How to Collect and Use Customer Data to Grow Your Online Business

How to Collect and Use Customer Data to Grow Your Online Business

August 3, 2023

As an e-commerce retailer, knowing exactly who your customers are is vital to the success of your business.

If you don’t really know who you’re serving, you can’t possibly serve them to the best or your ability.

And assuming you know what your customers want might lead you down the wrong path. It can result in wasted capital and other resources.

And simply collecting this customer data won’t do much good if you don’t know what to do with it. 

More than four in ten teams struggle when it comes to actually putting this data to productive and practical use. This, essentially, renders their data collection efforts moot — and ultimately shuts the door on business growth altogether.

That’s why in this article, we’re going to help you understand how to harness your customer data.

But first, let’s talk about why customer data is incredibly valuable in the online race.

Customer Data: The Key to E-commerce Success

Like we just said, trying to deliver value to your target audience without truly knowing who they are and what they want from your brand just isn’t going to work.

Such a haphazard approach is like throwing spaghetti against a wall. Sure, some of your efforts might work — but you’re basically leaving it all up to chance.

And, even when your efforts do pay off, you won’t really know why they worked. You won’t be able to replicate them in the future.

So, above all else, focus on your customer data. This will inherently keep your team focused on the exact things that need to be done to improve your services.

Let’s take a closer look at the key benefits of using customer data to drive your e-commerce business.

Improve Your Pricing Strategies

If you’re here on Prisync’s blog, you know how important it is to have a clear and comprehensive pricing strategy.

And you also likely know your approach to pricing has a lot to do with your audience’s perception. If your products are priced too high, you’ll simply be pricing your customers out of a purchase; if your pricing is too low, they may assume your products aren’t exactly all that valuable.

In either case, you won’t be getting much business.

Know exactly what your customers are looking for and exactly how much they’re willing to spend to get it. You can all but guarantee conversion from every one of your interested prospects.

What’s more, you’ll also be able to outperform your competitors without undercutting them and missing out on potential profits.

Essentially, you’ll be able to truly deliver the value your customers expect at a price they’re willing to pay — while also maximizing profits at the same time.

Enhance Your Customer Service Capabilities

Providing top-notch customer support and customer service should always be a top priority for your team.

But, if you only become aware of their needs after they encounter a problem — and after they reach out to you — you run a pretty good chance of losing them. Not only will they be annoyed at having to reach out in the first place, but you also won’t be all that prepared to help them when they do.

Again, your customer data plays a huge role here.

First of all, your team will be equipped to handle any issues your customers come to you with. If you know the key areas your audience tends to struggle with, you can strengthen your ability to support them throughout their journey.

You can also focus on eliminating these challenges, altogether. Sure, your support staff will likely need to step in at certain points — but providing proactive customer support before customers encounter a struggle will allow them to continue on their path to success with as little friction as possible.

Deliver Laser-Focused Personalization

Digging deep into your customer data also helps you deliver more value to your audience on an individual level.

Again, you’ll have a better idea of what your customers need at any given point along their journey with your brand — and will be better prepared to give it to them. Whether it’s a laser-focused offer, proactive support, or a quick, timely reminder, you’ll know exactly what to offer them, right when they need it.

The concept of e-commerce personalization is constantly evolving — and will continue to do so as time goes on. To that end, it’s vital that you learn as much as you can about your individual customers, and in turn deliver value as they expect from your brand at all times.

Sharpen Your Targeting

As we said earlier, assuming you know who your target audience is is a recipe for disaster.

If you’re focused on serving your idea of your customers, instead of serving your actual customers, you’re going to miss the mark one way or another. Worst-case scenario: The people you’re aiming to serve don’t actually exist — and you’ll end up offering products and services that nobody actually wants.

By getting down to the nitty-gritty details of your target audience, you’ll know with certainty that a market exists for your brand, and that the value you offer will be appreciated by these individuals. 

This means a better ROI on your marketing campaigns as improved targeting will allow you to:

  • Create targeted content that engages as well as resonates with your audience as you’ll be able to identify what content format works best (written, multimedia, long-form vs short-form, etc.) for each of your marketing channels as well as whether the content gets users to take a desired action.
  • Send more relevant and timely emails due to better segmentation and personalization.
  • Improve your ad campaigns by having a better understanding of what channels to place media placement as well as how to best retarget customers based on their previous behaviors.

What Customer Data Do You Need?

