It's Official: Google Rules The Web
Coleman: "Google is maintaining its grip as our gateway to the web... it is the make or break success factor for eCommerce websites"
Digital marketing agency Wolfgang Digital
has launched its latest E-commerce KPI Benchmarks
study. The report provides industry average metrics for retail and travel websites and shares sensitive numbers such as conversion rate and average order value (AOV). The report also examines the correlations between various metrics. It is based on an analysis of 87m eCommerce website sessions and €230m (£195m) in online revenue for the 12 month period ending 31 June 2016.
The report found that Google makes the world wide web go round, delivering over two-thirds of website traffic (69 per cent) and website revenue (67 per cent). Digging deeper into search, the report’s correlation study found that a high percentage of Google organic traffic correlates strongly with a high AOV, while a high percentage of Google paid traffic is the strongest correlating factor with high conversion rate. So for high AOV websites SEO will do the job, for lower AOV websites seeking a higher conversion rate PPC is your best bet.
Facebook also emerges well from the report, which found that Facebook-driven traffic has more than tripled, from 1.3 per cent to 5 per cent, in the past two years. Display ad traffic fared less well, however. Despite accounting for 38 per cent of digital marketers’ budgets, display failed to register as a top 10 traffic source. Email fares better in the report, delivering as much traffic as all social channels combined.
When it comes to mobile, there’s good and bad news. Mobile is now the largest traffic source of all devices, but seriously underperforms in revenue terms. Its 42 per cent share of traffic translates to just a 21 per cent share of revenue, and it suffers the lowest average conversion rate and AOV. Despite these lowly conversion metrics, the report’s correlation study found websites with a larger-than-average proportion of mobile traffic benefited from larger-than-average conversion rates, indicating that mobile is the device consumers use to make decisions before often completing the purchase on desktop.
More generally, the report found that site speed is key. For every 0.2 of a second a website can shave off its server response time, it can expect an 8 per cent improvement in conversion rate. Bounce rate, on the other hand, has zero correlation with conversion rate. In fact, the report concludes, as an overall website metric, it’s a dud.
Across the web, the average conversion rate is 1.5 per cent. Travel websites averaged 2 per cent, while retail websites averaged 1.4 per cent, and pureplay eCommerce merchants websites converted almost twice as well as their multichannel counterparts. This could suggest they are better at the whole eCommerce thing, or conversely, that the pureplay customers know that buying in one of the retailer’s physical outlets is simply not an option.
Finally, and encouragingly, the report found that people are buying more frequently and spending more per order online. Average conversion rates have increased 10 per cent since the last study, while for retailers the AOV has shot up 25 per cent to €186. For travel websites, the AOV is €333.
Commenting on the findings, Wolfgang Digital founder and CEO, Alan Coleman, who authored the report, said: “Google is maintaining its grip as our gateway to the web. And as the starting point for online purchases, it is the make or break success factor for eCommerce websites. Facebook’s mooted move into search is the most likely threat to Google’s traffic monopoly right now.
“Because digital marketers now have so much data, they often waste time on irrelevant metrics. Our study found that the much-hyped bounce rate has zero correlation with conversion rate, while site speed - being both be a strong conversion factor and a noted SEO factor - can offer an enviable ‘multiplier effect on the bottom line.
“It’s interesting that display accounts for a third of digital marketing budgets, yet doesn’t register as a top 10 traffic source. Social networks and search engines don’t pay agencies ‘agency rates’, display networks do. The secret agency rebates scandal hitting the headlines in the US right now could merge with this over-indexing of display story at some point in the future.”
You can download the report for free here.