Analysing Your Sales Data to Grow in 2016
Getting your head around how customers interact with your business is a huge factor in building for the future.
As the expression goes “Those who fail to learn from history are doomed to repeat it” and it certainly rings true when planning your business strategy for the coming year. Here we look at the data you should be paying close attention to and how you can make better use of it as you continue to build your business in the new year.
Finding Data and using it effectively
The more detailed a picture you have of your customers, the better prepared your business is for the future. As such you should ensure that you have the most complete data possible regarding sales/enquires/sign-ups (both instore and online), marketing and website performance. If you are failing to keep track of this data then you will be putting yourself at a severe disadvantage, compared with competitors who have been closely monitoring theirs. The data you have on each of these will vary depending on the systems you use. However, at the very least you should have information from Google Analytics (online software used to track website performance and sales) and your POS Software (your instore point of sale system). Google Analytics is an essential free tool that all businesses should be making use of. Although it is one of the most popular analysis tools, recent estimates from w3techs.com put the number of websites still not actively using Google Analytics at one in three. Add to this the fact that even fewer will be using ecommerce tracking data – and fewer still actively analysing it – then it gives those with the common sense to effectively utilise their data a significant advantage. An effective POS system is also a must for any business. Not only will a streamlined system make your in store sales quicker and easier for customers, but any system worth its salt will gather additional sales, marketing, staff performance and a host of other data. intelligentpos® for instance, offers a back office portal enabling you to manage reports, stock & inventory, loyalty, and more, as part of a high-speed iPad point of sale. You can learn more about what intelligentpos® can do for your business by signing-up to a free trial. When searching for a POS system, make sure that the one you choose for your business offers more than the standard sales features as these will be immeasurably valuable further down the line.
Analysing your sales data
This should be your absolute priority and fortunately, it is also the most accessible information you will have. Whether you provide a product or service, it is almost certainly the bottom line of your business’ measure of success. Understanding your customers and how they got to the point of purchase will provide you with the insight necessary to improve and expand your business, reaching those who fell out of your sales funnel at an earlier stage.
Tune in to your demographic
Analysis of your online and offline sales data should provide you with a plethora of demographic information. Analyse your data for gender, age, nationality, location and interests. Google Analytics provides detailed breakdowns of each of these categories, allowing you to more completely understand who your customers are. You might find that you are attracting (and converting) middle-aged travel lovers or perhaps teenage technophiles. In any case you can use this data to target the most effective advertising platforms for these groups or tailor your promotions to suit. Whether you advertise in magazines, radio or online, getting a strong sense of your target market will allow you to pinpoint the promotional platforms and marketing focus that engages your target customers and gives you the most reliable return on investment.
Analysing your advertising and marketing performance
If you are currently running campaigns on any marketing or advertising platforms, now is almost certainly the time to take a step back and analyse performance. An astonishing number of businesses subscribe to outsourced or ‘ready-made’ advertising options, without a clear understanding of how these are performing. Very basic reports or a lack of reports altogether can make it near impossible to see how valuable a marketing option actually is to your business and whether it is directly resulting in sales. Email marketing campaigns can be very lucrative and cost effective options for businesses, but how do you know what’s working and what’s not? What kind of content do your customers respond to? Are particular offers proving more enticing than others? Understanding this data is imperative if you want to make email marketing a part of your strategy in the new year. Other advertising platforms such as Google AdWords – if configured correctly – can allow you to see precisely how many sales and what volume you are receiving for your accrued costs. This and other platforms such as Facebook advertising can allow you to zero in on your targeted customers. Whether by interests, relationship status, age, gender or even their tendency to shop online, you can target types of customers down to the finest of details.
Understanding your sales acquisition channels
Where are the majority of your sales coming from? While your planned marketing options may be your most direct form of customer interaction, you may be missing the lesser-known routes that are really turning customers onto your business. Understanding your instore customers' motivation can be difficult to determine, but simple customer survey questions (basing this around a promotion) can be a great way to do it without pushing too hard. Comparatively, your online acquisition data is accessible via Google Analytics. Every sale or conversion can be actively tracked back from purchase to the method of arrival on the website. To achieve results through:
- Organic Traffic? Consider greater investment in SEO.
- Referrals? Try outreaching to more similar websites for promotion.
- Social media? Utilise social media advertising or up your levels of social media management and interaction.
- Paid Search? Increase your daily budget if return on investment is high enough.
- Direct Traffic (instore and online)? Increase brand-based advertising.
- Newsletters? Focus on increasing sign-up and providing the most engaging content and promotions.
Whether your customers arrive through search engines, newsletters, adverts, word of mouth, forums or otherwise, providing more backing to the channels that convert will result in less advertising guesswork and produce a more reliable return on investment.
Heed customer feedback, particularly complaints
A lesser known business adage states that “For every customer complaint, there are 26 other customers who have remained silent.” While positive feedback can make you feel you’re doing something right, a single complaint can bear significantly more weight than you realise. As a result, being proactive about customer complaints in the new year will have a significant positive impact on your business’ future. Having a feature on your website to take customer comments and complaints and a log kept instore of the same, provides you with a guideline for major challenges you need to address in 2016. Likewise, social media can be a very popular hotspot for customers to vent about issues regarding your business. Whether it is related to a product or customer service, just showing some proactivity in these areas can indicate to customers that you are listening and aiming to get it right. In social media, make sure to respond to any customer complaints or comments as quickly as possible. Even if you can’t fix their issue, showing that you are willing to engage plays a big part in customer retention. According to Forum Corporation Research, “Almost 70% of the identifiable reasons why customers left typical companies had nothing to do with the product. The prevailing reason for switching was poor quality of service.”
Analyse Your Website's Performance
If your website is receiving a reasonable volume of traffic then certain patterns will start to become apparent. Where are people gravitating to on your website and where are they abandoning their purchase, sign-up or subscription? For any analysis of website performance, it is generally best practice to start from your bottom line and work backwards. Whether you are focused on sales, subscriptions or otherwise, you should be tracking a goal funnel that monitors your number of conversions and the performance of the steps that lead up to it. A typical online goal funnel could have the following steps:
Shopping Cart > Checkout > Payment > Success
A customer has plenty of occasions to drop out at each of these stages. Naturally, a customer online is far more likely to abandon their cart in a queue than a customer instore. As such, your payment process needs to be streamlined, simple and direct. If you find that one stage has a significantly higher drop-out rate than others then it may be worth looking at the general usability of that page. Often, quite small, simple changes to the process – such as more obvious progress buttons or transparent postage costs – can have a significant impact on performance. Bear in mind that improving success rates from 1% to 2% will result in an additional paying customer in every hundred.
Maintaining growth and development
With the options above, you can give yourself a significant advantage over competitors who don’t heed their marketing and sales data or at least aren’t reviewing it correctly. The new year is a great time to revaluate your business performance, but you must ensure that you have the right tools for the job. Good online analysis software like Analytics is vital, as well as a point of sale system like intelligentpos® when you’re looking to manage, analyse and market your business the right way for your customers. If you are lacking the data to make significant change this year, then applying the tools to allow you to do it should be your first step.