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IRP White Paper on Transforming Ecommerce Profits Using the IRP Insights Terminal

The IRP Insights Terminal is proven to increase online sales and improve the efficiency of ecommerce teams. It reduces the complexity surrounding online selling and allows businesses to focus entirely on sales and profits.
Author
20 min read
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Overview

The culmination of two decades of research and development in the field of ecommerce technology, the IRP Insights Terminal (IIT) provides a proven solution for unprofitable ecommerce.

Generating profit is the primary reason why individuals start up companies. Conversely, unprofitability is the primary reason why businesses fail. In online trading, the problem of unprofitability is exemplified in recurring, identifiable problems that can be considered systemic: data inundation, multiplicity of tools, inadequate revenue-focussed direction, lack of information immediacy, imprecise attribution and accountability, leaking revenue and inefficient workflows.

The Insights Terminal was designed from the ground up to address every one of these issues. By mining the primary data of each IRP system and running analyses through sophisticated statistical models and machine learning algorithms, insights are continuously generated that can be actioned immediately, resulting in increased revenues on a global scale, ultimately pushing up profits for each IRP client.

This is proven technology for ecommerce. It creates a fully-quantitative, evidence-based environment in which the performance of every contributor to the online operation is constantly evaluated in the light of comparative market data. The Insights Terminal removes all trial-and-error guesswork and streamlines the efficiency of ecommerce teams.

The problem – unprofitability

Being profitable is one of the most fundamental aims of commerce – according to, Professor Michael Porter of Harvard Business School, “If your goal is anything but profitability – if it’s to be big, or to grow fast, or to become a technology leader – you’ll hit problems.”

Conversely, unprofitability is the primary reason why businesses falter, decline and ultimately disappear. In online trading, the issue of unprofitability is manifested in a number of systemic problems.

Data inundation

Consider the following selection of data sources familiar to most online businesses:

  • Revenue, margin & profit data
  • Customer data
  • Transaction data
  • Shipping data
  • Traffic & website data
  • Big data
  • Digital marketing & promotional campaign data
  • Service provider data
  • Product data
  • Pricing data
  • Epos data
  • Third-party software data
  • Stock control & supplier data
  • B2B data
  • Marketplace data
  • Admin staff usage data
  • Security data
  • Payment processing data
  • Current, historical & future growth statistical data
  • Competitor analysis data

This huge quantity of data is generated from several different origin points and it’s constantly being updated and expanded. It’s difficult to know where to focus attention, how to capture and analyse the data and how to make the most of so much information.

Multiplicity of tools

The data inundation problem generates an associated problem: multiple tools are required to collect and analyse data from differing sources. These tools may include separate packages for website analytics, campaign management & measurement, consumer behaviour, stock control analysis, pricing & margin analysis and other business information tools.

Third-party analytics packages can’t deliver what businesses need – it’s impossible because they don’t have access to the business’ raw data, only very high-level stats such as traffic figures, bounce rates and so forth.

Despite this, many companies attempt to juggle several different analytics and reporting packages to glean some idea about how their online operation is performing. But that’s no solution. The data is not set up to identify sales and profits in the most efficient way, thus making the ecommerce team intrinsically inefficient.

Inadequate revenue-focussed direction

Even when businesses do have access to their data and are using multiple tools, it’s almost intractably difficult for them to pinpoint which actions they need to take to drive sales upwards.

Owners and managers may be alert to the probability that their data contains valuable information, however they don’t know how to collate the data and mine the morass of information to find any potential ‘gold’ that may lie therein.

This leaves businesses suffering from inadequate directional input which they could action to generate growth and profitability – despite having access to the data.

Lack of information immediacy

Owners and managers often want to know the immediate state of their online operation – common questions are ‘how is my business performing today?’ or even more precisely, ‘what’s happening on my site right now?’. But where do they look to get comprehensive answers? Normally, it takes some time to pull disparate areas of information together in order to answer such questions.

Attentive ecommerce managers also want to know how customers are interacting with their website, how they navigate it, search on it, what they focus on, what they quickly dismiss, what devices they use, where they come from, how they purchase and so forth.

