Using image processing packages or GIS (Geographical Information Systems), you can process and analyze spatial data. We differentiate between three types of spatial data: geostatistical data, lattice data, and point patterns.
The applications of spatial data analysis in e-commerce are nothing short of fascinating. E-commerce is a rapidly growing sector, with market revenue expected to reach $4.3 trillion in 2024. It is projected to grow by 9.49% a year between 2024 and 2029, resulting in a market volume of $6.48 trillion by 2029. Most of this revenue is generated in China.
By 2029, 3.6 billion people will be using e-commerce platforms. User penetration is anticipated to reach 40.5% this year and exceed 49% by 2029. The average revenue per user will amount to $1,620.
Considering how lucrative it is, any online marketer would do well to try to master ecommerce.
The role of heatmaps in e-commerce
With 87% of shoppers now beginning product searches online, e-commerce platforms have every reason to invest in spatial data analysis. Heatmaps visually represent users' interaction with a website, showing where they click, hover, scroll, and spend the most time. They allow businesses to find out which products, categories, or sections attract the most attention and determine the parts of the page website visitors are ignoring or rarely engaging with. Here are more details on how to generate a heatmap.
By analyzing heatmaps, e-commerce platforms can improve product placement by positioning promotional or high-demand items in areas where visitors are most likely to interact with them. Website visitors spend 30% of their time looking at the right half of a page but more than twice as long (69%) on the left half. This is expected, as one reads from left to right in Western-hemisphere languages. Vertical menus should always be on the left, the first part people look at.
Refining navigation
Make sure that important categories or call-to-action buttons are placed in visible, high-traffic areas. Conversion expert Michael Aagaard increased a long landing page's conversion by 304% after he placed the CTA button at the bottom. The golden rule in marketing is to position your call to action above the fold.
Heatmaps highlight usability issues, such as frustration (repeat clicks on non-clickable elements) and unclear navigation. They reveal the areas where users seem to get stuck or confused. This information helps optimize the site's design and functionality, ensuring smoother navigation and better user experiences.
Data analysis of last-mile logistics
The growth of e-commerce has resulted in a major increase in the parcel delivery market. Last-mile urban area deliveries are harming sustainability practices. Tackling this issue is crucial if stakeholders want to facilitate consolidation of deliveries, possibly by using delivery and collection points where shoppers could receive their packages. A 2023 paper proposed an innovative spatial modeling approach to explore different last-mile logistics scenarios. The research involved comparing consolidation strategies to fragmented door-to-door deliveries.
The results revealed a scenario without delivery and collection points was the most expensive and least efficient due to too many failed deliveries. In terms of reducing energy use, using bikes instead of vans brought a high number of benefits. It's advisable to encourage the use of delivery and collection points instead of simply adding more.
How GIS enables customer behavior analysis
GIS enables e-commerce platforms to analyze customer behavior and demographics based on different locations. The data helps create targeted marketing campaigns, personalized promotions, and tailored product offerings for specific geographic areas.
GIS allows companies to identify their customers' locations and create promotions specific to different regions, cities, or neighborhoods. For example, an e-commerce company might offer special discounts to shoppers in areas where certain products are trending.
Companies can tailor promotions based on local weather patterns by using GIS to track weather conditions. For instance, a clothing retailer can promote windbreakers in areas experiencing strong gusts of wind.