Determining essential metrics for your goals

Welcome back! In my last post I wrote about the importance and definitions of data, data-based decision making and data-driven mentality. This time I want to dive a bit deeper into data gathering in itself. Let’s get you started on the track of mastering data collection!

I have to start this post with a spoiler: Not everything discussed in this post will be applicable to your individual situation and this post is not a definitive guide to data-collection. It varies per situation and organization.

For example: Metrics that matter for a webshop in clothes matter less for a webshop in pet-products for example. Some organizations want to maximize profits, others want customer retention. There simply is no one-size-fits-all solution here. But that’s okay. I’m here to teach you a mind-set and give fresh perspectives. You will have to figure the rest out yourself.

With that out of the way, let’s dive in!

Data collection – A unique skill on its own

Proper data collection and creating Data Collection Strategies are a whole unique skill-set on its own. Many professionals have built entire careers on mastering what data to collect, as well as when, how, and where to gather it. They will often have a background in data-analytics which gives them an advantage. But fortunately for us all, it’s not a requirement to start collecting data for yourself.

Becoming a master at data collection and analysis is a process, it requires trial and error. Over time, you too will become more apt in the process.

Navigating the Data Collection Maze

So, where to start with your own data collection? As stated earlier in this post, it’s important to first determine what your goals are. What do you hope to achieve with the data you collect? Goal-setting in itself is something we will cover in a future post as well. But, if you have the right goals set, you can determine your most valuable metrics.

If your goal is to increase your revenue as a web shop within a certain timeframe, you’ll most likely have to look at the following metrics.

• Visitors over time: How many per day/week/month, and what are the popular times?
• Revenue per visitor: How much, on average, does a visitor spend in your webshop?
• Conversion rate per visitor: Not every visitor is a buyer; out of 100 visitors, maybe 10 buy a product.

Making use of your data

Once you know the answers to the questions above, you’ll get a clearer image of what is actually going on in this webshop. You could have thousands of visitors a day, but only 5 of them buy a product. That means you could easily increase revenues by increasing the conversion rate.

The other way around, you could have only 100 visitors a day, but 15 of them buy a product. That means you have a great webshop conversion rate (15% of visitors). This suggests you could try to drive more traffic to your webshop to try and grow revenue.

Both options require different approaches. It might be “easier” to drive traffic than it is to increase conversion. Who knows!

Experimenting with different solutions will help you determine what works best for you. But know that running experiments based on such metrics would be considered very effective data use. We will dive into this later. It’s a whole chapter on its own, reserved for another time.

Moving Forward with Your Data

Wow, that turned into a much longer post then I initially set out with. But understanding and acting on the data you gather is crucial to optimizing your webshop’s, website or organizations performance.

Whether it’s improving conversion rates or increasing traffic, the key is to start small, measure your results, and continuously review your strategies based on what the data tells you.

Keep experimenting, and stay tuned for more insights on leveraging data to drive your business forward.