Conversion rate in detail

The full text is divided into the following two sections:

• The basic conversion rate formula of the electric business industry and the calculation method.

* Mushroom Street in the industry to convert the conversion rate of the basic algorithm and decomposition.

First: Electric dealers have formulas.

After so many years of working in Taobao, this is my innermost thoughts. I have mentioned a lot of formulas before, in the field of electrical business, as long as the pursuit of profit, can use some formula to decompose.

　　below is this the simplest example.

Therefore, when I diagnose the electricity quotient and the shop, I often list the various sources and transformations of the shops, then judge the transformation of each step and whether the data is in the normal range, so it is easy to find the root cause.

Second: Conversion rate is the focus of the pursuit

The above complex derivation, we see, is that both the flow guide and the purchase, there are various conversion rates. This allows us to know the steps of transformation. For example, the ads to guide the flow, we need to know how many times the ads will show, and then the ads click-through to the store transformation, and then, this group of people will not buy also not necessarily, will produce a purchase conversion rate ...

So these are all information on a chain. There is a problem will not be normal, such as a high rate of time, is often cheated click (such as sexy pants), that must lead to the conversion rate of the page to reduce.

For electric dealers in the efforts of things, but often go to the side, such as they will reduce customer unit price, improve the number of display, which actually does not guarantee profits. Some people say, this call hit the market, I have always wanted to say, do not make money to play what the electric dealer. In other words, I think the key point that the electric business pursues is undoubtedly the "conversion rate", the transformation is higher in each link, have the real meaning.

Third: Conversion rate must distinguish who into who

People often ask me, their conversion rate of 2% How, I always ask to go back to "who's conversion?" So, it's important to be clear that, since it's a "transformation," there must be a change from A to B, which is b divided by a. and the corresponding B, is generally a behavior, such as purchase, such as registration. We take Taobao, Taobao itself in the station transformation there are many species, the most often see is the following several.

This is the typical Taobao browsing path, all the transformation is in a path to calculate. There are several transformations in this area. Every day to Taobao has tens of millions of people, of which purchase millions of single, so the whole station purchase conversion rate in 5–10 bar. At the same time, Taobao operations look from their own search and category page, activity page after the purchase, "buy UV/into the category and activities of the UV" is the category and activity of the purchase conversion rate.

Taobao commonly said "UV/IPV_UV conversion rate" There is also an algorithm, that is, "buy the", is to see the category of commodity details page of the people inside, how many individuals finally bought. For example, women's category, conversion rate is about 6%. The shop looks more different. Look at 100 people point to shop or shop merchandise, a few people bought. This proportion is strange, not similar to different levels of sellers, the gap is very large. The conversion rate of other people's home is also the key point that sellers ask each other.

So, be sure to be clear, who converts to who, not the same path conversion rate, contrast does not make sense. For example, you take the ad click conversion rate and store purchase conversion rate is higher than, it is meaningless.

IV: The conversion rate of decomposition, determine the direction of operation

Conversion rate decomposition, I directly with our mushroom street, such as the site examples. Because the end of the year for colleagues to break down the task, just tidy up the following figure.

The figure can be seen, mushroom Street browsing-purchase path, there are "stroll in Mushroom Street" and "Go to Taobao buy" two parts. "In the Mushroom Street stroll" Part, the user enters the homepage or the promotion page from each kind of channel, enters the waterfall flow the chart wall, this is the first step transformation, basically is 100% will enter the waterfall flow. Then users see a lot of shared goods, turn over, see their favorite point in, enter the details page, this is the second step of transformation.

Enter the details page, judge the information feel really good, click "Buy", jump into Taobao, this is the third step transformation. After Taobao, buy, this has the fourth step transformation, to Taobao after the purchase conversion rate. Therefore, the purchase conversion rate of the whole station is very easy to calculate, four conversion rate multiplied on the line. What is this for? To share our efforts in the direction of operation.

