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How Google Analytics calculates the Conversion Rate
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Analysis of the conversion rate by acquisition channel
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How to interpret the variations in the Conversion Rate
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Mistakes to avoid
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Four rules to improve the Conversion Rate
1. How is the Ecommerce Conversion Rate calculated in Google Analytics?
How to calculate the ecommerce conversion rate:
The e-commerce conversion rate is calculated by dividing the orders - calls transactions in Google Analytics - for visits or sessions to use the terms of Google Analytics.
The conversion rate is the ratio of transactions to visits.
orders (transactions)
———————— % = CR
visits (sessions)
If we have 10 orders for every 1000 visits, our average conversion rate is 1%.
2. Analysis of the Conversion Rate by acquisition channel
It is important to say that the Conversion Rate found in GA's ecommerce report is average, because the conversion rate can be measured in relation to different dimensions: by country, in case we sell to multiple countries, per period or by type of user (new vs. returning) and others size
Another example is the conversion rate per device (mobile vs desktop), generally the mobile conversion rate it is lower than the desktop conversion rate.
3. How to interpret the changes in the Conversion Rate
If we activate some marketing campaigns which bring a great deal of traffic to the site, of which most are people who come for the first time on our site (new visitors) the conversion rate will drop significantly.
The user on the internet is generally very price sensitive, so promotional activities can significantly influence the conversion rate, so during the sales the conversion rate rises.
As we have said, the e-commerce conversion rate can vary according to the Country, the Type of Visitor (new vs returning), the Traffic Source (For example: Organic, Paid, Newsletter)
The Conversion Rate is a metric and therefore constitutes a quantity but by itself it is not able to explain the reason for its value or its variation. Therefore it must be analyzed in relation to a dimension, as we said before for example the country, type of user and others.
The term dimension is a term that is also used by Google Analytics, and it is therefore necessary to learn how to use it.
There are various reports on Google Analytics that already do this type of analysis, for example: the Audience> Geo> Location report (in Italian Audience> geographic data
Acquisition> All traffic> Source Medium
Audience> Mobile> Overview
4. Mistakes to avoid
Some people calculate the conversion rate as the ratio of orders to visitors rather than visits.
Calculating the conversion rate based on visitors has the effect of increasing the final value as visitors generally make more than one visit to the site in a given period of time, such as a month.
From my point of view it is better to calculate the conversion rate as the ratio between orders and visits rather than between orders and visitors for two reasons:
1) Even in the traditional retail world, or Bricks and Mortar, it calculates the conversion rate as the ratio between receipts and store entries, not between receipts and customers identified by name and surname;
2) Google Analytics, which is one of the most popular tools in the world, calculates the conversion rate using visits and not visitors.
5. Four rules to improve the Conversion Rate
Remove distractions
Remove all elements of the page that are not functional to the conversion
Remove obstacles
Remove unnecessary mandatory fields etc.
Instill a sense of security
Enter payment security information and symbols
Instill a sense of urgency
Communicate low product availability or expiration of promotions
Deepening
31 ways to optimize the Ecommerce Conversion Rate