Is Your Website a Bucket or a Sieve?

By Charles Nicholls | 01 Aug 2011

E-marketers often focus their energy on generating website traffic without analysing why visitors are failing to convert, writes Charles Nicholls.

Your website is a leaky bucket. The more traffic (water) you put in the top, the more it spills out. On average only 2-3% of website visitors convert, while only 3 out of 10 people that get as far as the shopping cart convert. That’s less of a bucket and more of a sieve.

So why are we as an industry so focused on website traffic and not on plugging the leaks? Most e-marketers want traffic above all and are willing to invest big bucks to get it—through SEO, paid search, display advertising, referral, social media, and so on. These all drive traffic with varying degrees of precision.

However, if you analyse the traffic sources that drive conversions, as opposed to the overall volume of traffic, then a different story emerges. A member of the SeeWhy research team pointed out that email was often the largest source of traffic for e-commerce conversions. Email as a significant source of conversions, yes… but the largest? This warranted further analysis.

So we dug into the data. Using a sample of 60,000 completed e-commerce transactions across multiple sites from February 2011, we were able to look at where the traffic came from that generated those conversions.

Rather than look at site traffic sources as they arrive on the site, we decided to look at traffic that reaches the top of the shopping cart process. This is essentially when an item is added to the cart and can be considered a signal of intent. The traffic picture at the shopping cart looks very different from the sources at the homepage and other key landing pages.

At the shopping cart, email represents more than half of the traffic (57%), while direct traffic contributes 18% and display advertising is a meager 1.7%.So the next piece of the puzzle won’t be a surprise to you: 67% of conversions came from email and 24% direct to the website. Since both of these percentages increased, it means that the others went down.

The paid traffic sources—search engine marketing and display advertising—were both at the bottom with less than 1% of the converting traffic.

This indicates that the shopping cart conversion rates for each of these traffic sources vary considerably; while organic search generated 10% of the traffic, only 4% of the traffic that converted came from search.

The overall conversion rate, including the long tail of other sources, was 23%; so in this case, the shopping cart abandonment rate was higher than average at 78%.What does this tell us? While there are some surprises in the data, it tells us to a significant extent what we already know. Customers that are familiar with the brand, having previously purchased or signed up for emails, are the best source of traffic for conversions when you email them. Equally, customers that enter the site directly are the most likely to convert, as long as they get as far as the shopping cart. Perhaps the surprises here are just how different the traffic source analysis looks at the shopping cart level compared with the site as a whole. This suggests that it is a worthwhile analysis to do on your individual site.

Of course, here we are only looking at last-click attribution, and this is far from perfect. But the data still points the way to building the brand and the relationship with your visitors across one or multiple visits. When you reach a point where they are willing to share an email address, so much the better. Your chances of conversion just went up significantly.

 Note: This data can vary significantly between individual sites; for example, e-commerce sites that sell specific accessories or parts often find that organic and paid search are the top converting sources. Visitors don’t necessarily know the name of the site, and the majority of sales are first-time purchases. The lesson here is that all sites are different, and you really need to crunch your own data. But you knew that already, right?

Republished with writer’s permission from original post by Charles Nicholls.

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