Using Data & Analytics to Drive Online Decision-Making
Data can tell you what’s going on now in your business. But it can also inform you of upcoming trends so you can accurately predict what will happen to can plan for growth and changes.
But making sense of all the data your business generates can be challenging. To help, e-Comas’s in-house data expert and Senior eCommerce Consultant Claudiu Clement has created an original framework called Comainde, which makes up the essential elements of a data analytical initiative.
Read on to find out what data-driven decision-making is, why it’s essential, and how you can use the Comainde Framework to manage your data and drive eCommerce decision-making.
What is data-driven decision-making (and why is it important)?
Data-driven decision-making is all about strategic planning and eliminating guesswork in business by utilizing quantifiable metrics and data. Collecting data based on your key performance indicators (KPIs) and turning that data into actionable insights allows you to make more informed decisions across your business, including your marketing strategy.
There are tons of valuable data eCommerce brands generate, from customer interactions and feedback to product performance and conversion rates.
By collecting, processing and analyzing this data, brands can make smarter and faster business decisions based on facts and numbers. This means spending less time on things that don’t work and focusing more on what is proven to bring you growth.
Making decisions based on data analytics also allows you to:
- Better target customers and markets
- Offer tailored shopping experiences
- Predict future demand for your products
- Adapt to trends and customer expectations
- Enhance sales and marketing performance
- Stay competitive in the eCommerce world.
Adopting a data-driven strategy gives you a better understanding of your customers and prospects. So you can deliver more targeted, individual and relevant campaigns, thus setting you apart as a market leader.
What is the Comainde Framework?
The Comainde (Collection, Management, Insights, and Decision Making) Framework is a new concept championed by e-Comas’s Senior eCommerce Consultant Claudiu Clement.
“Comainde integrates all four essential elements of a data analytical initiative,” he explains.
“It recognizes that a successful data-driven project requires more than just collecting data. It requires effective management of that data, using insights to inform decisions and making sure those decisions are data-driven.”
Comainde takes a holistic approach to data analytics, considering the entire process – from data collection to decision-making – as a single integrated effort. Doing so helps organizations ensure their data analytical initiatives are aligned with their goals, are efficient and effective, and produce meaningful insights that drive better decision-making.
4 essential elements for making data-driven decisions
Now we’ve outlined what data-driven decision-making is and its importance, here are the four essential elements that make up the Comainde Framework. Claudiu recommends using this approach in eCommerce data management, especially for companies that are willing to improve their teams’ Data Literacy:
First, it’s crucial to decide what data to collect. Thankfully, there’s a lot of data out there, but the challenge is determining which data sets are relevant to your business.
The key is to consolidate all your data to organize it effectively. This can feel overwhelming, so a good starting place is to list all your potential data sources.
There are many different channels to find relevant data, including:
- Social media and website analytics
- Search engine data (e.g. Google Analytics)
- Customer feedback
- Email marketing and automation
- eCommerce platforms
- And many more.
It’s also important to remember that there are different types of data, such as first-party data you collect directly from your audience and third-party data like cookies, which are being phased out.
You can collect data by going into each platform mentioned above. For example, if you’re enrolled on the Amazon Brand Registry program, you’ll have access to Amazon Brand Analytics. This great tool gives you a clearer idea about who your customers are and what they’re searching for, so you have a greater insight into where you should be focusing your marketing efforts.
However, investing in a dedicated analytics platform makes it much easier to gather and analyze all your multiple data sources in one place.
Once you’ve decided how and what data your business wants to collect, it’s time to think about how you will manage it effectively.
A crucial part of data management is organising and storing your data. Businesses should take a good amount of time to clean and organize their data since accuracy is the cornerstone of a successful data-driven strategy. After all, insights and analysis are only as good as the data you’re using.
eCommerce businesses generate vast amounts of data. So, honing into the most relevant insights is the only way to gain clarity and make better data-driven decisions.
Here are some pointers to help you organize your data better:
- Remove outdated, duplicate or irrelevant observations
- Resolve any structural errors
- Fix numbers, dates and times
- Standardize data entry.
eCommerce data management can be complex. So, forming a team of data management experts and choosing the right technology is also vital to managing your data properly.
Having dedicated consultants (either outsourced or in-house) overseeing your data and linking it to wider business operations is your best chance of long-term data-driven success.
The right tech shouldn’t be underestimated, either. Manual data management will only get your business so far. Therefore, finding the best data management platform for your business needs and goals should also be a priority.
Investing in the staff and resources needed to keep your data organized and managed might sound costly. But the value in using data to grow your eCommerce business is immeasurable.
Once managed efficiently, you can move on to the fun part – analyzing your data to draw conclusions about what to adapt within your eCommerce business.
You’ve collected all this data and have the systems to manage it effectively. Now it’s time to bring your data to life and measure your metrics to drive business insights.
While you might not be able to control your data, you can control what you care about. But deciding what data matters can often be the hardest part, especially since eCommerce analytics cover various metrics.
Therefore, understanding the metrics used in analytics tools is crucial, so you know how to read them properly and make good decisions based on them. Here are some of the metrics we recommend you look at to get started:
Conversion rate: the number of people who make a purchase after visiting a web page, such as an Amazon product detail page.
Average order value: the average value of each purchase made in your store, which tells you how much a customer typically spends on a single order.
Customer lifetime value: the total revenue you could expect from a single customer over their lifetime.
Repeat purchase rate: the number of customers who make more than one purchase from your shop and continue to buy from you after a given period.
Now, let’s look at the types of decisions you can make from your data, using the above metrics as examples:
You’re getting traffic to your website or product listings, but how many users are converting and making purchases? Knowing your conversion rate will give you an idea of how well your marketing is really doing. There are many ways to optimize your listings and improve your conversion rate, including using high-quality images, relevant keywords throughout your content, and informative product descriptions.
Average order value
Having a clearer idea of how much customers spend on each order allows you to gauge revenue and tailor your pricing and marketing strategies. Increase your AOV, and your revenue growth should also grow accordingly. A few ways to drive this metric up include free shipping, cross-selling, and offering product bundles.
Customer lifetime value
By understanding how much profit you’re making from each customer, you can determine their financial value and the lengths you should go to keep them. You can also use CLV to measure the effectiveness of your marketing campaigns and understand the key drivers that keep your customers coming back for more. Use these insights to build your retention strategies and how you can serve your customers better.
Repeat purchase rate
This is another metric that can help you with your customer retention strategy. Repeat customers are cheaper to acquire than new ones, and research shows that returning customers spend more money. By quantifying how loyal your customer base is, you can get a deeper insight into what keeps customers returning to your brand. So, you can decide what to focus more money and effort on to turn more customers into brand advocates.
Start making data-driven decisions today
Data has become an essential resource for any eCommerce business, but it’s about more than just gathering as much as you can. It’s about getting the right data and using it to inform better decision-making.
To make effective data-driven decisions, you must gather, store, and manage your data correctly and securely. This can be a daunting prospect. But with the right tools and dedicated team by your side, eCommerce businesses can turn their data goldmines into actionable insights.
e-Comas helps brands grow faster on eCommerce – globally, quickly, across multiple online channels. Our experts coach brands and handle their Amazon accounts to sustainably grow their business and improve their agility in tackling everyday challenges with online retail.
Working across Amazon, Shopify, CDiscount, Veepee, Bol, Walmart and more, they get you set up to scale your business and make it profitable by handling your account, content and advertising.