Why eCommerce Brands Should Switch to Server-Side Tracking
One of Elevar’s agency partners, eHouse Studio, breaks down what Server-Side Tracking is and why brands would benefit from using it!
Article via eHouse Studio
If your eCommerce business is relying solely on conventional tracking for analytics – client-side tracking in the browser – you should be wary about trusting your data. Why? Unfortunately, due to trends like increasing use of ad blockers, cookie restrictions, and Apple iOS updates, as much as 20–25% of your data could be missing or inaccurate.
While this situation has many potential repercussions, two of the most critical issues are that:
- it prevents teams from being able to make data-informed business and marketing decisions, and
- it creates inaccuracies on ad platforms, making ads less targeted and increasing customer acquisition costs (CAC).
The solution? Server-Side tracking. Server-Side tracking enables you to collect more first-party data and increase data accuracy so you can better trust your data.
So why isn’t everyone doing it?
It’s complicated – too complicated for most merchants to set up on their own.
Despite the complex nature of the beast, we strongly recommend to most of our clients that they work with a partner, like our friends at Elevar, and leverage their expertise to get it done right.
Client-side tracking issues aren’t going away. Instead, they will only continue to worsen. The longer you wait, the more money you waste because you can’t use data effectively to drive your business.
What is Server-Side tracking?
Like the client-side tracking you’re likely already doing, Server-Side tracking also collects data about customers and their behavior. The difference is in the structure of how the data is routed from Point A to Point B. A Server-Side set-up actually makes it easier for your data to get where it needs to go.
Here’s an analogy to help explain.
Two groups of scientists (your data) are exploring the wilds of the Amazon rainforest. They have the same end destination (the GA4 Pyramid), but one group is on foot while the other has helicopters to take them through the terrain. As Group 1 battles treacherous ravines and poisonous snakes (ad blockers, browser issues) down on the ground, it’s not unlikely that it will lose a few of its people (your data) along the way (yikes, fell off a cliff!).
A Server-Side set-up is like using helicopters: it provides an easier, direct route and all the data you send gets there in one piece. Server-Side works better because it uses a Server-Side Google Tag Manager (GTM) container and APIs to connect the source (e.g., website, Shopify admin) directly to endpoint destinations like Google Analytics 4 (GA4), Facebook and TikTok.
In contrast, client-side tracking (i.e., a browser GTM configuration) can result in a high number of untracked events. Even Facebook admits that a browser tracking a Facebook pixel will miss the events data for approximately 8% of site users.
Note that there’s no cookie-cutter way to set up Server-Side tracking (although an expert partner brings best practices and proven processes to a project). While the concept of using APIs to create direct, unimpeded routes for data is central to the approach, the actual set-up will vary depending on the specifications and nuances of a particular eCommerce site and business.
Why shifting to Server-Side tracking is inevitable
Let’s look at the trends.
1. Ad blockers
Not only do ad blockers keep ads from loading, most ad blockers may prevent tracking scripts from loading, or from sending information to your ad and analytics platforms.
How bad is it? Surveys show 26% to 40% of consumers are using ad blockers. Not only on laptops and desktops, but on mobile as well, where use of ad blocking has doubled in the last five years. This can really skew your data.
While browsers like Safari and Firefox have been blocking third-party cookies for nearly a decade, the 800-pound gorilla, Google Chrome, hasn’t yet. Although the company keeps pushing the date out, the latest estimate for its third-party cookie phase-out is late 2024.
Also, data privacy regulations like the EU’s General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) require websites to alert consumers to the types of cookies they’re using and enable consumers to accept or deny them.
It’s easier to set up Server-Side tracking today than in the past. Increased availability of APIs for the endpoints merchants need to send data to, like Facebook, GA4 and others, makes Server-Side tracking a more practical and cost-effective option for more companies.
How Server-Side tracking brings value
There are a number of key reasons why implementing Server-Side tracking is worth the effort.
1. More accurate data
The foremost benefit of Server-Side tracking is that you will be able to collect more and more accurate first-party data. A Server-Side set-up bypasses the browser and ad blockers. How? When the data is tagged in the cloud-based GTM container instead of on the site/in the browser, it looks like a first-party script call from a subdomain of your site, which ad blockers let through. This means you can be more confident in the data and get an accurate view of user behavior.
2. Faster page loads and higher conversion rates
As we always say, if you want faster onsite experiences for your customers, you have to cut back on the scripts. Server-Side tracking allows you to reduce the number of scripts running on your site, making your site faster and improving the customer experience. You know that speed is critical for conversion rates and that even a fraction of a second faster can go a long way: research shows a site that loads in one second has a conversion rate three times higher than a site that loads in five seconds.
3. Lower customer acquisition costs (CAC)
If your customers aren’t being tracked and sales aren’t being attributed accurately, it will look like your ad costs are higher than they actually are. If your data isn’t trustworthy, how can you decide where to allocate marketing spend? Without good data, it’s easy to make big mistakes.
In addition, in order to serve the most targeted ads through platforms like Facebook and Google Ads, you want to supply the platforms with the most accurate data. The better information you feed into the algorithms, the better site traffic you get, which ultimately lowers your CAC.
4. More control over your data
With Server-Side tracking, the merchant has more control over what data is captured, which endpoints get data, and what data they receive. In other words, you set the rules if you want to keep some customer information private and not allow it to be viewed or sent to third parties like Facebook and TikTok.
With client-side tracking, once you load those scripts onto your site from third parties like ad platforms, they can get in and access your first-party data. And the truth is, no one knows exactly what that code does – it’s like a black box only the vendor can see into.
5. Extended cookie life
Cookie life on browsers is now typically 24 hours to seven days; after that period, a person is considered a new visitor – which impacts attribution data. For brands with longer sales cycles, this can really be problematic. With Server-Side tracking, depending on a company’s tech stack, there often is a way to extend the cookie life to align with the customer sales cycle.
How to get started
At a high level, here’s what implementing Server-Side tracking entails (leaving out the gory details; ahem, potential challenges):
- Create a data layer so that you can surface all relevant eCommerce events (e.g., add to cart, view collection) and send the data to the server for processing and dissemination
- Set up a Server-Side GTM container in the cloud
- Configure your data and set up tagging on the server side
- Connect the data sources (website, Shopify admin) via the Server-Side GTM container and APIs to endpoint destinations like GA4, Facebook and TikTok
- Depending on the desired endpoints, you may continue to do some client-side tracking (not all have APIs)
- Test to make sure everything is tracking properly
We strongly recommend working with a partner to do this. We like to work with our partner, Elevar, because it makes Server-Side tracking a million times easier for our clients. Plus, they can provide ongoing services like maintaining the Server-Side container.
Data: You can’t compete without it
Data is the lifeblood of a successful eCommerce business, helping you make smarter business and marketing decisions. If you can’t trust it, what’s the point? Server-Side tracking is the wave of now. Don’t wait!
Written by eHouse Studio and Elevar