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asked in Metrics by (549 points)
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I realize that I didnt do anything with the conversion, average order value numbers etc over here. We can calculate total current GMV based on traffic per year to Google * conversion * average order value. Increase this by 2% to get the actual dollar opportunity.

answered by (135 points)
–1 vote

When a retailer creates a “You may also like” module on a page whether its a “Product details page” , “List page” or “cart page” – it usually serves two purposes:

1. Inspiring a customer to add something else to their cart /discover something new when they are looking at a similar product: Metric that improves: Average order value
2. Helping a customer find something valuable when they cannot find their originally desired item (the item is not available or out of stock) : Metric that improves: Conversion
3. In this case, as this is Google and these links are Merchant sponsored links – There is ad revenue of cost per click and cost per conversion (probably)

For Google shopping, we do not have any data for conversion or average order value.

For an average retailer, on desktop – the conversion is anywhere between 3-4% – Google shopping express may have a lower conversion as their shopping link is the third link on the search results page, they are a market place etc etc. So lets assume conversion is 1.5%.

Lets assume that Average order value is 50 dollars (again, I am taking an average from retail perspective)

By adding a module like this and with Google’s knowledge of the customer’s behavior on Chrome across different sites, you may have a higher chance of showing additional relevant items above the fold that will inspire a click through and potentially a purchase.

So I would assume the opportunity will be a % increase in AOV, conversion and ultimately ad revenue for Google. We should A/B test to see if these metrics improve and launch with further tweaks to design of module, number of items shown, placement etc.
I would assume a 2% increase in GMV from this based on past experience.

answered by (135 points)

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