You might have seen the message below in your Shopify store settings about setting up the Google Channel app. What should you do when you see this message? Shopify offers a number of sales channels to make it easy to sell products on different online channels like Facebook and the Shop app. The Google sales channel is a bit different, since 1) it now also includes Google Analytics 4 (GA4) tracking, and 2) it is now managed directly by Google. Although we work with larger merchants at Littledata, who typically use external apps and agency partners to manage sales channels and analytics, we’ve been getting a lot of questions about the recent updates. Here’s a first look at what the Google Channel app does, and how that compares with other ways to set up Google Analytics 4 (GA4). What is the Google Channel app? Shopify launched the Google Channel app back in 2017 to provide an easier way for stores to sell on Google, using Google Ads and Google Shopping. It’s free to install, though of course you pay for the Ads ;) “Sync your products to Google Merchant Center, list products for free on Search, YouTube and more and even run paid Performance Max campaigns.” In the relaunch in March 2023 Shopify/Google added tracking for GA4, along with better support for Google PMax (Performance Max) campaigns. Shopify wants to offer you with a no-code install process for GA4, but adding the Google Channel won’t “avoid any data disruptions” for all stores. [subscribe] Why Shopify is moving GA4 tracking to the Google Channel Universal Analytics - the previous GA version - will stop collecting data on 1st July 2023, so Shopify was under pressure from customers to offer in-built GA4 tracking ahead of that deadline. GA4 is also Google’s preferred way of tracking conversions in Google Ads, and PMax campaigns need conversions (purchases) tracked to maximize Cost Per Acquisition (CPA). I also think Shopify wants to push support for GA4 onto Google by moving all of the Google connections out of their core platform and into a ‘third party’ app. What’s included in Google Channel tracking? The Google Channel app allows a store to pick a GA4 property and copies most of the ecommerce event tracking available from Shopify to Universal Analytics: Page views Product views (including product name and price) Add to cart Checkout started Purchase (Order completed) [note]Are you tracking conversions in GA4? Find out in 5 minutes with our free order checker app[/note] What are the limitations of Google Channel for tracking GA4? Firstly, the Google Channel is built to work with Google Ads. However, there’s many other reasons to use Google Analytics other than for Google Ads targeting: tracking all marketing channels, understanding on -site conversion, checkout conversion, product performance and more. Shopify hasn’t optimized the tracking for that. So there are some limitations with the events sent to GA: No tracking of product list views or clicks No checkout steps, beyond begin_checkout * No currency field on Product Detail views No reporting on product SKUs No tracking of coupons and discount codes No server-side tracking for accurate orders and revenue No Enhanced Conversions for cross-device tracking of Google Ads * Theoretically, an event is triggered when users add payment info, but we couldn’t get this to fire in multiple tests. See a full comparison with Littledata tracking. Secondly, the GA4 tracking is tightly coupled with the implementation of Google Shopping feed (which has some bugs, judging by the thirty 1-star reviews from the last month) so while you can just use the GA4 part of the Google Channel app, you run the risk of disrupting Google Analytics when you edit Google Ads settings. Thirdly, there are no settings to adjust the Google Channel tracking - so if you want only certain events tracked, or integrate with third-party apps, your hands are tied. "There are no settings to adjust the Google Channel tracking. So if you want only certain events tracked, or integrate with third-party apps, your hands are tied." Lastly, Shopify does not provide full support for GA4 tracking via the Google Channel app. The app is theoretically supported by Google, but Google only provides technical support if you pay $50k+ a year for Google Analytics 360. Other than that you’d need to pay a consultant to check the set up for you. What is the best way to set up GA4? You need to start getting data into GA4 by July this year - not just for analysis, but also for building audiences and retargeting your own customer base in Google Ads. So beyond this app, you have two options: 1. Add Google Tag Manager to your store theme Pros: Reliable page view tracking, simple to customize settings, free to run Cons: No tracking of the checkout steps (even for Plus stores), revenue in GA won’t match revenue in Shopify, lots of time (and developer cost) required to set up all the shopping behavior events 2. Use a proven, highly rated app like Littledata Pros: Reliable tracking of the whole customer journey in GA4, 100% match between orders and revenue in Shopify, no implementation effort, no developers needed, instant data quality; and Littledata is optimized for Shopify Plus, including headless tracking, Shop App tracking and multi-currency tracking in GA4 Cons: Ongoing app charge to maintain data quality [note]Are you tracking conversions in GA4? Find out in 5 minutes with our free order checker app[/note] Why server-side tracking? The basic limitation of the Google Channel is client-side tracking -- which means all the events to Google are sent from the end user’s browser. This isn’t a reliable way to attribute sales to marketing campaigns in an age when many browsers and ad blockers limit tracking. The world of web analytics has changed a lot since Shopify added GA via the Shopify store preferences back in 2014 - but Google Channel isn’t changing how the event data is actually tracked. In contrast, server-side tracking allows apps like Littledata to hook into what is happening on Shopify’s servers from the add to cart onwards. This means 100% of revenue can be tracked and the vast majority (~90%) of that can be linked to a pre-checkout user journey and marketing campaign. There’s many apps that promise to ‘fix’ marketing attribution (Rockerbox, Northbeam, etc), but the only way to get truly reliable tracking of orders and revenue is server-side tracking. What your store should do today While I understand that Shopify wants to provide an out-the-box integration with Google Analytics for smaller stores, this Google Channel won’t be suitable for any scaling brand spending heavily on online customer acquisition and retention. You DO need to start tracking in Google Analytics 4 ASAP! If your brand turns over less than $1M a year, and you don’t have the time to dive into marketing attribution and targeting, then the Google Channel may be enough right now. And that's great! But if you are doing $1M+, or need to dive into the details of what drives customers to purchase, then I don’t think the Google Channel will be robust enough for you. If you're ready to be truly data-driven this year, consider applying for a Littledata Plus plan so we can support you fully with higher SLAs and analytics training for your team. Shopify has reason to launch limited free apps (eg reviews, email and geolocation) to address the concern that their sticker price doesn’t reflect all the paid app add-ons you need to run a store. Yet professionals at growing brands know you need paid apps to guarantee quality and support. Littledata’s Google Analytics connection is no exception -- try it for free in the Shopify App store today!

