Customers leave tonnes of data on e-commerce websites, primarily through their shopping carts, whether they purchase something or not. Many businesses make the mistake of ignoring this information. But your online cart contains valuable insights that can help you improve your bottom line.
Also called affinity analysis, basket analysis is a technique that looks at the items that a customer bought. Whether you’re hiring outsourcing to an experienced data management specialist in the UK or doing it yourself, basket analysis can help you increase customer loyalty, reduce churn rate, and unlock new sales opportunities.
1. Make accurate product suggestions
You get to see which products customers frequently buy from you when you look at their shopping carts. This information helps you make better-informed product suggestions, which you can provide on your e-commerce website or send via email for a more personal approach.
Plus, understanding such purchase patterns also helps you improve your sales forecast accuracy. For instance, you can predict when a customer would need to repurchase a particular product based on when they last bought one.
2. Curate lucrative product bundles
Shopping carts also tell you which products customers frequently buy together. In a makeup e-commerce site, for example, you see that users tend to purchase eyebrow powders and eyebrow gels at the same time. You can sell these two products as a bundle for a reduced price.
These packages are potentially lucrative because they can increase your average order value since you’re selling more products without incurring higher transaction costs. Also, bundles make it hard for customers to compare prices of individual items in different shops, so they just choose the most convenient option.
3. Reduce cart abandonment
Not everyone checks out their shopping carts. You can recapture these lost sales opportunities through a remarketing strategy. If a customer fills their cart without purchasing anything, you can bring them back through automated e-mails.
Remarketing ads are also practical tools for reducing cart abandonment. Facebook, for example, has dynamic ads, which show potential customers the products they already viewed but haven’t purchased. Dynamic ads give users a chance to take a second look at items they’re interested in. You can also capture the attention of lost customers by showing them other products that they might find useful.
4. Improve store layout
Optimize the layout of your e-commerce website by frequently placing co-occurring products. This creates more seamless browsing and purchasing experience for customers since they can find the items they need with a few clicks.
You can highlight on-trend items to show first-time visitors that you carry crowd favorites. You can also pique the interest of potential customers by creating a page dedicated to best-selling items.
Apart from these four benefits, basket analysis can also help e-commerce businesses improve their inventory by showing you which products run out fast. Market segmentation also becomes easier when you perform affinity analysis since you get to characterize different types of shoppers based on what they frequently buy.
Ultimately, data mining gives you valuable insights about your customers. And these insights help you deliver more value to your target market. This enables you to boost the loyalty of your existing customers and build trust with prospects, potentially increasing your bottom line.