E-Commerce KPI Study: There’s (Finally) a Benchmark for That

Posted by ProfAlfonso

Being a digital marketer, I spend my day knee-deep in data. The time I don’t spend analysing it, I spend explaining its significance to a client or junior colleague or arguing its significance with a client or senior colleague.

But after many debates over the importance of bounce rate, time on site, mobile conversion rate and the colour grey for buttons (our designer partook in that last one), we’re never much closer to an agreement on significance.

Our industry is swimming in data (thanks Google Analytics), but at times we’re drowning in it.

Numbers without context mean nothing. Data in the hands of even the savviest marketer is useless without a context to evaluate its performance against competitors or the industry at large.

Which is why we need benchmarks.
Through benchmarking, marketers can contextualise data to identify under-performing elements and amplify what is over-performing. They can focus on the KPIs that are important, and recognise whether they are achievable.

Benchmarks also give context to those who aren’t familiar with data. One pain point that digital marketers face globally is communicating their performance upwards. There are very few ‘digital natives’ sitting in company boardrooms these days but plenty of executives who know their numbers inside out.

Industry benchmark data arms us with perspective and framework when we need to communicate upwards. It ensures we get pats on the back when deserved and additional budget released when required.

Google Analytics Benchmarking Reports

Google, you might argue, have already solved these problems.

The upgrade and roll-out of Google Analytics Benchmarking Reports has been met with plenty of excitement for these reasons. With its large data set and nifty options to chop up the data by geography and website size, for a minute it certainly seemed like the benchmarking of our dreams. And while we recognise its usefulness to benchmark against real-time data (comparing a surge of traffic from a particular location for example, or seasonal demands), it still left us short of the hard data insights we were looking for.

We wanted reliable KPI data that went beyond user behaviour. We wanted average conversion rates and average transaction values as well as ‘softer’ engagement metrics such as bounce rate and time on site.

Most importantly, we wanted to know which engagement metrics actually correlated with the conversion rate, so we could narrow our field of analysis and efforts in pursuit of a healthier bottom line.

Which is why we went out and got our own and generated this e-commerce KPI report.

Data and methodology

We analysed the 56 million visits and approximately $252 million (€214 million) in revenue that flowed through 30 participating websites between August 1, 2013 and July 30, 2014. The websites were in the retail and travel sectors and included both online-only and those with a physical store as well as an e-commerce site.

We averaged stats on a per-website basis, so that websites with high levels of traffic didn’t skew the stats. We had more retail participants than travel participants so the average e-commerce figures are not the midpoint between travel and retail but the average figure across all study participants. Revenue is attributed on a last-click basis.

Results

Here is a highlight of some of our most relevant and interesting findings. For all the data and results, download the full report on
WolfgangDigital.com.

Average KPIs: Bounce rate, time on site, and conversion rate

First, we calculated some averages across engagement KPIs and commercial KPIs. If you are an e-commerce website in the travel or retail business, you can use these numbers to evaluate how your website is performing when set against a broad swath of your industry peers.

Well, remember the conversion measured here is a sale. If your conversion rate is lower than the study average don’t fire your CMO straight away; check if your average transaction value (ATV) is higher. If they balance each other out you are all good – if they don’t, it’s time to start digging deeper. Does the 1.4% conversion rate give you a smug tingly feeling or a stab of panic?

We often break down conversion rate into two parts: website-to-basket and basket-to-checkout. Industry norms tell us expect about 5% CR on website-to-basket and 30% on basket-to-checkout. Check which one of these conversion rates is most out of kilter on your site, then focus your attention there. This exercise will often give greater visibility on where the hole in your bucket is, Dear Liza.

Another factor in this analysis is that online-only retailers tend to enjoy higher conversion rates as the consumer
must transact via the website. If you have an offline presence, a lower conversion rate comes with the physical territory as your site visitors may convert in store.

KPIs by device: Mobile under scrutiny

Next, we segmented the data by device: desktop, tablet and mobile.

We found that although mobile and tablet together accounted for nearly half of website traffic (43%), they contributed to just over a quarter of revenue (26%).

Mobile alone accounted for 26% of traffic but only 10% of revenue. This suggests that while mobile is a favoured device for browsing and researching, it’s the desktop where users are more likely to whip out the credit card.

When we looked at conversion rates by device, this confirmed it.

What data matters: The correlations

We wanted to know which engagement figures had an influence (if any) on commercial ones.