It is beyond the capability of third-party plug-in software to synchronise this real-time data with historical customer and sales data in order to generate actionable insights that increase sales.

Imprecise attribution and accountability

It’s vital that those in charge of running a business know which people in their operation are responsible for success – and failure. There must be an agreed attribution model to which all parties sign up. Likewise, it’s important that all individuals within the online operation understand that they are accountable for their activities. This is particularly important for service providers and ecommerce managers.

People’s interests need to be aligned with the business’ interests and their performance measured in terms of their contribution to profit. But in the increasingly complex world of modern ecommerce, the way to do this is often obscure. These problems of attribution and accountability are particularly systemic within ecommerce.

Businesses also need to know how they are performing relative to other companies in the same sector and the overall market. This highlights the issue of comparison. Analysing only their own performance has limited value when it comes to improving and benchmarking progress.

Most ecommerce operations have multiple dependencies on third parties and are connected to several outside organisations, therefore it can be difficult to truly understand who and what is adding value.

Leaking revenue

Business owners, financial directors and ecommerce managers need to be able to spot market trends and propose actions for their team to take that will lead to increased revenues and profits. To do this they might use methodologies such as pricing analysis, channel analysis, YOY comparisons, margin analysis, etc.

Whilst these analyses can certainly generate tangible results, there is no comparative benchmark data. That is the key missing element – companies need to be able to benchmark their performance against other companies in the same sector and against the overall market.

However it’s often difficult to locate meaningful benchmark data, especially detailed and up-to-date figures.

Inefficient workflows

Business owners and financial directors have an interest in knowing how the performance of their ecommerce team can be improved. However, it’s often unclear how efficiency can be increased or which actions will impact on the bottom line.

Ecommerce teams and website managers often have to spend a lot of time analysing data and then even more time taking actions that they hope will generate revenues – but with no certainty that the actions will have the desired affect.

In addition, much valuable time is spent on fixing problems and fire-fighting issues instead of focusing on increasing sales and profits.

The net effect is that teams are not functioning as optimally as they could, largely due to information gaps and lack of precise, profit-enhancing activity. Businesses may operate in this inefficient manner for many years, or even for the entire lifetime of their online operation.

The solution – turning data into revenue

The solution lies within the client’s own data. More precisely, by deep-mining the full scope of a client’s sales, product, customer, website and service provider data, comparing it to anonymised market data and factoring in best-practice and historically-verified formulations for online growth, the Insights Terminal uncovers hidden information that provides the keys to increasing revenues and profits.

The IIT solutions for the systemic problems in ecommerce described previously (and other issues that are raised repeatedly) are described in the sections that follow. Several fundamental convictions underlie our approach:

  • Ecommerce is a sales channel and success is measured by the sales number.
  • Information must be instantly consumable and actionable to be effective.
  • Precise reporting and a highly-regulated ecosystem are key for success.
  • Service providers are proven by sales results alone.
  • A consistent sales attribution model must be followed repeatedly.
  • Performance must be benchmarked against the rest of the market.

Note: It may be useful to refer to Appendix 1 – Insights Terminal feature set when reading through the descriptions that follow.

Data inundation – the IIT solution

The Insights Terminal accesses every possible data point across each IRP client’s business and displays the analysed output in accessible, highly-consumable format. The information is immediately available – everything is available at the click of a button.

From high-level, highly-pertinent information right through to micro-detailed, granular analysis of every data point, the Insights Terminal provides a comprehensive, profit-focussed solution to the problem of data inundation.

Of particular importance is the Mission Control section – this is the first page that clients see when they log in to the Insights Terminal. Mission Control focuses clients’ attention on the key performance status of their business.

