{"id":96129,"date":"2023-02-15T08:41:13","date_gmt":"2023-02-15T13:41:13","guid":{"rendered":"https:\/\/www.invespcro.com\/blog\/?p=96129"},"modified":"2023-02-15T08:41:13","modified_gmt":"2023-02-15T13:41:13","slug":"the-role-of-data-analysis-in-e-commerce-experimentation","status":"publish","type":"post","link":"https:\/\/www.invespcro.com\/blog\/the-role-of-data-analysis-in-e-commerce-experimentation\/","title":{"rendered":"The Role of Data Analysis in E-Commerce Experimentation"},"content":{"rendered":"<span class=\"span-reading-time rt-reading-time\" style=\"display: block;\"><span class=\"rt-label rt-prefix\">Reading Time: <\/span> <span class=\"rt-time\"> 8<\/span> <span class=\"rt-label rt-postfix\">minutes<\/span><\/span><p><span data-preserver-spaces=\"true\">Data analysis is an integral part of any experiment. It allows you to quantify your findings, identify trends and insights, and ultimately make better decisions about your online business.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Data analysis is also valuable for understanding how customers interact with your site. By analyzing your ecommerce analytics data, you can determine what works and what doesn&#8217;t.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">In this blog post, we&#8217;ll look at data analysis&#8217;s role in ecommerce experimentation.<\/span><\/p>\n<h2><span data-preserver-spaces=\"true\">What is Data Analysis in the Context of Experimentation?<\/span><\/h2>\n<p><span data-preserver-spaces=\"true\">Data analysis is the process of extracting information from data. Data analysis can be described as a cycle of activities and procedures that transform raw data into information, knowledge, and understanding. It uses various statistical methods and tools to extract information from any given data set.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Data analysis in e-commerce experimentation can help you to identify what makes up your potential customers buying behavior, how much a particular factor influences their decision to buy, which websites they visit before making a purchase, how often they visit your website etc.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">To understand this better, let us take an example of an e-commerce store where users can browse through products by category or search for specific products by keyword.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Suppose two products belong to different categories but have similar titles and descriptions. The user needs clarification while deciding which product he should buy since both look similar on the website interface.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">To solve this issue, we need to analyze the number of clicks each product receives during a specified period (i.e., analyzing clicks per day) to find out which one is being clicked more often than the other so that we can make appropriate changes.<\/span><\/p>\n<h2><span data-preserver-spaces=\"true\">The Role Data Analysis Plays in E-commerce Experimentation<\/span><\/h2>\n<h3><strong>1. Business Growth<\/strong><\/h3>\n<p><span data-preserver-spaces=\"true\">Data analysis in ecommerce experimentation helps with business growth by providing insights into customer behavior, customer satisfaction, customer lifetime value, sales performance, and product performance. The data can be analyzed using different analytical tools depending on what you&#8217;re looking for.\u00a0<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">There are several ways data analysis can help you grow your business:<\/span><\/strong><\/p>\n<ul>\n<li><span data-preserver-spaces=\"true\">Determine which products are most popular among customers.<\/span><\/li>\n<\/ul>\n<ul>\n<li><span data-preserver-spaces=\"true\">Optimize pricing for several products.<\/span><\/li>\n<\/ul>\n<ul>\n<li><span data-preserver-spaces=\"true\">Identify areas where you need improvement or changes in products or services.<\/span><\/li>\n<\/ul>\n<ul>\n<li><span data-preserver-spaces=\"true\">Discover trends in customer behavior so that you can offer more relevant products at better prices.<\/span><\/li>\n<\/ul>\n<p><span data-preserver-spaces=\"true\">For example:<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">If you want to know how long a visitor stayed on your website, you&#8217;ll need to use a data analytics tool like Google Analytics or another analytics tool to get this information. This can help you identify areas where visitors are losing interest and optimize your site accordingly so that more visitors stay longer on your site.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Suppose you want to know what people are searching for when they visit your site. In that case, Google Keyword Planner will give you insights into what keywords people are looking for when they search for products similar to yours or related products that they might be interested in buying from you instead of someone else online.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">For instance, PayU, a fin-tech company, increased its conversions by 5.8% with the help of data-driven A\/B testing.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">PayU wanted to maintain an intuitive, straightforward, and convenient checkout process. However, thanks to a form analytics tool, they discovered that many were dropping off from the page, which had a major impact on their sales and revenue graph.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">The company made slight changes to its Checkout page form to streamline things using the data collected and conducted an A\/B test to validate its hypothesis.