Then we’d know which behavioural metrics were worth trying to improve to lift conversion rate, and which metrics we could finally label insignificant.

We did this by calculating correlations. A correlation ranges from 0 to 1, so 0 indicates on no correlation at all, while 1 signifies a clear correlation. A negative correlation indicates that as one variable increases the other decreases.

Time on site (0.34) and pages viewed (0.35) both had positive correlations with conversion rate, so our advice is to look at how to improve these metrics for your site to benefit from a higher conversion rate.

We delved into the device data and found mobile was the only device with positive traffic (0.29) and revenue (0.45) correlations to overall conversion rate. In fact, that 0.45 correlation rate between mobile revenue % and conversion rate was actually the strongest correlation rate across all factors we measured.

We infer that while the mobile conversion rate is depressingly low, a mobile user is still somebody with purchase intent who is likely to convert later on another device. The lesson we took from this is to make sure your website is mobile-optimised, particularly for ease of research and browsing content.

Finally, the time came to talk about bounce rate. Our Excel wizard had converted the data to an ‘un-bounce rate’ (1 minus the bounce rate) for consistency with positive time on site and pages viewed metrics. We gathered round the spreadsheet.

He revealed
there is actually a negative correlation (-0.12) between un-bounce rate and conversion rate. This correlation signals that it couldn’t be less influential on conversion rate, so for those unable to sleep at night for bounce anxiety, we’re delighted to let you sleep easy.

Increasing your conversion rate may not be as complex a task as it seems.

Our KPI study shows that if you can increase pages viewed and time on site it will push up your conversion rate (content marketing for conversion optimisation anybody?).

We’ve also proved that mobile matters. Don’t be discouraged if your mobile conversion rate pales against desktop’s performance; keep driving mobile traffic and revenue (however minor) and you’ll see the difference in your bottom line.

Read the full results broken down by industry level by downloading from the Wolfgang Digital e-commerce KPI Study.

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The Massive Ranking Factor Too Many SEOs are Ignoring – Whiteboard Friday

Posted by randfish

Despite Google’s ambiguity about how it’s used in the algorithm, we’ve seen evidence time and again that there’s a giant ranking factor that SEOs just aren’t optimizing for. In today’s very special Whitebeard Friday, Rand (or Randa Claus) shows us how to fill in this important gap in our work.

For reference, here’s a still of this week’s whiteboard!

Video transcription

Ho, ho, ho. Howdy, Moz boys and girls, and welcome to another special Christmas edition of Whitebeard Friday. I’m your host Randa Claus. (pause) I just can’t keep making fun of Santa like this. It’s just terrible.

I am very thrilled to have all of you with us for the holidays and for this special edition of Whitebeard Friday. We actually have some really important, juicy, meaty SEO material. Hopefully, my beard won’t get too much in the way of that. I feel like I have the same mustache. It’s just whiter this week.

I want to talk about this big ranking factor that a lot of SEO practitioners and experts are almost ignoring. By ignoring, I don’t mean to say we don’t know it exists. We just aren’t optimizing it yet.

That factor is engagement. I’m not just talking about onsite engagement. I’m talking about overall web engagement with your site and your brand. That can manifest in a bunch of different ways. A branded search is certainly one manifestation of that. Direct navigation, so lots of people going directly to your website, lots of people typing in searches for clearly your brand. They want to go just to your website. Time on site and browse rate, we’ve seen a bunch of elements around this. Pogo-sticking, which we’ve talked about on Whiteboard Friday previously. Traffic referrals, meaning traffic you’re sending out to the rest of the web. Google can see this. They have Chrome. They have Android. They have Google Analytics. They have all sorts of plugins. They have the web’s biggest advertising network. They can see all of this stuff. Then, finally, amplification in the forms of press and PR and word of mouth, kind of the non-link forms of amplification, which could even encompass social media.

So what is our evidence that these things are real factors in the search ranking algorithms? Well, unfortunately, unlike the early days of links when this was more directly observable and when the search engines were a little more open about this, they’ve been pretty quiet about engagement. They all talk about it in a broad sense, but they don’t specifically say, “Oh, yes, we specifically use time on site and browse rate.” In fact, they’re very nuanced around this.

The only thing that I’ve heard engineers or search engine folks say is, “Yes, we do use pogo-sticking, and yes, we will look at some forms of amplification and some things around brand,” which you could interpret to mean maybe branded search and some things around brand that could be interpreted as direct navigation. But they are not specific about this.