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The Insights Terminal provides directional analytics, with a focus on sales and guiding revenue. Key information in the Mission Control dashboard includes:

  • Target data – Target versus projected sales, total sales, margin, profit and AOV for any timeframe, change in sales projection versus 24 hours ago.
  • Country analysis – Key country data ordered by revenue, plus identification of ‘breakout’ countries.
  • Summary data – Top-level, at-a-glance overview of stock, B2C, trade, epos, telesales and marketplace sales.
  • Sales summary – High-level sales stats including percentage change over 24 hours, 30 days and 12 months.
  • Sales analysis – Key analysis of sales data including hourly, daily or monthly data.
  • Product, category and brand analysis – Rankings, sales comparisons and growth figures, plus stock analysis.
  • Payment method analysis – Stats covering all payment methods used by customers, including 3D secure transactions.
  • Traffic source analysis – Service provider and channel analysis for each traffic source, including benchmarking data.
  • Revenue gap analysis – Analysis of projected sales versus the potential sales if all channels were utilised maximally and conversion rates were optimised.

Uniquely with Mission Control, clients can click on a product and immediately dig deeper and deeper into the product data, related order detail, and so forth. This is fast, directional access to core data.

Multiplicity of tools – the IIT solution

The Insights Terminal is specific to the IRP Commerce Cloud – the IIT centralises all IRP primary data and uses it to inform intelligence. Because all analyses are auto-generated (and manually triggered when desired) for every data set from the same, single system, the Insights Terminal solves the problem of multiplicity of tools.

This is particularly evident in the Sales Analysis section. This section allows clients to delve deep into sales data and understand customer journeys in order to promote continual growth.

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Sales Analysis contains comprehensive analytic output that clients can click into to view at increasingly granular levels:

  • Depth analysis of brands, categories, products, stock items and platforms.
  • Cross-analysis by country, sale type, traffic source, timeframe.
  • Depth analysis of best & worst-selling, highest-margin and most-discounted items.
  • Comprehensive stats for any dimension including sales, margin, profit, product conversion rate, AOV, sessions, views, conversion rate, average unit price, discount, shipping rate, orders, payment method stats, etc.
  • Multi-element comparison charts including overlay and stack features with zoom functions to view granular detail.
  • Hourly, daily or monthly data displays.
  • Watch list and data-export functionality.
  • Click into intelligence insights at any point to immediately take revenue-increasing actions.

Clients can effortlessly click through from high-level information to fine-grained analytics – this is fully interconnected data and actions, all from the one system.

Inadequate revenue-focussed direction – the IIT solution

The IIT generates actionable insights – the continual feed of real-time, data-led recommendations for immediate revenue gains can be actioned at the click of a button. These insights can be viewed and managed in the IIT Intelligence Inbox.

The technology in this section is the IRP solution for inadequate revenue-focussed direction. Every insight has originated from anonymised raw data from all IRP instances, combined with the primary data of the client’s own IRP, analysed by the statistical and machine learning IIT algorithms, compared with real-time and historical computations, and displayed to the client in actionable format.

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The insights cover hundreds of thousands of aspects of the clients’ business. They include ‘critical alerts’, ‘biggest financial wins’ and ‘fastest wins’. Some typical examples are:

  • Average number of model images is low – 2 images per model
  • 143 customers with 3 or more orders have not ordered in the last 3 months
  • 18% of active models do not have multiple images
  • Dropped basket email campaign with no incentive
  • Re-engagement email campaign not set up
  • There have been sales to China in the last 30 days but Alipay is not set up as a payment method
  • Traffic source has below average growth rate
  • Active models are missing images
  • No email segmentation for UK
  • No specific heading banner added

From the Intelligence Inbox, clients can then:

  • View details of the alert including: category, core metric, event type and origin.
  • See the ‘impact value’ of the alert and a full description of its solution.
  • View key market data associated with the alert.
  • Solve the issue by clicking the ‘Solve’ button and taking whatever actions are described.
    • An AI-based ‘auto-solve’ option is in development that will address the question ‘Can you make the move for me that will make the most money?’
  • Contact the relevant account manager straight from the interface.

There is also a specific Product Intelligence Inbox that reports on anomalies in number of views and conversion rates for categories based on data from the last 30 days.

Because the IIT has access to product margins, shipping methods, promotional prices, vouchers used, email campaigns, live chat, etc., the intelligence actions are limitless. In addition, as the machine learning system runs over time on each client’s IRP instance, it will continue to learn which actions are the most profitable.

