Ecommerce Analytics – A 101 On Getting It Right
Whether you’re starting out on the Ecommerce journey or looking to expand it’s important to remember that your web, mobile and marketing analytics aren’t a set and forget activity. Your use of analytics will change as your business does, and your approach will be dependent upon where you are in the growth phase. We see four main growth phases and outline here what you should be thinking about during each of these.
Are Your Campaigns Profitable?
With a little work you can measure revenue and sales per campaign in Google Analytics, Adobe Site Catalyst, Coremetrics, WebTrends and other web analytics tools.
The problem is that revenue and sales are not a good indicator for profitability. For campaigns to be generating value to your organisation they must be profitable which in most cases means that the profit made from immediate sales must be greater than the cost of executing that campaign.
How To Calculate Actual Campaign Profit
Calculating the actual profit of your campaigns takes time, however identifying unprofitable campaigns is critical. A robust way to calculate the actual profit is to use the Profit Per Campaign method that requires that the individual Cost of Goods Sold data is available for each item sold.
How To Calculate Gross Margin Percentage
The Gross Margin Percentage is a key metric that you need to use along side total revenue in your web analytics and reporting tools. The reason for this is that you really need to use profit rather than simple revenue to determine the true value of your campaigns.