Revenue-based loans for early-stage companies burst into the mainstream in 2022. Whether you are a subscription commerce business or a SaaS company, this could be a powerful new way to fund your expansion. In this guide I’ll explain what I’ve learnt as a founder from many weeks of conversations about the different flavours of debt funding, and when they’re appropriate for your business. What is a revenue-based loan (RBL)? An RBL is a business loan secured against a company’s future recurring revenue stream rather than the company’s assets. Most growth-phase companies can’t borrow from traditional banks because they are not profitable, are asset-light, and don’t have big enough revenue streams. Alternative debt providers, including RBLs, have stepped in to fill that need. This is different to invoice factoring. Factoring companies take over the billing relationship with your customers to repay the debt, which doesn’t work for companies like Littledata where most of the revenue is from Stripe card processing or payouts from an app store. How do RBLs compare with traditional loans? RBLs are typically covenant-lite and without personal guarantees. This means if your revenue drops and you are unable to repay the loans the lender has no right to take control of the business or pursue you personally for the debt. That said, all debt needs to be repaid in full — even if your revenue drops unexpectedly. How do RBLs compare with selling equity (VC funding)? Firstly, they are much less dilutive - sometimes non dilutive. This means the current shareholders keep their same hard-earned share of the business. Some lenders may ask for warrants (share options) to share in the upside if your growth takes off, but these are still a lot less dilutive than VC funds. Secondly, RBL providers won’t interfere or distract you. They don’t want a say in how you run your business; they only want visibility on how your revenue is progressing. On the flip side, debt providers won’t be able to advise you on growth strategy — most are very transactional. Yet, in my experience, VC investors exaggerate the benefit of their advice, which can be just as distracting as helpful.  Since the outcome for most VC-based companies is very binary, VC funds inevitably focus their attention on the biggest winners in their portfolio — meaning you won't get their attention in times of need anyway. In many cases RBLs are not a complete alternative to equity funding — they just reduce your dilution by match funding other equity investments. Are RBLs the same as venture debt? The terms are often used interchangeably, but traditionally venture debt was taken on alongside a big injection of cash for equity (e.g. alongside a Series A investment). This boosts the size of an already large funding round but doesn’t help companies trying to grow up to this level. RBLs can be used independent of any equity funding round. Littledata’s Story Littledata started exploring revenue based loans back in 2020, and took out our first 3 month loan from Forward Advances. However, with our marketing mix and 30 day free trial it’s impossible to get a return on investment within 3 months. So in 2021 we took on a 12 month loan from ClearCo, and then in 2022 another 12 month facility from Capchase. Then later in 2022 we started working with Element Finance, who have been extremely helpful in working around our existing lending and can lend over 4 years to postpone a larger equity raise. Will taking on a loan reduce my funding options in the future? As this kind of debt funding becomes more mainstream it is becoming a useful bridge to ever-larger Series A rounds. In my experience, having a loan on your books will not block an equity investment - as long as it is not convertible into equity, and the warrants for the lenders are minimal. In fact, since debt funders are agnostic about the exit route or valuation, they keep open exit options that a VC might block. So for example, If your growth stalls and you want to switch to run your company for profit, once you’ve repaid the debt, the income is all yours. If you can use debt funding to achieve a certain scale ($5M+ ARR), you’ll be able to access much cheaper term loans from lenders like Silicon Valley Bank. Is my business suitable for an RBL? If you haven’t yet generated $100k annual recurring revenue (ARR), or you are investing in a new and unproven market, then equity funding is a better option. To get confident in the stability of your future revenue streams the debt provider will want to see: 1. Majority recurring revenue 2. High net year-on-year revenue growth (at least 50%+) 3. Low customer value churn (less than 50% per year) 4. Low customer concentration (any one customer churning has low impact) My company Littledata qualifies on all fronts with 100% recurring revenue, high year-over-year growth, less than 40% gross value churn, and our largest customer is less than 2% of our revenue. How much can I borrow? Loan values are usually expressed as a multiple of run rate ARR, and the maximum will be between 20% (2 months revenue) and 50% (6 months revenue) of your ARR. This maximum depends on revenue stability, term length, and other factors. I think I can raise a VC. Are RBLs still relevant? I think so, yes. It helps boost your valuation and gives you time to wait for the right investor. Investors value subscription-based companies as a multiple of their ARR, depending on growth and churn. If you’re growing at a predictable rate month-over-month, why would you sell out a bigger share now when you could hold off for a higher valuation in the future. Short-term RBLs won’t increase your runway unless you can increase your revenue faster than the loan duration - otherwise the extra revenue you gain from bringing forward hiring or marketing spending will likely be offset by the debt repayments. But VC funding can also reduce your runway (by encouraging higher burn rates) AND limit your exit options. It’s a necessary evil in some cases, but don’t believe it’s the only way. (Image credit: Founder Collective) What are the options for funding a sub-$2M ARR business? At this level, you are limited to borrowing over a maximum 12-month term. This means you’ll need to repay the loan monthly over a year, so if you borrow $200k you’ll repay around $18k per month including a fee. This fee is typically expressed as a discount rate — equivalent to the discount you might offer a customer for paying annually rather than monthly. Discount rates on 12-month loans currently range from 5% to 11% depending on the underwriting risk. This translates to an APR of 10% to 18% since half of the money is repaid within half the loan term. Some lenders will structure the repayments as a percent of your monthly revenue (i.e. you repay over a minimum of 12 months), which limits the cash out if your revenue sinks. But, in practice for a growing company, the repayments will be fixed. You could also borrow for 6 months for half the cost. This doesn’t work for us, but it could work for you if you can quickly translate marketing dollars into more recurring revenue. Since the process is usually fully automated — with data feeds from common accounting and banking platforms — these lenders are very quick, with offers in 24 hours and loans within 10 days. Some of the lenders in this space are: Clearco (previously Clearbanc) Uncapped Forward Advances (stopped lending) Capchase Velocity Capital Vitt Founderpath Pipe Full disclosure: we’ve taken loans from Forward Advances, Clearco, Capchase, and Element Finance. What are the options for funding a $2M+ ARR business? The lenders above will welcome you with open arms; at this scale, their risk is lower and the fees are higher. But there are now more options for lower interest rates and longer-term loans. Element Finance offers 4-year loans of $500k+, with no warrants. Element Finance recently provided funding to Littledata for the next stage of growth.  