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">The old checkout page asked users for their mobile numbers and email addresses while purchasing. However, the new checkout page only asked for their mobile number to complete the shopping process.<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">Have a look at what the control and variation looked like:<\/span><\/strong><\/p>\n<div class=\"blog_img\"><img fetchpriority=\"high\" decoding=\"async\" class=\"alignnone wp-image-96130 size-full\" src=\"https:\/\/www.invespcro.com\/blog\/images\/blog-images\/PAYU-control.png\" alt=\"data analysis\" width=\"512\" height=\"333\" data-wp-pid=\"96130\" \/><\/div>\n<p><span data-preserver-spaces=\"true\">Control:\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/vwo.com\/blog\/ab-testing-examples\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">Source<\/span><\/a><\/p>\n<div class=\"blog_img\"><img decoding=\"async\" class=\"alignnone wp-image-96131 size-full\" src=\"https:\/\/www.invespcro.com\/blog\/images\/blog-images\/PAYU-variation.png\" alt=\"data analysis in ecommerce\" width=\"512\" height=\"329\" data-wp-pid=\"96131\" \/><\/div>\n<p><span data-preserver-spaces=\"true\">Variation:\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/vwo.com\/blog\/ab-testing-examples\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">Source<\/span><\/a><\/p>\n<p><span data-preserver-spaces=\"true\">By simply removing the email address field from the checkout page form, they saw a 5.8% increase in conversions as compared to the control.<\/span><\/p>\n<h3><strong>2. Personalization<\/strong><\/h3>\n<p><span data-preserver-spaces=\"true\">If you look at the statistics,\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.kameleoon.com\/sites\/default\/files\/kam\/documents\/consumer-survey-digital-rends-US.pdf\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">75% of US shoppers<\/span><\/a><span data-preserver-spaces=\"true\">\u00a0expect brands to personalize their journey \u2013 while 69% said not all brands are customizing the online experience.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">This goes to show just how important personalization is.\u00a0<\/span><\/p>\n<div class=\"blog_img\"><img decoding=\"async\" class=\"alignnone wp-image-96132 size-full\" src=\"https:\/\/www.invespcro.com\/blog\/images\/blog-images\/Personalization-statistics.png\" alt=\"personalization statistics\" width=\"483\" height=\"512\" data-wp-pid=\"96132\" \/><\/div>\n<p><span data-preserver-spaces=\"true\">(<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.kameleoon.com\/sites\/default\/files\/kam\/documents\/consumer-survey-digital-rends-US.pdf\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">Source<\/span><\/a><span data-preserver-spaces=\"true\">)<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">In e-commerce, personalization is the ability to deliver content and relevant experiences to individual customers. Personalized recommendations, tailored search results, and advertising are some of the most popular uses of personalization.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">One of the biggest challenges in using personalization is understanding which elements should be personalized and how they should be customized.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Data analysis plays an important role in this process by helping companies understand their users&#8217; preferences and behavior patterns. Using this information, companies can then decide which elements should be personalized and how they should be customized.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">There are many different types of personalization that can be used in e-commerce experiments.\u00a0<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">Here are some examples:<\/span><\/strong><\/p>\n<ul>\n<li><span data-preserver-spaces=\"true\">Optimizing the shopping cart experience by providing recommendations based on past purchases or browsing history (including related products)<\/span><\/li>\n<\/ul>\n<ul>\n<li><span data-preserver-spaces=\"true\">Offering personalized recommendations based on site visitors&#8217; social media activity (such as Facebook likes) or demographics (such as age group)<\/span><\/li>\n<\/ul>\n<ul>\n<li><span data-preserver-spaces=\"true\">Personalizing the shopping cart experience by offering different offers based on past purchases<\/span><\/li>\n<\/ul>\n<p><span data-preserver-spaces=\"true\">Data analysis can also help companies make sense of large amounts of unstructured data, such as text or images. This can help them better understand their users&#8217; interests, needs, and preferences so that they can provide more relevant content and services.<\/span><\/p>\n<h3><strong>3. Customer Acquisition and Retention\u00a0<\/strong><\/h3>\n<p><span data-preserver-spaces=\"true\">As an e-commerce business, you may wonder what to do to retain customers. There are many factors at play in customer retention and loyalty, but one of the most effective ways to retain customers is through experimentation.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Experimentation is the process of testing different scenarios to see how they affect your customers&#8217; behavior. You can use this customer data to understand what works best for your business and make the necessary changes so that it does work best for your business.