Metrics in the e-commerce world are often overwhelming. The list is a long one to start with and it only gets longer as you scale your business. Depending upon your scale and stage, you could be tracking anywhere between 10- 55 metrics.
Early stage businesses, start with simpler metrics such as Total Sessions, Conversion Rate, Average Order Value, ROI per Acquisition Channel. However, as your business grows from 0-10 orders per day to 100-200 orders per day, aggregate metrics like overall conversion rate give away to much drilled down metrics such as Channel wise Conversion Rate, Channel wise ROI, Lifetime Value and more. Further, you also require more sophisticated tracking (and tools) to analyze these metrics efficiently.
On a daily basis, I deal with 100s of marketing teams, each operating and growing at a different pace - right from clocking 100 orders a day to large enterprises clocking over 150,000 orders per day. But one key metric that barely gets replaced in the growth journey of an e-commerce business is that of the ROI ( more specifically channel wise ROI). Even though the calculation of this metric does get difficult with scale, the overall metric itself remains sacrosanct!
Are Micro Funnels important in E-commerce?
Before we get to micro funnels, let’s do some basic math on how a typical funnel looks like and the kind of results optimization can generate.
|Funnel / Stage||Early Stage||Growth Stage||Scale|
|Monthly Unique Visitors||7,500||200,000||1,500,000|
|Average Orders A Day||4||127||1150|
|Average Cart value||$20||$20||$20|
|Paid Traffic ( 75% )||5,625||130,000||750,000|
|With Optimization||Early Stage||Growth Stage||Scale|
|Monthly Unique Visitors||10,000||200,000||1,500,000|
|Impact on Conversion Rate||25%||25%||25|
|Average Orders A Day||6||158||1438|
|Average Cart value||$20||$20||$20|
Improving conversion by 25% results in a revenue impact of $19,000 - making the whole concept of optimization all the more important. Sounds great. The question then really is - what are you optimizing and how? It is for this reason, you need to look at your micro funnels.
Micro Funnels are nothing but conversion funnel associated with a specific acquisition channel - such as Organic Search, Paid Marketing ( PPC ), Social and Email.
The journey on the paid marketing side - Facebook, Adwords is a faster one because you can experiment and iterate real quick, given the fact that you have set a marketing budget for it. However, the journey of building your organic traffic and conversion channel requires far more investment - both in terms of time and money. And this is exactly what we picked up for our analysis on - Can push notifications to help you optimize your micro funnels. More specifically the organic traffic funnel?
Understanding The Attribution Models
Before we start, it is important to understand the fundamentals of conversion and conversion attribution.
Google Analytics works on Last Non-Direct Click Attribution and here is what it means:
This model ignores all direct traffic and gives full credit of the conversion to the last channel preceding the conversion.
There is absolutely no doubt that this model as it more or less works like a charm for the most of the early and growth scale e-commerce businesses. However, things start to get a tad bit complicated when you scale up, start investing and scaling up multiple channels and when your conversion journeys involve more and more touch points.
Another metric that a lot of marketers start consuming is the Assisted Conversion Ratio in the Assisted Conversions Report to understand the contribution of each channel in driving conversions. Here is what that means -
Assisted conversions are “the number (and monetary value) of sales and conversions the channel assisted. If a channel appears anywhere—except as the final interaction—on a conversion path, it is considered an assist for that conversion. The higher these numbers, the more important the assist role of the channel”.
This beauty of this report is that it lets you track the entire journey a user had taken before finally making the transaction. And the evolved marketers out there refer to this report as the Bible paying attention to the Last Click Attribution model (which gives the 100% credit to the immediate channel preceding a conversion). This does make calculating channel wise ROI a bit difficult but we will get around to that as well.
Optimizing your Organic Traffic Micro funnel using push notifications
Given that we now have a sense of how is that you can track conversions (both direct and assisted), let’s look how can you start optimizing your micro funnels.
