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Web Site Measurement Hacks by Eric T. Peterson

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Hack #59. Measure Multi-Step Processes

Reducing abandonment through multi-step processes is a tried and true method for making your investment in web measurement pay off.

Multi-step processes are flows of two or more pages on your site that, when successfully completed, somehow contribute to the success of your business. Processes you encounter online every day include shopping cart checkout, new member registration, search, and the simple act of moving from more general to more specific information in any type of site.

Measuring multi-step processes is important, because with every successive click, you lose visitors; this is often called abandonment because the visitor is "abandoning" the process. Regardless of the reason, any impediment will prevent visitors from successfully completing the process, making your web site less successful. Your job is to identify these leaks using the right data and experiment with changes that can reduce abandonment.

When measuring and analyzing multi-step processes, there are several key metrics you should be familiar with:

Retention rate

This metric is calculated as the percentage of visitors that successfully continue to the next step of your funnel. This rate highlights how many visitors are retained.

Attrition rate

This metric is calculated as the number of visitors lost at any specific step of the funnel. It is effectively the inverse of the retention rate.

Conversion rate

This metric is calculated by dividing the number of visitors that complete the process by the number of total visitors that began the process. For example, if 100 visitors start at your home page, and 5 of them complete the expected process, your conversion rate is 5 percent.

Abandonment rate

This metric is the inverse of the conversion rate. It describes how many total visitors are lost in a given process. Following the previous example, your abandonment rate would be 95 percent.

Identify the Leaks

When web measurement tools were first deployed, analysts began using clickstream data to understand where people were abandoning a given process. Applied to multi-step processes, clickstream data provides useful insight into the specific paths visitors are navigating.

However, clickstream analysis has a significant drawback in generally assuming that people navigate in a linear, task-oriented fashion. Unfortunately, countless analyses and usability studies have demonstrated that users navigate web sites in a nonlinear fashion, browsing multiple site sections and pages before zeroing in on a specific task.

Despite erratic behavior, the fundamental question remains: where are users bailing out of a process? To address this need, some web measurement vendors now provide functionality to measure multi-step processes (sometimes called "fall-out reports").

Process reports allow you to select several "checkpoints" that users must pass through before successfully completing a given process. The process report doesn't care if it took 3 or 30 clicks to get from A to B to C, just that the user made it from A to C and passed through B at some point along the way.

Analyzing Multi-Step Processes

When used properly, fallout reports can provide powerful insight into where your most significant leaks are occurring. Figure 4-6 highlights a typical online purchase process.

Typical online purchase path

Figure 4-6. Typical online purchase path

Users begin by entering the site on the "Home Page" and have successfully completed an order when they reach "Buy Process – Order Confirmation." You'll notice that between steps one and two, 82 percent of the visits are lost(for example, only 18 percent of home page visitors reach the "Category – Software" page). While this looks pretty bad, you cannot reasonably expect every visitor to be interested in software products. You should be less concerned about abandonment early on in the process, especially when visitors have a large number of choices available to them early on.

You can see that between steps two and three, only 47 percent of the visits are adding a product to the shopping cart. This is where the red flags start to go up in my mind and I start asking myself, "Is it something about the way the page is laid out or the language that we use that is preventing people from clicking the 'add to cart' button?"

Further down, between steps three and four, you'll notice 70 percent of visitors exit after the "Add Product to Cart" page; this is significant. These prospective customers have sent a clear signal that they are considering a purchase but, for some reason do not enter the checkout process. The central question you need to ask yourself is "why?"and this page should be flagged for additional study.

Between steps four and five, 62 percent of prospects are leaving after viewing the "Buy Process – Shipping Information" page. This means 1,830 people have clicked from your home page, added a product to cart, and read about shipping information, but chosen not to proceed further. Again, this should be flagged for additional study. Often this area of attrition is associated with poorly displayed shipping rate information, creating an opportunity to test shipping charges using A/B testing.

Even more fascinating, 45 percent of prospects have made it to the next-to-last step in the process, the "Buy Process – Billing" page but, for some reason, abandoned the process. Why? Often abandonment at a step where you're asking for money is simply driven by people's unwillingness to commit. That said, frequently companies forget to post privacy and security information on pages like this, causing visitors to abandon because they're not sure they can trust the site. In this case, double-check the page to make sure everything looks professional, the language is clear, and privacy and security policies are clearly described (or at least links to these policies exist). You should also augment these theories by apply clickstream analysis to understand what content visitors are clicking away to access (for example, are they visiting the "Help" section, and never returning to purchase?).

The net result of this multi-step process and significant attrition is that the site is left with a 0.5 percent conversion rate, and we've identified at least four pages that need to be checked and tested. Fortunately, since you have established attrition and abandonment baselines, you can experiment with design ideas at the page and process levels.

The Payoff

The payoff of improved conversion is usually significant. Using the example above, this site attracted 70,875 visitors in the month of December, 0.5 percent of which you convert generating $38,400 in sales based on an average order value of $100.00.

Now let's assume this site somehow reduced abandonment from the "Add Product to Cart" page by 10 percent, meaning 40 percent of prospects continue to the "Buy Process – Shipping Information" page instead of the current 30 percent. If all other attrition levels stay the same, this site would generate 122 additional orders (506 total orders, up from the original 384) yielding an additional $12,200 in sales—a 32 percent increase.

Now imagine that the site was able to decrease abandonment in other steps in their checkout process.

Hopefully you can see the power of multi-step process analysis. Most of the significant financial gains that companies make using web measurement applications are tied to this type of analysis. Because top vendors make this type of analysis fairly easy to implement and understand, you'll be able to take advantage of process reporting somewhere on your web site as well!

—Matt Belkin and Eric T. Peterson

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