to create relevant offers and relevant
targeting experiences for their audience.

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Other than creating relevant offers, segmentation is important for cutting
down ad costs, finding out new up-sell or cross-sell opportunities (Amazon
does this very well), and allows you to concentrate on the most valuable
customers.

So, what determines a segment?

What is the best way to segment your audience? How do other leading
businesses use segmentation in real life? These are all answers that can be
found here. For another detailed guide on segmentation using Google
Analytics, check out this resource.

Loyalty, Loyalty, loyalty!

It’s 2019 and that means that even though your customers have bought
from you, they’re constantly being courted everywhere else. Increased
competition from other brands means that you’ve got to have a special
“sauce”, a certain je-ne-sais-quoi that keeps customers coming back.

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In order to build a successful retention strategy, you’ve got to know the
metrics that actually matter. Leaders in retention like Shopify know what
to track when they’re brainstorming retention strategy.

In Chapter 1, we covered some key metrics that are indispensable in e-

commerce and it’s important to constantly refer to those metrics when
thinking about retention. KPIs like Repeat Customer Rate, Customer
Lifetime Value help to cut through the noise and give you a compass on
what to focus on.

For ideas on how to create your own secret sauce that keeps customers
coming back, check out this article. You’ll see how companies today are
absolutely killing it with referral programs, flash sales, and more engaging
projects that customers can’t get enough of.

Is the market satisfied? How you can

determine the product market fit
Selling a product is not a decision that should be taken lightly.

How can you guarantee that someone out there will actually exchange
their hard-earned dollars for your product?

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Understanding the market, knowing your customer pain points,
capitalizing on trends, and staying nimble are signs of a business that will
be around for a long time to come.

Here’s a good place to start when working on your product market fit
research. Evaluating market fit isn’t just for the beginning stage of your
business.

Savvy business owners are constantly watching trends and analyzing

market changes. This strategy gives you the upper hand in creating better
products and experiences for your audience.

This detailed analysis gives you actionable strategies on how to exploit a

product within its identified market and how to measure success.

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How can an e-commerce CRM benefit your
business?
CRM stands for customer relationship management.

Today, most CRMs come in the form of a software that makes managing
the ultra - important customer relationship very easy.

Easy how?

Well, most CRMs provide a central place where data like partnerships,
contacted customers, prospects, leads, and much more can be found.

Some of the biggest and most tangible benefits that CRMs have to e-
commerce businesses include:

• improving customer understanding

• more affective customer attraction
• better customer retention
• lower management costs

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 • customizable and nimble integration with various e-commerce
platforms

When it comes to building and maintaining prosperous relationships with

customers, a great CRM is indispendable.

Are they happy? Your guide to measuring

customer satisfaction
A major factor in creating repeat customers is keeping the customer
happy. Happy customers stay and frustrated ones leave to better options.

As a business owner, you’ve got to have systems in place that allow you to
see if you’re providing the best possible customer experience.

From the moment visitors come to your website to when they land on the
checkout page, it needs to be as silky smooth as possible.

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With this handy guide from REVE Chat, you’ll be able to measure
important metrcis like Net Promoter Score, Customer Effort Score,
Conversion Rate, and Repeat Customer Rate

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#4 MARKETING ANALYTICS
Where to spend your money
Deciding on where to allocate marketing spend is certainly not a walk in
the park.

For example, You’ll find countless articles on the internet claiming that
social media has become “pay-to-play”, which encourages business
owners to spend more on ads.

Although there is some truth to those claims, many business owners still
spend money without blindly and see little to no return on investment.

This isn’t just exclusive to social media.

This goes for every marketing channel.

That’s why the importance of actionable data cannot be overstated.

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Once you’ve defined your business goals, set up a great data collection
system, and know your audience, you’ll be in a better position to know
EXACTLY where to spend money to boost your marketing efforts.

Speaking of marketing spend, let’s get into some important e-commerce

acquisition metrics.

Top e-commerce acquisition metrics

1) Visitors

This is the total number of times a user navigates to your website.

As an e-commerce store owner, you’ve got to know how many people are
coming to your website, where they’re from, and on which device so that
you can serve them better.

2) Transactions

A transaction can be defined as a sale or purchase of a good/service. This

is when your visitors become customers.

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3) Revenue

Revenue is the income generated from the sale of goods and services
before any costs and expenses are deducted.

