Data-driven business insights are crucial for any Amazon seller to gauge the changing customer behaviour and market trends. Sellers face several hurdles to overcome challenges and identify opportunities when selling online on the Amazon marketplace.
Fierce competition, product substitutes, and finding new buyers are a few of the several challenges. Data analytics play an important role in facilitating the survival and growth of these sellers in an increasingly competitive market space. Keeping sight of necessary data points will enable sellers to increase sales and win market share.
When running a business on Amazon, you must ensure that you sell profitable products. Sellers must develop sophisticated skills to pave the path for long-term success. It comes through an incremental approach that allows you to find and capitalize on short-term advantages while staying aligned to the ultimate business objectives.
Amazon sellers can no longer rely on the traditional siloed approach by using crawling/scraping tools to pull product data from Amazon. Such an old-fashioned approach made it difficult to analyse sales and competition levels, determine price changes over time, and other critical data points.
But, as technology is advancing, mining data and using it for decision-making has become much more accessible. Collection and synthesis of data help sellers simplify their approach to identifying and marketing profitable products. Amazon analytics tools for sellers allow them to go granular, observing minute and critical factors regarding each product in their catalogue. Thus, sellers are better informed about the competition, customer dynamics, and pricing evolution.
What are Data Analytics?
Data analytics is crucial for any business to make sense of data. In a modern ecosystem, organizations produce large volumes of data daily. Data analytics is thus an essential operation to analyse raw data and make conclusions about that information. Whether real-time, historical, unstructured, structured, or qualitative data, data analytics help identify patterns, effectively generate insights, and inform and automate the decision process. Data analytics thus helps connect decisions and actions.
Why do Amazon Sellers require Data Analytics?
The cut-throat competition in the Amazon marketplace requires sellers to stay at the top of their data. With data analytics, sellers can become more innovative and forward-thinking in their decision-making. By connecting insights with actions, sellers can better optimize their product listings, improve marketing and advertising campaigns, optimize internal operations, and improve customer experience.
Data analytics arms sellers with actionable information to better predict the product’s performance and handle disruptions. Thus, an enhanced understanding of markets and customers will enable them to manage inventory in real-time, avoiding extreme cases of over-stocking and under-stocking that can impact cash flow. Moreover, with the help of data, they can make smart offerings and optimize pricing to boost sales while ensuring a healthy profit margin.
How can Amazon sellers use Data Analytics?
The analytical process involves several strategic steps to get the desired outcome.
· Sellers must primarily identify the business problem. Before they begin to collect data, they must try to identify what they want to do with it. Is it to optimize product listings, improve advertising campaigns, or boost conversion rates? Recognizing the business problem and setting well-defined goals effectively streamlines the entire data analysis process.
· Once sellers identify the problem, the follow-up step is data collection. Through surveys, reports, and other valuable sources, they must gather necessary data points to have a complete 360° view of the problem.
· Data cleaning is crucial after collecting and combining data from various sources to amend or remove incorrect or superfluous data. It helps improve data quality and eliminates inconsistencies.
· The next step involves creating visualizations by leveraging appropriate charts and graphs. Using accurate reporting tools enables you to convert the insights into a consumable format to help stakeholders comprehend them. Accordingly, they can monitor the online selling business performance and optimize the relevant sections.
What are Amazon data analytics tools?
To analyse data, the Amazon data analytics tool comes in handy. These are technologically-advanced BI tools that allow sellers to perform a wide array of operations. It helps:
· Source products
· Forecast sales and inventory
· Keyword research
· Product research
· Calculate FBA fees and other taxes
· Manage PPC campaigns
· Optimize product listings
· Inventory management with restock alerts
Amazon seller tools have an extensive category of use cases. Based on the data problem and business objectives, sellers can leverage the tool to fit their purpose.
Importance of Sellers Reports in Data Analytics
Data provides a path to help Amazon sellers measure progress across several domains. While data analysis helps them extract valuable insights, it is only via the concise and relevant seller reports they can better understand their business prospects. Reports enable effective visualization of data, allowing sellers to determine how they should invest their time and resources to get the desired results.
The lack of data and analytics can cause sellers to struggle significantly and adapt to the ever-changing Amazon ecosystem. Thus, data analytics is of strategic importance to ensure success.