The Role of the Database in E-Commerce

As technology grows, the number of people participating in e-commerce purchases will grow along with it. Electronic commerce, known as e-commerce, is a type of business model that involves making transactions over the internet. Any store, business, or person who actively sells products online are considered to be apart of e-commerce. In 2018 alone, mobile conversions increased by 55 percent and are expected to reach $175.4 billion in USD sales.

However, with the ever-growing industry, there is a system that is running the backend of each and every successful e-commerce site; a database. With the abundance of fast-growing data being transferred every day, sites need to be thoughtful about database best practices. By ensuring proper procedures, businesses can fully leverage an agile system to help store, organize, and structure data for an e-commerce site.

What is a Database?

If you have ever heard of the term “Cloud database” or “Database-backed” site, they are referring to a site that is using a database. The basic function of a database is to digitally store information that can be captured, retrieved, and distributed easily at a later time. Through this system, information such as transactional or systems oriented data can be organized and tracked based on chosen settings. This also gives businesses the ability to analyze and track information about the products, sales, and customers that have been input into the database.

Provides Structure

One of the biggest benefits of using a database for e-commerce is the addition of structure to vast amounts of shop data. No matter how big or small your online store is, an infrastructure is needed for all the gathered information to make sense and provide useful insights. When the data is structured, it can be accessed more efficiently by the e-commerce application.

Attracts an Audience

A database system helps e-commerce sites pinpoint potential customers based on compiled information. Marketing teams can use customer data that is stored within the database to create targeted lists that will be used for directing marketing efforts. The more information a marketing team has, the better they can identify and tailor communications with them. Not only will this method help to retain customers, but also helps to gain new customers as well.

Tracks Data

Databases are an integral part of the success of an online commerce site. With the ability to store, organize, and analyze immense amounts of data quickly, there is no wonder why databases are essential. Through organized and updated data, companies can quickly respond and update based on changing market conditions.

The following are common types of data that databases help to store and track for e-commerce sites:

Product Information

Databases help e-commerce sites to update and hold information regarding products. This can include detailed product descriptions, prices, specifications, product reference numbers, promotions, and availability. Updating this information through your database saves you from changing and publishing new data to every individual site page by uniformly keeping all pages up-to-date with the same info.

Customer Information

Having customer data to store and analyze is huge for e-commerce sites. Through databases, information such as contact details, names, spending patterns, and more can be held for later marketing use. For instance, personal demographic details are very relevant to buying potential. The collection of this type of data helps to create distinguished target markets and allows for improved customer communications, encouraging online commerce sites to focus on customers’ wants and needs. When you can tell what a customer wants, issues and problems can be resolved easier.

Transactional Information

Tracking and managing transactions are one of the most important jobs a database can do for an e-commerce site. Tracking every order throughout the sales funnel in an organized manner, along with the needed processing details, is key to keeping the business functioning. The database helps to keep the inventory up to date after each transaction, such as what is in or out of stock, billing, shipping statuses, purchase orders, and more.

Databases are crucial to an efficient and successful e-commerce site. Whether you have a small company with limited data or a big store with millions of products, databases help to digitally store and organize important data. With so much information needing to be processed, it would be impractical to not have a database in use.