4 Types of Amazon Analytics Tools and Are They Worth It?
It's been long acknowledged that surviving, let alone thriving, as a Seller on Amazon is a complicated process. With the number of Sellers and products available growing by the second, it seems near impossible to get any kind of visibility or growth. This year alone, Amazon reported that it now has nearly 2 million small and medium-sized businesses — and it's only expected to grow larger from there.
This is where analytics tools come in. Understanding your customers, products, and trends are all critical to standing out and succeeding in a crowded marketplace. Luckily for you, Amazon has continued to expand the data they make available to Sellers with their own reporting platform, Amazon Brand Analytics (ABA), which provides said critical insights — check out our free eBook Mastering Amazon Brand Analytics for a full guide on that.
However, the third-party market has also expanded, and more sophisticated options are available to analyze, supplement, and report the standard data available to all Sellers. If anything, the challenge is picking the right tool and understanding where investments in advanced analytics are really worth the cost.
So, if you've ever thought, out of all the tools out there, which one is the most important? And what makes them important in the first place, well... you've come to the right place.
In this article, we're going to cover the four major types of Amazon analytics tools and explain what each one delivers, plus the kinds of Sellers that would benefit from each.
Full disclosure: We are an Amazon analytics software provider. Our product, Nozzle, uses AI and Amazon data to optimize Seller experience, including insights on customers, competitors, and ad delivery — as well as tailor-made business solutions. Of course, we highly recommend our product, but it can't do everything. Understanding the full spectrum of choices will help you build the right tool stack for you. So, let's get started.
Customer analytics tools
Amazon has been known for providing large volumes of customer data to its Sellers with little clarity on what data exactly means, forcing brands to use tactics to gather information on customers. That is changing somewhat as Amazon has started providing tools like Demographics within their Brand Analytics. But they still leave a lot to be desired.
There are multiple ways to build up a picture of your buyers on Amazon. One way is to use customer analytics software to combine a range of Amazon reports to give you a surprisingly detailed view of customer behaviors and buying intentions.
Analytics tools stitch together data across Amazon's siloed reports to provide an integrated view of the customer. Advanced data analysis then quickly finds insights across variations of the customer journey and helps prioritize the most promising sales journey. It enables Sellers to test various approaches in near real-time to determine which combinations will yield the best sales results.
What they deliver:
- Customer-specific insights.
- Analysis of the consumer base.
Who should use customer analytics tools:
Basically, every Amazon business.
- Customer insights are the foundation of succeeding as a business — customer habits and needs ultimately inform all business decisions and strategies.
- Calculating customer lifetime value (CLV) is crucial to ongoing success.
Tools worth looking into:
- Straightforward to access and comes directly from the source.
- Provides a picture of search trends, customer behavior, and competitors.
- Guaranteed to be aligned to Amazon’s landscape as it develops.
- Doesn't provide much in the way of context about why different brands and ASINs are doing well.
Suggested reading: For more detail, check out our eBook: Learn How To Master Amazon Brand Analytics.
- Enabled for both self-service and all-in capabilities depending on your Seller goals.
- Focused on key Amazon customer analytics such as:
- Customer Acquisition Costs (CAC): To gain a better understanding of your new and returning customers, thereby allowing for more effective budgeting and branding decisions.
- Customer Lifetime Value (CLV): Identify your customers’ true value and derive growth and profitability opportunities from those insights.
- Customer behaviour: Track and pinpoint the decisions your customers make to optimize your selling strategies.
- Ad management: Make better advertising decisions with insights provided by PPC and DSP experts.
Price analytics tools
Sellers need to use pricing tools because prices change very quickly with new market entrants and more fierce competition. So, keeping a check and maintaining competitive pricing is essential, and you really can't do this manually. Setting a price that is too high or too low will, at best, limit product growth. At worst, it could cause severe issues for sales and cash flow.
It isn't as simple as if sales are high, raise prices; if sales are low, lower prices. What you definitely want to avoid is a race-to-the-bottom.
Cutting your margins through price reductions doesn't always improve your position on Amazon. That is why it is vital to understand the effects of different pricing strategies.
What they deliver:
- Pricing history/analytics and revenue insights.
- Dynamic pricing rules to decide how and when the tool should change your product price.
- How to deal with FBA (fulfilled by Amazon) and non-FBA products.