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">For\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.testbirds.com\/en\/blog\/benefits-of-e-commerce-testing\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">instance<\/span><\/a><span data-preserver-spaces=\"true\">, Hobson&amp;Company saw that crowd testing resulted in a 10% increase in retention rate.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Clearly, data analysis plays a role in every aspect of your e-commerce business, from understanding your customers to improving your marketing strategies.\u00a0<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">Here are just a few ways that data analysis can help you with customer acquisition and customer retention:\u00a0<\/span><\/strong><\/p>\n<ul>\n<li><strong><span data-preserver-spaces=\"true\">Customer acquisition:<\/span><\/strong><span data-preserver-spaces=\"true\">\u00a0You want to acquire new customers without spending too much on advertising campaigns or other marketing tactics. Data analysis shows how visitors interact with your site and what they do when they visit it, so you can use this information to target ads and landing pages that are more likely to appeal to them.<\/span><\/li>\n<\/ul>\n<ul>\n<li><strong><span data-preserver-spaces=\"true\">Customer retention:\u00a0<\/span><\/strong><span data-preserver-spaces=\"true\">You also want to keep existing customers happy so they don&#8217;t leave and go somewhere else instead. Customer surveys can show what they like most about doing business with you, but if you want to really understand their needs, look at their behavior patterns over time (i.e., what products they buy).<\/span><\/li>\n<\/ul>\n<h3><strong>4. E-commerce businesses can quickly analyze visitors&#8217; behavior and make improvements without spending much time, money, or effort.<\/strong><\/h3>\n<p><span data-preserver-spaces=\"true\">The role of data analysis in e-commerce experimentation is to provide the best insights for businesses to improve their sites. In today&#8217;s digital world, data analytics has become a key tool for e-commerce businesses to create a competitive advantage over their competitors.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">By analyzing customer behavior on the website, companies can gain insight into what products are most popular with customers and how they use the site. This information can then be used to optimize the website&#8217;s design and functionality so that customers can find what they need easily while browsing.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">For example, in one A\/B testing\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.omniconvert.com\/blog\/ecommerce-ab-testing-case-study\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">case study of Ideall.ro<\/span><\/a><span data-preserver-spaces=\"true\">, a Romanian appliance e-commerce store that offers a wide range of top-brand household appliances, the test boosted the conversion rate by 22.26% in just 6 months.<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">Ideall&#8217;s qualitative research (surveys) helped them discover:\u00a0<\/span><\/strong><\/p>\n<ul>\n<li><span data-preserver-spaces=\"true\">What people liked and disliked about the brand<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">The obstacles they encountered on the path to completing a purchase<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Consumer behavior and the demographics that defined them.<\/span><\/li>\n<\/ul>\n<p><span data-preserver-spaces=\"true\">Data analysis in e-commerce experimentation helps retailers understand how different design elements affect customer behavior, which allows them to increase sales by improving their site design.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">For example, suppose there is a drop-off point in a particular area of your website due to poor navigation or organization. In that case, you can experiment with different designs until you find one that works best for your customers.<\/span><\/p>\n<h3><strong>5. Helps Reduce Cost\u00a0<\/strong><\/h3>\n<p><span data-preserver-spaces=\"true\">Data analysis in experimentation helps reduce cost and risk by allowing companies to test new ideas before they invest in them. This can benefit small and large businesses alike, as experimentation is important to any company&#8217;s growth plan.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">However, it&#8217;s important to remember that not all experiments are created equal. You need to ensure that your experiment is properly structured so you can extract valuable insights from it later on.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">To get the most out of your data analysis, you must first understand how to use it effectively.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">For\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/conversion.com\/blog\/saving-the-high-street-using-experimentation-in-store-to-improve-customer-experience\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">instance<\/span><\/a><span data-preserver-spaces=\"true\">, Blockbuster, the multibillion-dollar video rental company, was facing declining popularity in 2000 as customers had to pay high late fines if they couldn&#8217;t return the rented movies in time.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">They proposed a solution to conduct a simple and low-priced $12,000-only email-as-a-reminder experiment. However, the strategy was cast off as it was too simple.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">As an alternative, they implemented a transformative, high-budget strategy to remove fees backed by a big advertising campaign. The strategy was not only unpopular, but it was illegal. The expected legal and business costs surpassed tens of millions of dollars.