Revenue-focussed direction reaches new levels with the prediction capability and AI-assisted trading functionality built into the Insights Terminal. This allows clients to use AI and machine learning to predict purchase likelihoods and intervene in a way of the client’s choosing in order to close sales, for example by offering immediate discounts or other incentives. When triggered, the technology detects and responds automatically to key selling opportunities.

Lack of information immediacy – the IIT solution

Because the Insights Terminal runs off primary data, it has live access to sales numbers and website usage. The Real Time section allows clients to understand what’s happening on their site right now.

Clients can see immediately such key information as:

  • How many customers are on site and if they are new or returning.
  • Where customers are located around the world.
  • Basket, checkout and order status.
  • What platforms, operating systems, traffic sources and search terms are being used.
  • How specific pages are being used.
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This is the IIT solution for the problem of lack of information immediacy. Equipped with this information, clients can:

  • Analyse on-site behaviour.
  • Trigger an intervention (e.g. price discount) to increase the likelihood of closing a sale.
  • Engage using Live Chat.

Once the IIT is activated, on-site behaviour is fed back into the machine learning model, giving clients the ability to analyse, predict and measure the actions that will increase sales on the website.

This is high-value functionality for ecommerce managers and website managers – and ultimately for business owners who will see the bottom line positively affected.

Imprecise attribution and accountability – the IIT solution

If ecommerce managers and business owners know how they and their service providers are performing relative to the market then they can more easily spot anomalies, make improvements, set goals and improve efficiency.

The Insights Terminal employs an agreed attribution model, benchmarking and performance ranking analysis to address the systemic problems of imprecise attribution and accountability within ecommerce. In addition to this quantitative data, qualitative feedback from owners, ecommerce managers and account managers is also utilised.

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The IIT is constantly calculating who and what is providing value, monitoring performance in real time to generate ever-increasing revenues. The Comparison section contains the key analytical data for service providers:

  • Service providers – for each service provider, the following data is shown:
    • Total Sales, Total Spend, CPA%, Target CPA%
    • Rank according to revenue generated and other performance measurements
  • Traffic source sales growth comparison – Sales and growth figures, benchmarking data expressed in terms of percentile ranking for the sales from each traffic source, average percentile ranking for the traffic source sales growth comparison metrics.
  • Traffic source CPA% costs comparison – CPA% and growth figures, benchmarking data expressed in terms of percentile ranking for the CPA% of each traffic source, average percentile ranking for the traffic source CPA% costs comparison metrics.
  • Traffic source efficiency comparison – Efficiency rating and growth figures, benchmarking data expressed in terms of percentile ranking for the efficiency of each traffic source, average percentile ranking for the traffic source efficiency comparison metrics.
  • Traffic source sales percentage comparison – Percentage contribution to sales and growth figures, benchmarking data expressed in terms of percentile ranking for sales from each traffic source, average percentile ranking for the traffic source sales percentage comparison metrics.

The Digital Village section also displays summary data for every service provider, including their name, current performance ranking, associated traffic channel, CPA%, cost, sales generated, and percentage contribution to sales. There is also summary benchmarking data expressed in terms of percentile ranking for each service, based on their performance for other clients.

The Digital Village section gives clients a real insight into staff usage patterns, industry connections and the third-party dependencies on which their ecommerce operation relies.

The IIT thus knows which service providers are proven by results and by experience and that – crucially – will be the right fit for each client. By using a consistent attribution model that is followed repeatedly, sales are correctly attributed to the correct traffic sources run by the correct service providers.

Read more: Solving Ecommerce Using Data and a Market-Based Approach Read more...

Leaking revenue – the IIT solution

The lost revenue analysis generated by the Insights Terminal provides a key additional dimension for financial reporting: results are compared to agreed targets, to history and to a real, externally-driven potential figure.

For example, the IIT might highlight that, 1) a company's conversion rate is lower than the average rate for other IRP clients, 2) that they are not running a specific digital marketing channel that is proven to generate growth for companies in the same sector and with comparable projections and margins and 3) that their CPA for PPC is much higher than the average.