However, we’ve seen tons of experiments and lots of information that suggest that even if these aren’t exactly what they’re using, they’re using stuff like it. When you see experiments that show, hey, despite the fact that site speed is a very small factor, we reduced the page load time and saw all these wonderful things happen around search. What’s going on there? It’s some form of engagement. It’s something they’re measuring around that, that’s not just site speed, but engagement overall. That increases as you bring page load speed down.

So what’s the problem here? Why is it that SEOs, many of us at least, are not optimizing for this yet? Well, the answers are oftentimes we don’t have the authority. If you go to someone, you pitch an SEO project internally at your company, you’re the person who runs SEO, and they’re like, “No, you take care of our crawlability. You take care of our links. You’re not responsible for how much traffic we send out or the time on site and browse rate or amplification and press.” Those are all different departments, and it’s very tough to get that synchronization between them.

We may not have access to the tools or the data that we need to measure this stuff and then to show improvements. That’s very tough and hard too.

Then the inputs around a lot of this stuff are not direct. Let’s go back to links as an example. If you know that links are the big ranking factor for you, you can show, “Hey, we got this many links. Here’s how it changed our ranking position. We need more. Here’s how we go about getting them.” Plan, execution, analysis, it’s simple. It’s direct. It may not be easy, but it is observable.

This is often indirect. There are so many things that impact this stuff that’s indirect, and that’s really tough and frustrating.

As solutions, it’s going to be our job to do what early SEOs had to do — socialize. We have to go out to the industry, to our colleagues, to our clients if we’re consultants, to other web professionals across all the forms of marketing, and we have to socialize the fact that engagement is a major input into SEO, just like SEOs did starting in about 1999/2000, where we had to explain, “Look, this is how links work. Links are important. It’s not just about getting listed in the directory. It’s not just about keywords anymore. It’s not just about meta tags anymore. Links really matter here. I can show you Google’s PageRank paper here. I can show you all these patent applications here. I can show you the impact of links.”

We have to do that again with engagement. That’s going to be tough. That’s going to be an uphill battle, but I believe it’s something we’re already starting. A lot of industry leaders have done this ahead of this Whiteboard Friday for sure.

Second off, we’ve got to utilize the tools that we do have available to be able to get some of this data, and there are some. While I am no big fan of Google Webmaster Tools — I think a lot of the data in there is inaccurate — we can look at trending numbers around things like branded search, and we can do that through Google Analytics. So Google Analytics, yes, keyword not provided is 90% of your referrals. That’s okay. Take the sample 10% and show over time whether you’re getting a bigger and bigger proportion and bigger and bigger quantities of branded search. That’s a directional input that you can use to say, “Look, our brand is growing in search. There it is.”

You can do user testing around search results. This is something I see very few folks doing. We often do usability and user testing on our websites, but we don’t do them in the search results. If you ask a group of five users, “Hey, go perform this search. Take a look at these 10 results. Tell me which one you would choose and why. Now tell me your second choice and why. Now tell me your third choice and why,” you will get to things like time on site. You’ll get to things around pogo-sticking. You’ll get to those engagement metrics that happen in the search results.

Then, of course, you can use, if you’re a Moz subscriber, Fresh Web Explorer or something like mention.net or Talkwalker or Trackur or something to get these amplification numbers and data that you might not be able to get from raw links themselves. This is gettable data, just in different ways than we’re used to.

Finally, we actually are going to have to change what we’re comfortable with. We’re going to have to get comfortable in a world where the ranking factors are indirectly influenceable, not directly influenceable. That’s weird for us, because we’ve always said, “Okay, algorithm has all these factors. I can influence these ones. That’s the ones I need to work on. I’m going to go to work.”

Now we have to go, “Wait a minute, wait a minute. In order to influence traffic referrals, I’m going to have to do things around my content, things around how I earn traffic, and then, boy, I don’t know if that’ll have a direct impact on my rankings.” You don’t. This is a world of indirect inputs. This thing, this tactic I’m going to pursue is going to lead to this thing, which I hope is going to lead to engagement, which I hope is going to lead to rankings.

That’s frustrating. It’s harder to sell. It’s harder to invest in, but, oh man, the ROI is there. If you can do it, if you can earn that buy-in, you can make these investments, and then through experimentation, you can learn what works for you and where you need to move the needle. This is going to be weird because it’s a world where our tactics are correlated, but they aren’t explicitly causal into the ways that we influence the rankings. It’s a whole new world, but it’s about to be a new year, and I think it’s a great time for us to invest in engagement.

