December 19, 2023
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In the modern world of digital business, data is your most valuable asset. Companies across industries need to track key performance indicators (KPIs) and make data-driven decisions about their customer base, and the ecommerce sector is no different.

Efficient ecommerce data management can mean the difference between owning a thriving store or joining the roughly 90 percent of ecommerce businesses that fail. Discover what ecommerce data management is, the types you need to know, how it can help your business, and some best practices for implementation below. The survival of your business depends on it.

What is ecommerce data management?

Ecommerce data management is the process of gathering, storing, organizing, and analyzing information about your customers and your business. Storefront owners looking to start or strengthen their business data management and adopt a data-driven sales approach should focus on these three areas:

  • Data visualization – Compiling data in visual representations to improve decision-making. These visual representations might be charts, graphs, plots, or infographics.
  • Data cleansing – Fixing or removing inaccuracies or incomplete or repeat entries from datasets.
  • Data integration – Pulling data from multiple sources into one central dashboard for more efficient analysis and a more comprehensive business view.

Implementing these three processes into your data management best practices helps make your data more useful. Databases of customer and inventory information will become more user-friendly, and you’ll be able to spot trends that can help you grow your business easily. You’ll also experience increased data security and protection against breaches, among other benefits.

What are the benefits of effective data management?

Although it can be challenging to implement data management strategies from scratch, the businesses that overcome this hurdle can expect significant payoffs. Here are some benefits ecommerce data management can provide:

  • Corporate agility – Quickly pivot inventory decisions, marketing strategy, or messaging based on the latest trends in your business and the overall industry.
  • Elevated marketing strategy – Transform your marketing campaigns and increase return on investment (ROI) with data-driven learnings from trends in your internal data.
  • Better customer experience – Manage inventory and promotions based on customer behavior and buying history.
  • Advantage over competitors – Analyzing organized data from your business allows you to quickly align with the latest trends in customer behavior or industry movement.
  • Higher sales and revenue – A more targeted, data-driven approach to sales, marketing, and inventory can help increase sales, revenue, and the lifetime value (LTV) of your customer base.
  • Lower business risk – Numbers don’t lie. Forecasting revenue, setting goals, and creating business plans based on concrete statistical data sets up your business for success. No more launching marketing campaigns or business initiatives off whims or gut feelings.
  • Improved customer experience – Customer behavior data and purchase history allow you to curate a shopping experience unique to each customer. Send them promotions on past purchases or items you think they may like because of their buying history.

Types of ecommerce data management

There are two primary types of ecommerce data management — customer data management and product data management. Let’s explore each in more depth to get an idea of how they work together to inform your ecomm business strategy.

Customer data management (CDM)

CDM (or customer database management) refers to the collection, storage, organization, and analysis of customer data. This data can include information like the following:

  • Shipping addresses
  • Customer birthdays
  • Email addresses
  • Purchase history
  • Browsing habits
  • Names
  • Contact information
  • Demographic details

Proper collection and management of this data can be a powerful tool for your business. You’ll begin to see trends in purchases or browsing behavior that can help inform how, when, and what you market to your customer base. This information can also help to increase conversions, improve customer retention, and evaluate your brand’s exposure.

Product data management (PDM)

PDM, or product data management, in ecommerce involves the same data management process as CDM, but the data pertains to your ecommerce inventory management instead of your customers. Comprehensive PDM may include the following data points:

  • Supplier details
  • Pricing and sales history
  • Inventory data
  • Product specs

Your PDM practices help you keep product information current across channels and make data accessible to all necessary parties. PDM also enables you to optimize your inventory management system and even streamline collaboration across team members or departments. You can even forecast product demand and gain a competitive advantage by evaluating market trends. Given the power of proper PDM, there’s no denying that sales data impacts business.

Best practices for ecommerce data management

Of course, the benefits of ecommerce data management can only transform your business if you implement the process properly. Follow these best practices to integrate efficient data management into your day-to-day operations seamlessly.

Collect the right data

Attempting to collect data in your ecommerce business can be like opening Pandora’s box. Once you start paying attention to the facts and figures, you realize just how many they are.

How do you make heads or tails of all the numbers and percentages? The most effective way to sift through it all is to focus on your KPIs.

According to, a business should consistently track between four and 10 KPIs. This handful of numbers ensures you only track what you need to and don’t get lost “in the weeds” of watching every number in your business.

The important KPIs to track for ecommerce data management include:

  • Conversion rate
  • Cart abandonment rate
  • Customer acquisition cost
  • Customer lifetime value
  • Net profit margin
  • Average order value

The above list should give you a manageable number of KPIs to track and set yourself in the right direction. The good news is that ecommerce analytics tools can help you collect and analyze this data. However, as your company grows and you start to deal with larger, more complex data sets, you may need to look into ecommerce big data management tools and services.

The good news is you don’t need to seek out any special, hard-to-find tools to handle big data management. Some popular platforms, like Shopify, have everything you need to handle larger datasets and complex analytics. However, it’s important the platform you choose can handle this growth.

