Insight Report FINANCIAL SOLUTIONS BUSINESS INTELLIGENCE Data from arvato s payment systems yields valuable insights into customer behaviours and trends. Convenience in every transaction
Executive summary As more consumers choose e-commerce as their shopping channel, e-commerce merchants can get business intelligence from their purchase and payments data. arvato's open and transparent reporting systems that put data at merchants fingertips and generate valuable insights provide a powerful advantage in a rapidly growing and competitive market landscape. INTRODUCTION E-commerce continues to grow. The latest figures show that more than 50% of Northern Europeans shop online (Northern B2C E-commerce Report 2015, ecommerce Foundation), with an average online spend of 1,956 a year. Many of these shoppers choose to pay after delivery, taking advantage of the additional flexibility and control that payment-after-delivery services offer. With clothing and footwear consistently among the top items bought online, many want to receive and inspect their purchases before paying. The option to pay by invoice, instalment or on account also allows consumers to take greater control of their purchases and payments. For example, using the My AfterPay self-service portal from arvato Financial Solutions, consumers can check all their incoming invoices, due payments and account balance 24/7. They can also adjust their payment plans to suit their individual circumstances dividing an invoice into instalments, or using a credit card to pay the amount due, for example. Pay-after-delivery services also offer a significant advantage for e-commerce merchants, thanks to the valuable data generated. Analysis of this data can provide business intelligence to improve business efficiency, marketing, sales and other aspects of the entire customer journey.
BY COMBINING AND COMPARING DIFFERENT DATA SETS, MERCHANTS GET VALUABLE BUSINESS INTELLIGENCE THAT CAN PROVIDE TRUE VALUE E-commerce merchants who want better understanding of their customers in order to increase sales and improve the customer journey should select a payments partner that is willing and able to provide this data-driven business intelligence. WHAT DATA, AND WHERE DOES IT COME FROM? Purchase and payment data from arvato s e-commerce systems provides both broad and deep insights into consumer behaviour. Every e-commerce client has access to an easy-to-use, personalised dashboard that presents the data in a transparent, convenient format. The dashboard data is segmented into: Age and Gender Daily Reservations Reservations per Weekday and Hour Monthly Controlling Repeated Reservations Daily Reservations, for example, shows order size, total order value, daily, weekly, monthly, quarterly or yearly cycles, identifying when people tend to buy and when they don t. Reservations per Weekday and Hour shows sales volumes and shares broken down by time. Monthly Controlling data includes subjects such as payment numbers and volumes, choice of payment method, returns (as an absolute or percentage of sales) and net purchase. Repeated Reservations is particularly relevant in terms of customer loyalty, seeing which customers come back to buy again. Monthly Business Intelligence Updates to each client present highlight figures for the month, and include links to the relevant dashboard category. These updates provide an additional level of transparency and convenience, making it even simpler for e-commerce merchants to transform their data into value. Beyond these categories, a geographic breakdown of the data provides an interesting dimensions where arvato can help e-commerce merchants better understand local trends, requirements and behaviours. Future releases of the automated dashboard will examine geographical spread. TURNING DATA INTO BUSINESS INTELLIGENCE Raw data starts to reveal its worth when put into context. By combining and comparing different data sets, merchants get valuable business intelligence that can provide true value. The data sets from the arvato dashboard can be combined to reveal behaviours and trends. For example, combining the Age/Gender data set with Returns figures for a fashion brand might reveal a higher return rate among younger customers. One age group might make more purchases, while another may have a much higher order value. Combining the arvato data with that from other sources can reveal even more. Web analytics or campaign data together with Reservation figures, for example, can show which websites, pages or advertisements encourage more sales. Reservations amount 800 000 600 000 400 000 200 000 0 1 800 1 600 1 400 1 200 1 000 Number (*) of reservations 800 600 400 200 0 Age and Gender distribution Unknown Male Female 20 29 30 39 40 49 50 59 60 69 70 79 Age range Daily Reservations May 2013 June 2013 July 2013 August 2013 September 2013 October 2013 November 2013 December 2013 Reservations per Weekday January 2014 Saturday 11% Friday 14% Thursday 20% February 2014 March 2014 Sunday 15% Wednesday 14% April 2014 3 000 000 2 500 000 2 000 000 1 500 000 1 000 000 500 000 0 Monday 13% Tuesday 13% Amount( ) reservations Source - arvato Online
