Your Amazon Analytics are a treasure trove of information about your customers, your store, and how to grow your business. But don’t be intimidated by the data. You don’t need a degree in statistics to understand what it means.
Overview of Amazon Analytics
The term 'Amazon Analytics' covers a plethora of data and insights that help you understand how to improve your product listings and make better decisions about where to focus your marketing efforts. The sort of information you can glean from your Amazon Analytics includes:
- Product performance
- Customer behavior
- Sales data (both ASIN-level, which means "by product," and SKU-level, which means "by item")
- Inventory levels (including forecasting)
- Marketplace performance
- Competitor information
Navigating your Amazon Analytics data in Seller Central
If you're an Amazon seller with membership to the Amazon Brand Registry Program, then you will have access to Amazon Brand Analytics (ABA), a wide range of information in that you can use to inform business and marketing decisions. Simply log in to Seller Central, and then head to the 'Reports' tab.
Within this tab, you'll be able to access:
- Search term reports: these reports show you how well your search terms are performing as well as give you insight into the click-share (the percentage of total clicks for a particular search term that is directed toward a particular product), and conversion-share (the percentage of total sales for a product that comes from that same search term) for each term.
- Search query dashboard: The "Query Performance" dashboard provides insight into how your customers are searching for your products, showing you search query volume, impressions, clicks, add-to-cart, and purchases.
- Brand metrics: this tool helps you measure how your brand is performing throughout each stage of the purchase funnel, by showing you interactions/engagements with your brand (both ad-attributed, and non ad-attributed). This is a relatively new solution from Amazon that can help Amazon brand owners understand where to make improvements to listings and marketing efforts.
- Market basket analysis: this is key in helping you determine which products customers purchase at the same time (i.e. which items of yours they buy together). It allows you to make sure that your products are bought with other products that you know your customers like. If a customer buys one of your products and then also buys something else, you can consider making those products more accessible via bundles.
- Item comparison & Alternate purchase behavior report: similar to the Market Basket Analysis Report, but more targeted and, arguably, with more actionable information, as it removes the uncertainty around the length of time that something may have been in someone's basket. This report tells you what other items your customers are interested in, giving you a chance to expand your customer base by advertising related products. It can also help you determine which products to bundle together and sell as a package deal.
- Demographics: this is where you can see an aggregate view of customer gender, income, education level, and more. As an advertiser, you want to reach and engage with your customers as effectively as possible. To do this, you need a full picture of your customer base. This is where demographic data becomes indispensable.
Metrics are simply the numbers that measure how your business is doing. They can help you understand the performance of your products, channels, and campaigns.
Sometimes it can feel a little like an alphabet soup of acronyms, which we know can be a bit overwhelming! Here's a rundown of some common - and not so common - Amazon metrics that your Amazon analytics data can give you:
- Advertising Cost of Sales (ACoS), ACoS is simply the amount you spend on ads versus the revenue you make (the calculation for your ACoS is ad spend / sales).
- Average Order Value (AOV) - AOV measures the average value of every purchase made with a brand or seller over a specified period of time.
- Break-even ACoS - Break-even ACoS is more of a target than an actual measurement, but it's still important to understand it. Your breakeven ACoS is the amount you can spend on advertising without exceeding your product's margin.
- Click-through rate (CTR) - Click-through rate is a key metric to judge the quality of your ad's performance. It measures how many people click on your ads compared to how many people have seen them. Simply, it's the number of clicks, divided by the number of impressions.
- Conversions—the number of people who bought something after landing on a web page, such as an Amazon product detail page (PDP). Conversions normally happen within a finite period like 24 hours after someone clicked on one of your ads to buy something on Amazon.
- Cost of Goods Sold (CoGS) - Cost of Goods Sold is a term used to describe the total direct costs related to selling a product—this can include materials, shipping, and even labor.
- Customer Acquisition Cost (CAC)—how much it costs you to acquire a customer through advertising or marketing efforts; this includes all expenses associated with acquiring customers including media costs (like Facebook ads), creative development costs (like creating banner ads), and any other fees related to getting customers through paid advertising channels like Facebook or Google Ads
- Customer Lifetime Value (CLV/LTV)/Profit Per Customer - Customer lifetime value shows you how much profit you're making from each customer. Amazon sellers can use customer lifetime value to better understand how to target their marketing strategies, driving growth through more efficient acquisition and retention strategies.