Back to the nature of the business site such as Mushroom Street, in order to solve the user "What to buy" problem, and ultimately hope that users can produce the purchase, right? So, the whole station conversion rate is very important. If now 1 million people a day, the whole station conversion rate is 4%, that is 40,000 single AH.

Therefore, we put the "whole station conversion rate" task broken down, to find ways to improve the conversion rate of all links.

To improve the conversion rate of users to the wall page of the Mushroom street, it is necessary to increase the content of the guide, so that users can easily point to the picture wall. To improve the conversion rate of the wall page, it is necessary to make the goods on the wall new, good enough, enough to be liked, but also to consider all kinds of waterfall flow mechanism, recommended mechanisms and so on. If this place is like a forum to rely on the top and editorial recommendations, it is certainly not reliable AH. At the same time, to consider to the user "not to do" and "wish to smell the details" of the feeling, to attract users to see the details. Right?

To improve the details of the page to Taobao conversion rate, it must be in this page before the win "like", mushroom cooler based on like, the possibility of buying a lot more, and then let the mushroom cool feel in this more relaxed and have a sense of community (such as discussion). Then, be sure to make the obvious button that we want her to do, that is, buy. Also remember that this may be a single user access path on the last page of Mushroom Street, we can not let the user turn off, so in the bottom of the page next to the wall, is the way to retain users.

Improve to Taobao after the single rate, it is not we can directly control. So mushroom street must be in the mushroom cooler point "buy" button to jump to Taobao before, let the user "already think well", to Taobao just to "pay money". Although this is difficult, this conversion rate is crucial.

See a website like Mushroom Street do it? is to find ways to improve the various conversion rates. What our operations team does every day is to use various mechanisms to control the quality of the goods the user sees on the wall, to get more people to "like" and see the details, and then to "make up your Mind" on the details page.

What's the result? can share the data is, Mushroom Street at present point to Taobao after the purchase conversion rate (is the last step that) on average reached 8%, the individual category is higher, more than Taobao category itself. The reason is because here is "based on the likes of buying", point to Taobao Product Details page, mushroom Cool has been basically want to buy, to Taobao is "verify" their favorite, rather than "pick". Combined Guide to Taobao conversion rate of about 35%, combined down, mushroom Street overall conversion rate will be up and down 3%. The large section above is like a soft text. That's because I have no other case to speak of myself. More because research oneself than the study of others to the actual and have the clout.

To tell the truth, in Taobao work, has been in the station to study various transformations, we are accustomed to the logic of Taobao, but also familiar with a variety of formulas. So the general data can't hide me. and to Mushroom Street, can from "for Taobao guide deal" of the "Amoy" angle to see, users browse and deal is not a place, conversion rate concept is different, this is more interesting.

My view of conversion rate, summed up three points:

1, this field, do not boast, it is easy to calculate.

2, although there are formulas, the knowledgeable is really not much.

3, decomposition conversion rate, it is easy to find the direction of the effort.

* Special chirp: often asked Mushroom street and Taobao combination too close to the problem, my view is to face the reality, the reality is sold in Taobao, "the whole network marketing, Taobao deal" is not very good. Besides, this is not called "Taobao ecosystem."

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Above is the first part of the end, the second part of the Mushroom Street in this industry conversion rate of the way.

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The path of purchase and transformation

On the recent often by a variety of reporters and peers asked the "Mushroom Street transformation" problem, sorted out, the use of a way, and then share with you a good.

We said last time, like our mushroom Street to solve the user "What to buy" problem, and for the Electric dealer to guide the transaction of the website, a very important piece of income, is from the Electricity Business website Commission. That is to say, I take a deal for the electric dealer website, they will give me to divide. This income is also often called "CPS (cost per Sale) income".

At present, Taobao Taobao guest system, also known as the "Taobao Alliance" is the largest partition platform. In fact, Mushroom Street is now mostly divided into income from the Taobao Alliance.

