Keys to

Unlocking
Your Web
Marketing
Genius

Improve Your Merchandising

by Analyzing Browse-to-Act Ratios
By Chris Grant, Enlighten

Based on WebTrends
Take 10 Series
Improve your Merchandising
by Analyzing Browse-to-Act Ratios
Whether you have an e-commerce site or not, chances are you’re
making merchandising decisions. What content should you feature
on the homepage to get more visitors to check out your products
and services? Should you include an image of a deliverable to
encourage higher registration? Whatever merchandising questions
you’re asking, web analytics can give you the insight to answer them.
In other words, you’re able to observe actions that imply interest
in a particular item, prior to a final action such as purchasing.
And if you know which items seem interesting to a lot of people,
you can draw conclusions about why, and then apply those insights
to other items.
It’s terrific customer intelligence.

Defining Merchandising
Merchandising, of course, is a motley collection of factors that
Understanding Appeal —the E-Commerce
together affect that mysterious intangible called “appeal.” Some
Context
Let’s start with a sales-based merchandising question.
of the factors have to do with their presentation on your web site,
but many do not. Consider the following items, all priced identically:
- Item A is a best seller. An impressive 10% of visits include a
Web-related merchandising factors include the size and quality of
purchase of Item A.
an item’s picture, the amount of detail shown in the image,
- Item B never sells very well. Only 1/10 of 1% of visits include a
whether all possible product colors are displayed, whether the item
purchase of Item B.
is shown in use or alone, the descriptive text, the caption or
- Items C and D are in the middle. 1% of visits include a purchase
heading text, the placement on the page and the location on the
of Item C and 1% include a purchase of D.
site to name just a few.
Given this information, would you …
Non-web factors might include price, warranty, shipping costs and
- Raise the price of Item A? Or lower it?
shipping time. And don’t forget that the total mix of items that you
- Drop Item B? Or promote it more?
offer is also merchandising, involving questions about whether you need
- Feature Item C more often? Or treat Items C and D exactly
more items of a certain type, or whether some should be dropped.
alike?

The web is unmatched for consumer analysis.

To make smart decisions, you need to know more
The wonderful thing about web site analytics is that you’re in a than just the sales patterns described here. You need
position to closely watch thousands of anonymous people wander to know two other metrics: exposure and appeal.
through your “store.”
Exposure - how often the item is browsed
Not only do you know what items they bring to the cash register,
(looked at or viewed)
you also can see more subtle actions: where they went first, what
Appeal - if the item is looked at, how frequently it is bought
items they stopped to look at, what items they picked up for a
closer look, and which ones they ignored. And that’s just the An item’s success = its Exposure + its Appeal
beginning. You know how long, and sometimes how carefully, they
examined an item, whether they asked questions about the item
and how much comparison shopping they did on your site.

K E Y S TO U N L O C K I N G YO U R W E B M A R K E T I N G G E N I U S
For any given item that has an associated action, what percent of visitors act on the
opportunity? That percentage is an indicator of something about the item’s appeal.
- Chris Grant

Exposure can be calculated by dividing the total number of visits
that view an item by the total number of visits to the site. For
example, 40% of the visitors to your site may view Product A.
Appeal can be calculated by dividing the number of actions taken
(in this case purchases) by the number of visits to the item. Notice
we’re only looking at those people who have already expressed an
interest in the item by viewing it.
Let’s call this measure of appeal the “browse-to-buy ratio.” A high
browse-to-buy ratio indicates the item has high appeal. If an item is
bought every time it is viewed, its browse-to-buy ratio would be 100%.
Beyond Sales Numbers: Non-Purchase
Actions that Imply Interest
The browse-to-buy ratio is a commerce metric but the concept is
much broader than sales. A purchase is just one type of visitor
action that implies some kind of interest. Other actions that
indicate interest can include drilling down for a closer view or
more information, downloading a screensaver, adding an item to a
wish list, signing up for notifications, putting an item in a
shopping cart and requesting a quote.
Every one of these actions is worth measuring, because they reflect
the effectiveness of the merchandising of an item and give you
actionable insight about changing the merchandising. That’s why
I more broadly refer to the metric as the “Browse-to-Act Ratio.”
You’ll have to use your judgment to interpret the
ratios, because the metrics are just flags that help
you focus your attention on two subsets of your
items, those with the highest and the lowest ratios.
Look for patterns. Are the items with terrific ratios displayed in a
different way from those with poor ratios? Do they have bigger or
brighter photos, are they less expensive, more appropriate to the
season or perhaps displayed higher in a list?
Don’t forget that drilling down can sometimes indicate a problem
too. For example, a visitor may be frustrated by a lack of
information in his first glimpse of the item. If you see too many
drilldowns happening, you might be burying some important
product information too deeply. Consider moving some of it up in
the navigation if you find this to be the case.
PUTTING AN ITEM ON A WISH LIST
If you have a wish list (or even a tell-a-friend feature) on your site,
you can calculate the ratio of wish-list-adds to item views. This
gives you an even stronger indicator of an item’s appeal than just
looking at drill-downs. But a wish list is, after all, a list of items
that aren’t going to be bought just yet, implying that the items on
a wish list may be enticing, but there’s apparently something
that’s preventing an immediate purchase. Think about whether
this is happening.

