The customer is king! That is what any successful B2B business will tell you today. So, what does it take to put your customer (or your customer’s needs) front and center in your B2B eCommerce strategy? It’s simple really… The same way you invest time and energy in getting to know people who interest you in life, you also need to spend time getting to know who your customers really are. After all, while it is important to focus on new business, it is the recurring business that is going to prove essential to your sustainability. Research indicates 80% of your future business will come from 20% of your current clients.
If you want to build lasting relationships with your clients, you need to be interacting with them, engaging with them, and then, you need to take your relationship to the next level. So what is this next level, you may ask? Simply put it is when you take the information gathered by getting to know your customers and use these data-driven insights to gain a deeper understanding of who they are and what they want. B2B disruptor companies are doing just this and doing it well. They see the value in this data and are structuring their entire eCommerce strategy around the information they have sourced and analyzed. Without eCommerce analytics, you’re basically flying blind.
Effective eCommerce Analytics: It’s All About the Layers
There is so much to consider when looking at the statistics and analytics of your organization. Like the lovable, green animated character Shrek’s famous onion analogy, an effective B2B data-centric model will peel away the layers of this analysis to get at the heart of their customer. It is helpful to know the surface level information: who are your customers, where are they located, and which products are selling best. But what about the rest?
This initial layer of information does not tell you why your customer has chosen you as their B2B resource. It also does not give insight into why a potential customer abandons their shopping cart. Yet these analytics are of equal importance, and any good marketing strategy will ensure these layers are also being examined.
Authors of the book Data Mining Techniques comment:
“forward-looking companies are moving toward the goal of understanding each customer individually and using that understanding to make it easier (and more profitable) for the customer to do business with them rather than with competitors."
The Beauty Behind Conversion Rates
Conversion rates are one of the best metrics to use in the B2B environment but while there is definitely a place for this type of measurement, B2B business owners need to remain cognizant of the entire buying cycle.
It is common knowledge within the B2B environment that eCommerce customers will likely not make a purchase on their first site visit. For this reason, parameters should be put in place to measure the conversion rate on a different scale. Site owners can implement micro-conversions to effectively measure the conversion rate on a different scale. These micro-conversions could include elements such as the number of reviews read, the number of pages browsed and the number of products compared.
Experts agree that site owners should drill down beyond headline conversion rates if they want to achieve an accurate portrayal of their customer base.
The Importance of the Abandonment Rate
According to experts at Zobrist, reducing shopping cart abandonment rates is a major challenge in eCommerce. Analytics can help.
For example, if a distributor of auto parts is noticing an unusually high cart abandonment rate, they should review at the abandoned carts individually and look for trends. With this kind of visibility, they might find that several of those carts were abandoned after 1000+ brake pads were added to the cart when the company only had 600 in stock and ready to ship. If the customer didn’t want to wait for a back order, it makes sense that they would abandon their cart and opt to make the online purchase through a competitor with enough inventory.
With this kind of analysis, the site owner is then able to assess the reason for abandonment and whether it is due to inventory issues, location, or region. This type of information proves invaluable within the B2B world as it allows the business owner to effectively manage inventory volumes across locations for a greater conversion to sales.
Maximize Your Profit Margin
Being able to easily see the profit margins of specific products is important for eCommerce for two reasons. First, it allows B2B companies to determine the deepest discount they can offer while still maintaining adequate levels of profitability. Second, it provides insight into which products should be featured prominently on the site, which should be discontinued, and which should be more heavily advertised.
A typical manufacturer’s gross profit percentage falls between 25 and 35%. This is the gross margin, which reflects solely the relationship between revenue and the cost of goods sold. It does not include variables such as taxes, employee payments, and other ancillary expenses. There are various strategies that manufacturers can use to optimize profit margins. These include:
- Understanding individual customer margins. Here, a business owner can look at optimizing their individual margins which is a great way to impact overall profit margins.
- Conducting an in-depth analysis of all channels. This will give the business owner insight into the profit potential for each site. The owner can then define a sales strategy for each channel, aimed at maximizing that potential.
- Examining the supply chain. Optimizing the supply chain processes could lead to lower cost, higher quality, and reduced time-to-market.
Most importantly, businesses can integrate software to assist in measuring analytics and configuring products effectively.
How to Make Your eCommerce Analytics Work Effectively for You
Zobrist’s Smart Merchandiser ticks all the right boxes. Not only does it support Adobe Analytics, Google Analytics, and Coremetrics, but it also supports the leading eCommerce technology platforms such as HCL Commerce, Salesforce Commerce Cloud, and Adobe Commerce Cloud to provide a holistic solution for your analytics requirements.
Part of an effective eCommerce statistics and analytics strategy is ensuring no data falls through the cracks. Zobrist’s Smart Merchandiser has a proven track record in this field: no data goes unchecked.
