Ecommerce Analytics in India – An Overview

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Ecommerce Analytics in India – An Overview

Ecommerce is an active and budding industry in the Indian market. Thousands of Indians buy and sell products online every day. Here, we’ll discuss what ecommerce analytics is and how it can promote better results for online store owners in the country. 

The ecommerce industry in India has been growing exponentially for the last few years. Many Indians prefer online shopping and home deliveries, be it groceries, electronics, furniture, or high-end items. 

According to IBEF (India Brand Equity Foundation), the Indian ecommerce market is expected to reach 350 billion USD by 2030. We currently have 125 million online shoppers and another 80 million are estimated to add to the count by 2025. The Digital India program has nudged many businesses to expand their stores to electronic marketplaces. 

With such growth in the ecommerce industry, it’s no surprise that business owners are investing in online analytical tools to derive useful insights from data and make better decisions to boost sales. SMBs and large online retailers are partnering with ecommerce analytics service providers to digitally transform their businesses and increase ROI. 

In this blog, we’ll read more about e-commerce analytics and its role in the Indian markets. 

What is Ecommerce Analytics?

Ecommerce analytics is the process of collecting, analyzing, and interpreting data from online marketplaces, digital stores, electronic transactions, etc., to make data-driven decisions. The data is collected from various internal and external sources like website traffic, social media reactions, ad clicks, online sales, product/ brand searches, and much more. 

There are many tools for Ecommerce analytics providing in-depth insights and graphical reports for retailers and store owners to easily understand customer behavior and market trends. From creating a robust marketing strategy to forecasting market demand, analytical insights can help an ecommerce business in many ways. While tools like Google Analytics are helpful, an ecommerce business needs tailor-made solutions to derive actionable insights in real-time. Partnering with reputed Ecommerce development companies in India helps business owners streamline their data (and data sources), create seamless workflows, automate recurring tasks, monitor daily activities, and enhance customer experience

Types of Data Used in Ecommerce Analytics

Data is crucial for analytics. In the ecommerce industry, four types of data are used by businesses to gain a deeper understanding of the target audience, markets, customers, and competitors. 

Zero Party Data 

Zero-party data refers to the data a business directly collects from the target audience. It could be in the form of surveys, quizzes, feedback, etc. The audience voluntarily shares this data with the business, which is then analyzed using an ecommerce tool. 

First Party Data 

First-party data belongs to the ecommerce business and is extracted from website traffic, in-store visits, interactions with customers (online and offline), etc. The customers are aware that their data (preferences, behavior patterns, interests, etc.) are collected by the business. 

Second Party Data

Second-party ecommerce data is collected and owned by other organizations which share the data with the businesses. This includes data from affiliates, business partners, etc., and provides a sneak peek into customer behavior, purchase habits, and market demand for different products. 

Third-Party Data 

Third-party data is collected by organizations that are not connected or affiliated with the ecommerce business. It includes market research firms, analytical service providers, data brokers, etc., who sell customer data to businesses. 

KPIs for Ecommerce Analytics

When implementing data analytics in ecommerce and retail, KPIs (key performance indicators) have to be selected carefully. These metrics help store owners know how their business is performing and find ways to improve the results. While an ecommerce business has many KPIs to track, the following is a must.  

Discovery Rate

The discovery rate is the percentage of users who discover or visit the ecommerce website for the first time. It shows whether the efforts to attract new customers are being successful. It also helps determine which channels are delivering the expected results and where the business can find more opportunities. 

Acquisition Rate

Acquisition rate is another important KPI for digital commerce analytics. It shows the number of visitors who completed the necessary actions on the website. It is derived by dividing the total number of people who became customers from the total audience. This puts the customers in the sales funnel. 

Conversion Rate

In some instances, the conversion rate is the same as the acquisition rate. However, conversions are considered subjective, while acquisitions have specific criteria. This changes from one marketing campaign to another and what the business wants. 

Customer Retention Rate

As the term suggests, the customer retention rate is the percentage of customers who remain with the business and initiate multiple purchases over time. ecommerce analytics helps find ways to improve the retention rate by creating customer loyalty programs, referral schemes, etc. A higher retention rate implies greater success. 

Use Cases of Ecommerce Analytics

Customer LTV 

By using the analytical tools of ecommerce, businesses can process customer data to determine their value over their lifetime (interaction with the store). A high-value customer is someone who generates more sales and repeat purchases and adds value to the business. Retailers can create highly targeted campaigns, deals, and offers for such customers. 