- Which products and merchants to price against.
Who should use price analytics tools:
- Businesses that are struggling to get exposure
- New sellers that are still figuring out their price points.
- Resellers, as they are most sensitive to pricing changes
- Sellers in markets that have high or seasonal price fluctuations
A good pricing strategy will also help win your share of the Buy Box. For more information, check out our guide on Conquering the Amazon Buy Box in 2021
Note: Customer analytics can also optimize a seller's chance of the buy box. CLV insights provide deeper context for what pricing strategies would be profitable. We cover this in more detail in Effective Amazon Pricing Strategies for Sellers.
Tools worth looking into:
- Provides real-time comparisons between your fulfilment costs and FBA.
- Enables you to tweak your FBA price profitability to match or exceed direct fulfilment.
- AI tool that optimizes product prices based on what will win the Buy Box.
- Reprices in real time based on insights on competitors.
- Real-time updates about sales, profits, and product rankings.
- Simplified pay-out reporting with visualization.
- Customizable reports: single product or a combined analysis for all your products.
Search analytics tools
Amazon keyword research is one of the most crucial steps for an Amazon seller product launch. You need to choose a focus keyword or long tail keywords to attract your target customers and boost your ranking on Amazon.
Finding high-volume search terms is not enough. You also have to ensure the keywords used align with your product and brand and are your customer's keywords. And this is where keyword research happens.
With the right keywords, your Amazon keyword research will provide search term options that are most relevant to your product.
What they deliver:
- Keyword tracking and research for a particular product so that Sellers can ensure their product listings are optimized for every time a potential customer searches for their product.
Who should use search analytics tools:
- Sellers who want to expand their position/visibility in their specific market by optimizing results based on customer insights.
- Sellers who want to know more about their customers' search habits — this also needs good customer analytics.
Tools worth looking into:
- Keyword and competitor tracking.
- Super URL feature, useful in marketing products to social media users.
- Alerts for negative reviews and hacking attempts.
- Organic Search Performance tracking and optimization.
- Keyword research, keyword ranking, and listing tracker.
- Provides insight on competitors through research on product keywords and/or ASIN numbers.
- Listing tool for keywords and phrases that you deem important to your existing and future product listings.
Product analytics tools
There are two things Amazon sellers need to excel in the marketplace. Firstly, they have to find the right products to sell. And secondly, they have to offer it to the right customer base. Identifying and launching new products is key to retail success, but it can be costly and time-consuming. This is of course made all the easier with the right product analytics tool.
What they deliver:
- Tracks sales trends and performance of groups of products.
- Helps identify product trends and ideas for potential new products.
Who should use product analytics tools:
- Sellers who want to optimize their choices and decisions regarding their existing products based on evidence.
- Getting ideas for new products.
- Finding out the profitability of niche products.
- Basically, get an outsider's perspective on their own products.
- Sellers who need to know how their competitors perform and what they should achieve to overtake them.
- Sellers who sell, or are looking to sell, a niche product
Tools worth looking into:
- Monitors sales to identify viable opportunities.
- Tracks key product metrics.
- Customized grouping for "similar products."
- Database and research tool comprising 540 million products.
- Smart product feature filters — e.g. by price, weight, sales volume.
- Finds frequently used keywords for particular products.
Amazon Product Opportunity Explorer (Beta)
- Identifies potential niche product opportunities.
- Based on clusters of products related to sets of keywords.
You can only improve what you can measure
So, are these tools worth it? Yes and no. It cannot be stressed enough that the power of any analytics tool depends on your ability to act.
- All tools have their own 'worth', but it's clear that customer analytics tools hold the most value for money as they deliver the most valuable insights.
- Every insight delivered by these tools comes back to the customer.
- The benefit behind each tool also comes back to maintaining a detailed knowledge of CLV.
Customers are the most crucial factor to a seller's survival so prioritizing customer analytics only makes sense. The landscape of Amazon for Sellers is constantly evolving — in terms of design, software, analytics tools — but customers will never change.
The right combination of tools can provide adaptable, expansive solutions that seamlessly fit within your business while growing and adapting along with your Amazon presence. With this in mind, we think Nozzle could be the key to making the most of any toolset. Get a feel for how we fit with your Amazon sales by starting a free trial today.
.webp)