Careful to not confuse this metric with profit.

Profit is achieved when there’s a positive balance after deducting

expenses from revenue.

4) AVG Order Value

This metric helps you understand your customer’s spending habits and can
help you to indentify opportunities to upsell, downsell, and make tailored
offers to them.

To find out your AOV, divide the sum of generated revenue by the total
number of orders.

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5) Unique purchases

Unique Purchases refers to the total number of times a product (or set of
products) was part of a transaction.

Here’s a good example from the team at Marketing Mojo:

“If you see that product A has been purchased 500 times, but only has 10
unique purchases, it means that product A was bought on 10 separate
occasions in quantities of 50 at a time.”

6) Conversion Rate

This metric indicates the percentage of visitors that come to your site who
become actual customers.

In order to find your conversion rate, you need to take the total number of
sales divided by the total number of visits to your site.

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7) Customer Acquisition Cost

Customer Acquisition Cost or CAC refers to the overall cost to acquire a

customer including the cost of producing, storing, and shipping the items
that a customer purchases.

This metric can sometimes be overlooked but is a very telling measure of

the likelyhood of a business’ success.

If it costs you more to acquire customers than the value (revenue) those
customers bring, you’re going to be in trouble very soon.

The team over at BigCommerce has a helpful guide on how to achieve a

positive CAC here if you want to read more about this.

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8) Return On Advertising Spend

Return On Advertising Spend or ROAS measures the efficacy of your digital

advertising campaign.

This tangible measure lets you know what’s working in your campaigns
and how you can fix it.

To calculate ROAS, You take the revenue generated from a campaign and
divide it by the cost of the campaign; the number that you get from that
calculation is the ROAS.

How to measure Customer Acquisition Costs

in e-commerce?
I’ve mentioned how you can calculate Customer Acquisition Cost above,
but if you want to dig deeper, check out this article by Neil Patel that gives
you a better picture at how this metric can determine your company’s
fate.

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You’ll learn the importance of improving on-site conversion metrics,
enhancing customer value, and properly using your CRM to raise your
CAC.

Google Analytics Acquisition Reports

In Google Analytics, you can find 10 separate reporting sections under

acquisition.

That means that you can easily discover the marketing tactics that are
bringing the most customers to your site and double down on them. Social
Media Examiner has assembled this practical guide on using Google
Analytics Acquisition reports to help you identify the marketing
techniques that are bringing the most visitors and leads to your website.

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Google Ads

Google Ads (formerly as AdWords) is a popular marketing channel for

businesses of all sizes.

As the undisputed search engine in most of the world, there’s a pretty

good chance your target customers uses Google.

Over the years, Google Ads have grown in popularity and thus price, so it’s
important to note that it can very easy to waste money on Google Ads
that do not bring in the customers you want.

With the proper customer and market research, you’ll be able to correctly
invest in Google Ads with a more measured approach.

To check the success of your campaigns, you’ll need to link your Google
Ads account to our dear friend, Google Analytics.

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When properly done, you’ll have access to a rich set of actionable data
that will help you tweak your campaigns to get the most bang for your
buck.

Here’s how you can do that.

Facebook Ads

Facebook boasts an incredible arsenal of analytics tools to help you get

the results you want from your paid marketing efforts.

To fully take advantage of their tools, you’ll need to understand how

Facebook’s analytics tools are broken up and what metrics are the most
important in each analytics subdivision.

The three analytics platforms on Facebook are Page Insights, Audience

Insights, and Ad Manager.

Due to the large amount of information these analytics platforms dish out,
it’s easy to be overwhelmed.

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Use this guide to help you focus on the metrics that are most important.

Display Ads

Display ads usually have the goal of getting the user to click-through the
ad and take an action on a landing page.

All good marketing strategies require setting goals and display ads are no
different.

In order to have success with display ads, you’ll need to set some solid,
measurable goals. Some common goals for display ads include:

• Brand awareness
• Freebies or lead magnets (ex: 5 powerful ways to write engaging
web copy, etc)
• Attracting abandoned users through custom retargeting
• Lead nurturing

After you’ve set those goals, you’ll need to make sure you’re using the
right targeting methods (such as keywords, demographics, interests, etc)
and catchy copy that will prompt the user to take the wanted action.

