This post post aims to develop an understanding of how to calculate product specific conversion rate & discuss the potential analysis & insights can be generated from it.
Quite often the business problem or questions that most ecommerce website encounters is very specific to product management as to how much product to stock, which are fast moving ? how can I move some of the product quickly etc.
How to measure how many views different products have received & whether those views are turning into transaction & revenue? What actions can I take based on such data?
What is product conversion rate?
There are many ways to define what we can call the product conversion rate. For example you can check # transaction for any given product divided by # of visits to that specific product. Moreover, you can also use quantity to # of visits ratio to calculate the product conversion rate.
In omniture there is an event called prodview which counts # of pageviews for any given product and then when it is used with revenue or transaction, it gives interesting conversion ratios for different product.
For our understanding we will use ratio of quantity to # of visits for different product as a product conversion rate.
Why product conversion rate?
Calculating product conversion rate is very important to understand which product is converting better vs. others? Moreover if you have cost data, you can also find out that whether the profitable products are converting better or not? With such insights, you can modify the e-commerce shop to ensure that the profitable products get more chance to convert etc.
As a normal analytics practice first thing is to build a template of what data we want to calculate the product conversion rate.
For our understanding we will use ratio of quantity to # unique views to product page for different products as a product conversion rate.
The quantity data will be available from the Google analytics interface & we need to get data of quantify & product views for different product.
How to get data from Google Analytic?
There is only small change that is required to calculate the product conversion rate in Google Analytics i.e. by using Google Analytics Events tracking.
Here is the syntax that you can use to generate product views statistic in
This needs to fire on all your product pages in Google Analytics.
As a result of this, in your event tracking report you will find product names in event actions and get unique product views as well of total product views of the event via total events and unique event metrics.
You will find product names in event actions and get count of unique views as well of total views of the event via total events and unique event metrics.
By putting together all the data you have here is what you can get as an output for different product. Please note that in last column you can create conversion rate for your different product.
Obviously, some of the product has very high conversion rate as shown in highlighted portion. These are your winners.
Plot this conversion data with the product’s revenue and you know whether high converting products are getting sold or not ? You can also use the advance segment to calculate the product conversion rate for different sources which will provide even better insights to what products works and which doesnt work ?! What more ? You can figure out low converting product and reduce them from your stocks & save the money from warehouse !
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