Saas Capital, based in Seattle, also offers 4 to 5 year loans with lower interest and warrants. They can lend between 4x and 12x trailing MRR, depending on growth and churn, but focus more on SaaS. Riverside Acceleration Capital offers a 3 to 5-year loan, with an interest-only period at the start to reduce cash out. Prefcap offers a 2-year, rolled-up loan (no monthly payments, but repaid or refinanced in full at the end of 2 years). This reduces your cash out, but they want warrants with the right to invest equity in the next round. Flow Capital, based in Canada, offers a 3 to 5-year loan with lower interest but with warrants. Lending over longer periods is much less predictable, so the process will be more like interacting with a VC: a week or two to get to a term sheet, and then 6 to 8 weeks to complete due diligence and access the funds. In Conclusion If you’re a growing subscription business, check out the possibilities for RBL financing. Even if you don’t need the money now, it can be a useful option for bridging to the next equity round — or allowing you to say no to egregious term sheets. I’ve spent many weeks pitching VCs and as flattering as it is to have experienced investors quiz you about strategy, I’d far rather be putting the capital to work in growing the product and customer base. RBL funding gives me that option.

We are off to the races in 2023 already with Shopify officially launching Commerce Components by Shopify (CCS), an improved offering for large retailers. CCS allows enterprise retailers to access Shopify's foundational, high-performing components, such as its checkout, along with flexible APIs to build dynamic customer experiences that integrate seamlessly with a retailer's preferred existing services. But larger brands don't just want composable commerce. They also want -- actually, need -- complete, accurate, actionable data. Have Shopify's new Commerce Components been designed with the modern data stack in mind? There are lots of good things to say about Commerce Components. Enterprise retailers can take the components they need and leave those they do not, and developers are “free to build with any front-end framework they choose”, says Shopify. CCS uses Shopify's global scale infrastructure, which has over 275 network edge points to enable fast storefronts and checkouts no matter where customers are located -- and in a year where consumers are savvier than ever and demand a great experience. While we are excited about how this will attract larger brands to the Shopify ecosystem, we feel the Data Analytics component is underwhelming -- and won’t allow enterprise brands to track full server-side event data for building marketing attribution, product recommendation, or personalization data models. This component uses ShopifyQL, launched in mid-2022, as a neat query language for charting. But data analysts using ShopifyQL to query Shopify’s own data tables can only query the current state of the customer or order, and not understand the customer journey that led to that order. Popular reports such as marketing attribution by campaign or channel are just not possible from this data set. Furthermore, most enterprise brands we talk to want to own their own data warehouse and have the flexibility to use best-in-class tools like BigQuery, Looker, and dbt to store and analyze the data. Littledata provides a raw event data feed, directly sourced from Shopify’s servers to power just such a modern data stack -- and gives analysts the flexibility to build their own data models. Littledata is excited to work with brands using Commence Components (including headless stores), but we think Shopify will need to lean on its partner network to provide the breadth of functionality, especially in data analysis, that enterprise brands require. For now brands on our Littledata Plus plans are skeptical about the initial release of Commerce Components, just as they have been about Shopify's new Web Pixel and overall Shopify Theme changes.

Hi Everyone, This is Edward, Founder of Littledata, making it easy for modern DTC brands to get accurate data. 2022 has been a bumper year for Littledata. We extended the product to work with BigCommerce as a data source, and Facebook Ads as a data destination. And after closing a funding round during a tricky period in the financial markets last summer we’ve grown the team to 40 people globally. I’m immensely proud of the glowing reviews we get from customers, and we’ve now been judged as a category leader by G2. It’s been great to see customers like Geologie driving a 25% increase in retention using the improved subscription data available with Littledata. Customers drive Littledata forward, and I always welcome your feedback on where we can take the product next. As something festive for this time of year I wanted to add a data twist to an English classic - the Twelve Days of Christmas. Here it goes! On the twelfth day of data, My analyst sent to me: Twelve reports drumming Management reports are the beating heart of any digital business and you need to be able to trust the data you make decisions from in 2023. I recommend Google Analytics 4 as a powerful, free way to build reports on online marketing, merchandising, customer experience and more. And if you find GA4 a bit ugly you can use the same events in Looker Studio (previously Data Studio) to build pretty management reports. Eleven data piping DTC companies generate valuable first-party data from their customer interactions - but are you piping that data to marketing or analytics platforms where you can make use of it? Littledata pipes first-party data from Shopify and BigCommerce into the platforms that brands rely on - Google, Facebook and hundreds of others via Segment. Ten charts a leaping Data doesn’t come to life until it’s visualized and, as much as I like the chart designs in Shopify Analytics, Google Analytics 4 provides more than ten powerful ways to look at your customer behavior. You can use the GA exploration module to build whatever you fancy, including customer behavior, sales performance and checkout funnels. Nine feeds to Looker If you want more from your charting, look to Looker. Google has rebranded Data Studio to be Looker Studio - and it’s still the same fast and free data visualization suite. Connecting a Google Analytics 4 source is easy, and if the reports don’t run fast enough for you try hooking Looker Studio up to BigQuery. Eight ROAS If you’ve given up on measuring Return On Advertising Spend by campaign in 2022, don’t despair! For Facebook Ads there is a fix in the form of Facebook’s Conversions API, sending the conversion events via Littledata’s servers. And for Google Ads you can import conversions