Overall, this could reveal that the company's sales should be much higher than they are, even if at first glance their results might have looked reasonably good.

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This is the IIT solution for the problem of leaking revenue. The company's management team are now empowered to make some fast and effective decisions that will allow them to grow revenue further than they could otherwise have achieved without the Insights Terminal.

Read more: Lost Revenue Analysis by IRP DeepAgent (IRP client log-in required) Read more...

Inefficient workflows – the IIT solution

Rather than fixing problems and fire-fighting issues, the Insights Terminal frees ecommerce teams to maintain a constant focus on increasing revenues through the website. This highlights the IIT solution for the problem of inefficient workflows. The Insights Terminal:

  • Streamlines workflows for ecommerce teams, providing constant advice on where performance can be improved.
  • Provides efficiency by pinpointing clear areas of action that impact on the bottom line.
  • Empowers teams to spend less time analysing and more time taking actions to generate revenue.

The key for ecommerce teams is to find opportunities that can be acted on today. This could be as simple as changing a key message for a specific country, transforming its conversion rate and resulting in a huge uplift in sales – for very little time spent. Each day, teams may opt to:

  • Go straight to the Intelligence Portal to begin actioning insights for immediate gains. This option represents the least work for the biggest return.
  • Use the powerful Mission Control and Sales Analysis features to deeply examine, plan and act for longer-term results that can be monitored and which in turn become more input for the IIT to analyse and report on.
  • Perform the above actions in parallel. All actions should increase sales immediately or over a sustained period of time.

The Insights Terminal is an essential ecommerce tool for online merchants which not only highlights areas for instant improvement, it increases efficiency operationally and will fundamentally help businesses to grow sales.

Read more: A Team Guide to Sales Transformation Using the IRP Insights Terminal (IRP client log-in required) Read more...

Conclusion – switch on profit

The Insights Terminal is proven to be a sophisticated and elegant solution to systemic problems in ecommerce. It has generated growth rates in excess of 100% for IRP clients and provides business owners, financial directors and ecommerce managers with multiple measurable benefits.

Key revenue benefits

  • Reveals exactly where sales are coming from and how to increase sales.
  • Learns the sequences of moves that increase sales, tells clients what moves to make and who should make them.
  • Constantly learns to improve accuracy and to make more money for the client.

Key efficiency benefits

  • Streamlines workflows for ecommerce teams, providing constant direction on how to improve performance.
  • Pinpoints actions that impact the bottom line and highlights areas for instant improvement.
  • Reduces time spent analysing and increases time spent taking actions to generate revenue.

Key reporting benefits

  • Benchmarks digital marketing results against the rest of the market and reports on performance.
  • Compares results to targets, history and an externally-driven potential figure to generate revenue gap analyses.
  • Provides insight into staff usage patterns, industry connections and third-party dependencies.

Key real-time benefits

  • Provides real-time customer analysis of customer journeys in order to apply precision conversion techniques.
  • Computes purchase probabilities based on purchase history, location, language, device and real-time behaviour.
  • Works as a sales agent to manipulate sessions or engage customers directly.

The future is intelligent commerce

We can see the direction in which things are moving in ecommerce. The future is going to be fought out on intelligent systems. The Insights Terminal gives businesses the competitive advantage in this environment.

The Insights Terminal differs radically from all other third-party analytics packages. Only the Insights Terminal is built into the IRP system so that clients can move from insight-to-action immediately. It removes reliance on gut feelings about key decisions and replaces it with evidence-based direction.

The Insights Terminal cuts through the confusion of ecommerce, reducing the complexity surrounding online selling and allowing businesses to focus entirely on sales and profits.

Appendix 1 – Insights Terminal feature set

The Insights Terminal is offered to clients in three levels of increasing sophistication and complexity. Each level includes the features in the level below.

