eCommerce Data Analytics 101: How Data Can Drive Sales

eCommerce Data Analytics Performance Viewing in a Laptop | Data Noodle

Have you ever wondered how you can stay ahead of the cutthroat competition in the online world? With the meteoric rise of eCommerce and digital trends, more businesses are bringing their brands into the virtual scene, making it harder to find opportunities for growth. 

And in this game, your customers have the upper hand. They can easily compare prices, read product reviews, and switch from one brand to another in just a few clicks. Consumer expectations are at an all-time high—how do you exactly keep up?

It all boils down to one thing: data. Out of all the strategies for growing a business, eCommerce data analytics takes the lead. With this approach, you get access to historical business data, facts, numbers, and future forecasts that can boost your revenue and change marketing strategies for the better.

But we understand how numbers can intimidate businesses from taking this route. The language of analytics may not feel welcoming to everyone, but it’s not impossible to learn its ins and outs.

Don’t fret! We’re here to guide you every step of the way. Let’s discuss its definitions, benefits, best practices, and many more in this article!

The Basics: Defining eCommerce Analytics

eCommerce analytics refers to collecting and interpreting data from every area of your business that affects sales and performance. 

Using a large amount of data, you study the return on investment (ROI), keep track of trends, measure consumer behaviour, and make business decisions. This process also includes metrics related to the customer journey like discovery, acquisition, conversion, and retention. 

Analytics aren’t just about numbers—it’s a story. For example, you noticed that only half of your visitors actually make a purchase, while the other half left their shopping cart for good for some reason. 

This story can open up new opportunities and questions that help you understand your customers better. What keeps them from clicking the checkout button? How can you convince them that every cent they spend on your products is worth it?

Think of data analytics as your car’s dashboard. When you’re behind the wheel, each symbol indicates something. The check engine could mean there’s a loose wire. The coolant temperature means the car is running way too hot. The door-open icon indicates that a door is not properly shut or the door switch is faulty. 

In a nutshell, eCommerce data analytics lets you know what needs to be fixed, where you’re heading, and how you can move forward. Do you keep driving, or do you pull up on the roadside and get to work?

Why eCommerce Data Analytics Is Important For Businesses

According to Statista, Singapore’s eCommerce market is expected to garner a whopping 4,330,000 users by 2027. And by the end of 2023, the market’s revenue will approximately hit S$8,230,000,000.

The staggering trajectory proves that the ecommerce industry is flourishing. This is why it’s important for businesses to rely on eCommerce data analytics in making informed decisions and exceeding consumer expectations.

What else can this strategy do for your business in this ever-growing landscape? Let’s take a closer look at the benefits of eCommerce analytics:

Personalise The Shopping Experience

Your customers likely have different ways of interacting with your eCommerce platform. Half of them may instantly check out special offers and discounts, while the other half is looking for specific products—skipping even the home page. 

Every consumer takes certain actions. eCommerce analytics pick them up, helping you determine how your website should be structured based on a customer’s preferences.

In the process, you personalise the shopping experience that potentially increases engagement. You now have the chance to tweak your landing page, product categories, and deals to convert users into buying customers.

Other personalised shopping experience strategies also include:

  • Showing targeted ads depending on the audience
  • Sending customised emails
  • Offering recommendations to narrow down options.

Measure The Effectiveness Of Marketing Campaigns

It’s easy to invest your hard-earned money towards online marketing campaigns. You can spend hundreds and thousands of dollars on SEO, SEM, or email marketing to boost your online presence and conversions.

The catch is, if you don’t study your campaign’s effectiveness, you won’t figure out if it’s working or not. You’ll be swimming in murky waters.

Thanks to data analytics, you can keep tabs on real-time stats like user engagement time, ad clicks, promotion effectiveness, and channel data. These metrics will help keep you in the loop regarding your ROI and how profitable your marketing strategy is, to name a few. 

Optimise Product Pricing

Product pricing is typically established based on a certain product’s demand, competitor pricing through ecosystems, and how accessible it is in the marketplace. In the past, business owners followed traditional pricing methods like cost-plus markup and the rule of thumb—but times are changing.

Gone are the days when these pricing strategies would work, given that the online world now contains millions of products from different sellers.

This is where eCommerce analytics come into play. Using analytics tools, you can look at the bigger picture of the factors influencing consumer segments. This can help you maximize your revenue since it identifies the most efficient price point at the product level. 

Improved Customer Service

There are times when you don’t want to buy a product right away, especially if it’s pricey. You make sure that it fits your preferences, can last for many years, and make your life just a bit easier. You decide to reach out to customer support and ask questions not stated in the product description.

Within seconds, you already have your answer. And when your purchase arrived at your doorstep, everything exceeded your expectations. You share this great experience on review websites and social media platforms to vouch for a business’s services.

This positive situation presents a huge opportunity for commercial growth. Through data analytics, you can further improve customer service by sending out surveys to gather customer feedback. 

It allows you to keep track of the average response speed, helping you improve overall response timeliness. You also get to monitor other factors such as the delivery time of your products so you avoid delivery issues in the future.