To dive deeper into what these KPIs mean and to explore others that may apply to your business, visit the Nexcess ecommerce glossary.

Store data securely

There are generally two options when it comes to data storage — on-premise or in the cloud. Regardless of your choice, your data's safety is vital to your ecommerce store's success.

On-premise dedicated servers are typically the most secure storage structure. But cloud storage platforms are beginning to offer similar levels of security. When working with a third-party hosting or storage provider, be sure to ask about their data encryption and backup and disaster recovery (BDR) capabilities.

Use data wisely

Your data is only as effective as your management and analysis plan. As an ecommerce entrepreneur, you should review your data regularly, segment your customer list to get the highest ROI, and set clear benchmarks or goals. Compiling data into visual representations also enables you to get the most out of your data by easily spotting trends and patterns in the movement of your customers and inventory.

Be transparent with your customers

Another ecommerce data management best practice is to be transparent with your customers. This means establishing a privacy policy clearly stating how you will collect, manage, and use customer data.

This is a critical part of your ecommerce store’s success. You may want to consult an attorney to ensure compliance with legislation like the General Data Protection Regulation (GDPR) and Payment Card Industry (PCI) compliance. Customers want to feel safe and secure with your brand. Transparency and an in-depth privacy policy give customers comfort that their financial, shipping, and other personal information are being properly looked after.

Give your customers control over their data

Data and privacy laws are changing due to events like the Facebook scandal and widespread corporate data breaches (83 percent of organizations have experienced more than one breach, according to a recent IBM report). Customers want more control of their data.

Allow customers to control what data they share and don’t share with your brand. You can also vow not to sell data to third parties and let your customers know where you stand.

Most browsers are also allowing shoppers to block third-party cookies. Shifting your marketing to cookie-less ad platforms can still maintain the effectiveness of your campaigns while maintaining the privacy of your customers’ data.

How to use customer data to improve your business operations

While ecommerce product data management helps handle your inventory, mastering customer data management can help improve average order value and lifetime customer value — ultimately boosting sales and revenue. Here are a few ways you can leverage customer data to enhance your ecommerce business.

Personalize the shopping experience

Today’s ecommerce brands are most successful when their customers feel like the brand caters to them and only them. While we know this isn’t the case, the best online stores in the game do this by leveraging their customer data.

Fortunately, you can do this too. Ecommerce sales tracking enables you to better understand customer purchase history and remarket to them based on previous purchases. You can even suggest other products they may like based on what they’ve bought before or reach out to them with an upsell — bundling accessories with a primary item they purchased recently.

Send targeted marketing messages

Grouping your customers based on demographics, purchase history, or other factors can help you get the most out of your marketing messages and promotions. You can also A/B split test different promotions and marketing messages to see which land best with your customers.

Identify and address customer pain points

Regularly ask for feedback from your customers. You can do this through customer surveys or running sweepstakes where customers enter a drawing for a prize by submitting their information.

Additionally, ask them what it’s like interacting with your brand and other brands in your industry. Gain a complete and deep understanding of their perspective and what’s driving their purchases from your store. This information will also help you formulate key marketing documents like customer personas and your brand’s personal marketing journey.

Improve customer retention

Customer retention will naturally improve as you personalize your shopping experience. Customers respond to brands that cater to them. By remarketing to your customer list based on previous purchases, browsing history, or relevant upsells, you’re making your list feel like they’re receiving a personally curated shopping experience.

Saving customer data like birthdays and other demographics can also improve customer retention by making them feel special or important. These important dates throughout their personal lives also give you another opportunity to remarket or send promotions. Ultimately, the more you can stay in contact, market to, and deepen the relationship with your customers, the more likely they will stay.

Ecommerce tools that can help

Here are some tools to help with the business operation tips above:

  • Coveo – Personalize your ecommerce shopping experience.
  • Mailchimp – Explore customer list segmentation and A/B split testing to hone in on the perfect marketing message for each customer and improve customer retention through automated follow-up campaigns.
  • Lucidchart – Map the customer journey to easily identify and navigate customer pain points.

Bottom line

When done right, ecommerce data management can set your store up for success. Tracking, storing, and analyzing your customer data can significantly boost sales. Simultaneously, ecommerce product data management can help you streamline your inventory processes and trim your bottom line.

Naturally, effective data management starts with a hosting plan that can support the data you need and grow with you as you scale your business. As an industry leader for decades in the ecommerce space, Nexcess can provide you with whatever you need to help your business.

From hosting to ecommerce site security, Nexcess has your back. Contact our team today, and let us show you what taking us on as a trusted partner can do for your ecommerce venture.


Nexcess, the premium hosting provider for WordPress, WooCommerce, and Magento, is optimized for your hosting needs. Nexcess provides a managed hosting infrastructure, curated tools, and a team of experts that make it easy to build, manage, and grow your business online. Serving SMBs and the designers, developers, and agencies who create for them, Nexcess has provided fully managed, high-performance cloud solutions for more than 22 years.

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