from Google Analytics to improve attribution and measure ROAS. Seven data warehouse Is building a data warehouse on your long to-do list for 2023? Even if you don’t have the budget or bandwidth for deeper data analysis now, it could be a valuable asset for the future? Well you can tick this task off today! GA4 includes a free data feed into BigQuery - Google’s high-scale cloud warehouse. Hosting your event data in BigQuery will cost no more than tens of dollars a month, and from there you could pipe it into another data store of your choice: Snowflake, AWS RedShift or even SQL Server. Six orders matching Accurate management reports need accurate event data to feed them. If your store made 6 orders, you’d expect to see 6 orders in Google Analytics right? Wrong! Stores which rely on the thank you page being tracked to feed an order into GA see only 5 of these 6 orders. A 20% loss of orders and revenue will put a big dent in the trustworthiness of your reporting, and it is totally fixable with server-side order tracking. GA4! Google Analytics 4 is the latest version of GA, and the only version you can use from July 2023. It’s a must for any brand wanting a single source of truth on marketing performance, and powerful ways to share data across Google’s marketing platform. Get started today with Littledata’s GA4 connector! You’ll at least need 6 months of historical data, so it can’t wait until July to get started. Four CAPI birds Facebook Conversions API (CAPI) was one of the big marketing innovations of 2022. It’s the only way to get back some of the lost visibility on Facebook Ads due to iOS 14, and power advanced targeting like dynamic product ads. Earlier this year we launched Littledata’s Conversions API destination for Shopify and BigCommerce to make it super-easy to match Facebook Ads to online conversions. It can’t wind back all the changes to cookies and browser tracking, but it can boost your Facebook performance by 34%. Three UTMs UTM tagging - decorating the link clicks from your online marketing campaigns - is still the bedrock of marketing attribution. Littledata can help you link orders to landing pages, but your company needs a consistent UTM tagging system to get the most from your reporting.  Luckily common platforms like Klaviyo and Google Ads have tools to make this UTM tagging easy. Two data truths ONE - brands that invest in better data get better growth. See case studies of Grind Coffee, Rothys and Geologie. TWO - Google Tag Manager brings as many problems as it solves. Don’t waste weeks getting server-side Google Tag Manager to run - license a proven server-side data platform. And events in Big-Quer-er-er-ry! The icing on the Google Analytics Christmas cake for me is the fast and reliable data feed into Google BigQuery, and from there into Looker Studio or any reporting tool of your choice. For $99 a month you can now license the kind of data pipeline that enterprise brands have spent hundreds of thousands building. There really is no trade off between accuracy and cost saving. Have a very happy Christmas, and wishing your family, team and data a safe and successful 2023! Best wishes, Edward

There have been rumors circulating about the latest version of Shopify checkout not supporting Google Tag Manager (GTM). Is Shopify cutting off support for GTM on the checkout completely? This might be the biggest announcement from Shopify this year, but also the most overlooked. We have been working with Shopify tracking since the beginning at Littledata and have followed these updates closely. So let me unpack what is and is not changing for GTM tracking on Shopify and Shopify Plus. What is Google Tag Manager? Many Shopify stores use Google Tag Manager (GTM) to deploy marketing ‘tags’ across their web pages, without the need to directly edit the store theme.The  free tool developed by Google has shot to popularity ahead of paid rivals such as Tealium. GTM makes it easy for these stores to track pageviews and on-site events in Google Analytics, Facebook Ads and other analytics and marketing platforms, but capturing checkout steps and transactions (orders) is more difficult. Until recently, Shopify Plus stores had the ability to also add GTM to the checkout pages, by adding the GTM container to the theme checkout.liquid file. This allowed tracking of checkout steps to power, for example, abandoned checkout retargeting via email or Facebook Ads. Even though there are automated solutions that track checkout steps accurately and securely without the need for GTM, some merchants and agencies still tried to do this manually via GTM. When will GTM be blocked on the Shopify checkout? Starting last month (November 2022), and accelerating after peak trading season (holiday shopping) ends, Shopify will no longer be allowing Google Tag Manager in the checkout for Shopify Plus stores. Shopify has been rolling out a new version of its checkout to Plus stores which will remove the ability to add scripts via checkout.liquid. The checkout.liquid file will still be present but be ignored. Shopify will no longer be allowing Google Tag Manager in the checkout Stores will get the ability to modify aspects of the checkout experience from within Shopify admin, but not the ability to add GTM to the checkout. This is not a temporary measure; it’s a long term solution to increase security in the checkout. You can still track completed orders on the order status (thank you) page via the Checkout Order Status Script section, but this client-side tracking is increasingly unreliable. Why didn’t merchants get a headsup? To be fair to Shopify, they have flagged extra scripts on the checkout as a security risk for a few years. They have been trying to close the Additional Scripts loophole since 2020, and have added a browser console warning about third-party scripts being blocked on the checkout. Their long term solution is the Web Pixels API, to allow tracking of checkout pages without access to the checkout pages - but this solution isn’t quite ready, and doesn’t include key steps of the checkout journey. How to replace GTM on the Shopify checkout If you run GTM on a Shopify Plus checkout you need to find an alternative to tracking the checkout steps. And you need to do so ASAP. Although GTM may still be running in your store, it won’t be for much longer. You have only two options I’m aware of: Use Littledata’s end-to-end tracking, which tracks tracks Shopify checkout steps server-side and automatically sends those events to data destinations such as Google Analytics, Segment, Facebook Ads (via Conversions API). This has the added advantage of tracking pre-checkout events server-side, which improves both page performance and data accuracy. Use an app that integrates with Shopify’s Web Pixel API. Apps like Elevar have taken this route, even though Web Pixel is still quite limited. Neither solution will provide quite the same level of customization as Google Tag Manager, but then it comes without the risks either. Can your store really take the risk of interrupting the checkout journey for the sake of some minor marketing optimization? Littledata tracks Shopify checkout steps server-side, without the need for GTM Why is Shopify restricting usage of GTM? GTM is loved by marketers for its ability to bypass developer blockers to get marketing tags live, but it is hated in equal measure by web security experts for the same ability to bypass security. With great deployment power should come great responsibility, but GTM allows a non-technical user to inject unknown JavaScript into all web pages on a site with minimal scrutiny. On pre-checkout pages of a store the worst impact is container bloat - multiple tracking tags from different vendors slow down the user experience for customers. The antidote to bloated GTM containers is to push most of the tracking server-side. Server-side tracking allows for faster page loads while improving data accuracy. But adding GTM to the checkout pages presents a much greater risk. As well as potentially interrupting a business-critical path to payment, rogue scripts loaded from GTM can scrape credit card details from the page and facilitate credit card fraud. The final straw for Shopify seems to have come in August when Shopify’s checkout was out of action globally for the best part of a day due to a conflict with GTM. I can’t believe more people aren’t talking about the @shopify checkout issue. 