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Here’s a handy guide on using data to supercharge your display ad
campaigns from landing page experts, Instapage.

Search Engine Optimization (SEO)

Search Engine Optimization is the process of affecting the visibility of a site

in a web search engine’s unpaid search results.

Many people often think that SEO is simply about looking at high
performing keywords and stuffing as many of them as possible in order to
rank high on search engines like Google.

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It’s not that simple, and simply stuffing as many keywords into a piece of
content or ad can actually hurt your website’s visibility instead of helping
it.

Carefully studying relevant keywords, creating helpful content (long form,

short form, rich visuals, etc.), and writing focused, rich copy for ads are all
part of a strong SEO strategy.

And what’s one of the best ways to measure your SEO efforts?

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You guessed it...Google Analytics. Among it’s multitude of reporting
options lies the ability to dissect the keywords and organic traffic that
impact your business.

Using Google Analytics to find out things like clicks, impressions, average
page positions can go a long way in making your website favorable to
search engines.

To dive deeper into understanding things like quality of traffic and

creating custom SEO dashboards in Google Analytics, check out this guide.

Social Media

There are so many social networks out there that it’s difficult to keep up
with them all.

Even more difficult for e-commerce business owners is knowing which

metrics to focus on when investing in social media marketing.

Here’s the thing, you don’t need to be on every single social media
platform.

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You just need to be on the ones that are working for you.

There are plenty of businesses out there who are simply on 1-2 social
media networks and are killing it.

This only happens when you’ve done your due diligence (audience
research, market fit, competitor analysis, etc) and have a social media
marketing strategy in place.

Without these things, social media can be black hole that just absorbs
your time and money.

Lucky for you, the teams at Sprout Social and Convince and Convert have
come up with detailed guides on the social media metrics that matter.

In these guides, you’ll find how to track important social media metrics
using Google Analytics.

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Is Email Marketing “dead”?
Despite the barrage of articles that say so, email marketing is far from
being “dead”.

Email marketing is one of the best ways for business owners to converse
with their audience.

When someone opts into your email list, it usually means that they’re
interested in learning more about you and what you have to offer.

It’s often the first place where you get to make a solid first impression to a
potential customer.

Email can be a powerful tool when you’ve figured out how to create
content for your list that isn’t just a crappy email announcing a sale you’re
having that week.

Just as important as the content itself is the ability to track your efforts
and seeing where you can improve your open rate, click-through rate, and
reply rate.

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This guide by Campaign Monitor breaks down how you can easily set up
email campaign monitoring using Google Analytics.

To learn more about the most important email marketing metrics, check
this great resource out by marketing leaders, HubSpot.

You’ll learn how to track conversion, rate, email share rate, and much
more!

Referral & Direct

Referral traffic can be defined as traffic that has come from links on other
websites rather than directly or from searches.
In Google Analytics, direct traffic is often reported as traffic that has no
data on how the session arrived at your website or when the referring
traffic has been configured to be ignored.

The most common causes of direct traffic are often manually entered web
addresses, broken tracking codes, and non - web documents.

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Both referral and direct traffic can be excellent sources of new leads for
your business and can give you insights into the most popular content and
influencers in your industry.

It’s important to learn how to understand referral paths so you can clearly
track good referral traffic and avoid bad referral spam.

The big picture: Multi - channel funnels

Put simply, multi - channel funnels show you how your marketing
channels (aka trafffic source) work together to generate sales or other
outlined conversion goals.

Often times, the last touchpoint before the conversion gets all the credit
but that may not be the entire story.

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Knowing things like how much time the user spent from the first visit until
the purchase goes a long way in helping you optimize your marketing
strategy.

This guide from the team at Online Metrics reveals the best way to go
about creating a solid multi - channel funnel reporting system.

Remember that multi-channel funnels can get extremely complicated and

is a more advanced technique once you get familiar with Google Analytics.

How to steal good ideas from competitors to

get the upper hand
In the battle for the customer’s attention and loyalty, you’ve got to know
what your competitors are doing.

This allows you to better understand not just your business but gives you
the necessary information to seize untapped opportunities.

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Setting clear goals, understanding exactly who your competition is,
speaking to your competitors’ customers are all strategies that will help
you stay ahead.

Be careful to not be a slave and becoming reactive to what your

competitors are doing.

