Insights from Google Analytics - A Case Study

Devising Marketing Solutions Through Digital Analytics

INTRODUCTION

This article uses the Google Analytics tool to analyze the performance of Google Merchandise Store. The data is from the Google Analytics demo account. This is only a brief analysis based on limited data.

EXECUTIVE SUMMARY

Purposes

This case study concentrates on providing Google e-commerce merchandise-store with digital marketing solutions, based on audience, acquisition and conversion analytics reports. Insightful observations are derived from the reports, aiming to discover hidden patterns behind data, to apply marketing concepts to the patterns, and to explore further development potentials.

Insights

Above all, the most impressive insights are that, Audience: highly valued and loyal audiences are centralized in age group 24-45 males, new customers constitute a larger proportion in the total customers compared to returned customers; Acquisition: social media channels have great potentials to play an important role in increasing revenue, in conjunction with current direct and referral channels; Conversion: the most popular household electronics products are closely related to highly valued customers, but the drop-off rates are high in purchase funnel due to less interactive web design and lacking of content.

Recommendations

Accordingly, best-fit recommendations are to build strong customer relationship by increasing interactivity of website, and to fully utilise the social media platforms to magnify revenue from the best-selling products by stimulating impulse-purchasing.

AUDIENCE ANALYSIS

Audienceanalysis is used to differentiate, segment, target and posit customers by their characteristics, in order to maximize the effectiveness and efficiency of marketing activities given limited resources.

Another crucial application is to reconcile marketing strategy, content and engagement strategy for instance, with target customer base. It draws the deep-inside “pictures” of users to dig more potential business opportunities, such as setting up “convertible” customers online profile database and predicting future demand.

Figure 1 shows that top three large age groups are 25-34, 18-24 and 35-44, accounting for nearly 86% of total users.

Additionally, the gender components are male-dominated in 69.7%, approximatelydoubling the females’ proportion.

Table 1 reflects a positive correlation between the size of age group and sessions, transactions, as well as conversion rate. Top three large age groups have the top-rank sessions and conversion rate. 25-34 and 35-44 contribute the most revenues, 47.77% and 33.07% respectively. However, revenue from 18-24 group is only 7.64%, the bounce rate of 18-24 is the second largest with 43.83%.

In Table 2, as a result of each genders proportion in total user base, the sessions, transactions and revenue are positively correlated to the gender, indicating a 7:3 ratio of male to female. However, females’ bounce rate (40.85%) is slightly higher than that of male (38.89%).

Insights:

First, 25-34 males contain the highest customer value against other groups, since they are at working age and possess more purchasing power than 18-24 users who are mostly at school with low disposable income, this can be reflected on their lower revenue per transaction (131.80). 35-44 group has the highest revenue per transaction (192.53) because of their accumulated wealth in middle age, they spend more money on each transaction. Thus, e-marketers need to put more resourceson attracting these highly-valued audiences.

(Audience analytics - Age group)

Second, Google merchandise store also has independent categories for children apparel and Nest® household electronics. It is reasonable to infer that these products for children and home use will be purchased mostly by young parents aging above 24 (Euromonitor, 2010). This is the reason why 25-34 group contributes far more revenue than 18-24 group. Even though 18-24 has a large user base, yet they have not started families or raised children yet and consume less in these types of products.

(Children apparel and Nest® home electronics)

ACQUISITION ANALYSIS

Acquisition analysis is implemented to identify the sources of traffic and to focus more recourses on channels that bring most customers and revenue, therefore, e-marketers can invest an optimized portfolio of channels to extend “touch points” and “reaches”.

Furthermore, it also concerns with the “stickiness” of each channel, aiming to not only attract a wide range of customers, but also engage them “deep dive” into the website pages, finally leading them to the last purchase stage.

Table 3. Among all channels, organic search attracts the most users (39.08%), followed by social (22.66%) and referral (18.31%). However, in terms of conversion rate and revenue, referral and direct channels take the lead and seize 90.69% (46.58%+44.11%) total revenue, with conversion rate 11.25% and 7.51% respectively, organic search and social lag far behind.

Table 4. Except for YouTube, major referrals are from “Google” related websites. Top three “Google” related websites dominate 96.41% referral revenues up to $310,464.52. Even though YouTube has the largest 58.12% total referral users, yet revenue from it is zero.

Table 5. In social network, YouTube as a video streaming social media contributes to the most 95.07% total sessions, however, its session duration (38s) and page per session (1.88) are lower than the follower Facebook, with 3m9s duration and 3.62 page per session. Sessions from the rest popular SNS (Social Networking Sites) such as Twitter and Google+ are far less than 1%.

Insights:

The most referral traffic is from YouTube because of cooperation between Google and YouTube (Appendix-3), since there is an independent category for YouTube-brand products on the website. In this case, traffic can transfer from YouTube, as a referral “gate”, to Google store and be shared between two websites to bring win-win benefit. As a result, E-marketers would better seek long-term business cooperation with other partners/ brands to attract new referral traffic.

