For anyone selling a service or product online, ecommerce tracking is an essential tool in your analytics box. More than any other measurement, it allows you to track real ROI and make key decisions as a marketer. It allows any savvy user to see the big picture from acquisition to transaction. If your website is either of the aforementioned types, you should be using it… yesterday.
During my research I found a fantastic graph provided by analytics expert, Justin Cutron, which encompasses the four types of ecommerce data. The following are his descriptions of each piece.
* Acquisition Data: Information associated with getting traffic.
* Engagement Data: Info about how people interact with the website.
* Conversion Data: Info about business success (revenue, revenue, revenue…..)!
Instead of using his examples for each type of data I would like to draw from my own experience as an analytics guru at my company, to better paint the picture of how vital I feel this information is to any online business.
The Acquisition data is probably the most important for marketers. For this example, I will compare two websites we have used in the past. I can’t name them, but both are ski travel oriented websites. While measuring traffic from each site, before we implemented ecommerce tracking, one seemed to be a much stronger performer than the other. We were excited to have the traffic from both and were assuming that the traffic led to conversions. Once we implemented ecommerce tracking we found out two key points of information. One was that the site we thought was underperforming, because it was sending less traffic, had a much higher conversion rate! Secondly, and more importantly, we found that we were not getting an excellent ROI on either referral. Armed with this new information we were able to negotiate new plans that used a cost-per-click model that was much more economical.
Engagement is a little trickier; it’s really any way that the customer interacts with your site in between arrival and purchase. Cutron uses segmented bounce rates as one of his key examples. Truth is there are hundreds of things that can be measured so this is a great place to identify what your KPI’s are outside of transactions. Brian Clifton who wrote, Advanced Web Metrics, recommends that you gather up a team of your best and brightest at the firm and brainstorm as to what matters most to your company outside of transactions. Perhaps registering for a newsletter is very valuable, or how many people look up store locations. Whatever your KPI’s are, ecommerce tracking will assist you in knowing who your purchasers are and how they react, vs. someone who does not.
The best part of ecommerce tracking are the conversion metrics. This is where you can really measure and get in to ROI. Ecommerce tracking will tally all transactions by source, so all it takes is a little calculation, and you will know exactly what kind of return you are getting from each referral partner. You can also look at average order value, which will help you make decisions on what you should be advertising or what type of customers view your partner’s sites. These reports are so powerful; you shouldn’t have an ecommerce site without them. Period.
Please read Justin Cutron’s blog for more information concerning the topic, he has a lot of great insights and other articles that can help you launch your ecommerce tracking.
Clifton, B. (2010). Advanced Web Metrics. Indianapolis: Sybex.
Cutron, J. (2012, February 9). Creating an Ecommerce Tracking Plan for Google Analytics. Retrieved January 16, 2013, from www.cutoni.com: http://cutroni.com/blog/2012/02/09/pimping-out-google-analytics-for-ecommerce-websites/