\u00a0<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">You must also understand your data sources.\u00a0<\/span><\/strong><\/p>\n<p><span data-preserver-spaces=\"true\">There are many different types of data sources that you can use when analyzing your ecommerce business data. These include web analytics, social media analytics, transactional emails, customer surveys, and more.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Each source has its advantages and disadvantages when it comes to analyzing your business performance, so learning about each one will help you choose which ones work best for your specific needs.\u00a0<\/span><\/p>\n<h3><strong>6. Manage your inventory better.<\/strong><\/h3>\n<p><span data-preserver-spaces=\"true\">The data collected during the experiment must be analyzed to make sense of what happened. This can be done by using statistical software or by manually going through all the data points.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">However, it is often difficult to identify the importance of different variables in an experiment and determine which variables impact the results.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">This is where statistical analysis comes in handy.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">By using statistics, we can determine which variables are significant and which ones have no impact on the results at all. This helps us improve our process by identifying which areas need more attention or how we can improve our processes as a whole based on what we have learned from our experiments.<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">Here are two examples of how data analysis in experimentation helps you manage your inventory better by helping you understand what works best in your business.<\/span><\/strong><\/p>\n<ul>\n<li><strong><span data-preserver-spaces=\"true\">When you want to know what your customers want more of:\u00a0<\/span><\/strong><span data-preserver-spaces=\"true\">Conduct an experiment with different flavors or colors of a product and see which one sells better than others. In this case, you can use the A\/B testing technique to get more insights into how customers respond to different options offered by you.<\/span><\/li>\n<\/ul>\n<ul>\n<li><strong><span data-preserver-spaces=\"true\">When you want to know what kind of ads work best for your products:\u00a0<\/span><\/strong><span data-preserver-spaces=\"true\">You can run multiple variations of ads using any advertising platform (Facebook Ads, Google AdWords, etc.) and see which one performs better than others. In this case, you can use multivariate testing techniques like multivariate testing or <a href=\"https:\/\/www.invespcro.com\/blog\/google-optimize-the-good-the-bad-and-the-ugly\/\">A\/B testing<\/a> technique to get more insights into how different ads perform for different audiences.<\/span><\/li>\n<\/ul>\n<h2><span data-preserver-spaces=\"true\">Wrapping-up<\/span><\/h2>\n<p><span data-preserver-spaces=\"true\">Everyone is different, and what works for one e-commerce site might not work for you. However, I think it&#8217;s fair to say that most of us can agree that data analysis plays a very significant role in today&#8217;s e-commerce industry.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Collecting data is the first step to taking your website optimization strategy to the next level. It provides you with proof of which experiments worked and which didn&#8217;t, and it can help decide future iterations of those that did not work out. You can&#8217;t know what works best for your website unless you are regularly gathering data points from your site.<\/span><\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p><span class=\"span-reading-time rt-reading-time\" style=\"display: block;\"><span class=\"rt-label rt-prefix\">Reading Time: <\/span> <span class=\"rt-time\"> 8<\/span> <span class=\"rt-label rt-postfix\">minutes<\/span><\/span>Data analysis is an integral part of any experiment. It allows you to quantify your findings, identify trends and insights, and ultimately make better decisions about your online business. Data analysis is also valuable for understanding how customers interact with your site. By analyzing your ecommerce analytics data, you can determine what works and what [&hellip;]<\/p>\n","protected":false},"author":50,"featured_media":96474,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[36],"tags":[],"class_list":["post-96129","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cro"],"_links":{"self":[{"href":"https:\/\/www.invespcro.com\/blog\/wp-json\/wp\/v2\/posts\/96129","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.invespcro.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.invespcro.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.invespcro.com\/blog\/wp-json\/wp\/v2\/users\/50"}],"replies":[{"embeddable":true,"href":"https:\/\/www.invespcro.com\/blog\/wp-json\/wp\/v2\/comments?post=96129"}],"version-history":[{"count":0,"href":"https:\/\/www.invespcro.com\/blog\/wp-json\/wp\/v2\/posts\/96129\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.invespcro.com\/blog\/wp-json\/wp\/v2\/media\/96474"}],"wp:attachment":[{"href":"https:\/\/www.invespcro.com\/blog\/wp-json\/wp\/v2\/media?parent=96129"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.invespcro.com\/blog\/wp-json\/wp\/v2\/categories?post=96129"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.invespcro.com\/blog\/wp-json\/wp\/v2\/tags?post=96129"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}