Finding smart ways to add competitive analysis into your regular audience
and market research will save you time and unnecessary stress.

Here are some of the best ways to conduct thorough competitive analysis.

Always keep in mind that doing the research alone is not enough; it’s
about taking that data and putting it to work in your business

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#5 PRODUCT ANALYTICS
How to optimize your inventory / product
portfolio
Why is one product’s sales skyrocketing while the others have significantly
dropped?

Why is one product super popular this month vs last month?

Were sales fluctuations caused by AdWords campaigns?

Facebook Ads?

Web design?

These are all questions that product analytics can provide answers to.

Product analysis allows you to understand which products and product

lists are performing, why they’re performing or underperforming, as well
as what you can do to optimize sales.

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Before getting into the weeds of effective product analysis, let’s look at
key product metrics.

Top Product Metrics

Number of products

This metric refers to the total number of products in your inventory.

Number of active products

Number of active products is the total number of products currently

available in your inventory and to customers to purchase

Gross Margin

Gross margins is the difference between revenue and cost of goods,

divided by revenue. It’s the total percentage of sales revenue that the
company keeps after incurring costs.

Product conversion rate

To find out this percentage can be calculated by dividing the number of

purchased products by the quantity of product views.

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Product detail views

This figure represents how often a visitor clicked on a product detail page
or box.

Product add to carts

This measures when the product was placed in a visitor’s shopping cart.

Product removes from cart

When the product was removed from a visitor’s shopping cart

Number of Reviews

The number of reviews indicates the number of customers who have given
your store some sort of public feedback.

It doesn’t take into account customers who have purchased without

reviewing or customers who have given provate review not available to
the public.

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Merchandising Basics
When there’s a big holiday coming up, the staff at malls are often hard at
work organizing their inventory to guide the way customers shop.

This is merchandising 101; designing a physical or online store in a way

that makes it easy for the customer to buy.

If you’ve ever purchased something online and it was a smooth, quick

process, that was no accident.

That brand carefully engineered their ads, landing pages, email campaigns
and more to make it a no-brainer buying experience.

Now, think about the opposite.

If you were to try to buy something online and the site was clunky, took a
long time to load, or you couldn’t easily find the checkout button, would it
be the same, no-brainer sales experience?

You’d probably click off that website within moments.

As an e-commerce store owner, having a solid merchandising strategy

plays a major role in your short and long term success.

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How can product analysis help you boost
sales?
Here are 5 ways:

1. When you know what your hottest products are, you can
completely focus on products that have the highest potential for
sales growth. No more guessing, no more bombarding your visitors
and customers with products they don’t want.

Doesn’t that sounds amazing?

2. Product analysis can also help you with creating powerful,

actionable reports that can help you make smarter product, sales,
and marketing decisions.
3. In addition to powerful reports, product analysis can help you
create product segments like “Almost Out of Stock”, “Fastest
Selling”, “Most Refunded”, etc. As always, you can get always get
super granular with your segment and get even more clarity.

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 4. After you’ve identified top sellers in your inventory, you can easily
cross-sell products that are most bundled with your top sellers.
5. Lastly, product analysis makes product elimination easy. You can
spend your time building more of what your customers want
instead of focusing on underperforming products.

How to track profitability by product in

Google Analytics
Sales are good but profitability is even better.

Knowing how to maximize cash flow is key in growing your business and
staying profitable for years to come.

Source: Online Metrics

Use this detailed breakdown by the team at Practical E-Commerce to learn

how Google Analytics can help you track profitability.

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You’ll learn how to create helpful reports like “Gross Profit by Category”
and “Advertising Cost By Category”.

Which products should you feature?

By now, you already know that Google Analytics’ abilities knows virtually
no bounds. In addition to all of the actionable reports, it can generate for
you, you can also use it to easily identify your most popular products.

By doing this, you’ll be able to make decisions that will maximize your
sales and increase your revenue.

Get the step-by-step guide to finding your most popular e-commerce

products here.

To support the step-by-step Google Analytics guide, check out this

resource to see examples of what top brands like River Island and Rifle
Paper look for when choosing products to feature.

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How to get the most out of your hot
products?
Hot products can be defined as having one or a combination of
characteristics like Most Profitable, Highest Sales Margin, Top From Paid
Search or Best Bundles by revenue.

These products are your best advocates and one of the most powerful
brand evangelists.