Demand Forecasting

Keep in mind that the success of eCommerce businesses heavily depends on inventory management. While excessive stocking can lead to higher costs, insufficient stocking causes shortages and consumer satisfaction. 

This gets even more harmful if you sell products with a short shelf life since the incurred costs would be irreversible.

Thanks to eCommerce analytics, you can effectively forecast inventory for the next season. It’s ultimately helpful in deciding which products to keep in stock and which ones should be reevaluated for sale in the upcoming months. 

Key Areas of eCommerce Metrics You Should Know

Just the thought of gathering so much information can already feel overwhelming. With lots of metrics and factors to consider, where do you begin? How can you make data-driven decisions when you don’t know the key areas of eCommerce metrics that produce real insights?

To be honest with you, there are actually a lot of metrics out there. But the good news is, you only need to start with the most essential ones to look at the bigger picture and stay ahead of the game. 

Take a closer look at them below:


Let’s start with the basics first. The buyer journey will always start with awareness, which happens when potential customers learn about your brand for the first time.  

And to decide which channels are worth investing in, you should understand how your customers become aware of your brand.

For instance, if your customers discover your brand because of social media ads, paid ads or influencer marketing is your ideal channel. A referral program, on the other hand, is more effective if a huge chunk of your customers subscribes to your mailing list because of recommendations. 

Here are some of the awareness metrics you should keep track of:

  • Reach per channel is the number of users who see your content on social media or email campaigns. This includes your social media followers and subscribers, among others.
  • Impressions per channel refer to the total number of times your post or content has been viewed. Impressions can be higher than reach since a user may interact with a post more than once.
  • Engagement per channel is the number of subscribers and followers that engage with your content. This is often measured by likes, shares, comments, and other types of active interaction.


Another eCommerce metric that can drive your business to new heights is the behaviour of customers. This can be observed when customers actually visit your online store and browse your product catalogue. 

They haven’t purchased anything at this point, but they’re starting to consider buying what you offer.

Behaviour metrics are important because it tells you how near your website brings visitors in making a purchase. Or if the opposite is true and your potential buyers leave your product page as soon as they view it.

Check out some of the behaviour metrics to look out for:

  • Traffic source reveals where the majority of your visitors come from. It’s either social media platforms, email, blog posts, or another channel.
  • Bounce rate is the percentage of users who exit your page after viewing only one page. 
  • The number of cart additions tells you how many times your visitors add products to their shopping carts—whether they check out or not.
  • The time spent on product pages is the average time a customer spends scrolling through your page. Do they take the time to read the product descriptions?

By looking at behaviour analytics, you discover parts of your eCommerce store that need improvement. This, in turn, can increase conversion and engagement rates in the long run.


When it comes to conversion analytics, there are two questions you should ask yourself:

  • What drives website visitors to become paying customers?
  • When do users convert into actual customers?

Because as much as you want to believe that all users who visit your website buy something, not everyone bothers to fill their shopping carts. And even if they do, users can change their minds, leave the products and buy from your competitor instead.

Luckily, conversion metrics will help you optimize the online shopping experience and boost conversion rates. It can also assist you in analyzing your budget and determining the investments that gave you the best returns.

Here are the conversion metrics you need to include in your eCommerce analytics dashboard:

  • Customer Acquisition Cost (CAC) tells you the total amount of money you’ve spent to get your customers over a certain period of time. For example, if you acquire customers through organic search, your CAC is $0.
  • Return on ad spend indicates the most profitable campaigns and the ones that need changes.
  • Average order value (AOV) is the average amount of money a customer spends when placing an order.
  • Cart abandonment rate refers to the percentage of users who add products to their carts without completing the purchase.
  • Total advertising cost of sale (TACOS) tells you the generated revenue you made from ads.

Looking into conversion metrics isn’t only limited to the total sales you’ve earned. They should also tell you which conversion campaigns need tweaking and how much money you’ve spent in generating your sales.


Just because a customer has finally bought your product doesn’t mean the buyer journey has ended. You should be able to retain them, buy from you repeatedly, and nurture their loyalty through promotions and deals.

In fact, a study conducted by Frederick Reichheld of Bain & Company shows that increasing retention rates by 5% boosts profits by up to 95%

You can tell which of your customers choose to stay with you and why by tracking retention analytics. They are crucial because they may help you identify which channels lead to primarily one-time transactions vs those that promote client loyalty and brand familiarity.

To get started, here are the top retention rates you should pay attention to:

  • Average time between purchases reveals how frequently you receive purchases from repeat customers.
  • Customer retention rate tells you how many customers you’ve gotten, lost, and retained over a period of time.
  • Repeat purchase rate determines which of your products are bought repeatedly.
  • Customer lifetime value (CLV) is the number of times the average customer makes purchases from your business in the span of your relationship.


When online shoppers have reached this stage, they aren’t just your customers anymore—they are now your brand ambassadors. 

