Search
  • Anthon Fynn-Williams

The Correct Way to Calculate & Analyse the Conversion Rate Metric in Google Analytics

Updated: Oct 4

Many people simply use the default Ecommerce Conversion Rate metric in their Google Analytics to determine the overall performance of their website. The problem with this is that the default overall conversion rate not only can be very misleading, but it doesn’t actually provide you with much context as to how your website or business is performing.


For example - Let’s say over the past year, your website had a total of 100,000 global visits & 500 transactions. Based on this info, Google Analytics will calculate your conversion rate as:


(Total Transactions/Total Global Visits) x 100

(500/100,000) x 100

= 0.5%


At a glance, this may look like a pretty low conversion rate. However, the reason why this could be misleading is because your business may have a target market of only certain countries therefore using the total global visits in your conversion rate calculations is inaccurate.


Let’s say your business’s target market is people living in European countries but 30,000 of your total visits came from people in the US, Asia & Australia thanks to a strong search engine and social media presence. Technically speaking, those 30,000 should be excluded from your conversion rate calculations since these people are physically unable to buy from your website even if they wanted to.


100,000 – 30,000 = 70,000

(500/70,000) x 100

= 0.71%


This 0.71% is a much more accurate representation of your conversion rate.


There is no point in analysing and reporting on the activities of the web visitors who aren’t in your target market since they are not intended to make an impact on your business’s bottom-line in the first-place. For example, let’s say you're client/boss runs a business that sells Dutch football shirts to football fans in the Netherlands. You can’t say to your client/boss that their business isn’t performing well because people in Spain & Italy aren’t making purchases from their website.


Similarly, if you are providing conversion optimisation services for this business, don’t try to optimise for the visitors from Spain & Italy. Focus on the business’s core target market, which is football fans in the Netherlands.


Let’s look at this in a real life example;


Below is an example of a default conversion rate metric in Google Analytics:


To find this in your Google Analytics account, go to


Conversions > Ecommerce > Overview


While 1.67% isn’t a bad conversion rate, this isn’t an accurate calculation. The business’s primary target market is people in the UK but the above conversion has been calculated using the visits & orders from the people outside the UK also.


In order to calculate the true conversion rate of the business, the formula should be:


(Total transactions/Visits from the UK) x 100


To get Google Analytics to calculate the true conversion rate of our client’s business, we need create and apply a new advanced segment that filters out all the traffic that isn't coming from the UK.



Notice how only 79.19% of their total visits are from their target market.


Next, go to Conversions > Ecommerce > Overview


We will then see the conversion rate metric calculated with your advanced segment applied.


This 2.01% is a much more accurate representation of our client’s conversion rate.


How to analyse the conversion rate metric in Google Analytics


Following on from our earlier example, we have a conversion rate of 2.01%. Now what valuable insights can we get from seeing this 2.01% metric?


The truth is, not much.


In order to get more valuable insights from this, we need to dig deeper into our data find find answers to important business questions such as:

  • Has the conversion rate increased or decreased over time?

  • Which areas of the website have the highest & lowest conversion rates?

  • In which cities do our customers convert the most?

  • Which traffic channels are generating the best conversion rates?

  • Which devices perform the best on our website in terms of conversions?

Etc…


Let’s take a look at how we can use Google Analytics to answer each of these questions:


Question 1: Has the conversion rate increased or decreased over time?


To answer this question, click on the date range towards the top right and select compare period to compare this period’s conversion rate to a previous period.

In this example, I’ve used 2 days worth of data so I’m going to compare against the previous 2 days.


Click apply and your report will now look similar to the one below:


From here, we can conclude that our conversion rate has improved vs the previous period from 1.45% to 2.01%.


You can use any time period that suits the analysis you are conducting from weeks, months or even years depending on how much data you have available in your Google Analytics account.


Question 2: Which web pages have the highest & lowest conversion rates?


If you’re using Google Analytics, a handy report which would help answer this is:


Behaviour > Site Content > Landing Pages

From this report, we can see that the visitors who land on page 5 have the best conversion rate at 29.19% and the visitors who land on page 9 have the worst conversion rate at 0.94%.


From here, you can then use the secondary dimension feature to take a deeper look into this report.


I’m going to use a Secondary dimension of Device Category to take a deeper a look at the device performance of these web pages.



From this, we can see that visitors who landed onto page 9 via desktop have the highest conversion rate and visitors who landed onto page 10 via mobile have the lowest conversion rate.


Another useful thing to here would be to use the compare period functionality to find out if these conversion rates have increased or decreased over time.


Question 3: In which cities do our customers convert the most?


To answer this question, let’s go to:


Audience > Geo > Location

Next, choose City as the Secondary Dimension. You report should look similar to the one below.



From here, we can conclude that London is bringing in the most conversions but doesn’t have the highest conversion rate. The city with the highest conversion rate would be Birmingham at 2.12%.


I overlooked (not set) because these are the visits whereby Google was unable to track to location of the visit. Its most likely that these particular visitors used some sort of VPN or IP blocker to prevent their IP address from being tracked by Google.


Question 4: Which traffic channels are generating the best conversion rates?


To find the answer to this question, go to


Acquisition > All Traffic > Channels


Your report should look similar to the one below:


From this, we can conclude that traffic coming from partner sites have the highest conversion rate.


It may even be useful to go one-step further and choose a Secondary Dimension to get further insights in regards to the traffic channel performance and use the compare period function to see how the conversion rates are changing over time.


Question 5: Which devices perform the best on our website in terms of conversions?


To find the answer to this question, go to:


Audiences > Mobile > Overview


From this, we can conclude that desktop users have the highest conversion rate at 3.48% and mobile users have the lowest conversion rate at 1.57%.


Again, it may be useful to use a secondary dimension to get even further insights about the device performance and use the compare period function to see how the conversion rates are changing over time.


I’m sure by now, you feel like you have much more valuable insights in regards to how your website is performing and how you could actually improve it by digging deeper into your data and analysing the conversion rate metric in different ways.


Takeaways


1. Always calculate the true conversion rate of your website by excluding any traffic that not apart of your target market.


2. Never use the overall conversion metric alone to assess the performance of your website, think of the important business questions you have and find ways to answer them.


3. Whenever possible, compare your conversion rate metrics over different time periods.

Avoid analysing it as a standalone metric.


If you have any questions about anything explained in today’s post or would help with calculating & analysing the conversion rate of your eCommerce business, get in touch and let’s have a chat.


Thanks for reading!

39 views
join our mailing list

Never miss out on our latest insight-packed posts on Digital Analytics & Optimisation!

ABOUT SWAYVEN DIGITAL

Swayven Digital is a Digital Analytics & Optimisation Agency based in London, UK. Our mission is to help businesses optimise the performance of their digital platforms, improve their marketing efforts & drive business revenue by leveraging the power of digital analytics.

For more information about how we can help transform your use of digital analytics please email info@swayvendigital.com.

Our Contact Details

Swayven Digital

Kemp House

152 - 160 City Road

London

EC1V 2NX

Tel: +44 (0)7503 254383

Email: info@swayvendigital.com

Main Menu
Stay Connected
  • Swayven Digital Facebook
  • Swayven Digital Twitter
  • Swayven Digital Linkedin

© 2020 by Swayven Digital