With the right promotion strategies and the proper use of social proof
(customer reviews, case studies, etc), Hot Products not only help with the
sale of products but also boosts how your brand is seen!

Studies show that a whopping 54% of e-commerce shoppers read reviews

before making a purchase.

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How to unfreeze cold products?
Cold products are products that can be identified as Lowest Quantity Sold,
Lowest Gross Profit, Lowest Sales Margin, Most Refunded Products, and
Most Abandoned Products.

There are a number of reasons why a product would be classified as cold

including poor product placement, boring product description copy, low-
quality product image, lack of social proof, etc.

When you figure out what the issue is, you can then test to see if you can
turn cold products into hot ones.

Which products you should stop listing?

Goodbyes are difficult but sometimes, they’re necessary.

As an e-commerce owner, you’ve got to know when a product isn’t cutting

it and go back to the drawing board.

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Yes, even with customer persona, market analysis, product analysis,
sometimes, things could still fall flat of your expectations.

As mentioned in the paragraph above, it may not only be the product’s

fault.

It can be a combination of worse user experience on your website, bad

mobile responsiveness, or even inventory costs.

Before you jump the gun and just press DELETE, here’s a helpful guide on
the 6 steps you should take before removing a product.

Product Bundling
In layman’s terms, product bundling is strategically selling multiple
products together at a combined price.

This strategy holds benefits for both the e-commerce store owner and the
consumer.

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For the owner, bundling can increase efficiencies and reduce marketing
and distribution costs.

For the consumer, it gives them a single source (your store) as the solution
for multiple needs.

Behemoths of e-commerce, Amazon are experts at product bundling and

making you feel like you’re always getting a better deal if you buy two or
more products together.

Understanding activity around specific products in a bundle can be a little

tricky in Google Analytics but this guide shares how you can do it!

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How to know when to reorder?
You’ve probably noticed the use of the word inventory throughout this
chapter and that’s with good reason.

Inventory management is crucial to the success of your business because

it affects order fulfillment, customer satisfaction, and revenue.

It’s fair to say that poor inventory management = a dead or soon-to-be

dead business.

One of the critical aspects of inventory management is being proactive

and knowing when to re-up on orders to satisfy customer demand.

In a study conducted by UPS, 42% of shoppers abandon shopping carts

because the items are out of stock.

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That’s why real-time data on Quantity Sold, Quantity Left, Inventory
Velocity, and Depletion Days. For a fuller understanding of key product
analytics terms, head over here.

Structuring Your Site For Smooth User

Experience
Proper navigation design is indispensable in keeping visitors on your site
and buying from you.

The best information archictecture combines the users’ desires with the
business’ goals.

From the header to the product categories, your information structure

should make sense.

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Of course, I’m not saying to spend 30 hours mulling over how big your
search bar should be, but you should know how to categorize your
website’s pages and products so that it’s very easy for visitors to make a
purchase.

Successful brands like Best Buy and Amazon have a navigation structure
that houses “Parent Categories” and Subcategories” to make the shopping
experience easy.

You can read more about that here.

How To Create Discounts That Don’t Eat Into

Your Profits
While offering discounts is a great strategy to increase conversions and
revenue, offload excess inventory, and increase customer loyalty, they can
also eat into your profits.

So how can you create irresistible discounts without them taking a

massive toll on your pockets?

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Here are 5 ways:

1. Offer post-purchase discounts that offer the customer a discount on

their next purchase
2. Reward new customers by offering them a generous discount for
their first purchase. A discount on the first purchase can lead to
more sales down the road.
3. Analyze your customer behaviour to offer discounts to customers
who have a history of purchasing when there was a sale or special
offer
4. Remember those cold products? Offer special codes to your
customers to offload this otherwise costly inventory
5. Build your marketing strategy by offering generous discounts to in
exchange for your visitors’ email addresses.

You can track how well these discounts are doing using the Enhanced E-
Commerce reports in Google Analytics.

With this powerful data, you can see just how effective your discounts are
and adjust accordingly.

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#6 CONVERSION OPTIMIZATION
Where your store is leaking money
One way you can ensure that your business stays afloat and thrives is to
be aware of its shortcomings.

There will be flaws, there will be frustrations, and there will always be
opportunities to improve.

Having systems in place for goal setting, data collection, and competitive
analysis are all great but you also need a system where you can get
important feedback.

