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The number of digital buyers worldwide has crossed the two billion mark and is constantly growing, making eCommerce a major industry and a vital part of the global economy. This also means that online commerce is becoming ever more competitive.

With giants like Amazon dominating the market, established retailers like Walmart entering the arena, and thousands of smaller merchants utilizing the benefits of simple eCommerce platforms like Shopify, Magento or WooCommerce, it is really tough to remain successful and profitable. Unless you start relying on the one competitive advantage you have – data.

Setting up a proper eCommerce analytics system may seem complicated and time-consuming (and sometimes it really is), but is also a necessary step in the development of any successful online retailer. If you are overwhelmed by the abundance of data delivered by the platforms you are using, you’re not alone. Organizing these large volumes of disparate data into a cohesive reporting structure, that will provide you with the right insights and allow you to make the right decisions, is a tough task.

This is why we have prepared this step-by-step guide for all you ambitious eCommerce marketers, with practical advice on how to embrace, structure and utilize data for your benefit.

Step one

Understanding what eCommerce analytics is

The good thing about eCommerce data is there’s lots of it: shopping cart activity, item sales, category trends, advertising performance, customer demographics, browsing and buying behavior… the list goes on. The bad thing about eCommerce data is – there’s lots of it. In some cases, it can be outright intimidating.

Nonetheless, when you manage to gather, visualize, and analyze all of your crucial eCommerce performance data, it becomes an unparalleled tool for growth. So, simply put, eCommerce analytics is the process of gathering all the different information related to your eCommerce business, primarily from your online store, and putting this data under a microscope.

This process involves integrating all your data into one place, building dashboards and reports so you can display these results visually, and then analyzing this displayed data to gain actionable insights about your business.

Why do we emphasize actionable insights? Well, a bunch of random numbers shown in a nicely designed dashboard won’t help you win more customers or earn more revenue. But, by understanding what these numbers are telling you, you can make timely and effective decisions that will support the growth of your business.

For example, with the right data at your fingertips you can:

Understand which channels are bringing the most customers – and optimize your marketing budget and investments accordingly
Learn which groups of customers spend the most and what they are spending their money on – and target them with specific offers
Discover which customers are least likely to make a second purchase and why – and develop an appropriate customer retention strategy

Most importantly, all of these insights will be based on real-life data, actual bits of information delivered by the platforms you are using. Basing your business decisions on hard numbers and facts instead of costly guesses and estimates puts you in a much better position, and gives the competitive edge over online retailers who don’t approach eCommerce analytics with the same level of seriousness.

To achieve all of this, however, you first need to identify which metrics are the most crucial to your eCommerce business.

Step two

Identify the right metrics

Before you start trying to integrate all your data in one place, it’s important to work out what data points you actually need, and from which sources. For an eCommerce business the best way to do this is to look at your customer journey and identify the crucial data points at each stage.

There is a lot of data out there, and each company will want to approach this stage of the analytics process slightly differently, depending on their business goals and strategy. However, the following list is a good starting point for the majority of eCommerce businesses. Remember, you can always review this and change it in the future!

Key eCommerce metrics

throughout customer journey stages


Website traffic by sources, Organic search impressions


Ad spend, CPM, CPC, Organic search clicks


Sessions, Session duration, Page views, Bounce rate


Total sales, Total revenue, CVR, Return on ad spend


Customer satisfaction, Churn rate

Checkout behavior

Abandoned cart value, Drop-offs, Cancellations


Net promoter score, Product reviews, Social media sentiment



The key data sources for most of these metrics are:

Website analytics tools: Google Analytics, with the addition of Google Search Console
eCommerce platform: Shopify, Magento, Shopware, WooCommerce…
CRM (if you have one on top of your eCommerce platform)
Advertising platforms: Google Ads or Bing Ads, retargeting platforms (AdRoll, Criteo), Facebook/Instagram, other social ads (LinkedIn, Twitter, TikTok, Pinterest, Snapchat…)

And we haven’t even started listing specific tools and platforms that are used by merchants on popular marketplaces, such as Amazon. This shows you the complexity of the data sources landscape. There are literally thousands of data points available in any of these tools, from which you need to carefully select your metrics.

Step three

Establish your KPIs

Key performance indicators (KPIs) are values that show how effective you are at achieving your set objectives, and these are built based on your business priorities and the metrics you have decided to track.

KPIs can be as simple or sophisticated as you like and, again, will come down to your particular business and what you are trying to achieve. Some e-tailers focus on customer growth, some are more concerned about customer retention and repeated purchases, while others have their eye primarily on revenue and profit, or on successful inventory management.

By focusing on the following KPIs you can build a dashboard that lets you easily stay on top of all major developments in your eCommerce business, without getting lost in a vast sea of data.


1. Customer acquisition cost (CAC)

There are a couple of ways you can attract people to your online store, and advertising is one of them, bringing you an instant influx of new customers. But to be certain that you’re making a profit, you need to understand how much money you need to invest to acquire at least one customer.

2. Average order value (AOV)

Use AOV to track the average amount of money customers spend on each purchase, whether it’s their first order or they’re a returning customer. Combine this with the average number of purchases by each registered customer, and you will be able to get another highly important KPI – Customer Lifetime Value (CLV).

