They say you can’t fix a problem until you acknowledge it’s there. And for eCommerce, that problem is analytics. Teams are drowning in dashboards and, understandably, missing major glitches until it’s too late.
For one, there are thousands, even millions of metrics to track across multiple channels that even when you’re expecting unusual behavior, you might not be able to address it before you’re in the midst of a business disaster.
Case in point, recurring site outages during Black Friday and Cyber Monday weekend. In 2018, what started as a 50-percent-off Black Friday deal at J. Crew turned into a technical glitch preventing customers from checking out. Instead of boosting sales for the holiday season, the whole ordeal cost J. Crew an estimated $775,000.
The problem is that traditional approaches to eCommerce analytics are falling short at the most critical moments. Preventing these kinds of disasters and spotting unique business opportunities requires a new approach — real-time anomaly detection.
With AI and machine learning at its core, real-time anomaly detection monitors and correlates vast amounts of eCommerce data to forecast business performance. It’s a way to make reactive, often manual analytics processes proactive and autonomous.
There are four key ways that this expanding approach to analytics can improve your eCommerce business.
1. Increasing revenues and profitability
As costs of doing business increase and consumers expect more from your eCommerce experiences, Amazon continues to undercut retailers on price. And over the years, it’s become abundantly clear that you won’t be able to win a race to the bottom against the likes of Amazon or even Walmart.
Now, it’s more important than ever to balance your pricing power with the need to increase both revenues and profitability. With real-time anomaly detection, you can unlock insights that make this possible.
Look at Best Buy’s improbable turnaround as an example. By focusing on the “opportunity-rich environment” of retail, Best Buy has survived what looked like certain defeat. One key to that success has been identifying ways to personalize experiences to meet consumer expectations.
Real-time anomaly detection can help make this a reality by identifying unique eCommerce trends and tailoring marketing campaigns to support those trends.
But it’s not all about identifying opportunities to increase revenue. Anomaly detection also helps you spot technical glitches that lead to lost revenue so you can avoid disasters like the ones that happen every holiday season.
2. Converting more visitors into customers
Average eCommerce conversion rates leave a lot to be desired. Research from Smart Insights shows that global eCommerce conversion rates average about 2.86 percent. Any opportunity to increase conversion rates can significantly improve your eCommerce business — but spotting those opportunities can be a challenge.
While that report shows desktop eCommerce conversion rates hover around 4 percent, smartphones experience under 2 percent in conversions. If you’ve experienced similar splits, the answers to the problem may lie in data anomalies.
Real-time, AI-driven anomaly detection can help you analyze your email campaigns, customer engagement activity, consumer behavior on site and more. By automatically spotting and correlating anomalies, you’ll see where visitors are abandoning your site so you can address the issues and improve conversions.
3. Improving customer retention and loyalty
“Discounts are important, and they’re the basis of any rewards program, but if that’s all you’re offering, chances are the repeat purchases you’re getting are fleeting and not customer ‘loyalty’ at all! And if you’re not inducing true loyalty, your business is not future-proof.” — Shep Hyken, author of The Amazement Revolution and customer service expert
Experience is everything when it comes to keeping customers on your eCommerce site (and getting them to come back in the future). Anything from slow performance to outages and cart glitches can lead customers to your competitors, which is exactly what happened when the website for hardware and home goods chain Lowe’s went down this past Friday.
Problems with the eCommerce experience can result in slow revenue leaks that last for days or even weeks. What many companies already know but are reluctant to admit is that manually spotting these subtle leaks is humanly impossible, especially at the scale eCommerce operates in. It’s why real-time anomaly detection is becoming a necessity for eCommerce companies to stay competitive. These solutions will notify you of all issues — regardless of size — as they occur, giving you opportunities to plug leaks before customers abandon your site.
4. Keeping up with your competition
Competitive forces impact your ability to increase profits, conversion rates, and retention. And the only way to maintain an edge is to gain deep, actionable insights into your competitors’ behavior.
One way that real-time anomaly detection helps you stay ahead of competitors is through adtech analytics. AppNexus, an online ad firm acquired by AT&T for $1.6B in 2018, uses an autonomous analytics platform to detect both large and subtle problems in its ad campaigns.
With granular insights into real-time ad performance, this solution helps employees quickly address the root cause behind incidents, so they can augment campaigns before competitors adapt to the market.
Make your eCommerce analytics more dynamic
Companies are finding that the traditional analytics tools and dashboards that they were able to rely on in their beginnings are no longer sufficient. They restrict teams to a reactive approach, which can lead to missed opportunities, revenue leaks and a weaker competitive stance.
As eCommerce grows more complicated — more channels, higher consumer expectations, more metrics—you need a more dynamic approach to analytics.
If you want to keep pace with the ever-changing market and stay ahead of crucial business incidents, it’s time to implement real-time anomaly detection. Get the insights your eCommerce business needs, precisely when you need them.
Amit Levi is VP of product and marketing at Anodot. He is passionate about turning data into insights. Over the past 15 years, he’s been proud to accompany the development of the analytics market. Having held managerial positions in several leading startups, Amit brings vast experience in planning, developing, and shipping large scale data and analytics products to top mobile and web companies. An expert in product and data, his mantra is “Good judgment comes from experience and experience comes from bad judgment.”