Broadly speaking, all of the data you collect on your customers is valuable to your business in some way or another.

But, taking this broad statement as gospel is part of the reason teams easily get overwhelmed — and why they often fail to actually put this data to good use.

That said, it’s important to understand the different types of customer data to focus on, and to understand exactly how this data will enable you to better serve your customers.

Customer Profile/Persona Data

By today’s standards, creating profiles for your target customer is non-negotiable.

Buyer Personas


To fully flesh these personas out, there are four key types of data you need to collect.

  • Identifying data refers to your customer’s “on-paper” information. This includes their age, gender, geographic location, and any other surface-level info that gives you a basic idea of who they are.
  • Descriptive personal data dives a bit deeper, looking at the individual’s overall status. Their level of education, their career, and their familial situation are all examples of descriptive personal data.
  • Psychographic data focuses on the customer’s interests and opinions, and the activities they enjoy. This data allows you to better understand who your target audience is as human beings.
  • Behavioral data focuses more on who your target audience members are as consumers. Here, we’re concerned with what your customers do when engaging with brands like yours — and what triggers them to do so.

If just one piece of this puzzle is missing, you’ll end up overlooking countless opportunities to better serve your customers — and to grow your business.

Quantitative and Qualitative Data

Continuously collecting both quantitative and qualitative customer data is crucial for gaining a better understanding of them, on both an individual and audience-wide level.

Quantitative data is that which can be boiled down to numbers. As an e-commerce retailer, you’ll want to keep a close eye on how this data fluctuates over time, and how it compares to your internal KPIs as well as your industry’s standards.

Common examples of quantitative data to focus on include:

  • Average Order Value
  • Repeat Purchase Rate
  • Conversion Rate
  • Cart Abandonment Rate
  • Customer Lifetime Value

In contrast, qualitative data describes certain aspects of your customers, and/or their experiences with your brand. Here, it’s all about context: What your customers are saying about your brand, and the meaning behind their questions and comments.

Again, you need both types of data to be able to best serve your customers. While quantitative data can help you identify specific strengths and weaknesses in terms of your business’ performance, qualitative data allows you to get a more “nitty-gritty” understanding of what these numbers actually mean.

For example, a sharp decline in your repeat purchase rates will tell you that something is going wrong for many of your first-time customers. But you’ll also need to gather some qualitative information to determine exactly what the problem is — and what you need to do to fix it.

A more positive example:

If you notice an uptick in conversions, repeat purchases, etc., you’ll want to elicit qualitative feedback from your satisfied customers to pinpoint what you’re doing right. In turn, you can double-down on these efforts to deliver even more value to your engaged audience members.

5 Key Steps to Collecting and Using Customer Data to Grow Your E-commerce Business

In order to use your customer data to improve your brand’s value and grow your business, you need to:

  • Have complete control over the data you collect
  • Have a complete understanding of what this data means
  • Know exactly what you’re going to do with the data once you collect it

This simply can’t happen if you take a haphazard approach to your data-related processes.

In other words, you need to be strategic and systematic as you collect and use your customer data moving forward.

Here’s how to get started.

Define Your Business Goals

Before you start collecting any and all customer data you can, you need to have a clear idea of what you hope to accomplish by doing so.

Overlooking this crucial step can cause a number of data-related issues for your team, such as:

  • Collecting an overwhelming and unmanageable amount of data
  • Collecting irrelevant or unusable data
  • Misinterpreting data that would have otherwise been useful

Basically, you don’t want to collect customer data just for the sake of doing so — or with the assumption that you’ll know what to do after you’ve collected this info.

This isn’t to say that you’ll know exactly what you need to improve before collecting additional data from your customers.

(If you knew what to do from the start, you wouldn’t need more customer data in the first place, right?)

But, your team should be able to identify specific gaps in your operations based on their experiences with your customers, as well as their expertise within your organization.

Your business’ performance data plays a huge role here. Whether you’re not meeting certain key performance indicators, or there’s clearly room for even more improvement. You need to nail down the specific area to focus your data collection efforts on moving forward.

Overall, this step is about ensuring the customer-facing improvements you make lead to worthwhile results for your business. While becoming more customer-centric is always a top priority for your e-commerce company. Doing so without considering your business goals is simply unsustainable is great.

So, before you even begin thinking about what more you can do for your audience, you need to have a pretty clear idea of how making these improvements will lead to growth for your business.

