Is your online retail business heading in the right direction? To answer this question, you need data.
For example, you need to know how many people convert into customers, whether they’re satisfied with the user experience, and many other aspects of running an online store. Shopify provides an opportunity for its users to get this information. Even more, it presents analytics on the corresponding page, so you don’t have to integrate complex solutions.
This page serves as a command center, providing store owners with a panoramic view of crucial sales, orders, and visitor data. If you want to grasp the store’s performance across multiple sales channels and for varying timeframes, go to Analytics.
What exactly should you monitor? This guide will walk you through the functionality and benefits of the Shopify Analytics tool. We’ll explore how to effectively use the Analytics page to:
So, let’s focus on this feature and what metrics to pay attention to.
Shopify is one of the top eCommerce platforms providing the ability to manage an online store of various sizes. It suits beginners due to its user-friendly interface as well as eCommerce enterprises, thanks to advanced features and approaches like Shopify headless commerce. Among its basic solutions is Shopify Analytics, which we’ll discuss in the following sections.
Shopify Analytics is an essential suite of tools and reports, giving online merchants an in-depth understanding of the store’s performance. It’s an integrated data interface that is dynamic and always changing to meet the demands of the digital marketplace. Here is what it offers:
Most website owners leverage Google Analytics to measure their metrics. So why should you tap into the Shopify Analytics tool? Isn’t it an extra time-consuming process?
To make it clear, let’s match both tools in the form of a table.
As you can see, GA and Shopify Analytics may provide similar insights. However, Shopify is more sales-focused, tailored for Shopify store owners, and created with them in mind. The tool developers have considered their users’ needs from the retail sector.
What does it entail? The data is real-time, allowing for agile decision-making. It aids in creating more targeted and effective marketing strategies, inventory management, and promotional planning.
The best thing is that it’s a part of the Shopify ecosystem, ensuring seamless integration with the CMS. These are its strengths. As far as weaknesses are concerned, Shopify store Analytics may lack the GA’s data comprehensiveness, advanced segmentation, and cross-domain tracking.
Let’s first begin with the reasons for measuring KPIs. Let’s assume you want to boost sales. What can you do?
For example, you may personalize communication to offer more relevant goods to shopprts. With the right product selections, you may nudge people to buy what they may not have heard about.
According to statistics, a tailored experience increases a client’s likelihood of making a purchase in 84% of cases. That’s where you need to understand what people really want.
How? With the help of data about consumers, such as their age, gender, location, and interests.
What do they usually purchase? Are there any behavior patterns they demonstrate over and over? Where do they come from?
Next, imagine a situation where prospective buyers are abandoning their carts at a specific stage of the buying process. You may want to identify where they drop off and fix possible issues.
Is it on the checkout page, the cart page, or another place? Shopify Analytics can also be instrumental here.
It displays the percentage of sessions that result in an order and tracks the conversion rate of online stores. The process is divided into phases, starting with adding products to the cart, going through checkout, and completing a transaction. By examining these phases, you can determine where clients are losing interest or running into difficulties.
In short, Shopify Analytics is all about creating more efficient sales funnels, making informed, data-backed decisions, and spotting underperformers. And that brings good results. According to McKinsey and Forbes, data-driven organizations are:
You can see what works, why it does and focus on these areas to take advantage of them. Alternatively, you may spot marketing efforts that are falling flat and tweak them for better performance.
Fewer roadblocks, speedier conversions, and minimizing risks. That’s what Shopify Analytics’s motto could be. Now, let’s overview the metrics available for measuring in the tool’s dashboard.
The first group of metrics revolves around understanding the financial health of a Shopify store. There are three cornerstone parameters:
Let’s break these down:
Total Sales
Gross Sales
Average Order Value (AOV)
What It Tracks
It gives you a comprehensive look at the store’s sales performance. It includes the sum of gross sales and then adjusts for discounts, returns, shipping fees, and taxes.
It measures the total value of all items sold before any fees or adjustments. This includes everything you’ve sold across all sales channels without factoring in taxes, shipping, discounts, or returns.
It calculates the average amount spent each time a customer places an order. It’s computed by dividing the total revenue (excluding gift cards and post-order adjustments) by the number of orders.
Why It Matters
This metric offers a clear picture of the store’s revenue over time. By sorting these sales amounts by sales channel, you can identify which ones are most profitable and which might need revamping.
By looking at Gross Sales, you get an unfiltered view of the store’s selling power. It’s the raw revenue number that tells you how much the company is actually selling before any deductions.
AOV is a key indicator of customer spending habits. Understanding AOV helps fine-tune pricing strategies and product promotions. If your AOV is higher, it suggests people are buying more expensive things or more items per purchase.
Each of these Shopify KPIs offers a unique perspective on how well the store is performing:
They help you make well-informed decisions that will lead to growth and success.
Now, let’s proceed to the next group of metrics in the Shopify Analytics dashboard: Returning Customer Rate and Customer Cohort Analysis. They’re not just numbers; they are reflections of consumer trust and satisfaction with your store.
Why? Because if people decide to come back to a business, they demonstrate their loyalty and happiness.
So, it’s critical to comprehend whether you’re able to delight shoppers with your offers. Note that both indicators are accessible in the default view, so you don’t have to take extra steps to see them.
Returning Customer Rate
Customer Cohort Analysis
What It Shows
This metric reveals the percentage of buyers who have shopped more than once in the store. To calculate it, divide the number of returning shoppers by the total number of those who ever purchased from you.
