👉 E-commerce math encompasses the mathematical principles that underpin online shopping, from pricing strategies and revenue optimization to inventory management and customer behavior analysis. At its core, it involves understanding how to calculate and maximize profits through dynamic pricing models, where prices fluctuate based on demand, competition, and other market factors. For instance, businesses use algorithms to adjust prices in real-time to optimize revenue. Another key aspect is the calculation of conversion rates, which measure the percentage of website visitors who make a purchase, helping businesses refine their marketing strategies. Additionally, e-commerce math includes analyzing customer lifetime value (CLV), which estimates the total revenue a business can expect from a single customer over their lifetime, guiding decisions on customer acquisition and retention. Inventory management also relies heavily on math, using techniques like ABC analysis to prioritize stock based on value and turnover rates. Finally, understanding customer behavior through data analytics, including metrics like average order value (AOV) and customer acquisition cost (CAC), enables businesses to make data-driven decisions that enhance overall profitability and customer satisfaction.
