The report is based on an analysis of 20.8 million visits and 108 million page views to 26 e-commerce sites from July 1, 2008, through June 30, 2009.

This study, identified and measured 4 primary traffic source categories that encapsulate all source origins:

* Organic listings
* Paid listings
* Direct access and bookmarks
* Other referrer

Most likely to buy are consumers who navigate directly to a retailer’s site by typing in a URL or clicking on a bookmark, as their conversion rate registered at 7.38%. Consumers who came to an e-commerce site from another site or an e-mail converted at 6.58%, the study shows. The overall conversion rate was 3.6%. (This means the PPC conversion rate is still much lower than direct access and bookmarks visits)

The study found that:

* Paid search visitors bought the most, with an average order value of $117.06 versus $109.27 for those coming from other sites, $106.64 for visitors from organic search and $95.29 from direct referrals, such as from a bookmark or direct entry of a URL
* Average order value for all retailers in the study was $104.21, down 31.7% from a previous Engine Ready study that analyzed data from a two-year period that ended December 2007. Retailers said average order values from all channels have declined in the past 12 to 18 months
* The average time on a site per visit increased 5.8% from the previous study to 4 minutes, 33 seconds. Consumers who navigated directly to a site spent 5 minutes, 8 seconds. The study found consumers who spent more time on a site were more likely to buy, but that their average order value was not higher than that of other buyers
* Site visitors on average viewed 5.2 pages per visit, up 15.6% from the previous study. Those who came directly or from other sites or e-mail viewed the most pages, 6.2 on average
* Average number of seconds on a page dropped 9% from the earlier study to 53 seconds, which could be a sign marketers are doing a better job of presenting information on their pages in a more easily readable format, the study says. Paid search visitors spent the most time on a page, 66 seconds on average.
* 43.9% of all visitors left after viewing just one page, down slightly from 44.5% in the earlier study. Organic search produced the highest bounce rate, 48.5%, and direct access the lowest, 39.2%
* Direct access produced the largest share of site visits (40%), followed by other referring sites and e-mail (27.9%), paid search (19.8%) and organic search (12.3%)

According to the author, people in rural areas respond to direct mail offers at a significantly higher rate than those in urban areas. Is the same true in Paid Search? The article gives a positive answer to this question. By looking at low population density states like Wyoming, Montana, Alaska, etc, they concluded that the quality of the traffic appears to be more than 60% higher than that of more urban states. (I am not so sure how they measure this 60%; I am interested in seeing the methodology).

Another factor catalog mailers have always known: the presence of retail stores matters. Not surprisingly, if you send a catalog full of terrific products to someone who lives near a physical store selling similar products, you’ll drive a lot of sales to that store. - I am really looking forward to working with a retail chain to testify this in Australia.

Landing Page Test Variables:

1. Colours
2. Ways of highlighting offers and discounts
3. Location and appearance of ‘Buy Now’ buttons
4. Strength of calls to action
5. Copy
6. Adding incentives

Google’s Website Optimiser allows you to easily test up to four variations of a page and reports on the final conversion rate of each. This allows you to narrow down what works and what doesn’t work on your website and within your industry. For example, you may find that a green ‘Buy Now’ button converts your shoppers 10% better than a red ‘Buy Now’ button.

Having this sort of information is vital to your online marketing success and can have a significant impact on your bottom line.