This Shopify store analysis tracks whether and when audience segments return to make more purchases. It breaks down the percentages of those groups according to the date of their first purchase.
Why It’s Useful
A high Returning Customer Rate is an indicator of consumers’ positive attitude toward the brand. It implies customers are happy with their purchases and the store’s overall experience.
Segmenting clients into cohorts lets you classify the audience and see how people behave in the long term. You can categorize the effectiveness of different campaigns and the impact of certain events on purchase behaviors. For example, you can track customers obtained during a New Year’s campaign:
Strategic Insight
By keeping an eye on this rate, you can assess how well your retention tactics are working. If the rate is low, it may be time to update your post-purchase follow-up or client engagement strategies.
Create more engaging and resonating marketing campaigns with the help of this data. For future holidays, you can think about using similar tactics or promotions if you observe that a cohort from a previous season sale has a high rate of repeat purchases.
In this section, we’ll answer the following questions:
There are four Shopify metrics that can be used to understand this and evaluate marketing and website performance. They’re all available in Shopify’s default view, so you don’t have to generate custom reports to get them.
Online Store Conversion Rate
Online Store Sessions by Traffic Source
Online Store Sessions from Social Source
Sales Attributed to Marketing
What It Displays
This indicator displays the proportion of browsing sessions that end with an order. It’s an obvious sign of how well you’ve organized the store to convert visitors into buyers.
This metric serves to identify how users have found your website. It categorizes possible channels into:
It measures the number of store visits originating specifically from social media platforms like Facebook, Instagram, YouTube, or Twitter.
In this report section, you can see how many products you’ve sold as a result of particular marketing efforts. Tools like UTM parameters are used to track these sales.
Strategic Importance
It divides the purchase journey into three main phases:
This detailed perspective makes it possible to pinpoint the stages at which potential clients lose interest. It helps improve exactly the required parts.
You find out what channels are the most fruitful so you can focus on them more and use resources efficiently. For instance, investing in social media marketing could be beneficial if your traffic comes predominantly from these venues.
Same as with the traffic source, you can pinpoint the social network to capitalize on.
By determining the efficacy of various marketing initiatives and campaigns, you can optimize the promotional strategy for greater return on investment.
Do you want to know how sales channels, staff, store locations, and products relate to your sales and revenue? Analytics for Shopify provides this opportunity with metrics, such as:
They revolve around day-to-day management, bringing to light chances for optimizing operations.
Sales by Channel
Retail Sales by Staff (applicable for stores with POS)
Sales by POS Location (for stores with multiple POS locations)
Top Products by Units Sold
What It Reveals
It reports figures associated with each store’s active sales channel, including online, in-store, or via social media platforms.
If you have a brick-and-mortar store, you can use this Shopify KPI to evaluate what sales each staff member is responsible for.
If you operate several offline stores, this metric is critical for tracking sales from each of them.
It shows best-sellers among your goods based on the number of units sold.
Strategic Insight
You discover where your marketing and sales efforts are paying off. Based on this Shopify data, you can specify the channel that requires your special attention.
You can utilize this information to study employee performance, plan their training, and incentivize high performers. It helps identify your star salespeople and those needing more support or training.
Your stores may vary in terms of their performance. With this data, you can spot the best-selling locations and those that might benefit if you refresh your approach, including stock, marketing, or staff allocation.
Information about top-selling products is needed for inventory planning, creating ads, recommendation sections on the website, social media content, and developing other goods.
After collecting Shopify data, you need to properly interpret it to reach better business outcomes. The Shopify Analytics dashboard lets you gauge recent sales and contrast them with the numbers from a previous time period.
You can easily switch between different date ranges, like comparing this week to the last or this month to the same time the previous year. By doing so, you can observe how a new marketing campaign, a seasonal trend, or perhaps a new product launch can impact sales.
Here is a step-by-step guidance:
Are your in-store sales outpacing online? Or is a particular social media platform bringing in more revenue than others? To assess the performance of various sales channels, check the “Sales by Channel” metric on the dashboard.
Proceed to the AOV parameter. If you notice an upward trend, it might signify that your audience finds more value in your offerings.
“Online Store Sessions by Location” and “Sessions from Social Source” are important Shopify KPIs for determining whom to target. For instance, if you find a high number of visitors from Instagram and most are from New York, doubling down on your Instagram New Yorkers could be a smart move. At last, come back to the Shopify data mentioned above during different periods.
Screenshot taken on the official Shopify website
Alt tag: Shopify Analytics tool
Let’s say you discover a 15% increase in returning buyers over the past quarter. Delve into what might be causing this:
Shopify Analytics is a critical part of running an online store. Whether you want to analyze your current standing, fix past mistakes, or plan future campaigns, embrace the Shopify Analytics dashboard.
You may feel overwhelmed by the number of metrics available within the tool. Start small. Tap into essential Shopify KPIs that are in line with your business goals.
Act based on the findings. For example, if your Shopify store analysis shows a high cart abandonment rate, investigate and implement strategies to streamline the checkout process.
And remember that analytics for Shopify is dynamic in nature. Track the Shopify metrics over time to detect short-term and long-term trends.
Now, it’s over to you. Apply these tips, keep a close eye on your Shopify KPIs, and watch as your store grows and evolves.
About the Author
Kate Parish is a chief marketing officer at Onilab. She has almost a decade of experience in the company and is still enthusiastic about every aspect of digital marketing. Kate sees the marketing mission in ensuring sustainable business growth. For this purpose, she helps companies and readers create efficient campaigns, solve common problems, and enhance crucial website metrics, such as conversions, bounce rates, and others.