3. Total revenue and Revenue by channel

Different customers approach online shopping in different ways. Tracking revenue breakdown by device, advertising platform, customer location, or any other dimension will allow you to see how your customers are buying your products, and fine-tune your campaigns to improve sales.

4. Customer retention rate

Customer retention rate gives you the percentage of customers your business has retained over a given period. You’ll want to watch this closely, as well as paying special attention to certain touchpoints or a particular offer.

Of course, given the number of input data points, this list doesn’t even remotely exhaust the potential KPIs that you can create and monitor to make sure your eCommerce business is on the right track. But making this list a short one will allow you to focus on the pulse of your business and which levers you need to pull to stay on the right course.

Step four

Get the data behind the KPIs

All the data available to you as an eCommerce marketer is in data sources that are isolated, and they are all formatted differently.

So, before you can do anything with this data, it needs to be integrated into a single place, stripped of all formatting, and then tagged so that different data points from different data sources can be compared to each other.

Only then will you have a ‘clean’ and unified data stack, enabling you to start analyzing data. This process consists of the following three steps:

Data Integration

The process of bringing all your data into one place by using data connectors based on APIs to fetch any type or format of data from all the tools you are using. Although this may sound simple, it is a technically very challenging process. But, if done properly, it eventually automates the whole reporting process.

And in a time when every minute you can lose a potential customer, having the right reports on time can be crucial for the profitability and success of your eCommerce business.


Data Transformation

Includes cleaning, normalizing, and unifying the data from disparate sources. This step is important as just one inconsistency in a single line of an imported dataset can skew the reports you are using to make important daily decisions.

Analytics platforms use a transformation engine that joins data from different sources, strips out the formats, and enriches it with additional information and rules that make analysis easier to carry out.


Data Harmonization

Ultimately you need to further optimize the data to be able to merge it into one cohesive dataset. This involves mapping of data points, so data from different sources can be effectively analyzed alongside each other.

Having data from different sources in a single dashboard may simplify your daily operations, but the real power of data comes from combining the data points and creating new insights based on these combinations. And this is why the data harmonization part is crucial in this process.


Integration + Transformation + Harmonization = A Clean Data Stack!

Having a clean data stack and trustworthy data will make your data visualizations more efficient and useful for business decision makers. Empowering users of various dashboards to discover actionable trends, patterns, anomalies, and opportunities and make timely decisions on how to optimize stock, prices, advertising campaigns and all other key aspects of any eCommerce operation is the ultimate goal of eCommerce analytics.

Either you’re analytical and data-driven, or you go by what you think works. People who go by gut are wrong.
Stuart McDonald

CMO at FreshBooks

Step five

Build smart reports

Once you have successfully collected your preferred metrics and KPIs in one place, you can start building reports. eCommerce analytics reports provide useful summaries of your past and current data, giving you the chance to identify opportunities for improvement, as well as errors in the past.

A good report will enable you to easily demonstrate the success of marketing campaigns and quickly provide the important answers you need to upscale your operations. And that means having the right metrics and KPIs ready for each report

The goal is to transform data into information and information into insight.
Carly Fiorina

Former CEO of HP

6 common eCommerce reports you should have

Sales Reports

Sales by channel

Sales by product line

Sales by customer location

Conversion Reports

Online store conversion rate, by device or geography

Number of returning customers

Cost per conversion

Marketing Reports

Cross-channel marketing channel performance

Conversion per advertising channel
  • Standard ads performance indicators (impressions or CPC)
Audience and Behavior Reports

 Customer demographics

Customers by geography

Customers by device type

Cohort Analysis Reports
Acquisition cohorts based on when customers made their first purchase
Acquisition cohorts based on what customers are buying with their first purchase
Behavioral cohorts that group customers according to how they came to your site
A/B Testing Reports

 CTRs for email campaigns or online ads

 Cost per Click
 Cost per Conversion

Step six

Benefit from intelligent eCommerce analytics

So you’ve integrated multiple data sources, established key metrics and KPIs, and built a visual dashboard with effective reporting. Congratulations – you can now start driving your eCommerce business forward with data-driven decisions!

This is, at its most basic level, what eCommerce analytics is – analyzing data to discover trends and draw conclusions to improve your business. That said, the complexity and volume of data mean that manual analysis is a labor-intensive and time-consuming operation. And, this is where intelligent analytics comes in.


Intelligent analytics benefits from the use of Artificial Intelligence (AI) to significantly accelerate and improve data analysis results, and this brings a number of benefits for eCommerce businesses:


Data analysis is significantly faster and more powerful
Otherwise hidden insights and trends are revealed
Decisions can be made proactively rather than reactively
Staff time can be optimized

Simply put, when it comes to data, AI can do it faster and better than humans. Relying on intelligent analytics platforms could give you the competitive edge you’re looking for. And all of this based on data just laying around and waiting to be used in the right way.



If you find yourself in the middle of the fierce eCommerce market battlefield, one of the main questions you should ask your team is: how do we stay ahead as an online retailer?

Creating a proper and efficient data infrastructure for eCommerce analytics is definitely one of the ways you can acquire the information you need to make the right decisions and steer your business in the right direction.

The earlier you start this journey, the sooner you will reach a point where you know more than your competitors, and can outplay them in this tough game of life and business. We hope that this guide has helped you to understand what you need to become a truly data-driven and successful eCommerce marketer.

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