That’s why it’s important to analyze everything that happened in your business during the holidays, instead of closing the books and diving into 2018. Looking at the data can help you understand what worked and what didn’t, as well as reveal issues and opportunities. All of those insights are based on a large volume of data, so your statistics are more significant, and your learnings more advanced.
Perhaps even more important than data analysis is making sure the data is valid in the first place. Have the proper systems and tools in place so you can collect data in a manageable and accurate way. Many software offerings create data reports and analyses for you. With Stitch Labs, for instance, you can look at your comprehensive inventory reports in order to understand what happened during a given time period so you can forecast more effectively.
When analyzing the numbers, always do a year-over-year comparative analysis if possible. This will tell you the most about where your business is now compared to where it was last year. From there, the question you should be asking is why? Why did these numbers occur, and then what effect did that have on the customer experience? If the average order value was significantly higher than last year, is that because you were more effective in cross-promotion? Or did you have more traffic going to your website because of an increased marketing budget?
Understanding those whys will help you determine action items for changing your business, both in the short- and long-term.
Beyond Your Numbers
Your hard numbers aren’t the only ones that matter. There are external factors to consider, as well as qualitative data, that can help you connect the dots between all your data points.
Industry trends: What’s going on in the eCommerce industry, and your specific vertical, that may have affected your bottom line? For example, if you look at consumer spending during the holidays for the past decade, you’ll see a dip during the recession in 2008 and 2009. It’s likely that retailers’ 2008 numbers were lower than in 2007.
Additionally, consumer behavior is changing. Today’s consumers plan for post-holiday sales. This year, 38 percent say they’ll wait until after December 25 to take advantage of those deals, up from a mere 5 percent in 2012. This indicates that retailers need to consider post-Christmas part of the holiday sales season.
Qualitative data: For many business owners, the best feedback you can get is from your customers. Talk to your sales and support teams and stress the importance of collecting and sharing customer feedback. Look at customer reviews to see if they’re singing a different tune than reviews you’ve received during the rest of the year.
How to Use the Data Moving Forward
The most effective use of data comes when businesses move quickly. With new technologies and ever-increasing competition, eCommerce retailers need to act fast to keep up and stay relevant.
For short-term success, such as post-holiday sales or ways to prepare for 2018, try pop-up sales, ad retargeting, cross-selling customers who purchased products during the holidays, and targeting new audiences with messaging that has already proven to convert.
Long-term, recall the why behind the numbers. Looking at the big picture and including all data can help you identify trends in your customer behavior and adapt your business accordingly.
Let’s consider a few examples:
Lots of backorders? Your customers likely went somewhere else; examine your forecasting strategy and see where you might need to pivot next year’s holiday season and in the upcoming months. Maybe you forecasted more products than last year, but you didn’t account for the additional ad spend that drove more traffic to your eCommerce store.
If your fill rate is low, then you may need to audit your fulfillment processes to see where you can improve. Are there warehouse organization issues, or is it because you don’t have aproper inventory management system in place?
Were there fewer coupon redemptions than last year? Take a look at your competitors’ deals, how you promoted the coupons, and how easy it was for your customers to redeem them. If you advertised adequately, perhaps redemption causes too much friction in the buying experience, or maybe your targeting was off.
At the end of the day, retailers are most successful when they look at the data together, instead of isolating metrics individually. Considering all factors can help you understand your business and your customers, and acting upon those insights are what sets successful retailers apart.
Stitch Labs helps thousands of retailers seamlessly sync inventory, orders, and data across all their sales channels and warehouses for more intelligent, profitable, and scalable retail operations.