Now, push notification as a channel works and it works better than most of the channels out there - including email, social, and AdWords. We have covered this multiple times that how browser notifications when used diligently, can have a drastic impact on the overall conversion rate. Bearing this in mind, the focus this time around was on the micro funnel of organic traffic - analyzing conversion journeys and understanding how web push notifications were contributing and assisting.
Web push notifications work on a very simple concept - provide your consent for the website from which you would like to receive notifications related to offers, new arrivals, sale alerts, etc and you shall get notified. Period. There is no need to sign up, share your email, your mother’s maiden name (like how is this even relevant?!), your dog’s favorite treat and what not! Since this channel works at a browser level, your notifications do not run the risk of getting selectively ignored when a user is on the device or becoming a victim of banner blindness too.
Analyzing Organic Traffic Micro Funnel For Over 180 Days
We analyzed over 55K transactions where the journey had started off from a click resulting from an organic search result. The objective was:
- To understand inefficiencies in the conversion funnel
- To find those channels assisting in conversions
Web push notifications (iZooto) seemed to be assisting the organic conversions quite a bit. To further solidify this theory, I also looked at the recent assist numbers for all marketing channels and found that web push notifications (iZooto) had the best Assisted/Last Click or Direct Conversions ratio.
What is this weird ratio that I’m talking about you ask?
It is the total number of assisted conversions divided by the total number of last click or direct conversions. The key lies in deciphering the ratio:
- The ratio is closer to 0 - channel is more likely the final one before converting
- If the ratio is 1 - channel is equally assisting and converting
- The ratio is greater than 1 - channel is further away in the conversion journey from the final converting channel
If you observe the above image, you’d see that iZooto (push notification) has a ratio of 1.99 which effectively means that it converting and also assisting almost equally. Now, this is something any marketer would love!
What Do We Know...What Have We Learnt
- More than 82% of transactions go through at least 2 or more distinct interactions
- Apart from brand keywords, three channels dominated the Assisted Conversion report -
- Display advertising
- Email Campaigns to existing user base
- Browser Notifications
- When compared over a period of 12 months, the contribution of Display campaigns have fallen by over 25%
- Browser notifications which are far more cost efficient, are increasingly filling this gap. With scale, push notifications can start to contribute anything up to 5-8% of total assisted sales. By scale, I am referring to websites with over 50,000 notification subscribers.
These learnings are far more interesting when we drill down on the organic traffic micro funnel as the conversion paths are dominated by 3 channels.
It would be a marketing hyperbole to state that these conversions would have been completely lost had it not been for push notifications but you get the drift. This does validate the Law of Shitty Click Throughs - users are increasingly swaying from interacting with display ads as a format.
Before Signing Off….
There are two solid takeaways here -
- Given the novelty and efficiency of browser notifications for retargeting and engagement, the advertising budget on display retargeting gets reduced significantly over a period of time. The impact on the spend will vary on the basis of your current scale but we have seen this dropping by almost 10-15% over a period of 3 months.
- Contribution and performance of browser notification as a channel goes up drastically when these notifications are event triggered as compared to a batch and blast approach. This obviously holds true for email as well.
Web push notifications can literally become the holy grail for all marketing campaigns as it can help in getting repeat traffic and conversions in a quarter of the spend for paid campaigns. That's dollars right back in your pocket! It contributes quite heavily towards assisting the final conversion and of course contributes directly. Identifying the set of campaigns that lead to repeat conversions effectively means finding the golden goose with the endless supply of golden eggs!
So, the next time you pour over your analytics data, spend some time analyzing the Top Conversions Paths report and try to look for a pattern. You might be surprised to find the hidden data that your conversion funnel especially the organic micro funnel might have to offer. This is definitely the next big time to look at. This is what is going to optimize your Organic micro funnel.
I would love to hear your findings after you analyze the conversion paths for your organic traffic. Until then….peace and let data speak for itself!