12 hours and massive stores are still affected with no announcement from shopifyHere’s a fix, if your store is affected pic.twitter.com/rkvr72AlBP— Matt Schroeder | 3PL Operator 📦 (@SchroedsBiz) August 31, 2022 With over $500M a day of GMV processed through Shopify checkout in Q3 alone, that is just too big an operational risk for Shopify to bear. Is GTM safe on the rest of my Shopify store? Yes, I can’t see why or how Shopify would restrict third-party scripts -- including GTM -- on the pre-checkout storefront. Shopify allows stores to add any functionality to the storefront as they want, even if that does make the pages load more slowly. That said, two advances in web tracking technology may make GTM redundant for your store: Enhanced Measurement in Google Analytics. This allows stores to track clicks, outbound links, video engagement and page scrolling without adding any code to the storefront. These were all events that required GTM to trigger previously. And it’s completely compatible with Littledata’s Google Analytics 4 connection. Server-side tracking across the customer journey. Browser-based tracking via GTM is increasingly unreliable as cookies and tracking scripts get blocked. Although Google Tag manager also supports server-side containers, the setup can be fiddly and requires you to run your own server infrastructure on Google Cloud. Littledata’s out-the-box server side solution provides all the benefits of server-side with none of the maintenance. So even if you’re quite happy with GTM - and not on Shopify Plus - I recommend you have a think about whether you really need GTM, or could find a lower maintenance solution. [subscribe]

Shopify tracking is our bread and butter here at Littledata, so we were excited to learn that Shopify has released a new Web Pixel extension API to help stores track key customer events via tracking ‘pixels’, and a Shopify pixels manager to manage these pixels. Together this is Shopify’s Web Pixel feature. There are a couple of things to clarify at the outset. Firstly, Shopify’s Web Pixel is not really a pixel at all, but a way of managing and triggering pixels across a merchant store. Most websites today use some type of Web Pixels to track customer behavior, but Shopify’s standardization and centralization of their own Web Pixel tools is a big deal for both merchants and the partners who work with them. The new Web Pixel signals a change in both how client-side events are tracked, and in how related technologies, such as Google Tag Manager (GTM) and Google Analytics, can access those events. I welcome the move to standardize the data layer for Shopify tracking, and remove some of the challenges for stores using GTM to trigger events. But I believe Web Pixel is being rushed out to fix a problem for tracking Shopify’s new checkout, and that there are a number of problems with tracking customer behavior in modern browsers that Web Pixel can’t solve. I welcome the move to standardize the data layer for Shopify tracking...but there are a number of problems with tracking customer behavior in modern browsers that Web Pixel can’t solve. In this post I look at what Web Pixel is, how it does (and doesn’t) change customer tracking for Shopify stores, and the benefits and challenges of different approaches to tracking. I explain why we think that Shopify Web Pixel currently misses the mark, and what we’re looking forward to as Web Pixel evolves. Let's dive in. Does Web Pixel change customer tracking for Shopify stores? Shopify merchants can track customer events in a variety of ways. Almost every Shopify merchant uses third party marketing platforms like Facebook Ads to drive traffic. And they all want to improve ROAS by sharing customer actions from the storefront and checkout (product views, checkout steps such as Add-to-Cart, etc.) back with those marketing platforms for retargeting and audience building. Historically, this has been done via a client-side browser tracking library: gtag for Google Ads and Google Analytics, Facebook Pixel for Facebook & Instagram Ads, the Pinterest Tag for Pinterest, etc. And there were three main ways stores could get these ‘pixels’ firing on the page: Via a Shopify app Triggered by Google Tag Manager (GTM) A developer adds the tag directly to the store theme In the case of 2 & 3, the challenge was both triggering the events at the correct time (e.g. listening for the click of ‘Add to cart’ button and sending the event before the page reloaded)  and having access to the right page, product and customer details at that time (e.g. product price, variant ID). What is Shopify Web Pixel? Shopify has seen stores struggle to implement tracking over the years, and wanted to make it easier for stores to track without Shopify directly supporting the data destinations. Shopify has been burnt trying to support third party platforms like Google Analytics and Facebook Ads (see the reviews for their Facebook Channel), and would prefer to push that support back to the third parties, or app developers that work with them. In comes Web Pixel. In Shopify’s own words, using the Shopify pixel manager allows: Access to a stream of customer events on your online store, including checkout events An additional layer of security for your online store and your customers, including greater control over the customer data that you share with third-party services Prevention of third party code running non-performing Javascript, or interfering with your online store and checkout Built in tools for privacy compliance Let's look at each benefit in detail, with my commentary. Access to a stream of customer events: this is solving the challenge of triggering the right event. This was always most difficult for the checkout, and will become impossible for Checkout 1 (see "Common problems tracking Shopify’s new checkout", below). However, Littledata already offers proven server-side tracking for any Shopify checkout, including headless builds. An additional layer of security. Yes, restricting access to the storefront by loading the pixels in a sandbox removes the risk of rogue scripts scraping personal data. But it makes it much harder to populate all the data fields that need to be shared with third parties. Littledata’s solution to do