The commerce world has changed dramatically over the past few decades. It doesn’t matter if it’s digital or in-person — sales and marketing have evolved greatly. And because of the growth of ecommerce and online sales, there are now many more factors to consider when analyzing sales performance.
When business isn’t booming, it can feel overwhelming trying to figure out why you’re not performing as well. That’s where sales performance data comes in.
Whether it’s finance, marketing, shipping, logistics, or even IT, your business’ sales performance affects how your staff does their jobs. The insights you gain from sales data impact every part of your business.
Analyzing your performance and understanding your results are therefore crucial to future performance. Let’s examine what sales data is and how you can use it to develop a sales strategy.
Sales data is the information you are measuring in relation to your store. It is also known as sales metrics or Key Performance Indicators (KPIs). These measurements compare hard results with your expectations.
Sales data can be as simple as how many sales you’ve made last month. It may be as complex as looking at how many clicks it took potential customers to decide to buy a product.
Why do you need to know more than how much you’ve made in revenue? There are plenty of reasons. Your finance team can plan better. Marketing knows where to direct focus and can determine which campaigns were successful. Inventory knows what’s in demand and what to order, and so much more.
Setting goals and keeping track of the data they involve may feel like a lot of work — but it’s also the data that will help you understand your performance. Data-driven sales planning removes the mystery from your pitfalls while also priming you for success.
Leave Bad Predictions to The Psychics
Knowing where you’re at helps you figure out where you’re going. Everyone in ecommerce makes sales forecasts. Understanding how to properly forecast isn’t supernatural — it just takes work.
Understanding the relationship between your data points and the departments it impacts enables you to make better decisions. Without data informing your sales pipeline strategy, you’re likely to spring a leak.
Are certain pages performing better than others? Is your paid social providing a good return on investment (ROI)? Is content meant for the awareness phase of the funnel creating a boom, while the advocacy phase is at a standstill? Tracking information about your sales at every stage of the pipeline gains insights about where potential customers are getting “stuck.”
Being able to forecast better means understanding your customer’s motivations. It also means you can develop and implement the strategies to change course and prevent clogs in the pipeline before they happen.
Having the “Things” Before They Can Fly Off the Shelves
We know customers have a short attention span. If a desired item is out of stock, you could very well lose that customer to a competitor.
If you’re up to date on sales data knowledge, you can instruct inventory to place orders for well-performing items. You can also figure out which products to stop offering. Examining the bounce rate and sales data informs you on what customers are looking for.
There are also ways to handle out of stock items in the interim. You can offer pre-orders. You could generate a wait list or offer “tell me when this will be back in stock” messages.
Whether you’re offering a blend of physical and digital products, knowing how they perform is always a big deal.
It can affect shipping and logistics in that you need to get those items delivered to your customers. Knowing what and how well you’re selling ensures you can have the appropriate packaging ready, that you have enough product in hand, and enough staff to process orders.
Shining a Light On What Shines
Great marketing (or even just persistent marketing) can really boost sales. At the same time, sales can also drive marketing. Knowing what’s performing well can give your marketing team an idea of what products need some extra love — and which have oversaturated content.
Examining data provides a look into your churn rate, customer acquisition costs, shopping cart abandonment rate, average order value, and lots more. This can dictate what your paid social focuses on, and how you talk about your store and offerings in both paid and organic channels.
Further, it can inspire your teams to create new programs and different types of content. Keeping your base engaged and happy is vital to continued success. If you’re seeing a lot of customer loyalty, it may be time to create an ambassador program or a rewards initiative.
More Than Meets the Eye
If you’re doing everything right and still not getting the results you want, it’s time to look at your site’s look and feel. User experience (UX) can significantly affect a potential customer’s decision to click “Add to Cart.”
Sales data and metrics can tell your web developers and designers a whole story. Leaving them out of the conversation can leave your site lacking. There’s a few reasons why.
Is your site slow? Does the design look dated? Is the site difficult to navigate? How about your site map? Did you decide to change a theme yourself and now everything looks bonkers? While there are some simple ways to optimize your site and speed up page load time, not everything is covered.
Your web developers and designers can ensure your site is in tip top shape when they know your goals and the story behind your performance.
Setting Up Goals You Can Score
All the motivation in the world won’t get you anywhere if you don’t have the proper tools to do the job. In the case of ecommerce sales, the proper tools are data. Giving yourself goals that can’t feasibly be reached sets everyone up for failure.
A motivated team — whether that’s just you or a few others — is a team that sells. Setting higher and higher goals once your sales have met quotas can actually be demotivating. There is always a struggle to perform better. Knowing what your store typically sells at what points in the year can help you develop reasonable, realistic targets that do not burn you out.
When you’ve studied your data, you can predict the level of revenue to expect. You can adjust your goals to make them competitive but attainable. You can also generate incentives that are within your budget, that are appropriate for the expectations you’ve created, and that boost morale.
In ecommerce, you aren’t in person to make the sale. That has both pros and cons. You can reach a lot more people with less effort. There’s little opportunity to say the wrong thing because you have the time and ability to edit. At the same time your store has to do the selling for you. You need to both capture attention and keep it. This can put a lot of pressure on you as you work to increase sales.
How You Can Do It
- Track your month over month (MoM) and year over year (YoY) revenue to set baselines and compare similar time periods.
- Tracking conversion rates and their sources helps determine what marketing or sales tactics impacted sales.
- Ensure you have the resources to handle increased sales.
- Make sure your teams understand both your strategy and products/services — and train them well.
- Find the balance between incentivizing good sales and not penalizing success with continually higher goals.
- Do the math. If sales data shows you’ve increased 10% YoY for a decade, asking for 25% increase is a big jump. Increase incrementally and conservatively as you learn more about your business.
- Continue to track data!
Knowing It’s More Than Just Numbers
In order to get a true picture of your business’ performance, it is important to find the balance of tracking enough data and knowing what is relevant.
You don’t want to track things that have no impact on your team’s success. If you only focus on numbers, or quantitative data, you can miss important wins as well as explanations for why things are the way they are.
Tracking top ecommerce metrics like customer service satisfaction scores, number of tickets, and response time may not provide the same level of “oomph” great sales would, but they can show where you shine. Great customer service and positive reviews are worth highlighting on your pages and in content, as they help establish your reputation as well as increase customer loyalty.
Do you have a lot of parents buying? Back to school season may increase purchases. Got a lot of customers in the South? Poor weather or natural disasters can put a freeze on buying. Sports fans? Customers will be watching games, not browsing webstores during the playoffs.
Factoring in what is going on in your industry, in the world at large, and where your customers are from can provide a valuable point of view when making sense of the total picture. If you’re tracking demographic information, you may be able to connect why certain aspects trend up or down.
Don’t discount the qualitative data. Understanding WHY your numbers aren’t where you want them is just as important as making good numbers.
Does This Still Sound Like Too Much Work?
It isn’t impossible to track and analyze on your own, but it certainly takes significant effort. It requires skill to weave a narrative from data. It also takes a lot of time.
Looking for an easier way to handle analytics AND your business? Managed WooCommerce by Nexcess isn’t just one of the best ways to host your ecommerce store. We also provide the Nexcess Sales Performance Monitor functionality free with all of our Managed WooCommerce plans.
Want one less thing to think about? Our Sales Performance Monitor doesn’t just throw information at you. It provides valuable insights that can help you make decisions about your ecommerce store. It’s like having a built-in consultant — because better is built in here at Nexcess.
Convinced? Give Managed WooCommerce a whirl! Check out our plans to get started today.