Understanding Shopify eCommerce Analytics

Understanding Shopify eCommerce Analytics

As an online retailer, nothing helps guide decisions like a robust and thoroughly understood analytics suite. When you don't know where to begin, it can seem overly complex to be practically helpful, and merchants should keep it simple and relevant as they learn it. It's necessary to spend just a small amount of quality time up front learning the fundamentals of your go-to analytics platform — and for the four million Shopify-assisted storeowners in the world, Shopify's inbuilt analytics has everything you need right there from your Shopify profile.

To get your newly flex-financed eCommerce business off to the fastest start, we've broken down some foundational considerations when incorporating Shopify eCommerce analytics tools into your workflow.

Why Use Shopify eCommerce Analytics?

You might have a simple sales strategy already working, hesitant to "fix" what's not even broken. Others might have complex sales, marketing, and other tech stacks that seem incapable of simplifying, even with advanced analytics expertise. In either case, there's a temptation to put off thoroughly investigating the analytics world, thinking it's beyond the practical application for you.

If analytics seem like a poor ROI of one's time, you're not alone — even 67% of executives aren't comfortable looking at, let alone applying, their data. Integrating third-party analytics with native tools is a significant pain point for most companies. If practical analytics tools are already inbuilt into your selling platform, you've already passed that main initial hurdle.

That's why we encourage exploring the most simplified and accessible options for millions of merchants: Shopify analytics. You don't need to become a developer or even learn much as far as the technology goes. Your time can be spent immediately delving into your market data and gaining deeper insights into what's impacting your business the most.

Nowhere is that more accurate than the in-house Shopify eCommerce analytics tools. They're as streamlined and user-friendly as you'd expect from a company built from the ground up to solve aggravating technical issues. Properly used, market analytics support online merchants' entire operations, clarifying which metrics have the highest impact on their business. It enables faster problem-solving and more accurate identification of those problems.

It becomes easier to prevent issues from happening and protect your bottom line. Naturally, there are analytics to prove it: one market report suggests companies using analytics earn 115% greater ROI than those without.

Related: eCommerce Reporting Best Practices

What Can Shopify's Analytics Do?

Shopify's basic analytics tools have the majority of the most critical metrics, and premium Shopify plans have even more effective tools, such as comprehensive reports. Their baseline analytics tools go beyond total sales, average order value, cart abandonment, and conversion rates. They also reveal granular information about traffic and sales sources, store visitors, product performance, and much more.

There are also helpful visualizations for interpreting and comparing data in the most valuable ways. Their Live View tool shows you a map of where your store activity is coming from, along with real-time KPIs (Key Performance Indicators) across each Shopify sales channel. While merchants can obtain most of Shopify's analytics through third-party sources, the question is, why do so?

You must factor in practicality and time even when you find a more advanced analytics platform. All but the most remarkable third-party analytics tools still create noticeable "hiccups" where the platform edges meet. Keeping it in-house is much smoother without a compelling reason not to. Also, most of Shopify's metrics are about one minute old, requiring less need to update data to be immediately valuable.

Note that for Shopify metrics that aren't updated as quickly, part of that time is spent cleaning the data (e.g., removing bot activity from traffic reports). This is another reason analytics are usually best left to the originator of the data, and dirty data — that which is wrong or not practical as it is — costs American companies up to 27% revenue loss.

The takeaway is that it's best to let Shopify crunch the data they are most familiar with instead of reinventing the wheel. Off-platform integrations necessitate bridging analytics systems, but you won't know what more advanced features to look for until you see an issue arise in your dynamic workflow.

How To Fit Shopify Analytics Into Your Daily Workflow

When incorporating analytics into your daily routine, the goal should be to streamline it into your workflow so well that it becomes second nature. Analytics are at their best when they don't detract from your frame of mind. Instead, they must take an advisory role, complementing a fluid decision-making process. Many allow the opposite, which is too easy when steeped in numbers, trying to please algorithms.

Occasionally getting absorbed into your analytics is okay and to be expected when they lead to noticeable ROI, but do not lose sight of the daily realities of your business. You’ll risk being sidetracked and missing out on more significant revenue opportunities as you anticipate the success you wish you were getting (if only your metrics were this way or that).

Instead, let your Shopify eCommerce analytics journey be natural and smooth. The goal is a trifecta of consistency, fluidity, and relevancy, and that's more to do with daily habit than living by statistics. Get used to referencing them often, though briefly, and then relate them to the day-to-day activities that need your attention most. This is the best role for analytics because you're running your Shopify store first — studying analytics comes second.

Applying Your Shopify Store's Analytics

While we've briefly covered how to use Shopify eCommerce analytics before, we'll touch on those which have the most significant bearing on the majority of Shopify storeowners' most common needs. Assuming you don't have time to pore over your Shopify store's entire analytical suite just now, what standout analytics is most likely to guide your team's workload to the best effect?

Below is a compilation of the most operative metrics that have the greatest significance for most eCommerce businesses, along with how to use them:

  • Online store conversion rate. This category comprises several metrics, and comparing them will give you insight into the most crucial moment in your sales process. You'll see a gradual decrease in your "Added to cart," "Reached checkout," and "Sessions converted" numbers. These numbers often point to friction in the checkout process that prevents customers from completing purchases. Some customers use their shopping cart to compare items without intending to purchase them. A separate product comparison feature may reduce these false flags, leading to cleaner data.

    A major telling factor lies between your checkout page and payment input screen: abandoned carts. This is one of the most significant issues online merchants seek to overcome. Why are your customers only going through the motions of a purchase? Some are only trying to calculate shipping, which could be done with yet another pre-POS website feature.

    See the order timeline to gauge the seriousness of any given failed transaction. Those who input payment methods but encounter errors are more likely to respond to an abandoned checkout recovery message. It's never too late to recover an attempted sale, but only if you know about them.
  • Sessions or Sales by social source. For marketers, it's essential to know where to direct efforts. Aiming for new market tactics where your traffic conversions already have momentum is a safe ROI bet — it helps your support team know which channels to accommodate the quickest.

    When running affiliate programs or seeking off-page SEO hits, see "Top referrers by sessions"; it shows the top five websites referring customers to your store.
  • Comparing the Number of Cookies to the Number of Visitors. For any decision based on the number of users or website traffic, it's a common but easily avoidable mistake to make assumptions based on cookie data alone.

    For example, if it's necessary to calculate the number of customers as accurately as possible (an essential metric when allocating marketing funds or seeking investing partners), how are you proving it? Visitors can have multiple cookies running simultaneously, which inflates the number of sessions being calculated. Be clear about which cookies you are comparing, as well, as Shopify uses two types that identify users and devices separately.
  • Top products by units sold. Product onboarding is one of the most common Shopify glitches. If you've experienced this and have an exceptionally high number of new product listings, knowing which product types perform best helps you know which new listings should be uploaded first.

This is also an essential metric for inventory purchases and will help you make better supply-chain decisions.

Applying Shopify Analytics to Your Sales Strategies

Now that you know how Shopify analytics can more effectively guide your efforts, you're likely to start thinking about which metrics will reflect your work in your Shopify store. Will modifications to your website have more of an impact on sales rates or customer support? Streamlining the buying process would likely impact the former while including more product information could lighten the load on your customer support.

Are those modifications more likely to impact "sessions by device type," "sessions by location," or for any reason? Do "sessions by traffic source," " social source," or " POS location" have more of a bearing on your marketing team's subsequent efforts?

The questions are endless — but with a mindful application of Shopify eCommerce analytics, the answers become more precise and relevant to your daily operations.