Businesses that use advanced analytics and big data have profitability and productivity rates 5% to 6% higher than their peers.
Unfortunately, as many companies have discovered, it’s not as simple as merely collecting data and waiting for profits to roll in. You have to get the right kind of information, know how to analyze it, and be willing to transform your organization based on what you learn.
What does that mean for retailers? Here are some of the most effective ways you can put analytics to work for you.
1. A/B test
Create two different pages to sell a product. The key is to test just a single variable at a time (e.g., the headline, the image, the CTA, the button color), so it’s clear what made the difference.
Then randomly direct potential buyers to one or the other. Then use analytics to determine which one performs better. From there, you can keep the top-performing page, and then run another A/B test to further refine your sales pitch.
2. Decrease or stop spending on low-performing products
Don’t allow yourself to get into a position where you’re spending more promoting a product than you are earning from its sales. Your regular analytics reports should include cost reporting, allowing you to determine your exact ROI for each item. Then you can take action based on what you learn.
Even better, you can set this process on auto-pilot. GoDataFeed allows you to automatically suppress products that meet criteria you set up in advance. That means, the moment you start losing money or profit margins become too narrow, you can stop the bleeding.
3. Increase spending on high-margin or top-performing products
It’s equally important to identify your “winners.” Analytics from cost reporting can also tell you which products are selling the most and where you’re making the most profit. It can help you keep track of particular offerings that are in high demand. You can then invest more where you’ll get the biggest return.
4. Invest more in your best shopping channels
Your products will perform differently on different marketplaces and shopping engines. Your customers may be more likely to search for your product type on New Egg than Amazon, for example. Or they may be more willing to spend higher amounts on eBay than Pricegrabber.
Compare analytics of similar campaigns across all channels to see where your products are converting. It’s valuable to understand where your particular customers are going so you can spend more time, effort, and marketing dollars on earning their business there.
5. Uncover and fix problem areas
Did you know that, on average, almost 70% of shopping carts are abandoned? You can use analytics to segment users and pinpoint where in the process they click away.
Armed with this data, you can better determine why they are leaving your website without making a purchase and correct the issue. Then you can revisit your analytics to find out if you truly corrected the issue – or if you still have more work to do.
6. Pinpoint anomalies and correct errors
Did a top-performing product suddenly stop selling? Or maybe a particular product has a high return rate? Use your analytics to find anomalies in your data.
By investigating further, you may uncover an error, such as an incorrectly listed price, a misleading or incomplete description, or a miscategorized item. GoDataFeed has many tools available to help prevent these issues from occurring in the first place, including supplementing product data from external sources, automating the creation of product names to include details such as brand name, and filtering out products that don’t meet the channel’s requirements. These issues may seem small, but they can add up to large losses if they go uncorrected.
Stop simply collecting data, and start putting it to use. More sales and greater profitability await.