Here is the simplest conversion process:

In the diagram we will focus on three parameters:

Conversion rate of the whole station: is to enter the site of the UV, into the downstream of the electrical business site of the UV, in order to convert the "whole station purchase conversion rate." About this I last article "Talk about conversion rate" has detailed, here does not unfold. Mushroom Street at the end of March, a few data is, stop UV220 million, outbound (into Amoy) UV is 750,000, orders more than 60,000, so "the whole station purchase conversion rate" is about 3%.

Taobao Customer order ratio: is all to Taobao transactions, only a part of the support of the split. The proportion and Taobao sellers set up the situation, the current total Taobao-related categories of support for the proportion of 50% or so, Mushroom Street did not support Taobao customers to do weighted (also can not do), so this value will be consistent with Taobao, is about 50%.

Average Commission ratio: is to support Taobao customer's merchandise, the average set of Commission ratio. The proportion and the class head has a lot to do with the category of Mushroom Street, we generally calculate according to about 5%. Usually, we combine "Taobao customer order ratio" and "average commission ratio", called "Split Commission ratio", so mushroom Street This number is about 2.5% (50% x 5%).

Sixth: Calculation and decomposition of commission

Well, we're starting to decompose the formula. (Every time I split the formula will feel very good fart, occupational disease?)

Does that make any sense? When we split the Commission income formula into "UV, whole-station conversion rate, support share ratio, customer unit price, average commission ratio", we found that each number can be calculated and can be checked. In other words, we can calculate. This is much more practical than in many industries.

At the beginning of April, I posted a new data on Mushroom Street, and soon investors "criticized" me, saying why I was so "really" saying so many real numbers, and I said, "It may seem to me that all numbers are counted, and I would rather have said it better than to let everyone count." From the existing number backwards, that is, to solve a one-yuan equation or two-yuan equation of the matter, I Junior high school will be.

So April 15 Taobao announced that "Mushroom Street Taobao divided into daily income has reached a hundred thousand of Yuan, is currently the largest third-party E-commerce platform", I am very happy, because it is calculated against the count we can be right.

The idea in our bones is integrity. And because there are formulas, we must be honest.

Then, on the formula above, we can see that if we want to pursue more commission, it will be easy to break down the operation and marketing direction. The arrival of UV must become larger. This is the most elastic part of the equation, and the other changes are limited. In other words, the UV increases by one times, my income doubles. The conversion rate of whole station is the core of operation. The last article was detailed, and it was not said. 3% of the value of the increase in space is relatively large, but the ceiling is also very obvious, can not double it?

Support the proportion of partitioning and positioning. If Mushroom Street is a pure Taobao guest site, that can be made 100%, but we are not, we are addressing the "user buy what" problem, so we must maintain "not utilitarian", that proportion will not change. Customer unit price can be improved. For example, Taobao comprehensive customer unit price often according to 150 yuan, that Mushroom street there is a lot of space, Taobao Alliance announced that the average price is 89 yuan, there is still room. Ways to improve, such as improving quality, such as trying to expand the crowd and category ...

The average commission ratio varies little. May even be reduced, but I think Taobao is an ecosystem, the best way to maintain system stability is to maintain a variety of proportional stability. This is like a forest in the proportion of snakes can not be exceeded, nor too low.

The pink stars in the picture are our operational direction and important level. The formula is broken down to this extent, the other is not a good thing to hide.

Summarize Part Two:

1. The number depends on the unreliable, the formula decomposition, anyone can calculate.

2. To enhance the income of CPS, we must learn to decompose the formula.

3. Find the factors that can be changed and measurable to try and never brag about the parameters in someone else's hand.

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In this way, the complete algorithm is here, there may be subsequent calculations, such as income and valuation, and even the calculation of the amount of financing, I am not very proficient, so do not forget, who stood out to share it. Take the mushroom street data to calculate, also very good.