that product and customer enrichment server-side is both secure and comprehensive. Prevention of third party code running non-performing Javascript. I've previously written about the 'Wild West’ of stores using the Additional Scripts field. I'm all for removing this risk, but again there’s a trade-off between security and the richness of the data captured. Built in tools for privacy compliance. Shopify launched the customer privacy API back in 2020, but it hasn’t had much adoption among tracking apps. With Web Pixel, Shopify is making every pixel respect the customer cookie consent (as managed by a cookie banner app). This is great, but Littledata already respects customer privacy with complete cookie banner integrations. For stores and app developers I see the key benefit of Web Pixel is robustly triggering standard events and data context for common customer actions. Web Pixel removes the need to build a GTM data layer with an app like Elevar, or set up GTM to use this data layer in the tags. But this, too, is not without complications. What’s wrong with Web Pixel? There are several issues with Shopify's Web Pixel as it exists today. Firstly, it is not solving the key problem in modern web analytics: the increasing gap in client-side tracking due to ad blockers, browser restrictions on cookies and handling customers opting out of tracking. The solution to this is fully server-side tracking, which Littledata is launching in Q4. From a technical perspective, there’s a major limitation with how you could use the tracking library (e.g. gtag) within the Web Pixel callback. To send data to Google Analytics, you would need to load the gtag library on the parent page (either from the theme or a script-tag) and, after the library has loaded, pass the gtag function to the sandbox the Web Pixel runs. This removes most of the security benefits Shopify is touting (not loading additional scripts) and massively complicates setup of custom pixels. Shopify's Web Pixel doesn't solve the key problem in modern web analytics: the increasing gaps in client-side tracking. And then there are a number of gaps in the standard events currently tracked via Web Pixel. I know Shopify intends to patch some of these, but it’s not there yet: No context on the collection being viewed in collection_viewed events No product list impression events No product list click events No remove from cart event No shipping step on the checkout No waiting before page reloads to trigger add to cart events Very limited access to the browser window context (including page URL) for the pixel No post-purchase events (refunds, cancellations, fulfillments) Common problems tracking Shopify’s new checkout Shopify has long said it wants to lock down scripts running in the checkout to protect customer security and privacy. The latest version of the checkout (labelled "Checkout 1"), rolling out for Plus stores in Q4 2022, does this by allowing more checkout customization via API but removing customizations and scripts in checkout.liquid. So if you're a Plus store, and added a GTM container to the checkout.liquid file, these tags will stop working before December. You have three options to continue to track the checkout: Use Littledata’s server-side checkout tracking Use another app making use of the Web Pixel extension Build a custom pixel using Shopify pixel manager If you're not on Shopify Plus then only Littledata’s checkout tracking will work for you right now. Want to learn more? Find out the differences between client-side tracking and server-side tracking. Why is Shopify restricting scripts on the checkout? Google Tag Manager (GTM) is a powerful tool to manage marketing tags, but i’ve written before about how it provides a backdoor for malicious code to be injected into the checkout. For example, hackers can add a keystroke tracking script which relays credit card details as they are typed to the hacker’s server. Or in another hack we saw, the user was directed away from Shopify’s checkout to a similar-looking bogus checkout. Shopify has signaled that they see checkout as core to the ‘OS of ecommerce’ and they want to protect their brand from association with such scams. If that means blocking safe tags like Google Analytics or Google Ads, then that’s a worthwhile trade off for better security in their view. Should your store use the Shopify pixel manager? In short, no. We do not recommend using Shopify's pixel manager. At least not yet. The main use for adding Web Pixel right now is tracking the checkout, but Web Pixel is missing a key step of the checkout (shipping) and are difficult to implement via a custom pixel (for example, loading the tracking library or passing through that library to the sandbox). If you need to add back checkout tracking, or start tracking Google Analytics 4, you’d be far better using a proven analytics app for that. If you want to remove Google Tag Manager from your storefront for performance or security reasons that is understandable, but I’d suggest you wait until 2023 and some of the issues with Web Pixel have been ironed out. For now your options are: Make more use of server-side tracking, which will speed up your site Use Littledata’s GTM data layer to remove custom code that triggers events Web pixel should be useful next year for stores moving to Shopify Hydrogen. For headless Shopify stores we expect Web Pixel to make it easier to track pre-checkout events like page views, product views and add to carts - in addition to the server-side events Littledata tracks for headless stores. Some predictions for the future From our conversations with Shopify, I think the ability for apps to add script-tags to the Thank You page might be removed in 2023. That would make Web Pixel the only way to track purchase events on the Thank You page – but it wouldn’t impact purchases tracked server-side. I don’t think Shopify can or should deprecate script tags across the pre-checkout storefront, because there are lots of uses for additional JavaScript besides from tracking. I predict the impact on the tracking app ecosystem will be similar to when Shopify opened up subscriptions in the checkout in 2021 - a proliferation of apps offering generic functionality, and a race to the bottom in app pricing. I’d expect to see many more free tracking apps - for common platforms, like Facebook, and for niche ones like Roku and Verizon Media - because the technical complexity of launching client-side tracking is reduced. This is especially true for Google Analytics 4. Many brands are waiting for Shopify to release an official GA4 integration, but I don’t think this fits with Shopify’s strategy. They prefer to make it easy for app partners to connect to GA4, and leave these partners to help brands with Google Analytics queries. [tip]See what Shopify stores can do today to prepare for GA4[/tip] And yet I expect an increased demand and perceived value for apps that solve the real challenges of data accuracy and marketing attribution, through server-side tracking and other innovations. I know many brands willing to pay for quality data, and Web Pixel is not able to deliver that just now. [subscribe]

