Product Portfolio Analysis In Ecommerce Part 1
Management Summary
Each product can be assigned a total of three values.
In our case, the
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Number of product views
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Product conversion rate
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Gross product sales
These three characteristics determine the position as well as the size of the Bubble. The selection of the characteristic values is always individually based on the previously defined requirements for the analysis.
Recording status quo – product portfolio analysis
Evaluating product views and sales is an essential step – but only the first. Advanced web analysis is required for in-depth insights. A product portfolio analysis is a good way to record the status quo and display it graphically in a bubble diagram. The potential and acute need for action of various products can be identified quickly and easily.
The meaning and purpose of it all? The perfect basis for strategic marketing decisions!
Application and benefits in eCommerce
Let’s stay with the shop operator and the questions that are currently affecting him: why are certain fans often viewed but rarely bought? Do tower fans perform better than pedestal fans in terms of conversion rate? Which fan is only rarely clicked on, but is then usually ordered?
After looking at the matrix, not only are these questions answered, the shop operator now has the opportunity to think about what the future strategy for the different products should look like on a factual basis. It would be optimal to achieve a placement in the top right quadrant for both stand and tower fans.
Note: Of course, a better target metric in the next step would be the contribution margin (if available in the web analysis) and the consideration of the return rate…
In part 2 you can read about the practical application of this concept. To make sure you don’t miss it, subscribe to our newsletter, like us on facebookor circle us on Google+.