With that, happy holidays, whatever holidays you celebrate. Happy new year if you celebrate the new year. I’m looking forward to seeing lots of you here on Whiteboard Friday in 2015. Take care.

Video transcription by Speechpad.com

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Content Flow: The "Melodic" Fix for Your "Broken" Content Marketing Strategy

Posted by SimonPenson

In a world now overflowing with ‘content,’ standing out is critical to breaking through.

And while almost all digital marketers are aware of the challenge that presents, the solution chosen simply extenuates the very issue it was designed to fix. Unfortunately,
too many people see the answer to standing out and achieving reach as becoming a ‘shout louder’. But that’s an approach that misses so many critical strategic objectives.

Maturing markets, as the ‘content market’ now is, require subtlety of approach and refinement. A campaign plan based on an unconnected series of ‘big bang’ content is unconnected from the very audience for which it was really designed to attract and retain.

The answer to this disconnect lies in something I call ‘content flow’, or ‘content dynamics’, and this post is designed to share the concept to allow you to give it a go.

What is content flow?

“The whole is greater than the sum of its parts.” – Aristotle

This quote eloquently ‘sums’ up the true value of content strategy. Your content marketing strategy is not hundreds or thousands of connected stories. It’s one story with a lot of scenes.

The only way of creating any kind of long-term connection with your audience is to introduce variation into your content strategy and connect those important bigger campaigns, or pieces, together using smaller pieces. The best way of visualizing this is to imagine the smaller ‘everyday’ content pieces you produce as ‘whispers’ that keep the campaign alive in between the larger, campaign-led ‘shouts’.

The music of content flow

To understand how to create the variation any good content strategy needs to work, we should look for a moment to some of the greatest content creators to have lived: classical music composers—the masters of the concept of ‘whispering’ and ‘shouting’ to create impact.

Listen to any ‘great’ piece and you will immediately notice that it has quieter periods followed by great crescendos, utilizing something called dynamic note velocity to create an absorbing ‘journey’ through the composition.

We can clearly see this is we look at the sound wave profile of such a piece. Below is a Beethoven composition with clear
crescendos and diminuendos that make the piece so absorbing. This is why classical ‘songs’ can go on for so long without losing your interest.

If this were content strategy, or an editorial plan, the ‘peaks’ would be those ‘big bang’ campaign ideas, while the ‘troughs’ would be the ‘everyday content’ that glues your big ideas together in a seamless and absorbing way. The result is a coherent composition that allows the user to feel the full range of your content marketing strategy and still experience it as a whole.

Content dynamics in marketing

Given that we now understand how content flow works in a musical context, we must now look at how those key principles can be applied to content marketing. The first step in creating the right flow of content is in understanding its importance, but the second is in the planning and measurement of your own work.

To do this you should start at the beginning, with the ideation process. It’s critical here to have a sound process for coming up with ideas that produced, consistently, enough of the right ideas that can fit the ‘peak’ and ‘troughs’ concept.

This is something I have worked on for the past ten years and the resulting process is something I have shared
right here on Moz previously. Since that time, however, the process has been updated even further and you can find the latest version here.

This process is designed to ensure you have enough of each type of content to enable the second phase—editorial planning.

Building your editorial plan

Once you have enough content ideas from your brainstorm the next phase is to begin ‘grading’ them into either ‘small’, ‘medium’ or ‘large’ ideas. You can do this manually as I’m about to explain now, or make use of the free and brand-spanking-new
Zazzle Media Content Flow Generator tool, which is designed to do the hard work for you.

Manual testing

To test out your best laid content plan is a simple process and it begins at the initial ideation phase.

Once you have your initial list of ideas, you should note them down in a simple Excel column. I’ve created an example below with some ideas for a fictional finance brand.

In the right hand column you will see a number. There is no ‘science’ here, just a simple scoring system to highlight the ‘size’ or, more precisely, the amount of time and resource that will go into the creation of each piece.

The purpose of this is to enable the plotting of your content on a chart that will allow you to understand how it flows.

The next stage is to then plot the suggested publication dates so you end up with something like this:

From here select the dates and scores and select the ‘Charts’ function from the menu bar of Excel (I’m using Mac in this example).