Six years ago we started Littledata to help brands get more complete data on their customer lifecycle — pushing the advantages of server-side tracking to generate accurate analytics. We’d seen how custom-coded server-side tracking for bigger brands like MADE.com had brought greater trust in marketing attribution and analysis, and we wanted to bring that technological leap to many more direct-to-consumer brands to enable them to be more data-driven. Fast forward six years and many others now believe server-side tracking’s time has come. Leading brands such as Dockers, Grind Coffee and Rothy’s are using Littledata to power their reporting and analysis — and your brand should be too. Here are the top ten reasons why you should swap out your Google Tag Manager (GTM) client-side tracking for a robust server-side tracking implementation. 1. Accurate revenue and orders Revenue and purchase volumes are paramount for any ecommerce store. However, tracking orders via the thank you page is increasingly unreliable. Getting the revenue in your analytics reports to match what your company is actually selling (as recorded in your financial results) is the #1 reason to switch to server-side tracking. Last year I wrote a longer article on why 12% of client-side orders don’t get tracked. In the year that followed, the release of iOS 14 (and beyond), the rise of ad-blockers, and web visitors increasingly opting out of tracking have all helped increase that number of lost revenue tracking to nearly 20% for some stores. Yes, you read that right — reliance on an outdated tracking script on your thank you page means you might be missing visibility on $1 in every $5 spent on your store. How would plugging that hole change your whole company’s attitude to analytics? 2. Data security Can you take the risk that important revenue and customer data is leaking out via the end user’s browser? Yes, data sent to the user’s browser and tracking pings back to Google Analytics are both encrypted. But data on the web page and the network requests can be intercepted by other scripts running via Google Tag Manager or a Chrome extension. In other words, data in the browser is inherently insecure. By contrast, if the checkout steps and orders are tracked server-side—directly from your ecommerce platform to your analytics platform—there is no risk of this kind of snooping. You can even add commercially-sensitive stock levels or gross margins to order events, increasing the usefulness of analysis without compromising data security. [tip]Related reading: Do you need to process customer data in-house to be truly data secure?[/tip] 3. Consistent data for reporting Have you ever dived into your website data and been utterly confused by which event names you need to report on? Things like typos, random capitalization (is it “Add To Cart” or “add TO Cart”?), and missing events caused by whoever set up Google Tag Manager. These make reporting a lot harder than it should be. Littledata’s server-side tracking follows a dependable and consistent data schema; you can be sure add_to_cart is always add_to_cart. This is especially important when you are working across multiple country stores (or multiple brands) and want to be sure you are comparing apples with apples when it comes to ecommerce conversion rate, checkout completion rate, or other key metrics. 4. Custom dimensions on your buyers Your ecommerce platform already gives you a fair amount of information about potential customers (more than you can safely expose on the web page as we just found out in the last point). With server-side tracking, however, you can enrich event data to get even more dimensions for reporting. These help you paint an even better picture of your customer, while still maintaining their privacy Littledata sends a range of user-scoped custom dimensions with checkout and order events. These reporting dimensions can be used to build cohorts based on when the customer last ordered, analyze customer lifetime value, or link a customer’s web activity in Google Analytics with their customer history in Shopify. That information goes a long way when you’re determining your best buyers and creating marketing campaigns to reach them. [tip]Learn how to use custom dimensions in Google Analytics for subscription ecommerce.[/tip] 5. Better sales attribution back to a specific Facebook or Instagram user Facebook Ads’ ability to attribute your sales to their mobile ads has been so eroded by iOS 14 that they strongly encourage all brands to use their new server-side Facebook Conversions API (CAPI). CAPI allows you to not only link an order to a browser session but also a range of customer identifiers. These identifiers improve your Event Match Quality score and better attribute your campaign spend—even between devices and browser sessions. Brands using CAPI have seen up to 30% improvement in their Return On Advertising Spend— so even just one use case justifies any cost in switching to server-side tracking. [tip] You can now get started with Facebook Ads via Conversions API by connecting your store using Littledata [/tip] 6. Post-purchase events—refunds, cancellations, and fulfillment Some events in a customer’s journey from discovery to delivery don’t happen in the customer’s internet browser. So, they can’t be tracked at all without server-side events. A few good examples of this are order refunds and order cancellations (say due to fraud or delivery stock problems). If you exclude these from your analytics, you may have an overly rosy view of some acquisition channels with a high return or fraud rate. Your marketing team might also want to trigger email notifications or other campaigns when a customer’s order is out for delivery or delivered. Server-side fulfillment events can achieve this too, triggered by any shipping app that integrates with your ecommerce platform. 7. Seamless tracking—even with a rapidly changing storefront Before founding Littledata I advised brands like MADE.com and Figleaves.com on analytics setup. Even these larger, well-staffed brands found it really hard to keep their client-side tagging in sync with their store theme updates. Every time a page layout was changed, inevitably one of the GTM triggers (which expected on-page buttons or images in a particular HTML format) would break. The interruption in tracking wouldn’t be noticed until someone went to check the reports at the end of the month—and the accuracy damage to the data was done. Server-side tracking removes this risk. Whatever changes you make to the layout of the page, the data layer is maintained on a server and cannot be tampered with. 8. Avoiding custom scripts on the checkout Tracking checkout steps is important as part of the customer journey. But adding custom JavaScript to the checkout is a security risk for any store (see point 2). It would allow a hacker to scrape credit card information from the customer or redirect them to a fake checkout where the payment is intercepted. With Shopify, it’s just not possible to add scripts to the checkout. Although Shopify Plus has a workaround with the ability to edit a checkout.liquid file, it’s likely at some point Shopify will close the loophole for the reputation of the platform. This is an area where again server-side tracking provides a better way. As the customer steps through the checkout steps, their progress can be shadowed on the server and the same checkout funnel can be visualized without any scripts on the checkout itself. 