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How to perfect your
e-commerce channel mix with data

Reaching your customers with e-commerce analytics.

Your perfect channel mix refers to the most profitable combination of marketing channels you can use to promote your business. However, as you might expect this isn’t a one size fits all solution and cannot be dictated purely by your team’s preferences or specific channel expertise.

There are countless channels for an e-commerce business to reach its intended audience, whether this be through their own e-commerce website, through social media, via influencers and affiliates or simply through search engine results.  

Determining the right assortment of channels can be daunting because while the possibilities are endless - budgets are not. And with the added challenge of tracking increasingly fragmented consumer journeys; it’s difficult to know where to start to ensure your budget and time are well spent.

Luckily you already have the answer - and it’s in your data. By using these three simple steps you can use data to easily identify the best channel mix for your business and then thrive successfully ever after.

1. Understand your audience’s acquisition & retention channels

You may know that Google is phasing out cookies by March 2023. This gives e-commerce businesses a short amount of time to focus on customer acquisition before it becomes significantly more challenging.  So there is no time like the present to harness data to understand the motivations of your various audience segments across platforms. 

This is where e-commerce analytics come into play. Because in order to create a compelling multi channel funnel retailers need to be able to track and visualise the key purchasing behaviours of their customers. Understanding this behaviour allows brands to align spend strategically to support growth goals. 

For example, if a brand’s core audience is millennials then using social media to push tailored content is likely to drive acquisition. That might look like a Beauty retailer promoting a video on How to effectively layer products via Instagram to attract customers to their website and incentivise email marketing sign ups. 

Successful retention on the other hand will rely on a positive on-going relationship with the customer. Meaning that upon purchasing a moisturiser from that Beauty retailer, customers will need to be encouraged to opt into other marketing communications, allowing the brand to continue to nurture them with timely emails and offers around product replenishment. Because while a one-off purchase is great, brand loyalty only develops as a result of repeat purchases.

2. Optimise under-performing channels

Today’s consumers tend to glide from one digital channel to the next before making an actual purchase. Which makes it challenging just to track their journeys through a traditional funnel, let alone understand if you are using a channel to its full potential. This is where benchmarking tools can help contextualise each channel’s performance in relation to others in the industry.


Start by auditing your owned and earned channels to identify those with the highest and lowest conversion rates. For example if you find that Paid Social has strong conversion rates but low traffic, this may mean that you can afford to spend more money on this channel to drive more footfall and reap larger rewards. On the other hand, you might find that Affiliates has high traffic but low conversion, which could point to issues with your website loading time, a misleading product page or simply customers with low purchase intent. If you find a channel is significantly underperforming compared to the market, this is a signal to optimise spend accordingly.

3. Identify high value channels 

While revenue figures are important, they only tell part of your story. As revenue is driven by successful acquisition and retention activity, understanding the critical KPIs (read more about critical KPIs here) associated with each is the only way to achieve sustainable growth. In practice, this means keeping a close eye on repurchase rates and lifetime value metrics.   

A customer’s lifetime value (LTV) is the amount of money they bring to your business during their “lifetime” which is usually considered to be 1-3 years. By calculating this metric across your customer base you can determine which channels acquired the most profitable customers. 

Once you know where your best customers were acquired you can calculate your Lifetime Value to Customer Acquisition Cost ratio (LTV:CAC) to determine whether you are under or over spending on each channel. Because with this in hand, you might see that your Affiliates channel for example is earning you an outstanding £100 in profit for every £1 spent, which would justify increasing your budget for that channel.

Ultimately in the face of an increasingly competitive e-commerce landscape, your success will be determined by your ability to use data to identify the right channels to acquire the best customers and keep them engaged long-term. If managed internally this means hiring a highly capable team of data analysts, data scientists and engineers that will cost you huge amounts of time and money.

You didn't hear it from us, but the secret shortcut to finding the perfect channel mix for your e-commerce business is by using e-commerce performance analytics. Armed with this kind of solution you can visualise performance instantly, make data-driven decisions quickly and access benchmark reports to compare your performance against your competition.  

To learn more about LTV:CAC and other critical KPIs for growth click here.

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