This post aims to develop an understanding of how to calculate product specific conversion rates and discuss the potential analysis & insights that can be generated from it.
Quite often the business problems or questions that most e-commerce websites encounter are one of the following:
- How much product to stock?
- Which products are fast-moving?
- How can I move some of the products quickly?
- How to measure how many views different products have received?
- Are the product views turning into transactions & revenue? What actions can I take based on such data?
What is the product conversion rate?
There are many ways to define what we can call the product conversion rate. For example, you can check the number of transactions for any given product divided by the number of visits to that specific product. Moreover, you can also use the quantity to no. of visits ratio to calculate the product conversion rate.
Based on the product conversion rate, an automobile e-commerce website was able to update its recommendations section, which in turn led to a 20% increase in transactions.
For our understanding, we will use the ratio of quantity sold to the no. of visits for the different products as a product conversion rate.
Why product conversion rate?
There are many ways to define what we can call the product conversion rate. For example, you can check the number of transactions for any given product divided by the number of visits to that specific product. Moreover, you can also use the quantity to no. of visits ratio to calculate the product conversion rate.
Based on the product conversion rate, an automobile e-commerce website was able to update its recommendations section, which in turn led to a 20% increase in transactions.
For our understanding, we will use the ratio of quantity sold to the no. of visits for the different products as a product conversion rate.
How to get data from Google Analytics?
There are two approaches that can be used for obtaining the data for product views:
Approach 1: Ecommerce / Enhanced Ecommerce
Here is the syntax that you can use to generate product views statistic in event tracking:
Event Category: Enhanced Ecommerce
Event Action: Product Detail View
Event Label: {{current page path}}
This needs to fire on all your product pages in Google Analytics.
As a result of this, you will be able to create a custom report with “Product” as the dimension, and “Product Detail Views” as the metric.
Report Image Source: Google Merchandise Store
Approach 2: Custom Events Implementation
You can implement the following data layer snippet to pass an event every time a product detail page is loaded.
Event Category: Product Detail View
Event Action: {{Product Name}}
Event Label: {{current page path}}
Based on this implementation, you will get the Product Names in your event tracking report. You will not need to go through the process of implementing E-Commerce tracking on your website, and will still be able to get unique product views as well as total product views of each product.
By putting this data together, here is what you can get as an output for different products. Please note that in the third column you can create conversion rates for your different products.
| Product Name (based on Event Action) | Unique Views (based on Unique Events) | Quantity Sold | Product Conversion Rate | Product Revenue |
|
Google Utility BackPack |
260 |
9 | 3.46% | 2231 |
|
Chrome Dino Collectible Figurines |
658 |
29 | 4.41% |
1840 |
| Google Black Eco Zip Hoodie |
713 |
27 | 3.79% |
1721 |
|
Google Incognito Zip Pack |
322 |
35 | 10.87% | 1611 |
|
Google Eco Tee Black |
133 |
15 | 11.28% |
1364 |
|
Google Incognito Techpack V2 |
413 |
15 | 3.63% | 1160 |
|
Google Campus Unisex Zip Hoodie |
142 | 17 | 11.97% | 1119 |
| Chrome Dino Marine Layer Tee |
300 |
12 | 4.00% | 1079 |
| Noogler Android Figure | 250 | 20 | 8.00% |
1872 |
| Google Cloud Unisex Zip Hoodie | 129 | 24 | 18.60% |
1654 |
Some of the products have a high conversion rate as shown in highlighted portion. These are your winners.
Plot this conversion data with the product’s revenue and you will be able to analyze various aspects of your product performance indicators, including:
- Know whether high converting products are getting sold or not
- Use the advanced segments to calculate the product conversion rate for different traffic sources
- Figure out low converting products, reduce them from your stocks and save the money from the warehouse!
anand
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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”