9. Faster page loading Many of the brands we work with support many data destinations. When using client-side tracking, this requires multiple tracking scripts to be loaded and multiple network requests to be made to track a single event. All of this extra browser activity slows down the user experience, especially on mobile devices. A slower page load, as measured by Google’s PageSpeed Insights tool, reduces the SEO of your landing pages. So, although the overall contribution of client-side tracking on your page load speed might be minimal (~5%), removing the tracking has a doubly positive impact on both traffic and conversion rate. The more reporting tools or marketing platforms your store is sharing data with, the greater the impact you’ll see from switching to server-side. 10. It’s the future! For all of these reasons, I believe in 5 years' time there will only be server-side tracking. The browser limitations, data security risks, and need for accuracy are only going to increase. Meta might be ahead of the curve with Facebook Conversions API but I would expect other marketing platforms to follow suit once they see its success. So why wait until your data is really broken? Get started with a no-code server-side implementation today. [subscribe]

Many brands with large customer bases are facing a similar question when it comes to storing data—is it time to bring all data processing in-house? Whether this is prompted by a data security audit, a data breach, or a desire to be more agile with data analysis, it's an important question that thankfully doesn't have a complicated answer. In this article, I’ll explore whether you should outsource or insource customer data processing for your brand. Quick side note—for Littledata’s direct-to-consumer (DTC) brands, customer data is usually first-party data captured as part of the ecommerce checkout process, including post-purchase interactions with the customers and web browsing information such as IP addresses. Why you need first-party data to be secure First-party customer data is data the customer shares with you directly through the server connecting them to your website. By its very nature, first-party data is created by a contract—and more importantly, a bond of trust—between your brand and the end customer. Accidentally leaking that data is brand-damaging: 46% of organizations surveyed by Forbes suffered reputational damage after a data breach. In addition, GDPR and similar regulations impose large fines (up to 4% of global revenue) for data breaches—specifically, lax processes leading to a data breach. You might also be concerned about commercial espionage—how valuable could your customer purchase history be in the hands of a competitor or a fraudster? Or maybe your company has been burned by third-party data processors in the past whose security standards did not meet your own. Taking these concerns together, you may be thinking the only way to be truly data secure is to process and store first-party customer data on your own infrastructure. But there are downsides to this. Do you want to own your own data infrastructure? By data infrastructure, I don’t mean owning bare-metal servers that sit in the broom cupboard behind your office. I’ll assume you are comfortable with the concept of hosting data in a public or private cloud environment. However, even maintaining that cloud computing infrastructure brings costs and risks. Your company will be responsible for software patches, updates to use the latest API versions, monitoring for suspicious activity, and handling outages. Data engineering is complex, and great data engineers are in short supply. So, I suggest you are better off licensing a secure data pipeline than building it all yourself. Does your company control the data end-to-end? Frankly, processing company data in-house may be missing the point if you do not control the data processing end-to-end. Many of Littledata’s customers have made a deliberate choice by working with Shopify or BigCommerce to leave purchase and transaction processing to a cloud provider—signing data processing agreements (see DPAs for Shopify and BigCommerce) to store customer data on US cloud servers. Many brands also make a choice to share customer data with Google (pseudo-anonymized) or with Facebook (not anonymized) to improve their customer acquisition and Return on Advertising Spend (ROAS). In effect, these brands are outsourcing the data processing that happens between the ecommerce cloud and the marketing cloud to Littledata. Trying to do this processing in-house makes little sense when the start and end of the data processing chain are third parties. Does EU customer data need to stay in the EU to be secure? You may have read about regional courts in France and Austria ruling against sending EU customer data to Google Analytics—or indeed sending data to any US server. I think these rulings are extreme and will eventually be struck down. There is no practical or legal reason why data processing on servers within the EU is somehow more GDPR compliant than hosting on the cloud in the US. That said, data nationalism as a trend is here to stay, so there may be a future need to keep EU data siloed. All cloud computing networks have EU servers, and tools like Segment make it possible to split EU customer data processing onto EU servers. The limitation is that right now, none of our other partners (especially Shopify, Google, and Facebook) have the same ability to process in the EU. This makes regionalizing only one part of the data processing chain pointless. Is outsourced data GDPR compliant? Yes, you can subcontract data processing to a third party. But to be GDPR compliant, your data processors need to enable the right to rectification, the right to erasure, and the right to restrict processing. All the main partners that Littledata works with (Shopify, Google Analytics, Facebook Ads, etc.) have API endpoints by which your customer can request their data to be updated or erased, and this request can be passed on to the downstream processors. If the customer requests to restrict processing (e.g. opting out of advertising retargeting using a cookie consent banner) your company needs to also pass along that choice to the downstream processors. Littledata’s tracking script makes that easy to do via integration with Shopify’s consent management, and plugins for OneTrust and TrustArc. Can you control outsourced data processing? Yes. Doing so is just a matter of working with a processing partner that a) is transparent on how they process the data, b) follows good practices in data security, and c) provides Service Level Agreements (SLAs) for the processing. At Littledata, we are clear about how we process customer data (and exactly what data points are stored where), have a public data security policy, and provide tight processing SLAs for Plus customers. [tip]Learn more about how Littledata protects your data while giving you 100% accurate analytics by booking a demo with one of our experts.[/tip] Conclusion I believe you can outsource data processing and still be truly data secure. In fact, I believe trying to bring data fully in-house is costly and pointless for most cloud ecommerce brands. Pick trusted partners to ensure your customer data processing is both super reliable and super secure, and get on with scaling your business!