This post is a collection of pain points we’ve come across when working with ecommerce businesses to support them on their data analytics journey. Most, at some point, have touched on all of these depending on where they are on their journey.
So let’s get into it and find out what’s keeping ecommerce business owners and internal department heads awake at night.
- Ecommerce Data Silos: Ecommerce businesses often grapple with data silos, where different systems or departments within the organization accumulate separate sets of data. This fragmentation hinders a holistic view of business performance and can obscure valuable insights from ecommerce data analytics. We wrote about this earlier where we acknowledge that most platforms you are using (E.g. Shopify) already have some level of built in reporting but it’s only data about that platform and there’s no way to link across platforms.
- Accuracy of Ecommerce Data: The quality and accuracy of data are critical for effective ecommerce analytics. Any errors in data can lead to misguided analysis, impacting strategic business decisions and potentially causing substantial harm to the business. A lot of ecommerce companies have scattered reporting that’s been pieced together over the years and if it’s not managed correctly the accuracy of this data can be way off and it’s going unchecked. If people are asking decisions based on this data then there is a high likelihood they are making the wrong decisions.
- Ecommerce Data Integration: With multiple disparate systems (ecommerce platform, CRM, ERP, marketing automation tools, digital advertising, social media, etc.) all generating a wealth of data, ecommerce businesses face the complex challenge of integrating this data for a unified, comprehensive view. This is often one of the biggest challenges. There are a growing number of tools and platforms that are making great strides in closing the gap but not all are created equal. That’s why it’s important to do thorough research or work with specialists that know what works and where for your data analytics needs.
- Ecommerce Data Analytics Skills Gap: The specialized skills required for data analytics—statistical analysis, data integration, data visualization and predictive analytics—are often lacking in ecommerce businesses. This skills gap can impede their ability to fully exploit the potential of ecommerce analytics. Often when starting out ecommerce companies will get some basic dashboards built either in-house or using freelancer services but often they lack depth, automation and the overall vision and holistic approach needed to set the company up for long term data analytics success.
- Translating Ecommerce Data into Actionable Insights: Ecommerce companies often struggle to translate raw data into actionable insights that can be leveraged for strategic decision-making. This step is crucial to realize the full potential of ecommerce data analytics. Doing analytics for the sake of analytics is not the right approach. You need clear goals and KPIs to make sure you’re working towards outcomes that will increase revenue, increase profits, optimize spend and lower their operating costs. If your ecommerce data analytics is not providing at least one of these business outcomes then you should rethink why it is your putting in the time and effort.
- Data Security and Compliance in Ecommerce: The advent of GDPR, CCPA, and other data privacy regulations has added an extra layer of complexity to ecommerce data analytics. Ensuring compliance while conducting analytics can become a major concern. This not only refers to opt ins and the data you collect. You also need to manage it effectively and have systems in place that ensure the right people have access to the right data and it’s stored and processed inline with the regulators guidelines.
- High Volume of Ecommerce Data: The enormous volume of data generated by ecommerce platforms can be overwhelming. Managing, processing, and analyzing this data effectively is a significant challenge faced by ecommerce businesses. Data integration, pipelines, data warehouses and the like are used to harness all of this data and ‘normalize’ it for downstream use such as reporting, dashboards, machine learning etc.
- Real-Time Ecommerce Analytics: Ecommerce businesses need real-time insights to respond rapidly to changing customer behavior or market trends. However, establishing systems for real-time ecommerce data analytics can be technically challenging and resource-intensive. There are some metrics and KPIs you should review daily, others weekly, quarterly and so on but in some cases access to real time analytics is key to making quick, well informed decisions that can have a big impact.
- Cost of Ecommerce Data Analytics Tools and Infrastructure: The expense associated with data analytics tools, infrastructure, and professionals can be prohibitive, especially for small and medium-sized ecommerce businesses, limiting their ability to fully leverage ecommerce data analytics. The good news is there has never been a better time to take advantage of the tools, platforms, freelancers that are available. The competition in the space on all fronts can be intense and this only brings the cost and barrier to entry down for ecommerce businesses. Nearly all aspects of the people, processes and technology required to build end to end ecommerce data analytics solutions can be run ‘as a Service’. Meaning you only pay for what you need that suits your business size but allows scaling up in future as you grow.
- Cultivating a Data-Driven Culture in Ecommerce: For ecommerce data analytics to truly make an impact, a data-driven culture must be fostered within the organization. This means making decisions based on data, not just gut feelings or experience. Building this kind of culture can be a considerable challenge for ecommerce businesses. As ecommerce is essentially a digital first business with regards to transactions with customers most are comfortable with some level of data-driven decision already. But making big shifts with teams that have been performing their tasks in certain ways for a long time can be a challenge. If planned correctly and with the right tools, the benefits can be massive and that’s a win for everyone.
If you’re experiencing any of these and want to talk to one of our ecommerce data analytics experts about how we could help, register for a no obligation, free consultation and we’ll see how we could support you on your journey.