How to Leverage Your Shopify Analytics for Holiday Hypergrowth

How to leverage your Shopify analytics for holiday hypergrowth

The holidays are around the corner! Lay your Shopify store’s foundation now and put your brand in a position for holiday hypergrowth.

Do you know the best indicator of the future? The past.

Last year, Shopify merchants broke records with $6.3 billion in sales over Black Friday and Cyber Monday (BFCM).  Daily total sales also started increasing 28 days before Cyber Monday—that’s 10 days earlier than in 2020. The holiday season is kicking off earlier and earlier each year.

Buyers are coming! Ecommerce operators must put themselves in a position to maximize their traffic and sales.

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How do you put your brand in a position to scale? Leverage your analytics.

Prep your store’s foundation by understanding past performance, setting goals, and iterating. Once you leverage your analytics, you’ll be in a position to make better, more informed decisions about your business.

Start with these 3 steps:

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1. Understand your baseline: If you’ve been in business for a few years, take some time to reflect.

1. What was last year’s revenue?
2. Which products led to sales?
3. How did your conversion rate look?
4. What was your AOV?
5. Do you have enough inventory to match prior demand?

Understand your past sales in order to make improvements.

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2. Set data-backed targets: Using last year’s stats, set realistic goals for 2022. Use previous successes (and failures) to inform your sales strategy. Make sure your goals are SMART (Specific, Measurable, Achievable, Relevant, and Time-bound).

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3. Monitor and iterate: Build daily data checks into your routine and make sure your efforts trend in the right direction.

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Let’s look at these steps in action.

Imagine you operate a skincare brand. Evaluating last year’s November and December performance, you notice lip balm was a clear best seller, with a low return rate. This year, try offering it as an in-cart or post-purchase upsell on all orders and set a goal to increase your average order value by X%. Test this bundle, and adjust it accordingly.

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Four e-commerce analytics collections to prioritize and monitor

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1. Key performance metrics

Fast-growing DTC brands keep a constant pulse on these data points, and daily trends should be pretty steady over time.

Data spikes could signal success from a new marketing strategy! On the other hand, drops could flag an issue (like a broken app in your tech stack) or friction (like an obstacle in your checkout flow).

• Net Sales
• Total Ad Spend
• Users
• Conversion Rate
• AOV

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2. Sales data

In order to set targets and position their store for growth, e-commerce operators need an understanding of where their dollars are coming from.

• Compare sales over time. What were your sales last year? Knowing your previous sales stats can help to set targets and manage inventory.
• Map high-performing products to your sales. Knowing your highest (and lowest) performing products helps to determine which products to push in marketing campaigns.
• Understand the breakdown of first-time vs repeat orders. The holidays are a great time to acquire new customers. Over time, are you retaining those customers? If not, you may want to pursue a new customer retention strategy.

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3. Site performance:

With the rising cost of ads, it’s important to make sure customers hitting your site are converting at the highest rate possible. Exploring your customer’s journey shines a light on the quality of traffic you're driving and their behaviour in your store. Keep an eye on:

• Users
• Orders
• Conversion Rate

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4. Channel Efficiency:

You probably know how much you’re spending on ads—but are your marketing dollars moving the needle?

• Monitor conversion by medium. If you’re running ads on TikTok, YouTube and Facebook— do you know which platform is giving you the biggest bang for your buck? Does one platform drive a higher AOV? Perhaps your SMS campaigns are performing better than social. Breaking down orders by medium can help to refine where you’re placing your marketing dollars.
• Monitor channel performance. This can include ROAS (your return on ad spend) and blended CPA (your cost per acquisition, or the marketing cost needed to transact a single order).

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Monitoring ROAS by channel helps you measure and analyze the impact of your ad campaigns. It might signal a need to pivot and change your ad strategy. Maybe you want to try split testing copy or CTA’s or using UGC! Take cues from brands like Fanjoy, who manage viral surges and edit ad strategies on the go.

Holiday ad spend tip: In November, shift 10% of your budget to retargeting campaigns.

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Strategies that lead to holiday hypergrowth

We’ve reviewed 4 key analytic buckets. Now, let’s dig into a few strategies that can help to reach your new data-backed targets.

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1. Implement a retention strategy to improve orders by customer type

Acquiring new customers is pricey—costing as much as [5x](https://www.shopify.com/retail/customer-retention-retail#:~:text=It's expensive to keep acquiring,selling to a new one.) more than retaining existing ones. Keeping this in mind, funnel your marketing efforts into retention, and soon enough, you’ll see a higher ROI.

How? Look at your orders by customer type. Calculate your percentage of new vs returning orders and build a retention strategy based on that info. A few techniques to try:

• Launch a loyalty program
• Start a referral program
• Nail the customer service experience

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2. Increase AOV by selling more to the customers you already have.

Let’s say your kitchenware store’s AOV is $75. What if you were able to upsell 500 orders a month by encouraging customers to spend an additional $25 on your best-selling oven mitts? You’d bank an extra $12,500 in revenue—without using extra marketing dollars.

Why?

Because you're selling more to customers you already have.

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BFCM sales strategies that increase AOV:

• One-click post-purchase offers. These offers are great because they don’t add friction to the checkout process and they’re triggered right after a customer completes their purchase—when excitement and customer loyalty are high.
• Pre-purchase cross-selling. This technique introduces customers to products related to what’s in their cart and is often displayed on the product detail page and/or in the cart. It’s the classic, “would you like fries with that?” strategy.
• Digital gifting: Gift cards once had a reputation as impersonal or an afterthought. Thanks to apps like Govalo, digital gifting is now a personalized experience that's appealing to recipients. Plus, it’s a huge revenue driver for merchants.

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For example, buyers tend to spend 33% more on a gift card than on a physical gift. When the gift card is redeemed, recipients are more likely to spend more than the value of the gift card. Govalo actually sees a $75 AOV increase when a customer checks out using a gift card!

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3. Test your way to a higher conversion rate

Even a 1% increase in sales conversions could have a significant impact on your store. To help set conversion goals, use Shopify’s e-commerce conversion rate calculator and see how your store stacks up against competitors.

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Conversion rate optimization strategies:

• Quizzes are a great way to target shoppers that need some direction. The experts at Justuno built an exit offer quiz for their client, Midland, and saw a 20% engagement rate (that’s traffic that otherwise would have bounced).
• A/B test your way to incremental change. Maintain a control group and set specific goals. There are many granular elements of your site to split test. Free shipping thresholds, gamified promo codes, search bar placement or additional payment options are just a few elements to test.
• Make sure your store is equipped to handle traffic surges. A slow website is a surefire way to lose customers, while speedy sites see an increase in conversions.

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Tydo is on a mission to make data more accessible.

Leveraging your analytics will put your business in a position for rapid growth—from BFCM and beyond.

At Tydo, we’re focused on providing data reports, visualizations, and insights so merchants have easy access to their data. Plus, we believe that merchants should have access to data basics for free.

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Pre-holiday tip? Sign up for Tydo’s free Email Reports, and get daily summary metrics delivered to your inbox. It’s the easiest way to keep a pulse on your store!

Understand your data, set goals, implement and iterate. Good luck!