Cohort analysis, responsive design, and 3 other must-know eCommerce concepts

Cohort analysis, responsive design, and 3 other must-know eCommerce concepts
Christina Coons is a professional digital marketer at Northcutt, an inbound marketing agency. She specializes in e-commerce, social media, and public relations, and spends her days helping brands succeed online.

Got something cool to sell, and sites like Etsy don’t quite cut it? Guess it’s time for an upgrade. Time for you to stop dipping your toes into the world of eCommerce and dive right in.

Here’s the thing about that, though – running a full-fledged online retail outlet’s a little different from selling a few things on a user-driven site. There are certain things you’ll need to know, and certain things you’ll need to do.

First thing’s first, get yourself set up with an e-commerce platform. WooCommerce is a great choice. So are Magento and Shopify. Choose whichever one you like best and familiarise yourself with some of the plugins available to you.

Your next step is research. There are a number of terms and concepts you’ll need to understand in order to succeed.

Here are a few to get you started:

Cohort Analysis

What It Means

A study of a group of people who share a common characteristic, such as level of income, gender, or age.

The goal is to identify a relationship between said characteristics and a particular behaviour or set of behaviours. For example, people who all graduated within a certain year might tend towards a certain level of income, and might also tend to shop online more frequently.

Why It Matters

Imagine grouping customers by their referral source – people who come to your store via a keyword search might be likelier to purchase than those referred by a click-through advertisement.

By conducting a cohort analysis, you can determine which customer segments are your most valuable, and which marketing avenues are your best area of focus.

Responsive Design

What It Means

An approach to web design and development where a site readjusts its layout, orientation, and orientation and dimensions based on the resolution of a visitor.

Most notably, this allows sites to be more easily viewable on mobile devices. Responsive design may also involve content that’s made for smaller screens – shorter articles, smaller resolution images, etc.

Why It Matters

According to Outer Box Design, 62% of smartphone users have made a purchase online at some point within the last few months.

80% of shoppers used a mobile phone instead of a physical store to look up product reviews, and one third of all eCommerce purchases during the 2015 holiday season were made on a smartphone.

The numbers speak for themselves. If someone comes to your site on their mobile and is met with a clunky and hard to navigate experience, they are unlikely to go grab their laptop and come back to your site.

A/B Testing

What It Means

A process by which two versions of a web page are compared to one another in order to determine which has the best effect on user experience.

This allows a site to be optimized to maximize conversions. Some people also refer to this method as Split Testing.

Why It Matters

By utilizing A/B testing on your storefront, you can identify weaknesses in your web design and opportunities to enhance the buying experience.

Some elements you might modify to do so include:

  • the visibility of a free shipping value proposition
  • the text that populates the search field on your site
  • promotional categories and promotional offers
  • a site-wide tagline
  • content targeted based on categories of interest or demographic detail
  • sidebars
  • visibility of ratings & reviews
  • the size of promotional offers

Conversion Rate Optimization

What It Means

Conversion rate optimization is a systematic process by which you improve the performance of your website.

It involves making use of analytics and user feedback, and is largely based on your site’s existing traffic, unique needs, and overall objectives.

Why It Matters

The more you do to optimize conversions, the more successful your storefront becomes.

Instead of going on at length about why this is important, here are a few initial tips to get you started:

  • don’t base your efforts on guesses or hunches
  • don’t just copy what everyone else is doing
  • focus more on specific traffic or demographics, rather than blindly trying to bring in as many customers as possible
  • understand how to implement a call to action – a button, link, or interface element that leads directly to a conversion (sale)
  • know what a conversion funnel is, and how to develop one for your site

PCI Compliance

What It Means

In simple terms, Payment Card Industry Compliance is a set of security standards developed to protect financial information during and after financial transactions.

It requires:

  • secure networks
  • secure storage of cardholder data
  • vulnerability management programmes
  • strong access control measures
  • regular monitoring and testing
  • a transparent information security policy 

Why It Matters

If you ever want to implement card payments of any kind on your site, you need to do so in a way that’s PCI compliant.

The More You Know, The Further You’ll Go

The above terms are only a brief overview of some critical terms in the eCommerce space – but they should be enough to get you started.

You’ll learn more as you start managing your site. Good luck, and get selling.


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