Data analytics provide insights that help businesses take evidence-based business decisions. It enables enterprises to uncover significant information from the raw data and help them boost profitability.
Gone are the days when companies’ advertising and promotions are all based on pricing and competition. Now almost all companies are focusing on customers.
But why? It is because the new generation of customers is not getting impressed with traditional marketing effort, they want companies to consider their individual choices and needs.
If you want your business to get success in online marketplaces, you must focus on data insights to make sure you are evolving with marketplaces and customer needs. Many of the businesses have already started using modern technologies such as artificial intelligence, machine learning, deep learning to make data-driven business decisions.
And you should also focus on data analytics to attain incredible sales.
Is it important to be data-centric?
Yes, there are many reasons for this. Data analytics conveys information that helps companies take beneficial decisions such as cutting down the cost of a low return campaign, increasing the budget of a profitable campaign, etc.
But how it can effectively drive more sales on online marketplaces. Well, online marketplaces such as Amazon and E-bay employs several algorithms and technologies to ensure the best shopping experience and accurate data analytics.
These data analytics provide everything from profit to spending on advertisements and therefore give sellers confidence in planning their business strategies. We have here listed a few of the benefits of using data analytics in online marketplaces.
Read on to find out.
Product research
It is never easy been easy to decide which product is best to sell on online marketplaces. And several reports suggest that several brands and companies get failed in selling their product online because of poor market research.
At such time, data analytics can help businesses and sellers by providing insights that are backed by solid data such as what people are buying, what the price they are willing to give, etc. And even after they add their products, data analytics enables them to find their most profitable products, their total spending on advertising, etc.
Segmentation
Analytics helps divide customer’s data into several segments for example according to their age, location, shopping habits, interests, etc. This information can help you target audiences that resonates with your products.
So, whether you want to target people who belong to a certain age group or living in a specific part of the world, you can make a marketing strategy that can directly influence them. In addition to this, segmentation also enables you to identify the most valuable group.
It will help you focus on investing money in the right customer segments and let you avoid those customers that are not likely to give any conversions. All this in the long run will help in maximizing sales and profits.
Effective marketing
The best way to stay competitive in the online world is to focus on- Customers. Data analytics provide insights that allow you to tailor-made the products for your customers.
Online marketplaces such as Amazon provides Split or A/B testing that lets sellers experiment between two or more variations in product name, listings photos, etc. This helps sellers find out- what is working for them and what is not.
In addition to this, customer ratings, reviews give sellers a wide idea of what their customers are feeling about their products.
When you will understand the winning ingredients of your product then it will be easy for you to market the right products in front of the right audiences.
Price optimization
Product prices significantly affect customers buying decisions. Online marketplaces tools enable companies to set prices based on key analytics such as market competition, seasons, etc.
It also provides information on sales that will help you analyze how discounting is impacting your product profits. And how a certain segment of people is responding to your discounts.
Amazon has built-in features to manage the price according to customer perception. Their software finds out the products that appear bigger in customer’s perception and therefore help to inline the price according to the competition.
Predicts the future
Data analytics help you foresee the market changes and react to them before the time runs out. Forecasting makes you prepared for events such as stock refilling, catalog changes, etc.
Let us take an example to understand this. We all know during festivals seasons sales grow but do you know which of your product sale has increased? And by how much? And not only on festivals, but there are also certain seasons, weekends, and parts of a day where sales can increase.
Data analytics let you know the answer to all these questions and make you well prepared for the future. So that you can advertise/ promote products weeks before the events and surge your sales.
In the end, data analytics will help you utilize the meaningful patterns in customer behavior and enables you to use information such as sales, profit margin, conversion rate to effectively target your existing as well as new customers. All this information will eventually bring you overall success.
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