A feedback channel is one of the greatest areas of conversion optimization

because it allows you to take a walk in the customer’s shoes.

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Another big piece of conversion optimization is having systems in place to
test things like page load times, mobile responsiveness, and more.

We’ll take a look at great tools you can use a bit later in this chapter but
first, let’s look at some top conversion rate optimization metrics.

Top Conversion Optimization metrics

Conversion Rate
This KPI indicates the percentage of visitors that come to your site who
become actual customers.

In order to find your conversion rate, you need to take the total number of
sales divided by the total number of visits to your site.

Bounce Rate

Bounce Rate refers to the percentage of people who leave your site
immediately after arriving.

Source: Neil Patel

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This can happen if you’re not using the right keywords in your campaigns,
if your website is confusing or takes a long time to load, and if your site is
not mobile-responsive, amongst a host of other reasons.

To discover your bounce rate, divide the number of people who leave your
site by the total number of visitors.

Cart Abandonment Rate

Your cart abandonment rate is the percentage of users who’ve added

items to their cart but leave your site before completing the checkout.

To find out your cart abandonment rate, you need to take the number of
people who’ve abandoned the checkout process in your store and divide it
with the total number of people who’ve entered the checkout process
(including those who’ve completed purchases and those who haven’t).

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As of 2018, cart abandonment rates in e-commerce ranged from 50-80%.

That’s way too high.

That’s a lot of time and money down the drain.

Source: SafeCycle

Unfortunately, cart abandonment still remains a costly and frustrating

problem for many owners because the reasons behind cart abandonment
vary vastly (another reason why regular customer feedback, optimization,
and testing is crucial).

You can nail down on these reasons and cut down cart abandonment
rates by making use of the Conversions and Shopping Behaviour reports in
Google Analytics.

Product Page Conversion Rate

Product Rate Conversion is understanding how many visitors turn into

customers from your product page.

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In other words, it measures how effective the images, copy, and other
elements are on your product page(s).

Page Load Time

Page load time is the total amount of time it takes for content on a
particular URL to load.

A faster page load time is a sign of a business armed with the technical
infrastructure to handle things like traffic surges and numerous orders
placed at the same time.

Time Spent On Site

Time spent on site refers to the time (in seconds or minutes) visitors have
spent on your website on average.

It’s important to know that sometimes this figure can be misleading due to
visitors leaving your site in another tab while not actually on it or similar
cases.

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Understanding the e-commerce customer
journey
The modern customer wants as much personalization as possible. Gone
are the days of creating generic, one-size-fits-all messaging and sales
experiences.

Knowing what’s it like to be in your customer’s shoes gives you the

opportunity to create personalized messaging, experiences, and offers.

As we mentioned in the previous chapter, your data plays a huge part in

helping you understand your customer journey.

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Using this guide, you’ll learn the importance of customer touchpoints,
how to map your customer journey, and how to set tangible goals that will
improve your conversions.

Assisted conversion + Attribution models

Similar to multi-channel funnels (mentioned above in Chapter 5), assisted
conversions refer to the interactions a customer has with your website
leading up to that conversion, but not the final interaction.

Source: Analytics for Humans

Essentially, assisted conversions help to paint a bigger picture of every

step before your customer purchases.

Understanding how to minimize flaws in assisted conversion reports and

multi-channel funnels, check out this article.

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Top conversion optimization tools
Data is only as good as the tools used to collect it. Let’s take a look at
some of the best tools available for conversion optimization:

Onsite Retargeting: OptiMonk

Many businesses ruin their customer experience using intrusive pop-ups

and annoying messages. OptiMonk was built with the human-centric
approach to marketing and sales.

With a comprehensive toolkit of user-friendly messages, you’ll never have

to worry about annoying your users again.

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Heatmaps: Hotjar

As covered in Chapter #1, HotJar is one of the leaders in creating accurate,

detailed, and visual data for businesses looking to understand their
customer behaviour.

Through the use of their heatmaps, you’ll be able to see exactly where
your visitors are spending the most time on your site so that you can
improve their experience and convert them into customers.

A/B Testing: Google Optimize / Optimizely

Google Optimize is built on Google Analytics which means that you get to
use your existing GA data to quickly see what can be improved on.