Select the ‘Line’ option and you should see the data in a chart that looks a little like this:

content flow chart

You can then use the various formatting options to make it more clear, or play with the numbers, more importantly, to get the ‘flow’ right.

The ‘right’ wave dynamic

Of course, you need to know what it is you are looking for to be able to decipher if your initial content plan is laid out correctly.

In simple terms there is no ‘perfect’ shape as every business has different objectives but whenever in doubt we should refer back to the initial learning from those classical pieces.

The strategy should be to create a handful of ‘big bang’ ideas per year surrounded by a cacophony of brilliant everyday content, which both entertains and informs and ties together your symphony.

The work above should then create something that looks like the chart below. The important part is in ensuring that the ‘big bang’ campaign ideas are evenly spaced and do not drown out the overall picture. There are few worse mistakes then simply creating a large number of ‘big’ ideas as we discussed earlier in the post.

The reason for that is simple and it comes back to the same rules as those that are applied to TV, radio and print when it comes to achieving perfect ‘content flow’.

Learning from print

We can reverse engineer this in practice by taking a look at how something like a magazine is put together. Having worked in the industry for many years I know first hand how content works over the long term, and it’s all about consistently delivering surprise and variation.

The best place to find this is on the cover. An example of this can be found below with this
Men’s Health cover:

You can clearly see how the cover lines correspond to the needs of the audience:

  1. Those that want to improve their body
  2. Those that want to improve their mind
  3. Those that want to be better lovers

And you can clearly see that the editorial team understands its audience in great detail and knows precisely how to deliver content in a way that keeps all elements of its readership entertained and informed.

That doesn’t happen by accident. It starts with the
persona creation process to segment the key interest sets. These then manifest themselves as regular ‘cover sells’ or ‘content pillars’ as I like to call them.

These concepts are then covered monthly within the editorial plan and how each key subject is covered will vary each time it is covered. So, in month one the ‘improve your body’ concept will be covered in a long form feature, looking at something like ‘the science of muscle growth’, while the next month it may be a quick-fire, shorter piece forming a 20-minute circuit training session. It’s this variation that creates ‘content flow’.

If you want to learn the tricks yourself all you have to do is reverse engineer a couple of magazines. To do that all you need is a ‘flatplan’ template – or the document many editors use to plan out the ‘flow’ of their issue.

You can then take a copy of the magazine from your sector and mark off the general schematic make-up of the edition a little like the example below:

You can then simply test that ‘layout’ for your own digital strategy.

Mobile

The testing phase shouldn’t simply stop at your overall plan, however, as content consumption is quickly becoming a ‘mobile first’ game. That means that thinking about how you plan your strategy for the various devices is also critical to success to ensure that the way in which you cover your key ‘pillars’ creates a compelling mix of content types for ALL devices.

I wrote about this aspect of the content strategy in
this earlier Moz post if you want some more detail.

Final plan

Like anything in digital there is no ‘perfect’ template to use when it comes to planning the right delivery for your brand but by sticking to the principle of ‘ebb and flow’ in your content flow and working hard on ideas you will quickly see how easy it is to grow a truly valuable, and engaged audience, over time for your site.

Six steps to nail your content plan

For those that like steps to work to this is the general process I work to:

  1. Start with a data dig to establish your key audience personas. Utilize a good persona template to record the key information.
  2. Work through a
    structured content ideation process to ensure you create ideas pinned to the key audience need.
  3. Work this data into a content plan and record in a
    calendar.
  4. Test how that content ‘flows’ using the checker tool I mentioned earlier. You find help as to how to lay your content out from magazines.
  5. Run the plan over a six-month period and then review based on the changes you have seen in key engagement metrics such as bounce rate, returning visitor numbers, time on site, etc.
  6. Change and repeat, constantly looking for the right ebb and flow for your audience and commercial goals.

Having got this far, I genuinely hope you are now keen to integrate content flow checks into your overall content strategy and marketing process. With most content discussions surrounded by ‘data’ and ‘ideas’ it is useful sometime to step back and remember that it is, ultimately still an art form, and always will be. That means you must ensure that any strategy you create is focused in not just on the buzzwords but the foundation too. By doing this you’ll turn your content creation process from a gaggle of ideas into a true symphony for your audience to enjoy.

And if you want to have a go yourself, here’s a reminder of that free Content Flow Checker tool. Click below to try it out on your strategy and let me know how you get on.


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