The Importance of Site Search Analytics for e-Commerce

Executives can't get enough of case studies. Why? Because they like to hear how others in the same vertical/industry/boat have failed in an endeavor and then rattle off at least 3 reasons why their own business is going to succeed and why they have an upper hand.

I was tasked with making a case for why a previous ecommerce client needed to invest X dollars into building a better site search engine. The following is my case study on "Company 734" (alias) that I presented to my client.

"Company 734 and Site Search" (so exciting, I know.)

The Business

Company-734.com began in 1990 with the idea of extending their reach of the brick and mortar brand online as many of its competitors began launching simliar retail eCommerce websites. The main focus was to attract the Baby boomers who were beginning to adopt the idea of the web as a new way of shopping. Through this initiative, Company 734 strove to better service online shoppers while preserving its brand.

Company 734's recent marketing strategies have included partnerships with comparison shopping sites such as CouponCabing and DealSea. On average, 85% of buyers coming from comparison shopping sites used promotion codes to make a purchase. Versus all other shoppers, these promotion code users were three times more likely to make a purchase, and their average order value was $20 higher, resulting in a positive $11 ROI [Figure 1].

Promotion code usage dropped significantly when other channels of traffic were evaluated, especially among the loyal customers, who received promotion codes weekly through email newsletters.

Considering the higher conversion rates of segments that had easy access to promotion codes, it was in Company 734's best interest to have their codes front and center in all marketing channels.

The Challenge

Compared to all customers, loyal customers of Company-734.com were unable to locate the best promotion codes for their purchase, exhibited by their lower site search usage as compared to other segments' site search usage. To counteract this, the content team published codes weekly onto a "content" page, but weekly promotion code usage did not rise as a result.

The analytics data showed that customers were not able locate promotion codes. Searches including the word "Coupon" and "Promotion Code" were trending upward month over month as the holiday season approached. At its height, "Promotion" -related search terms accounted for 20% of all site search but generated 0% conversion. The majority of these searches were coming from loyal customers.

The Technology

After initial research it was determined that iNile, Company 734's eCommerce platform provider, had built a basic site search engine that could only index product pages. This meant that the Promotion code content page that was published as a means to fix this problem was not showing up in search results. To further exacerbate this problem, iNile's system was unable to show available promotion codes at checkout, though this is not best practice for eCommerce sites, it would have been a workaround until the advanced site search engine was built.

Assuming that customers who were seeking promotions on-site act the same way as customers who came to the site with a promotion code (visitors from CouponCabin and other comparison shopping networks), this technical failure carried an opportunity cost of $5,425 in lost revenue, or 1% of annual revenue [Figure 2]. With consumer spending trending downward month over month, this opportunity to gain incremental revenue could not be ignored.

The Results

iNile's development team provided a workaround for their site search by building an "intelligent" redirect system. The content team would upload a batch of search terms - variations of "Coupon" and "Promotion Code" - and when a visitor entered a string that matched the batch, the Promotion Code content page would be served in place of the normal Search Results page.

Within a month after implementation, conversion from the "Coupon" and "Promotion Code" search terms and variations increased to 3% from 0% - a 300% increase. Average Order Value from these search strings was 15% higher than the site average. The growth in conversion was the impetus the content team needed to further optimize their search term batch that triggered the intelligent redirect. After 1 week of optimization efforts, the conversion from "Coupon" and "Promotion Code" related search terms grew to 4%.

The end result was that the segment of visitors who were searching for Promotion Codes once they got to the site outperformed the comparison shopping segment in terms of Net Revenue [Figure 3]

Next Steps: Building a Better Coupon Strategy

With the success of this site search project, Company 734 is now building a more robust shopping cart where there is much more flexibility to display and add multiple promotion codes. Customers can layer available deals in different product categories.