Analytics technology is taking the ecommerce industry by storm. Ecommerce companies are expected to spend over $24 billion on analytics in 2025.
While there is no debating the huge benefits that analytics technology brings to the ecommerce sector, many experts are pondering what those actual benefits are. New ecommerce startups are discovering interesting ways to utilize analytics. Those that have a solid strategy predicated on it will have a higher ROI.
How Can Your New Ecommerce Startup Take Advantage of Analytics Technology?
You will have a huge competitive edge in the ecommerce market if you leverage analytics to your fullest potential.
But how do you go about dong this? You can figure out how to take the online market for your goods and services by storm by following our guide to creating an e-commerce store! As shoppers continue to buy more of the things they need on the internet, tens of millions of merchants have migrated online to meet demand. Companies that know how to leverage analytics will have the following advantages:
- They will be able to use predictive analytics tools to anticipate future demand of products and services.
- They can use data on online user engagement to optimize their business models.
- They are able to utilize Hadoop-based data mining tools to improve their market research capabilities and develop better products.
Companies that use big data analytics can increase their profitability by 8% on average. However, ecommerce companies can benefit even more, because they have access to more data that they can leverage.
Keep reading to discover how you can build the next big online retailing company with our step-by-step guide to building a successful analytics-driven e-commerce shop.
Step #1 — Use Analytics to Select the Right Name
Decide on a company name in the early stages of your business process so you can use it on applications and other forms. As you think of new names, check their availability on web hosting sites.
Analytics technology can help you find the right name for your business. There are detailed databases of business names that you can use for inspiration and avoid trademark issues. The USPTO trademark database search is a good start, but you can also search domain registration records.
Some of the most popular web hosting sites with databases on registered domain names include:
- Google Domains
In addition to having databases of existing domains, they use machine learning to suggest new names for your business. These algorithms are getting better all the time.
If you discover that someone has already claimed your preferred domain name, consider altering it or choosing a different company name altogether. You can always change your company name later; however, it will require significant time and money to rebrand. The company name that you finally settle on should be:
Step #2 — Develop an Analytics-Based Financial Management Strategy
Analytics is also incredibly important for managing your company’s finances. You can use data analytics for everything from finding the right bank account to lowering your expenses and ensuring you don’t miss any deductions around tax time.
Many people don’t know the difference in banking services offered by different types of banks. It can be confusing to know which bank offers what you need. The business bank category has its own set of characteristics that separate it from traditional banks. For example, checking or savings accounts are often limited in number and charge more when they are frequently accessed. A business bank may offer more lending options to potential customers, making them a popular choice for entrepreneurs looking for funding for their startup company.
Choosing the right bank for your business is an important decision that will affect your company’s bottom line. The best way to do this is to evaluate what features are most important to you and then pinpoint where they overlap. Cashback, for example, might be an attractive offer if you’re open to changing accounts, especially if you put a lot of business expenses on your debit card. What you need is a bank that offers both cashback and the other services that are the most valuable to your business. You can consider options such as Nearside which make it easy to sign up online, offer cashback and doesn’t cost anything to sign up for.
You want to make sure that you can easily integrate financial analytics tools with your bank account. This is going to make it a lot easier to optimize your finances, such as identifying unnecessary recurring expenses and taking advantage of all possible deductions when you file taxes.
Step #3 — Select an E-commerce Platform with a Great Analytics Dashboard
Choose an e-commerce platform to build your company website around. You want to make sure that it has a great analytics dashboard, which is going to make it easier to optimize your business. Ideally, you will also be able to integrate tools like Google Analytics to make more nuanced insights. Smart owners will select their e-commerce platforms first to ensure optimal capability for their company websites.
Some of the best e-commerce platforms with great analytics dashboards include:
- Squarespace — Ideal for online brochures and portfolios
- WooCommerce — High-quality WordPress plug-in
- 3dcart — One of the most affordable e-commerce platforms
- Weebly — Easy-to-use website builder
- Magento — Versatile e-commerce solution
- WordPress — The most well-known website builder
- BigCommerce — Offers the most included features
- Shopify — The most complete e-commerce option
- Wix — Free solution for hobby websites
The e-commerce platform that you choose will determine the future of your startup. Some of the questions that you may wish to ask yourself include:
- How big do I want to grow my business?
- Will this platform accommodate significant growth?
- What kind of tech support do I want?
- How many plug-ins will I need?
- What are the short-term and long-term costs?
Step #4 — Use Analytics to Build and Maintain the Best E-commerce Website
As we stated in the past, big data is invaluable to developing websites. You should also have an analytics system in place to create the best possible website for your company. Make sure to read some of our previous guides on this process.
When you take an analytics-based approach to web development and website management, you can hook your customers with a dazzling company website that motivates them to act. Whether you choose to build your own website or hire a web design company for a custom site, you’ll need to impact the minds of visitors within seconds. Some of the things you will need to create your new website include:
- Logo and other branding materials
- Product photos and descriptions
- Homepage content
- Customer service page
- Company history
- Contact page information
- Site map
Aside from descriptions and photos, you might want to include other information for your products and services. If you have a lot of listings, you may also need:
Select a secure payment processor so you can start collecting money and setting aside taxes! If you already have an existing business and wish to use your current merchant account and payment gateway, you can do that. Otherwise, you will need to choose a third-party payment processor unless you select an e-commerce platform with a built-in payment system.
Some of the most popular payment system plug-ins include:
Simplify your order fulfillment processes by integrating the best shipping software with your company website. If you choose Shopify, WooCommerce, or BigCommerce as your e-commerce platform, shipping support comes included. Otherwise, you will need to find the best shipping app for your website, which could cost you a small monthly fee.
Startup businesses need shipping integration because it automatically:
- Selects the shipping company
- Chooses the shipping method
- Prints labels
- Provides tracking
Once you have your company website set up, you can test it a few times before the official launch.
On Launch Day, you want everything to run smoothly. To increase the chances of a successful launch, you should execute a few test purchases. Your payment processor should offer a mode in which you can test a purchase. These tests check the functionality of your payment system without charging your credit card or debit card.
Consider testing the purchase of different products and services at least a few times. Once you feel satisfied that your payment processor will work, your e-commerce website will be ready for launch. It will take at least a few weeks before Google web crawlers find, analyze, and index your website. In the meantime, you may wish to pay for advertising rather than rely on organic traffic.
Step #7 — Use Analytics to Improve Your Marketing Strategy
Now that you have finished all the hard work required to start a new e-commerce business, you cannot just sit there and expect everything to happen all by itself. You need to put your company out there. Thankfully, marketing your business today proves easier than ever. You will encounter no shortage of apps, tools, and techniques to put your logo in front of consumers’ eyes.
While your homepage, product pages, and search engine optimization will serve as the backbone of your future marketing campaigns, you will need to actively target customers online. Some of the ways that you can reach your key demographics include paying for:
- Google Ads to place your website at the top of search engine results pages
- Ads on Twitter, Facebook, Instagram, TikTok, and other social media platforms
- Qualified leads to add to your email list for an email blast
Any of these approaches are going to be a work in progress, so you have to take advantage of analytics to make the most of them. You will want to regularly review your data and tweak your marketing strategy. If you have your marketing analytics platform setup properly, you can focus on the best performing keywords in your PPC campaigns, identify the best converting landing pages and make sure you are reaching the right demographics with other marketing strategies.
You might find yourself waiting for a year or more before your company starts to turn a profit. Indeed, many of the most valued public companies do not turn a profit for years because all revenue gets reinvested back into the business. In the meantime, you can discover a bunch of ways to save your company money.