Identify the Customer Data You Need — and Where to Find It

Once you’ve defined an area to focus on, you’ll want to nail down the specific customer data needed to make the necessary improvements.

As we said earlier, all of the data you collect from your customers can prove to be valuable in some way. Still, it’s important to focus on the data and metrics that matter — both to your customer experience and your business goals — in order to make improvements that move the needle in the right direction for all involved parties.

(You also need to differentiate between this more meaningful data and so-called “vanity metrics” that don’t really tell you all that much about your customers’ needs and/or experiences with your brand.)

The key to identifying this data:

Understanding the customer journey.

Customer Journey


The goal here is to determine how your customers engage with your brand along their path to purchase. In turn, you’ll know where to look when collecting customer data. Plus, it can begin focusing on what data to collect from each of these sources.

Some cases show that the data already exists, and you just need to uncover it. In others, you may need to reach out to your customers or other sources to elicit the information you need to move forward.

Here’s a quick breakdown:

  • Zero-party data refers to any information your customers have provided on their own volition. Unsolicited social media comments, customer service inquiries, and even on-the-fly conversations are chock-full of valuable information that can help you better understand your customers’ needs.
  • First-party data is that which you solicit from your customers, and that is therefore owned by your company. To collect valuable first-party data, you need to home in on specific parts of the customer experience — allowing your audience to focus on these areas when providing feedback.
  • Second-party data is essentially another company’s publicly-available first-party data. Social media comments on a competitor’s page, for example, can give you a clear idea of their audience’s needs (and the company’s ability to meet them).
  • Third-party data is collected and published by research organizations, typically in “State of the Industry” reports and the like. These reports will help you identify industry standards in terms of customer expectations and overall business performance — in turn allowing you to gauge your organization’s ability to meet these standards.

No matter what customer data you’re looking to collect, it’s crucial that you consider all available sources and types of data. Without this critical step, you’ll always run the risk of missing out on important information that could have otherwise changed the course of your business.

Collect, Organize, and Assess Your Customer Data

Alright, so:

You know what you’re looking to accomplish with the customer data you intend to collect. 

You know what data you need to focus on, and where you’ll be able to find it.

Now, you need to actually collect the data, and prepare it for practical use.

This is where emerging technology comes into play.

With the right tools, your team will be able to harness more customer data than ever before. There will be in position to use this data to better serve your target audience.

First, let’s talk about data collection. 

As we discussed above, collecting data from a wide variety of sources is paramount to your efforts, here. That said, investing in technology to facilitate this data collection process is just as important.

Chatbots as well as behavioral analytics tools will allow you to automatically collect data from your customers as they engage with your brand in real-time. By assessing their on-site actions and behaviors, you’ll continue to gain insight into their path to purchase — as well as your ability to meet their needs along this path.

Mapping Journey


Survey software, helpdesk and ticketing tools, and other means of collecting customer feedback will also allow you to collect information from your customers that would have otherwise gone unnoticed or overlooked. 

Customer Data


Social monitoring tools are another key part of your data-related tech stack. These tools automatically collect information from around the web regarding your brand, your target audience, and your industry as a whole.

The next step is to organize the data you collect on your customers to make it accessible and usable for your team.

Without this step, the valuable data you collect can easily slip through the cracks — rendering your efforts up until this point moot.

Modern customer relationship management tools ensure your customer data ends up in a centralized location, where it can be accessed by your team for any number of purposes. 

CRM Platform


AI-powered CRMs can also help you organize your customer data in ways you may not have previously noticed. It helps to uncover valuable insight that can help you supercharge your efforts moving forward.

As you glean this insight from your customer data, you’ll then need to synthesize it into organizational knowledge for practical use. Knowledge base software streamlines your team’s ability to document, store, and share this insight throughout your organization — allowing all customer-facing teams to better serve your audience.

By today’s standards, use of technology is non-negotiable when it comes to collecting and using customer data. The right tools not only streamline (and often automate) your data-related processes — but also allow your team to do more with the data they collect than could humanly be possible without it.

Take Action Based on the Customer Data You Uncover

Once you’ve collected, organized, and assessed your customer data, you need to actually put it to productive use.

Unfortunately, like we said earlier, this is where many e-commerce retailers fall flat in their data-driven efforts.

To be blunt:

There’s no point in putting in the work to understand what your customer data is telling you if you’re not prepared to do something about it.

