When Google analytics was launched in 2006 it instantly gave a wealth of website statistics to website owners and marketers which was previously only available to the larger companies which paid big bucks for similar tracking software.  Until then, all we had to go on was rather limited and unreliable stats from web hosts.  Whilst Google Analytics has undoubtedly been a good thing (one of the best in fact) to happen to ecommerce websites it has also led to a lot of over-analysis of data and even worse, analysing the wrong data.  In this post we take a look at 3 of the metrics which are often misunderstood by web marketers.

1. Bounce Rate

By far and away the statistic which confuses most online marketers!  We’ll start by confirming what Google defines as a ‘bounce’ on your website.

From the horses (Google’s) mouth

“Bounce rate is the percentage of single-page visits or visits in which the person left your site from the entrance (landing) page.”

It might seem logical that you would want a user to go through as many pages as your site as possible and by the end, perform a positive action/conversion, whatever that may be.  The fact is users will rarely use the website in the way you want them to and (particularly with ecommerce sites) will not often convert on their first visit.  

If we take the example of a user looking to buy a product online; in this day and age they are likely to consult a number of different sites to find reviews and the best prices so you want to be able to make your site as visible as possible so they can find the product they are looking for early in their buying process.  With an effective web build, SEO and marketing strategy you can ensure that when a users is looking for a particular product they can be sent straight through to that product page.  If that users came to the site, noted down the price, looked on competitor sites for better deals then came back a few days later to your site to purchase, according to Google Analytics these two visits had a bounce rate of 50% because the person only viewed the one page on their first visit.  If however, your marketing had not been quite so targeted, that user might have been directed in the first instance to the homepage and then had to find the product themselves.  This multi page visit would of course not generate a bounce but we have given the user a more difficult task.

Bounce rate, particularly with an ecommerce site should not be viewed as just a number for the whole site which you need to get as low as possible.  The rate is available for every page on the site and this is where marketers can learn the most. On an ecommerce site, look at the homepage - if the bounce rate is high here then you have a problem which will need addressing.  Also, on the checkout process, whereas bounce rates will not tell you much you can look a similar stat - the % exits from these pages which will indicate which part of the checkout process is proving to be an obstacle (shipping costs, payment pages etc).

2. Conversion rate

You want your conversion rate to be as high as possible, right?  Well, yes of course, but if it is falling it might not be the disaster that you think it is.  

So why is conversion rate measurement not as simple as we first thought?  Let’s use this example:

You sell blue, red and yellow widgets from your online store and have always ranked well in search engines for the terms, red widgets, blue widgets and yellow widgets which have converted at an average of 5%.  After a website refresh and a solid 6 months of SEO you now find your website ranks well for the very competitive term ‘widgets’.  Good news of course as now you are generating more visits and sales through users coming to the site from this generic term.  However, many users who come to the site through this generic terms are looking for green widgets which you don’t currently sell - as a result conversion rate for these users is very low which drags down the conversion rate of the whole site to 4%.  So there you have it, in a 6 month period your conversion rate has dropped 20% but revenue is much higher plus you have a strong indication that you can expand the sites offering in the future to successfully sell green widgets too.

What marketers should once again be measuring is individual products or product categories when it comes to conversion rate.  If the conversion rate of red widgets has fallen through the floor then you can get concerned and look at the site performance and external factors such as competition.  The overall site conversion rate though, is often not as black and white as it seems.

3. Time on site

You are looking at your web stats and users and on the site for less and less time on average.  Whilst this may seem like an alarming stat, it isn’t necessarily, and in fact, can often be seen as a positive.  As a very simple example, if a user can find what they are looking for quickly, go through the checkout process easily and the site performance is generally quick, then they will not spend long on the site - and why would they need to?  I would argue that as long as revenue is consistent, the less time on average a user spends on the site, the better.

Of course, these 3 points have been simplified a great deal - they could all be discussed individually for days.  However, the main point to take away from this is looking at a website from a macro level will often throw up stats which might be misleading.  It’s the little nuggets of information by spending time looking at the stats from a micro level which can often have the most positive effect on the sites bottom line.

Coming soon...the metrics which some marketers ignore, and really shouldn’t!