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
event tracking:
pageTracker._trackEvent
(“uniqueproductname”,
“variantname”,
“uniqecategoryname ”,
-
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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Ravi is the co-founder of Tatvic and expert at managing different web analytics tools. Ravi actively works on conversion optimization projects to improve conversion rate and test newer hypothesis with e-commerce companies.
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14 Comments. Leave new
Keep it up Buddy! Adding my 10 cents… Conversion rate can also be measured by measuring of no. of units sold i.e divide total no. of orders by Total number of Visits. In some instance to show some more analysis we can divide No. of Product Orders by total no of visitors (which will give us sale for X number of visitors for that website).
This can be extending to non e-Commerce websites as well. One can use no. Of Goals Achieved divide by Total Visits.
Hi Suchet, Thanks for your comment & options. I agree with you that there are no. of ways to build product conversion rate or even build some psuedo conversion rates as well which provides the insights.
However, what I havent mentioned in this post probably is the ability of product conversion rate to be broken down by different advance segments. We can think if some products which moves very fast via PPC campaign and some via organic traffic. This can be huge insight especially when we look at product storage & transportation costs associated with e-commerce website.
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Hi Suchet,
Thanks for your comment. I agree there are many ways to get conversion rate defined, however till I wrote blog post, I wasnt sure if there were ways by which product conversion rate was calculated in Google Analytics. This articled addressed that need for calculating product conversion rate
Wow ! thats great post. We are an ecommerce retailer and never realized we can see how much our individual products are performing. This will certainly be a great input for our pricing structure.
Thanks for sharing this buddy !
Hi Tim,
Very happy that it was helpful to you ! Do share results if you can if you find something very unique about product conversion rate on your ecommerce website.
Best,
Ravi
Ravi hi, can you please provide detailed instruction on where and how to place the code you mentioned? Does it need to be placed above analyics code. Is there additional script required etc. Thanks Jan
Hi Jan,
I think this post needs update from a standpoint of updates that Google Analytics has seen. Let me update & send it to you !
Best,Ravi
Hi
Very interesting way to get more knowledge about conversion on product level. There is just one thing to remember with the mentioned method: Event tracking removes the bouncerate. It means: if a visitor have a product page as landingpage, then he will not be a bounce, because it is a pageview AND tracked with event-tracking.
Hello Jacob,
Yes you are right ! Thanks for bringing this to my notice. We actually got that and moved to using of custom variable instead of event tracking for a client !
I was inspired by your post and while trying to track product level conversion rate, I’ve set a custom variable with the product SKU on each view of a product page. Although GA recorded transactions on the site, they aren’t being spread to each custom variable in the GA Custom variable report (E-commerce tab). Any guidelines on what I’m doing wrong?
Hi bogdanch,
Which type of custom variables are you using. I suggest you use page level of custom variable for this purpose so that you dong have to worry about its value getting carried forward.
Interesting post!
But what about when a product, or a variant of the product (e.g. one specific colour), has run out of stock? This will lower the accumulated product conversion rate and hence a previously high-converting product will not look as good when compared to others. Do you have any insight on how this could possibly be solved?
You could add a page level custom variable called “in stock” or “out of stock”