Level 1 Features
Mission Control Grasp the immediate status of your online operation and view comprehensive business metrics from one central dashboard.
Comparison Use IRP Cloud benchmarking data to measure performance and view unbiased ranking analysis of your service providers.
Digital Village Know at a glance how your team and partners are using the IRP and reach out to them at the click of a button.
Sales Analysis Forensically explore and understand your sales data and customer journeys to promote continual growth.
Reporting & Storyboards Create highly-detailed, custom sales reports to measure the impact of your initiatives and drive your online strategy.
Incoming Feedback Gather fast feedback from your customers and analyse the results to inform your business growth strategies.
Level 2 Features
Intelligence Portal Increase conversions, traffic and CLVs by acting on precise and instantly-available intelligence insights that cover thousands of aspects of your business, from channel opportunities to conversion optimisations, operational enhancements, product openings, and much more – the IIT reports on every action needed and offers an immediate solution.
Product Intelligence Portal
Level 3 Features
Real Time Insights View, analyse and replay customer activity as it happens to inform your decision making.
AI and Prediction Capabilities Use AI and machine learning to predict purchase likelihoods and intervene in a way of your choosing.
AI Assisted Trading Leverage the power of DeepAgent AI to detect and respond automatically to key selling opportunities.
Section Level Insights Deeply understand the performance and operational status of key sections in IRP Admin.

Appendix 2 – Testimonials

Digital agencies

“IRP Insights represents one of the most powerful innovations I have seen in the last twenty years of business information technology and ecommerce … The IIT Intelligence Inbox alone is just one element of a growing set of insightful and comparative tools from IRP that allows all online stakeholders (be they owners, managers, investors, advisers or providers) to follow, learn, benefit from, and grow sustainably via intelligent data and fact-based revenue recommendations based on verified historical performance, as opposed to subjective opinion.”
~ Alan Skelton, Founder and Director, Digital Ignition

“The Insights Terminal makes ecommerce profit driven and fact based – it is unmatched ecommerce technology.”
~ Michael Curran, Chairman, Built for Growth Digital

Online retailers

“When I was given an overview of the Insights Terminal and learned how to use it, it was eye-opening. The amount of time this can save our team will have a massive long-term effect. It will allow us to focus on the higher-level tasks of strategy and growing the overall business. The Insights Terminal analyses our data and turns it into revenue-boosting actions – so our team can focus more on implementation and moving the needle further along …

Having used the IRP for a few weeks, I have now changed my whole day’s workflow to be far more efficient. Rather than fixing problems and fire-fighting issues, I can have a constant focus on increasing revenues through the website. I start my day off by going through my Insights Terminal’s ‘Intelligence Inbox’ and can see the impacts this is already having in terms of revenue …

The Insights Terminal provides a level of data analytics beyond any other system out there.”
~ Luke Fox, Ecommerce Manager, Ann’s Cottage

“The Insights Terminal has been instrumental in us learning where to focus our ecommerce strategy. It includes a set of tools that allow us to see clearly how our ecommerce works and what actions we need to take to make more profits and grow the business, not only domestically but globally too. Previous analytics applications led to more questions than answers and never helped us to find the solution that increased our revenue. The Insights Terminal has enabled us to trade more efficiently and focus our attention in the right areas, giving us a sustainable, competitive advantage over our competition.”
~ Nathan Hyde, CEO, Camping World

“From day one, the Insights Terminal has added value. The technology has a unique ability to pinpoint specific actions we can take to increase our sales. It keeps our trading team focussed on sales and puts sales actions at the core of the ecommerce platform. In key areas like international sales, the Insights Terminal is uncovering information that is increasing the bottom line of the company. Already it is a key part of our team’s toolkit.”
~ Colin Christie, CEO, Christies Direct

“Sales growth and profit are fundamental to our business. We are now the fastest-growing, independently-owned fishing retail site in the UK. The key to outperforming our competition is working smarter and more efficiently: that’s why we use the Insights Terminal. It is unique in e-commerce – it identifies trading opportunities for products at real-time speed. Our sales keep increasing as we act on the intelligence information it produces. The Insights Terminal is an indispensable part of our trading technology, enabling us to stay ahead of the market.”
~ David Burleigh, CEO, Fishing Tackle & Bait

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