Customer Behavior 

Customer behavior analytics deals with understanding how a customer interacts with the business – website visits, products they check often, factors that influence their decisions, CTAs (call to action) they respond to, and so on. It helps in product development, better marketing strategies, and showcasing the right product to the right customer. 

Customer Segmentation

Segmenting customers based on demographics, interests, age, gender, purchasing habits, etc., can be done through ecommerce analytics. It helps in developing personalized marketing campaigns for each segment and reaching out to them through their preferred choice of communication channels. 

Sales Performance 

By investing in the best sales analytics software, businesses can get comprehensive insights about the sales generated for the given period, estimate sales for the coming times, the difference between targets and achievements, and how to improve sales. 

Fraud Detection 

ecommerce analytics is also helpful to minimize the risk of fraudulent transactions by analyzing customer and sales data. The software will send alerts for potential risks, which help in devising strategies to safeguard the business and the interests of genuine customers. 

Revenue Management 

ecommerce businesses can rely on the best revenue analytics software to track their earnings and expenses. Store owners can get insights about where most money comes from and where it is being spent, the soft areas for improving MRR, critical focus areas, and so on. 

Inventory Management 

ecommerce analytics is also useful for inventory management. It helps optimize sourcing, production, warehousing, distribution, and stocking to ensure the business can always grab the market opportunities and provide the necessary items to customers. 

Website Optimization 

Another reason to use ecommerce analytics is to optimize the website to increase organic traffic, improve the conversion rate, reduce cart abandonment, and maintain a user-friendly website to enhance overall customer experience. 


Partnering with the right ecommerce analytics company will give businesses the necessary support to streamline their strategies and personalize the offerings (products, deals, loyalty programs, shipping, etc.) based on customer behavior and preferences. Personalization is necessary in today’s world to gain a competitive edge and attract more customers. 

What is the Data on Ecommerce in India?

According to a report by Forbes, the Indian ecommerce sector is expected to be around INR 4,416.68 billion in 2024. It is estimated to touch INR 7,591.94 billion by 2029 at a CAGR (compound annual growth rate) of 11.45%. The ecommerce users in the country are likely to reach 501.6 million by 2029. Moreover, GeM (Government e-marketplace) generated a total revenue of INR 4.5 trillion by July 23, 2023. 

What is the Current Status of Ecommerce in India?

India has the second largest internet market, with over 900 million users. Statistics show that almost 100% of the pin codes have an ecommerce option. Furthermore, over 60% of online transactions and orders come from second-tier cities and small towns, showing how ecommerce has penetrated the vast Indian market. The report also shows that tier 2+ cities will contribute around 88% of new online shoppers by 2030. 

With 100% FDI allowed in the B2B ecommerce industry, businesses have various opportunities to expand into new markets, partner with international brands, and increase sales in the Indian markets. 

What is the Market Analysis of Ecommerce in India?

Amazon, Flipkart, Snapdeal, Zomato, and Nykaa are the major investors in the Indian ecommerce industry. India is ranked at ninth place in cross-border trade growth and is expected to increase from 4% to 8% by 2025. The retail sector’s online penetration is estimated to touch 10.7% by 2024. 

Karnataka, Delhi, Andhra Pradesh, Tamil Nadu, and Maharashtra are considered the major hubs for ecommerce. According to the Invest India website, Jaipur and Surat are listed among fresh metros, while Vishakapatnam, Vadodara, Indore, Chandigarh, Patna, Kanpur, Lucknow, etc., are listed among the high-potential cities for the growth of ecommerce markets in India. 

ecommerce businesses can streamline their processes and increase revenue by taking advantage of ecommerce analytics services to understand market trends and customer behavior. This enables them to offer greater personalization, which will increase sales, revenue, and profits. 


Leveraging data and analytics is the right way for an ecommerce business to gain a competitive edge and conquer more markets locally, nationally, and internationally. The demand for ecommerce analytics will increase as the online retailer market expands. 

Choose the right tool for ecommerce analytics to gain an in-depth understanding of customers and market trends. Partner with a reliable ecommerce analytics company like DataToBiz to implement Power BI, Tableau, and other personalized analytical solutions in the business. Achieve long-term goals, enhance customer satisfaction, and boost revenue. 

Schedule an appointment with our team for more information. 

Fact checked by –
Akansha Rani ~ Content Creator & Copy Writer

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