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You can also benefit from an advanced statistical modelling tool as well as
a suite of sophisticated targeting tools.

Optimizely gives you access to a suite of A/B testing tools that allow you to
effectively target your messaging and launch more personalized
campaigns.

Conversion Analytics: Google Analytics + Conversific

As you know, Google Analytics is THE analytics tool to use.

With its massive reporting capabilities, customizability, and integrations

support, it’s a must use for businesses of all shapes and sizes.

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Conversific takes the incredible amounts of data from Google Analytics
and simplifies it so that business owners can focus on the metrics that
matter the most.

With aggregated data and actionable reports, you’ll know exactly what to
do next to take your biz to the next level.

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Measuring User Experience

User Experience or UX is all about the human experience on the website.

Everything from the aesthetics of your website to the checkout process

play a role in UX; but how do you actually measure this?

How can you quantify your customer’s emotions towards website?

This guide gives you numerous ways to measure UX including behaviour

analysis reports, forms, and testing page load speed.

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You can also measure your site’s UX by using The Standardised Universal
Percentile Rank Questionnaire or SUPR-Q.

This method is used to measure trust, loyalty, and appearance of your

website using 8 questions that participants answer with Strongly
Disagree–Strongly Agree on answers.

E-commerce Site Health

Bounce Rate Analysis

The general rule for bounce rates is to keep them as low as possible,
especially for paid traffic.

Bounce rates of over 30-50% usually mean lower conversion rates and is
an indicator that something in your marketing funnel and/or website
needs to change.

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Of course, there are exceptions to the rule but it’s important to keep an
eye on bounce rate trends in your Google “Acquisition” reports.

Landing Page Performance

Having high performing landing pages is crucial in improving conversion

rates in your business.

The role of a landing page is essentially threefold: 1) attract the right

audience 2) get that audience to engage 3) get them to take the necessary
action.

Source: Practical Ecommerce

Of course, this is easier said than done but it's not rocket science either.

Here’s your guide to creating and optimizing landing pages that get you
the reach, engagement, and conversions you want.

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Optimizing Your site With Technology and
Mobile reports
Tech reports in Google Analytics tell you how your visitors are viewing
your site.

More specifically, the reports tell you which browsers your visitors are
using.

Now, why is this important to know?

User experience differs greatly on browsers and you need to know how to
optimize your website for the browsers your visitors are using.

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We’re living in a mobile world so it’s imperative that your site is optimized
for mobile users

This means testing your site for mobile load speed, ensuring a clean and
smooth navigation experience, and making the buying process as
resistance-free as possible.

Here’s a more comprehensive list of actionable techniques for mobile

optimization.

Site Search
Another underused conversion optimization technique is setting up
internal site search reports.

What does this mean?

Well, it means having a better understanding of the keywords visitors are

using on your website.

A lot of people focus on keyword optimization for search engines but not
enough on internal site keyword optimization.

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Being able to track popular keyword search queries on your website gives
you room to optimize content, product search, and more!

Here are 5 Analytics reports you can set up for internal search.

Funnel Analysis & Checkout optimization

A funnel is a navigation path that you expect users to follow to achieve
pre-set website goals.

By setting up different types of funnels in Google Analytics, you can

clearly see where users enter and leave the sales process and thus have
plenty of actionable data to improve the sales process.

• How do you decide which funnel(s) are necessary for you?

• How can you set achievable funnel goals?
• How do you take all of this information to ensure a smoother
overall sales process?

Here’s a bookmark-worthy guide by the team at Optimize Smart to help

you out.

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Summary
In this guide, you’ve learned all about the sometimes-complicated-but
very necessary world of e-commerce analytics.

You’ve learned the importance of being data-driven and how the data you
collect can either make or break your business. You’ve uncovered the best
ways to set up accurate data collection using some of the best tools on the
planet (Like Google Analytics, HotJar, and Conversific).

You’ve discovered the innovative ways to nailing down your customers,

how to create products they’ll love, and how to keep them coming back
using the power of segmenting. You now know how to determine which
marketing channels are worth pursuing and how to measure their return
on investment.

Last but not least, you’ve learned how to ensure you’re always getting the
most from your store by optimizing page load times, mobile
responsiveness, and more.

You see, data is more than just percentages, graphs, and reports. Data
tells a story. It’s up to you to determine whether that story is a good one
or bad one.

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