Your products have created a huge impact on their lives that they promote the brand to their family, friends, and wider communities. However, this metric is often ignored and taken for granted, which is a huge mistake. 

If you keep track of your advocacy metrics, then you know if you’re truly meeting the success you’ve always wanted to achieve.

But unlike the previous metrics discussed, advocacy metrics might be a little harder to track. You can use these specific metrics to help you get started:

  • Referral program members tell you the number of customers willing to participate in your loyalty program to advocate for your business.
  • NPS score is a tool that measures how inclined your customers are in recommending your products to others. They are categorized into three groups: 
  1. Promoters – They are your most loyal customers.
  2. Passives – They feel satisfied and happy with your product but don’t feel the need to be your brand ambassador.
  3. Detractors – These customers are unhappy with your product. They won’t ever buy from you again and leave a negative review to discourage other people from buying from you as well.
  • Customer referrals indicate how many customers find your brand through recommendations.

eCommerce Analytics Best Practices To Consider

eCommerce data analytics doesn’t just revolve around one metric. You can never determine your success and overall growth by solely looking at your engagement, conversion rates, and the number of members in your loyalty program. 

That’s why following best practices in data analytics can make a huge difference. When you know what to prioritize, you can step in the right direction and make the most of your data.

To help you better understand, here are the best practices in eCommerce data analytics you should consider:

Gather Marketing Data Scattered Across Different Channels

It’s incredibly hard to make sense of your data if they’re scattered across various platforms and channels. For example, your paid ad data is across Google Ads, Twitter ads, and Outbrain, while your sales data is in Wix, Shopify, or OpenCart. 

You also have to keep track of your email providers, Google Analytics eCommerce data, and customer relationship management platforms. If you manually copy and paste all of them, it will take you a long time before you can start doing what needs to be done.

Ecommerce data analytics consolidate your data without having to manually shuffle between reports. By using a pre-built data connector, you can pull data from every platform and channel you use into Excel or Google Sheets. 

Be Mindful Of Data Ethics

When collecting customer data, make sure that you don’t ignore data privacy and data ethics. Use the data you store ethically and don’t cross any lines that can breach the trust of your customers.

Understand What The Numbers Truly Mean

There seems to be a misconception that gathering data alone makes up a big part of eCommerce analytics. However, this is not entirely true. You should have a purpose in mind. Looking at random numbers in your sheet can’t get the work done if you can’t connect these figures to consumer behaviour

Marketing tools may give you a big amount of information, but they aren’t created for cross-channel reporting. 

This is why it’s important to keep your data in one place! You’d find it easier to understand your consumers and find areas for improvement using the numbers and figures you collect. 

Automate Ecommerce Dashboards

Once you’ve gathered all your data in one place, the next step is to automate your eCommerce dashboard. Make sure you set your reports for automatic updates instead of manually pulling reports.

In this way, you can fully focus on data analysis, improving customer service, and enhancing the online shopping journey. 

Aside from saving lots of time and energy, automation minimizes room for errors that can have irreparable consequences. In the long run, it will establish a data-driven culture where gathering insights and analyzing data become the priority. 

Make The Most Of Your Data

When you start doing your own eCommerce data analytics, it’s important to optimally make use of your data. Use it to establish new marketing strategies, find areas for improvement, verify assumptions, and many more. 

Besides, this will help you set clear and specific objectives that relate to your business goals. Based on the data analytics you gather and assess, you already know where you can start. Do you focus on reducing abandoned carts? Or should you increase customer loyalty by offering top-notch customer support services?

Final Thoughts

You might be wondering if it’s possible to drive your eCommerce business to success without data analytics. Can you still meet your short-term and long-term goals even if you choose not to collect data and analyze them? 

Yes, you might. But taking this approach is almost the same as driving around in a new city without navigation. You’re moving forward, sure, but you don’t know if you’re getting to your destination or losing your way. 

On the other hand, when you invest your time and resources into eCommerce analytics, you can set the right strategies and make informed decisions. You’ll determine what areas of your store are performing well, and what areas need more attention. 

On a road full of intersections and potholes, you’ll know where to go. You’ll know what to avoid.

Don’t just sit back and relax when running your eCommerce business. Take full control of what you can do by tracking the right metrics and investing in the right eCommerce analytics platform like DataNoodle.

Contact us today—we’re here to help. 


What are the key areas of eCommerce metrics should I keep track of?

The main areas of eCommerce metrics you should focus on are the following:

  1. Awareness
  2. Behaviour
  3. Conversion
  4. Retention
  5. Advocacy

What are the benefits of data analysis for eCommerce ?

Data analysis for eCommerce helps businesses measure the effectiveness of marketing campaigns, enhance customer service, manage inventory for the next season and optimise product pricing, among others.

What are the best practices should I follow in eCommerce analytics?

To get started, here are the best practices you may consider when doing eCommerce analytics:

  1. Gather marketing data scattered across channels and platforms.
  2. Use data ethically.
  3. Connect the numbers and figures you collect to consumer behaviour.
  4. Automate your eCommerce dashboards.
  5. Make the most of your data.