- Customer Retention Rate - Customer retention rate is the percentage of existing customers who continue to be customers after a given period. Since repeat customers are cheaper to acquire than new ones, this metric gives deep insight into what keeps customers loyal, which can in turn help sellers boost their bottom line.
- Revenue—the total amount of money you made from selling your products or services over a period of time.
- Total Advertising Cost of Sale (TACoS) - This metric measures the relationship between your advertising costs and total sales. It differs from ACoS, which looks only at advertising revenue, not total sales. This isn't calculated by Amazon directly, but the formula is simple enough: Total ad spend / Total Revenue
Which tools for which data?
Amazon has many different analytics tools that can help you to understand your business and how it’s performing. The most popular ones are:
- Keyword research tools: these show what keywords people search for when looking for products like yours. You can use this data to help decide where to advertise so that customers find your product when they search for it on Amazon or Google.
- Customer Analytics tools: Customer analytics tools can be used to identify trends in customer behavior. For example, if a customer is purchasing from a particular location, or at a specific time of day and this information can be used by businesses to improve service and reduce costs. Customer analytics tools for performance measure things like conversion rates, sales per visitor, customer retention, and average order value to provide insight into how well your marketing campaign or website is performing. These tools also allow you to compare different time periods so you can see how your campaigns are doing over time, and how your long-term profits are impacted by improving your lifetime value/profit per customer.
- Price analytics tools: The most basic feature of any pricing analytics tool is the ability to see how your product prices are performing in real-time. This could be as simple as seeing which items have been discounted, or how much money you’re making from each sale. It will also help you understand how much margin is being added or removed by each discount event and what effect it has on sales volume. Price analytics tools will help you determine your pricing strategy as you can understand where you sit among your competitors and their products.
- Product analytics tools: Product analytics tools are useful for tracking sales trends and the performance of groups of products. They monitor sales to identify viable opportunities. Product analytics tools track key product metrics such as revenue, profits, and the number of sales. The data is usually presented in tabular or graphical form so that you can easily identify trends and patterns in your business.
How to interpret your Amazon Analytics metrics
You can interpret your metrics in many ways, depending on what you’re trying to learn. The first step is to figure out what question you want to answer.
- Consider the time period: Time can be one of the biggest factors impacting sales. Seasonality, discount events, holidays - even weekends can change buyer behavior. Understanding which periods are most critical for your sales can help you understand better when to run your campaigns to maximize performance, and even help with stock replenishment.
- Look at trends over time: Understand if a spike or drop in sales in a particular timeframe is a one-off or part of a wider trend that you need to look more deeply at.
- Consider connected products: Are there specific products that tend to drive sales for other products in your range? By looking at products that are frequently bought together, or that are bought in succession, Amazon sellers are more able to promote the products that are likely to bring repeat custom.
- Find your ideal retargeting window: Understand when your repeat customers are most likely to engage with offers and promotions by analyzing the time between purchases. This will help you identify exactly when you should ramp up your retargeting activity for maximum return.
- Understand customer retention: Fostering loyalty by understanding customers that buy from you again and again will help you see where you can afford to spend more on acquiring customers, and ultimately help you drive your Amazon sales revenue.
Quick tips for identifying areas for improvement
We recommend reviewing your sales by product, category, customer, keyword, ASIN, and country.
If you're an Amazon Seller Central user and you have access to the Professional Plan in Seller Central (which is required for this feature), then make sure that you review your sales by seller as well. It's also helpful to review any other metrics that are tracked in Analytics through the "My Metrics" tab of the dashboard.
Establish a benchmark. "If you can't measure it, you can't improve it", said Lord Kelvin (supposedly!) so the first step os to figure out where you are now. Make a record of your key metrics, and start creating a strategy for how you will improve each one. For example, if you want your revenue to increase by 20% year on year, you need to know what it is now in order to identify the levers you can pull to hit that goal.
Nozzle Amazon Analytics is a useful tool for sellers
Nozzle's Amazon Analytics is a powerful new tool for sellers to quickly and easily understand their customers, monitor their performance over time, and identify areas for improvement. It’s also great for building a brand by increasing profits and generating loyalty.
Hopefully, this guide has helped you understand some of the most important things about what Amazon Analytics are, and how you can harness these tools to beat the competition on Amazon.
Why not grab yourself a free 14 day trial of Nozzle today?
Or, if you have any more questions about how to use this tool or how to optimize your sales on Amazon in general, feel free to contact our experts at nozzle.ai. We’d love to hear from you!