DRILLING DOWN FOR A CLOSER VIEW

Do you show items in a list or thumbnail-view page and give
visitors a chance to click for more information, a sample or a
larger picture?

Try calculating the ratio of drill-down visits to overall visits to the

product-listing page. You’ll get an idea of whether the item’s title,
description and thumbnail image are interesting enough to attract
further investigation. Of course, the item’s intrinsic interest is also
important—more people will probably click on chocolate truffles
than on licorice no matter how good the sticky black stuff’s
merchandising is.

I M P R O V E YO U R M E R C H A N D I S I N G B Y A N A LY Z I N G B R O W S E -TO - A C T R AT I O S
ADDING THE ITEM TO THE SHOPPING CART ITEM EXPOSURE
The percent of item-views that turn into “cart-adds” is a significant LOW HIGH
measure of interest for any item. A cart-add action suggests the
visitor wants to look at the product again, if not actually buy it. Hidden gems Winners

A high browse-to-cart-add ratio suggests that most characteristics This quadrant contains items with You’d like all your items to be here.
low exposure but which convert This quadrant contains items that
of the item are satisfactory or close to it, including the detailed extremely well on those rare are very exposed and also convert
occasions when they’re looked at. extremely well when they’re viewed.

HIGH

HIGH
description, price, warranty, color, and of course, how the item Maybe these could be in the bread- You may get even more return by
and-butter category if more people giving these items more exposure,

ITEM’S BROWSE-TO-ACT RATIO

ITEM’S BROWSE-TO-ACT RATIO

is displayed. But if an item with a great browse-to-cart-add ratio saw them. Feature them for a while, or you can capitalize on the
or make their description clearer so demand by raising the price. You
also gets abandoned a lot, then you should be questioning what more people check them out. might also try to expand your item
line by adding items that meet a
is preventing that final purchase step from happening. similar need.

REQUESTING A QUOTE Losers Underperformers

This usually applies to big-ticket or complex items such as services Try to move all your items out of This quadrant holds items that are
or insurance policies. It often indicates a very high level of this quadrant, which contains items very exposed but still convert
that are rarely seen and, when poorly when they’re seen.
interest, because the visitor knows that he is asking a human looked at, just don’t convert to Something’s wrong here. Maybe

LOW
sales. Assuming these aren’t people are interested in the general

LOW
being, somewhere, to do some work on his behalf. The visitor is seasonal items, their very existence idea of the item (they looked at it,
in your item line should be after all) but something about it
also committing to a future interaction with you. questioned. just didn’t close the sale. You may
want to adjust the merchandising of
these items, or perhaps abandon
these but add other, more
PRINTING A PAGE appealing items of the same type
to your item line.
An item’s browse-to-print ratio suggests strong appeal, perhaps
indicating an intention to buy offline. For this reason, adding a LOW HIGH

“Print this page” button to your product pages, and making sure ITEM EXPOSURE
its clicks are measurable, can give you valuable information.
BACK TO ITEMS A, B, C AND D
ADDITIONAL RATIOS
Now we can make smarter decisions about items A, B, C and D
Hopefully additional ratios that relate to your web site are
with the new metrics.
jumping to mind as you read this paper. Just remember to think in
terms of percentages. For any given item that has an associated
Here are their exposure statistics:
action, what percent of visitors act on the opportunity? That
- Item A is viewed in 40% of visits
percentage is an indicator of something about the item’s appeal.
- Item B is viewed in .5% of visits
- Item C is viewed in 40% of visits
Taking it to the next level - Item D is viewed in 2.5% of visits
Ready for more?

Here are their browse-to-act ratios (% of visits that purchase

Once you know the browse-to-act ratio of an item, plus its
divided by % of visits that view):
exposure ratio (the number of visits to the item divided by the
- Item A: 25% (10/40)
total visits to the site), you can categorize the item in a way that
- Item B: 50% (.1/.5)
will lead to actionable insight into your web merchandising.
- Item C: 2.5% (1/40)
I find the following 4-category scheme very helpful. Each category - Item D: 40% (1/2.5)
implies a different possible merchandising adjustment. The categories
are Hidden Gems, Bread-and-Butter, Underperformers and Losers.