ARVATO: TURNING DATA INTO INSIGHTS Collated payments and purchase data available through dashboard Analysis reveals insights into customer behaviour. For Brand X, a key target group prefers to buy on Thursday evening M T W T F S S Insights allow targeted marketing, with special offers and advertising ahead of the Thursday peak SALE! New data generates new insights, allowing constant improvement Insights improve logistics planning: the warehouse is fully stocked and staffed on Fridays Aggregated data from arvato s payment systems yields valuable insights into customer behaviours and trends. Smart merchants use these insights to improve their marketing, sales and other business processes. 4
VALUE FOR YOUR BUSINESS A smart online merchant gets the best value out of this business intelligence by adapting and adjusting processes, planning, marketing and sales to take advantage of and cater for consumer trends and behaviours. The simple fact that the majority of orders for one merchant are placed on Thursday evening, for example, means that warehouse and logistics staffing can be at maximum on Fridays. Cyclical trends can identify sales patterns around recurring events pay days, for example, or major sales events such as Black Friday or one-off occurrences, such as concerts or sporting fixtives. The combination of two or more data sets can provide deeper understanding. When the data shows that women aged 30 39 buy more on a Thursday after 9pm, advertising, offers and discounts can be focused around that time. Multiple brands or product lines can be compared, showing which is more attractive to specific target groups. The insights provided allow e-commerce merchants to structure special offers by promoting payment methods for specific target groups at specific times. For example, highlighting the availability of an instalment plan in the lead-up to Christmas can stimulate sales by allowing shoppers to spread out their repayments. On a more strategic level, personas personality constructs used to visualise a particular type of customer can provide insights into preferences in terms of purchases, channels, payment methods, advertising and so on. And e-commerce merchants can even see how they stand compared with the market, with international benchmarking figures available from arvato. CONCLUSION Aggregated data from arvato s payment systems yields valuable insights into customer behaviours and trends. Smart merchants use these insights to improve their marketing, sales and other business processes. These improvements along the entire customer journey can directly contribute to increased sales. The provision of such data should be a natural function of payment solutions, not something provided at extra cost. Today s payment platforms should be built to utilise this valuable data and deliver these insights as a basis for all services. Data-driven business intelligence is an invaluable asset for e-commerce merchants who want to build a better business. The authors: Marie Honningdalnes, Product Manager E-commerce, arvato Financial Solutions Norway has worked in the payment industry for more than six years, working with both card payments and invoicing for e-commerce. marie.honningdalnes@arvato.com Christer Pettersson, Head of ecommerce, arvato Financial Solutions Sweden, is a frequent speaker at e-commerce events and fairs, and has more than 15 years of experience in e-commerce, web development and online sales. christer.pettersson@arvato.com
ARVATO FINANCIAL SOLUTIONS arvato optimises business performance through proven finance and accounting outsourcing solutions. Driving value beyond cost through our innovative client engagement model, the quality of our service delivery teams and a steadfast focus on delivering value for our clients at every stage of the customer experience, arvato enables global companies to gain a competitive edge by improving their working capital. Our business philosophy is entirely client-focused and driven by our customers requirements. Tailored to meet and exceed the specific needs of each and every client, arvato integrates client-driven business rules with world-class process capabilities from a trusted partner. finance.arvato.com SITRUS AGENCY Sitrus Agency is redefining content, creating and maintaining sustainable content ecosystems that go beyond the old limitations of owned, earned and paid channels. With more than 200 professionals in five countries creating value for businesses and organisations across the Nordic region, we are part of Nordic Morning, the largest communications group in northern Europe.