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EC-Assignment_1

Assignment E-commerce

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Rashi Pandey
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11 views

EC-Assignment_1

Assignment E-commerce

Uploaded by

Rashi Pandey
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Selected Time Period – Last 90 days data

Q1. Which marketing channels worked for the company, and which did not?

We pulled out the data from the Google analytics and did some calculations to find out which marketing channel worked
for the company.

Let’s understand new calculations added- % of new users acquired indicates out of total users acquired how many got
acquired by that marketing channel, likewise we can understand the other calculations as well.

Those highlighted in green are the channels that worked for company because they are generating the maximum
revenue as well as maximum users are getting acquired by those channels only. (Direct, Organic Search, Referral, Cross
network and paid search)

Those highlighted in orange are the channels that did not worked for company because we can see that zero revenue
generated or transaction completed from those channels (Display, Organic Video & Paid other)

Q2. Based on this assessment, how would you have reallocated marketing funds for the following year?
To maximize the marketing budget, we will focus on the best-performing channels such as Direct with 68% users and
72.3% revenue, Organic Search with 18.36% users and 12.11% revenue, and Referral with 5.95% users and 9.23%
revenue. Allocate 70% of the budget to these channels.

Spend moderately (20%) on Cross-network, Paid Search, and Email, which have some promise with further refinement.

Eliminate underperforming channels such as Display Ads, Organic Video, and Paid Other, which had no revenue or
transactions. Allocate minimal funds (10%) to low-performing but essential channels like Organic Social and Organic
Shopping for brand awareness and incremental growth. This reallocation ensures maximum ROI by focusing on effective
channels while optimizing or discontinuing non-performing strategies.

Q3. Will you prune or expand the product portfolio? Assess the performance of various products to
answer this.
Assessing the performance of the top 25 products sorted in the order of highest revenue. Defining metrics for evaluation:
1. View-to-Cart Ratio 2. Cart-to-Purchase Ratio
Defining Parameters for evaluation:
Expand IF both the metrics are greater than 50% .
Prune IF both the metrics are below 30%.
High View-to-Cart Ratio and Low Cart-to-Purchase Ratio indicate that the product is likely appealing and has strong
initial interest, but there is a problem in the buying process.
Low View-to-Cart Ratio and High Cart-to-Purchase Ratio indicate that the product may not be attracting enough interest
to add to the cart, but once customers do engage with it, they tend to convert. There could be issues with initial visibility
or awareness.

Expand the product portfolio by introducing variety for the products that are doing good.

Q4. Which metrics would you like to consider to measure the following critical KPIs?
(a) User lifetime value, (b) website traffic, and (c) conversions.

(a) User Lifetime Value (LTV)


To increase LTV, focus on successful marketing channels like Direct, Organic Search, and Referral as identified in Q1.
Key metrics to measure LTV:
 Customer Retention Rate (CRR): Tracks how many customers stay loyal over time.
 Average Revenue Per User (ARPU): Measures the average earnings from each customer.
 Purchase Frequency (PF): Identifies how often customers make repeat purchases.
These metrics help evaluate long-term profitability by analyzing how well we attract and retain high-value customers.
(b) Website Traffic
Based on Q1 insights, Direct and Organic Search are major traffic drivers. To measure website traffic:
 Traffic Sources: Tracks where users are coming from (e.g., search engines, referrals).
 Bounce Rate & Pages Per Session: Measure user engagement by evaluating how many pages they visit and
whether they leave quickly.
 Session Duration: Tracks how much time users spend on the site, showing interest levels.
These metrics reveal how well marketing channels bring in traffic and keep users engaged.
(c) Conversions
Q3 shows that products with high View-to-Cart and Cart-to-Purchase ratios perform well. Metrics to measure
conversions:
 Conversion Rate: Shows the percentage of visitors who complete a purchase.
 Cart Abandonment Rate: Highlights users who leave without buying, often due to high shipping costs or
complicated checkout processes.
 Goal Completion Rate: Tracks how many users complete specific actions like purchases or signing up.
These metrics identify barriers to completing sales and help optimize the checkout process for better results.

Conclusion: Using these metrics ensures improvements in attracting valuable users, driving more traffic, and converting
that traffic into sales. These insights allow the company to strengthen winning strategies and address weaknesses like
checkout abandonment.
Q5. Why do you think users carry out 'checkout abandonment'?
Checkout abandonment refers to the phenomenon where users add items to their shopping cart on an e-commerce
website but leave the site without completing the purchase. This occurs when users reach the checkout process but fail to
finalize the transaction.

I’ve extracted data of checkout page, especially how many people have viewed the page, but exited without transaction.
As per data of last 90 days, checkout page view has been 2743, but 4112 people has abandoned checkout.

Checkout Abandonment Rate= (views on Checkout Page/Exits during Checkout)×100

= (4112/2743) *100 ≈ 15%

Inference: approximately 15% of checkout attempts result in


abandonment, while 85% proceed to the next step (likely completing
the purchase or further engaging). Though, it’s relatively low, but
Following could be the possible reason for checkout abandonment:

Possible Reason leading to checkout abandonment

1. High Shipping Costs and Extra Charges


Unexpected shipping costs or additional fees can lead to high rates of cart abandonment, as users often feel
frustrated and misled when they encounter these charges late in the checkout process. This issue typically arises
when shipping fees are disclosed only at the final step, creating a sense of surprise and potentially damaging
trust in the site
2. Lack of Payment Options
Limited payment methods can cause users to abandon their carts if their preferred payment option is not
available. Shoppers often have strong preferences for specific payment methods due to convenience, perceived
security, or familiarity—whether it’s a digital wallet, direct bank transfer, or installment plan. This issue can be
more pronounced for international customers who expect payment options that cater to local preferences.
3. Technical Issues
Technical glitches such as slow-loading pages, checkout errors, or issues applying discounts can cause
frustration, leading users to abandon their carts before completing their purchases. These problems are often a
result of an unoptimized website that may not be responsive on mobile devices or that has heavy scripts that
slow down performance.
5. Complex Checkout Process
A long or complicated checkout process can discourage users who expect a quick and seamless experience.
Multiple steps that ask for unnecessary information or force users to create an account before completing a
purchase can create a barrier. To address this, simplifying the checkout process is crucial
7. Inadequate Customer Support
The absence of easily accessible customer support during the checkout process can lead to abandonment,
especially if users have questions or encounter issues that need immediate attention.

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