K E Y S TO U N L O C K I N G YO U R W E B M A R K E T I N G G E N I U S
 New Way Of Evaluating
Old Way Of Evaluating: Conclusion
Sales (Action) Browse-to-
Exposure As you can see, browse-to-act ratios can drive smarter web
Act Ratio
merchandising decisions than simply relying on sales numbers
25% of visits
Best Seller
High Exposure
that view the item
alone. With web analytics, you can get the insight into visitor
Item A 40% of visits
10% of all visits buy it buy it
view it interest and behavior that will help you uncover the hidden gems
Extremely Low
50% of visits
and losers in your product line.
Poor Seller Exposure -
Item B 1/10 of 1% of all visits buy it that view the item
of 1% of visits
buy it
view it

Medium Seller High Exposure 2.5% of visits

Item C 1% of all visits buy it 40% of visits that view the item
view it buy it

Item D Medium Seller Low Exposure 40% of visits

1% of all visits buy it 2.5% of visits that view the item
view it buy it

With the new information, we see that:

- Item A is an Underperformer. This is ironic considering its

stellar position on the sales list.
- Item B is a Hidden Gem, not a Loser as one might surmise
from the poor sales pattern.
- Item C is also an Underperformer.
- Item D is a Hidden Gem rather than a mediocre performer as
implied by its sales numbers.

Taking Action
These examples, while simplified numerically, were taken from a
real-life gifting site.
Here’s what the site owner did with the information.
Items B and D needed more exposure to visitors. Item B, buried
deep in an obscure item category, was subsequently featured on
the homepage at an increased price—and its revenue increased
dramatically. Item D, on closer examination, was felt to have a
confusing name and a poor thumbnail picture. Improving both
nearly doubled the viewing rate, resulting in nearly doubled sales.
Items A and C needed better merchandising, not more exposure.
Item A was changed to include an offer of free shipping. Item C’s
descriptive copy was adjusted to emphasize quality and warranty.
Both items’ conversion rates subsequently increased. Since the
view rates were so high, the increase represented a substantial
amount of revenue.
ABOUT THE AUTHOR
Chris Grant
Enlighten
Chris Grant is senior data strategist at Enlighten, a web design and
development firm in Ann Arbor, Michigan. She works on site analytics
projects ranging from the routine to the decidedly unique and cutting-
edge.
Her deep background is in market analysis, human factors, customer
satisfaction research and item development research, including a long
stint in the product development department of a Fortune 1000 company.
Chris has always swum in business waters despite five years in academia,
and feels that web site analytics is the perfect convergence for her varied
analytics career. She has a Ph.D. from The University of Michigan and is
a member of the WebTrends Customer Advisory Board.

I M P R O V E YO U R M E R C H A N D I S I N G B Y A N A LY Z I N G B R O W S E -TO - A C T R AT I O S
 Making Web Merchandising Decisions with WebTrends 7
WebTrends 7 provides very detailed merchandising reports making it easy to perform this kind of analysis. Overall the objective is to obtain
visitor-based numbers reflecting views and interest actions for a list of your individual items.

By opening the Product Drilldown report, a merchandising manager can drill into his complete product hierarchy. This allows a manager to
view the performance of a product family, product category, product line and individual product SKU. The Product Drilldown report
features visitor-based measures such as unique visitors, visits, and product views, along with interest metrics such as orders, cart additions
and completed checkouts. All of this information is available in one report, so merchandising managers can easily compare metrics for
individual products and subsequent roll-ups to see how metrics are trending across their entire merchandising mix.

Once the Product Drilldown report is generated, a WebTrends SmartReport for Microsoft® Excel® can then be easily created with a few
simple clicks, importing your entire Product Drilldown report into a fully formatted, presentation-ready Excel file. This is not a basic .csv
file that many other web analytics vendors provide. WebTrends SmartReports for Excel is a unique capability that WebTrends offers,
allowing WebTrends information to be further augmented with other business critical data or, in this case, to take advantage of Excel math
functions to create calculations or additional metrics such as a browse-to-act ratio or a cart-add-to-act ratio. As an example, the browse-to-act
ratio would be calculated by dividing orders by product views of a specific product. Then you can simply copy this calculation to all of the
products and product categories for which you would like to use this metric.

It's also important to note that once in SmartReports, you have a WebTrends toolbar embedded in the Excel environment. This allows you to
easily change a date range or report settings, automatically updating the SmartReport without re-importing new data from WebTrends. Now
with a few clicks you can instantly refresh your most important SmartReports, making it easy to build web analytics into your daily workflow.

These metrics are powerful performance indicators of your merchandising activities. WebTrends 7 makes this process easy and provides
many additional capabilities such as Visual Scenario Analysis and Visitor Segmentation to improve performance.

For additional information, please view the WebTrends 7 Quick Tour on eCommerce and find out more about what WebTrends 7 can provide.

For More Information

To learn more about improving your web site with web analytics, visit the WebTrends Resource Center:
www.netiq.com/webtrends/resourcecenters.asp

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Based on WebTrends
Take Ten Series
© 2003 NetIQ Corporation, all rights reserved. CS10551HOLM MH 0403
WP10679RET MH0703