(YouTube related products)

Social media platforms and streaming service websites have tremendous ability to attract affluent traffic, which is reflected in the large session base. However, negligible conversion rate (0.16%) and relatively low revenue per session (0.25) indicate that after attracting and leading customers into the store, the website is not efficient and effective enough to generate revenue, since social visitors mostly do “window shopping” (Appendix-2). Therefore, e-marketers have to initiate new ideas on how to convert traffic into revenues.

(Acquisition analytics – Channel)

CONVERSION ANALYSIS

Purchase funnel in conversion analysis can virtually show how many customers are filtered progressively from the first touch point to the final transaction stage. It is important for e-marketers to analyse which part of the funnel is the weakest/least-sticky and need to be improved to ensure more customers successfully pass through the funnel.

Product performance is best for e-marketers to analyse customers’ shopping behaviour by products, so that to decide product mix and decide which products need to put more resources in promoting to maximise revenue.

In Figure 2, 78.84% visitors dropatthe first stage of product review, then the drop-off rates decrease in the following stages as basket addition (49.91%), basket abandonment (47.91) and check out abandonment (34.52%). The proportion of visitors entering final transactions is only 4.09% of total 90, 259 sessions.

In Figure 3, comparing to high drop-off rates around 40-70% in purchase funnel progressions, four sub-categories of checkout funnel have relatively lower drop-off rates, i.e. 16.43%, 17.92%, 5.43%.

Completed transaction orders compose 67.82% of total billing & shipping orders, overpassing the transaction rate (4.09%) in the purchase funnel.

Table 6 lists each product SKU’s performance, Nest® seriesproducts contribute 8 out of 10 top-selling products and dominate 72.22% of total revenue.

Nest® products in CA (Canada) have a larger average price $149-$199 and buy-to-detail rate 2700%-4000% than any other USA products.

Insights:

The high drop-off rate (49.91%) of visitors in the stage between product viewing and basket adding may due to lacking of product details on the product page, because major new users are not familiar with the products if only limited product parameters are available, unlikely returned customers who have already purchased and known more about the products. To solve this, more details and contents need to be added for customers’ consideration.

(lack of product details in Google online store)

Moreover, when linking product performance with customers age group (Audience analytics Table-1), it is rational to find the intelligent household electronics, such as learning thermostat and security camera, are most popular among customers aging above 24, who have theirown houses with families. There is a strong connection between these age group customers and home electronics, e-marketers need to grab the opportunity to target these audiences and customise advertisement to reach them specifically.

RECOMMENDATIONS

Recommendation A

Recommendation:

Google merchandise store needs to initiate and enhance the interactionand stickinessbetween website and visitors,via providing sufficient contentsaccording to different visitors’ requirements or expectations on information.

Justification:

This is because significant bounce rate (around 50%) and purchase funnels drop off rate (around 50%) impede sales booming, reflected by unsatisfactory conversion rate andrevenue according toinsights derived from conversion analytics. Website optimization, engagement and content strategies can first increase interactivity/engagement, and then progressively boom revenue by converting traffic to transactions.

Objective:

Improve interactive/sticky contents of the website and improve financial performance (revenue).

KPI:

Conversion rate, drop-off rate in the purchase funnel and revenue (Or pages per session and average session duration).

Target:

Decrease bounce rate and drop-off rate by 10% in 2 month, increase conversion rate and revenue by 20% in 2 month.

Tactic:

Interaction is not only reflected in the website, but also in different information channels. Such as adding a link of “subscribe for newsletters” to give loyal customers an opportunity to “buy in” and keep engaged with the newest products or events beyond website. Interaction is enhanced through personalised and customized e-mail contents including advertisements or e-coupons.

(Example of E-mail marketing in Amazon’s subscription for newsletter)

Content and interactivity/engagement strategy must be integrated. To bring downbounce/drop-off rate, homepage layout must to be redesigned with attractiveness and stimulus. Optimized content allows digital interactions to reach greatest potential, for instance, bannersshould be designed “thinner”, to hold more content in the limited page space and reduce redundant page loading-time, since impatient visitors are likely to bounce/drop when pages are vertically too long.

(Successive banners in Google online store is too “broad” and cost much time to roll down to the bottom of page)

(Banners in Amazon can switch horizontally by automation or click, in order to save page space and attract visitors)

Content enhancement also suggest that multi-angle product pictures, sufficient product details and customers’ product reviews to be integrated into website layout.

(lack of product pictures in Google store)

(Example of Amazon’s sufficient product pictures)

(Example of Nest® official website product details)

(Example of Amazon’s Nest® product details)

(Example of Amazon’s product customer review)

Lastly,e-marketers need to monitor the changes of conversion rate and drop-off rate after the redesign of website by implementing A/B testing. Changing the variables one at a time and allow the customers tell which is more promising and efficient before officially launch the evolutions.

Recommendation B

Recommendation:

Engage more social referralsby either integrating the website with interactive social presence, or cooperating with social media platforms to increase traffic and conversions. At the same time, promoting Nest® household electronicsthrough social media influencing program can “tell stories” about products and foster brand recognition/loyalty through “word-of-mouth”.