Now, the direction your customer data takes your team will, of course, be unique to your circumstances. Really, the entire point of becoming data-driven is to remain agile. It allows this data to steer your efforts in the right direction.

In other words, there’s no “one way” to go about using the data you collect on your customers.

However, this isn’t to say you should “go in blind” when taking data-driven action.

Rather, you need to systematize your data-driven processes in order to make the most out of the information you’ve collected.

By developing standard operating procedures (SOPs), you’ll equip your team to take consistent and strategic action at all times. No matter what the data in question is telling you.

Conversely, taking a haphazard approach to your data-driven processes can easily cause your team to go off-track in some way. It’s overlooking certain data points, making uninformed assumptions, etc.

This systematic approach should somewhat mirror the scientific method:

  • Create a hypothesis regarding the outcome, based on the data on-hand
  • Test a specific improvement or change to your CX or internal processes
  • Assess any changes in the customer or performance data you’re focusing on
  • Make the necessary improvements based on your findings, in a way that benefits both your customers and your company

Whether you’re A/B testing your email content or ad campaigns, implementing dynamic pricing for specific products, or making improvements to your actual products altogether, a systematic approach is essential to ensure your results are accurate and dependable.

With standard operating procedures in place, you’ll spend less and less time figuring out what to do with the customer data you collect. In turn, you’ll have even more time to actually make improvements that matter to your customers and your retail business.

Make Ongoing Improvements to Your Data-Driven Processes

As with all areas of your business, it’s important to make ongoing improvements to your data-driven processes.

(Really, it’s these improvements that will enable you to make ongoing improvements to the other areas of your business.)

There will always be more data to collect on your customers.

Always more ways to collect the data you need. 

Always more insight to glean from the data you collect.

And always more you can do with it to better serve your target audience.

So, as you continue to strengthen your ability to use your customer data for practical purposes, you should always err on the side of thinking there’s more work to be done. 

This might mean routinely assessing new data sources, investing in newly-emerging technology, or further solidifying your data analysis capabilities. Regardless of what it means given your specific circumstances, it’s important to never lose sight of what more you can be doing.

Simply put:

If you’re not constantly looking to the future of your data-driven efforts, you’re going to miss out on countless opportunities to deliver value to your customers. With the majority of retailers becoming more and more data-driven by the day, merely maintaining the status quo will cause your company to quickly fall behind your competition.

Keep your customer data front-and-center at all times, though, and you’ll always know the best path to take moving forward.

Customer Data: Your Ticket to E-commerce Success

Going into 2021, there’s absolutely no excuse for you to not be collecting and using customer data. Try to improve your processes and deliver more value to your audience.

First of all, there’s more data available to your team now than ever before. And, modern technology has made it easier than ever to collect it all. 

At this point, you’d have to be actively avoiding it in order to ignore it.

More importantly, though, your customers expect you to be collecting information on who they are, and what they need from your company. And they expect you to actually use it to enhance their experiences with your brand.

On top of that, your competitors are almost certainly diving deep into their customer data. And are actively looking for ways to better serve their audience.

Simply put:

If your customer data is merely an afterthought for your team, your business just isn’t going to survive. Sure, you may get lucky and experience some small, quick wins — but your success is going to be short-lived.

In consistently staying up-to-date with your customer data, though, you’ll always know exactly what to do to deliver value to them as they’d hoped — and your business will continue to thrive long into the future.

  1. Nitin Maheshwari
    March 6, 2021

    thanks for sharing this useful article.

  2. Prisync Team
    March 9, 2021

    Thank you!

  3. Michael
    February 9, 2022

    Thanks for sharing this useful information!Hope that you will continue with the kind of stuff you are doing.

  4. Edward Clarkson
    February 10, 2022

    What an exquisite article! Your post is very helpful right now. Thank you for sharing this informative one.

  5. Edward Clarkson
    February 10, 2022

    Thanks for sharing this useful information! Hope that you will continue with the kind of stuff you are doing.

  6. Abby Smith
    February 17, 2022

    Thanks for sharing this useful information! Hope that you will continue with the kind of stuff you are doing.

  7. MECLABS Institute
    April 29, 2022

    This article was really brilliant, and I could not have said it better myself. I fully agree when you said that there really is no point in understanding the customer data if you’re not prepared to take action. There is definitely change that should immediately take place to help serve your customer, mainly because data can either change in a minute or even a year.

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