Tuesday, February 25, 2014

What is the most important customer group?

Digital Analytics – What is the most important customer group?

For years, many e-commerce managers struggled to understand online users’ behavior, so they could turn their portals into more efficient sources of revenue. At first, most of the activities and promotions were designed and focused on engaging both existing and new users, with the focus varying from time to time between the two groups; however the realty in most cases was that decisions were based primarily on personal opinions and current trends.

Despite spending hundreds of hours and several years analyzing web analytics, hoping to distinguish between these two groups, it has become clear that the more one learns about them, the more difficult it is to identify the difference between them. One of the main reasons for this is that overall, technology is evolving at a much faster pace than analytics technologies are, or at least it feels that way for most small businesses.

The “new visitors” segment can be a bit misleading at first. In theory, a new visitor should be a person who is visiting your site for the first time and a new customer should be a person who has purchased your product or service for the first time. In today’s world, however, it is very common for users to have multiple devices, such as a laptop computer, an iPhone, an iPad, and in many cases, multiple browsers installed on the same device. This makes it much harder for analytics tools to identify visitors as the same person. In my case, I have a laptop with multiple browsers, which I take from home to my office almost every day, therefore connecting on various networks (IP addresses). I often make online purchases and, depending on what I am buying, will use different credit cards and shipping addresses. Therefore, for most analytics tools, who am I? Am I a new or existing customer? Am I a new or existing visitor?
When Google released the Real-Time Data component to Google Analytics, I felt that most of my business dreams were about to come true. As a young boy I remember being trained by my dad about how to approach customers. He had told me to approach a customer that had just entered the store. I hesitated because I saw that there were other people that were also about to open the door and come in, so I asked him, “Who should I talk to first?” He replied, “The most important customer right now is the one inside of the store.” Along those lines, if you were to ask me today which customer group is more important I would definitely answer, “The one currently browsing your website!”

With Real-Time Google Analytics you can have real time data that will allow you to push content and specific data, in order to generate revenue. You can do this because you can effectively monitor the results of new campaigns and site-to-site content (prices, coupons, etc.) based on the traffic demographics. With Real-Time Data available it becomes much easier to see key data such as:
  • The number of people currently browsing your site
  • Their geographic locations and the traffic sources that referred them
  • Number of incomplete orders (cart abandonment)
  • Which pages or events they're interacting with, and which conversions goals are working best

In conclusion, there are no shortcuts when it comes to managing a successful e-commerce portal. The more time you spend understanding your customer base, the better businessperson you will become. Making the right decisions and minimizing your investment risk will depend on how much time you are willing to spend to understand your customers.