Justification:

Table 6 indicates that Nest® products are best-sellers among all products, focusing on promoting household electronics can generate most revenue and even take advantage of cross-selling. Moreover, Table 3 shows social channels generate a large user base, but the conversion rate is relatively low. Therefore, there is a great potential to boom sales when combining Nest® products with social channels, referring that social influencing campaigns must consider both traffic and conversion rate at the same time.

Objective:

Generating direct revenues when promoting best-sellers by diversifying social media platforms and enhancing social presence of the website.

KPI:

E-commerce conversion rate from social channels and revenue of Nest® products through social channels.

Target:

Social e-commerce conversion rate increase by 15% in 1 months, and Nest® products’ revenue from social channels increase by $20,000 in 1 month.

Tactic:

Adding more “sharing links” entrances such as Facebook, YouTube, to enhance social influence, connection and presence. Product awareness/recognition spread widely through customers’ sharing within online communities and by investing advertisements on these paid media. In order to increase conversion ratein social media platforms, e-marketers can offer discount/e-coupons to the customers who share the links with others via SNS, so that to stimulate customers towards “impulse buying” instead of “window shopping”.

(Adding more social sharing links)

Keep updating and managing the content posted in paid, owned and earned media communities. E-marketers need to combine real time content with product. During the post-Christmas and New year periods, they can create Nest® “Family reunion/Intelligent house” related topics and recruit opinion leaders to enlarge “tipping point” digital influences (Appendix-1).

Audience preference and “beats” on social media can be captured through online survey’s feedback, sharing analysis and social listening programme. They are used to capture the sentiment (positive/negative/neutral) of the public towards website, to find which social media is more efficient to invest and what are the triggers in social media that can stimulate and convert customers to purchase.

ETHICAL CONSIDERATIONS

By tracking visitors’ cookie and analysing historical purchase patterns, e-marketers can figure out what the customers’ online purchase behaviour is and they can customize content that exposed to customers.

However, the data collecting process must be noticed to the customers before they visit the website, without their authorization, the website should not track their cookie or collect their data. E-marketers must not violate customers’ privacy on data. For example, location information, phone number and credit card record need to be protected and prevent from being violated by the third party. It is necessary to anonymize the personal information.

(Google privacy terms)

Data accuracy is also crucial especially in the process of e-mail marketing and SMS marketing. When sending e-mails to customers, e-marketers need to pay attention to the privacy and accuracy of data, the product recommended in the email need to avoid violations, for instance, wrongly sending the baby clothes e-coupons to a female customer who has not been pregnant yet is inappropriate.

REFERENCES

Euromonitor. (2010). The First Age: Birth to Three Years OldJun 01, 2010. New York, NY: Alacra Store. Retrieved from <http://www.alacrastore.com/storecontent/Euromonitor/The-First-Age-Birth-to-Three-Years-Old-2109-6042>

APPENDIX

1. Google store “family gift box” videos on YouTube as social media marketing

Before Christmas, Google store sends the loyal customers a “Google box” as a gift, which contains a thanks card and 7 products that can be purchased on the Google online store, the customers who receive the gift need to post a video that introducing the products and these videos are spread widely on YouTube social media platform, this is an example on how social media marketing initiate customers’ interaction, public awareness and engagement. There are more than 2 to 4 million visitors who have seen these videos.

2.Comparing customer purchase journey in display and social channels

Table 3, Comparing social with display, even though the total traffic brought by social is more than that of display, the revenue per transaction of display (174.13 per appendix) is higher than that of social (157.81), which indicates that the display channel have more direct pre-effect on customers, before visiting the website, their purchasing decisions may have already been influenced by the display ads, they come to the website only to choose the product they want and pay, on the contrary, in social channels, most traffic is brought in but the customers may not have a strong purchasing demand or they simply do not know what want to buy, therefore, they solely do “window shopping” and quickly view the categories, a high bounce rate (56.69%), a low page/session rate (1.99) and a short session duration (44s) may also explain it.

(customers’ purchase journey in display channel)

(customers’ purchase journey in social channel)

However, the total number of transactions from social and display is relatively small (27 and 23), which indicates that e-marketers need to not only engage more traffic inflow, but also pay attention to attract and stimulate more transactions.

3. Customer online purchase journey:

From the purchase funnel, the reasons of low product view rate and basket addition rate come from the redundant clicks steps from viewing the product to adding to the cart, it takes four clicks for a visitor to add product into basket, which reduces the patience of visitors when viewing the products.

Moreover, if customers are the visitors instead of Google customers who have Google account, they have to jump out of the basket adding page to register when they decide to buy, and then after the register, the page turn directly back to the homepage, which means customers need to repeat the process of adding products to basket, it may cause many impatient customers to quit. E-marketers have to redesign the register UI-user interface and process of the website to ensure that customers can add products into cart without interruption and friction.

Step 1. Chose category