E-commerce industry is a highly competitive space today. With Covid-19 keeping most of the people locked inside the houses, they need E-commerce and home delivery. Analytics is helping e-commerce platforms a lot by figuring out what customers are likely to buy. Also, data analytics solutions enables online stores to know what selling prices would yield maximum profits.
Analytics in E-commerce helps the online stores to discover problems even before the customers note them. It enables the E-commerce platforms to showcase the best products first, devise new marketing strategies and promotions. Analytics helps online business spot gaps and make data-based decisions. Here is an article on how analytics is influencing daily E-commerce activities.
1) Build a balanced supply chain in E-Commerce
Products advertised on the E-commerce platform should be available in adequate quantities. Otherwise, the customer satisfaction levels would drop, and the customer lifetime value would decrease. Conversely, stocking too many units would increase the operational costs. Therefore, maintaining a balance between demand and supply in important. For this reason, e-commerce analytics solutions help to build a balanced supply chain and forecast sales.
2) Detect fraudulent activities
E-commerce platforms use analytics to detect fraudulent activities. For example, the platform warns customers when an abnormal transaction is detection. The platform notifies the customer confirming on the authenticity before approving the transaction.
3) Predict future E-Commerce trends
Analytics helps ecommerce platforms determine future shopping trends based on factors such as season, product categories, size of transactions, and so on. Furthermore, it helps to estimate future sales trends and opens new business opportunities.
4) Personalize recommendations for customers
Selling to the same customer is much easier than acquiring a new one. Personalized recommendations help to give the best products to customers. Therefore, when selling to the same customer more than once, the seller is optimizing the customer value.
The platforms shows recommended products when the customers click on a specific. Consequently, there is a chance that the customers want to explore more and buy something more. Also, the customers see what is new on the homepage, which enhances the customer experience even more.
5) Forecast inventory requirements
Ecommerce platforms need to know whether having a specific product in their inventory is effective. Data analytics helps to determine the sales volume, sales predictions, and customer satisfaction rate. Besides, it determines which products needs restocking, and which might need to be reconsidered for sales.
6) Personalize the customer’s shopping experience
Different customers engage with an ecommerce website differently. Some love to constantly check out the “deal of the day” while others dive straight into specific products, ignoring the home page. When a customer visits an ecommerce website, what is the first thing to show him/her? The answer to this question determines the effectiveness and quality of the platform.
Ecommerce analytics helps retailers study the user behavior and determine how the site should be structured based on the customer preferences. Furthermore, it checks whether the product landing page is most likely to engage with the customers and convince them to make a purchase.
7) Understand customers better
Online retailers analyze their customers, their behaviors, their demographics, and the churn rates. It helps to devise the product strategies to meet business goals and revenue targets. Also, it enables the platforms to start new promotions and maximize the conversions of visitors.
8) Optimize pricing of E-Commerce products
In the ecommerce industry, the price of a product is determined based on the demand for a product, its availability in the market and how competitors are pricing the same product. Predictive analytics solutions help to examine pricing trends and determine the optimum price that maximizes profit.