In online retail, it’s possible to travel to the past, thanks to data. What were customers’ paths to your store at this time last year? Different tools like Google Analytics can actually show you. Who abandoned their cart? Who bought the most? And how did they find your store? These data points can act as a crystal ball for your business.
Predictive analytics uses historical data to make decisions about the future. A survey by MECLABS reveals that only 37% of surveyed eCommerce businesses use historical data to improve their eCommerce sites. History is the best teacher, and predictive analytics allows retailers to use historical data to plan ahead. However, you need to make sure you have a game plan before you go ahead and use historical data.
There are three areas of your business that can benefit from predictive analytics, and we’re going to go over each of them.
Did they click on an ad because it was promoting a sale? Or was it a catchy title? These are important pieces of information that you can use to shape future ads. If you’re looking for inspiration on what to post to your social accounts, look at the types of posts that are providing the highest traffic rates possible. This can help shape the beginning of your customer’s purchase funnel.
Having hard evidence to support your decisions can take the guesswork out of the equation completely. Guesswork can lead to excess product and a waste of money, and a clearance sale to move inventory hurts your margins and brand image. Predictive analytics can make sure you avoid a surplus and a dearth of product.
You could have had the greatest, most catchy headline in your PPC ad. But, it can all mean nothing if your price is unattractive. One of the best ways to make sure your price is right is to test it at different dollar points. You can spot trends in your prices and learn which prices garnered lifts in revenue and profits.
There’s really nothing to fear about predictive analytics. Arming yourself with it can prevent the trepidation and insecurity that guessing brings. As a matter of fact, a lack of predictive analytics justifies distress. The answers to your questions are in analytics, and it’s up to you to unlock its potential. History repeats itself, and predictive analytics allows it to be an incredible teacher for retailers.