Understanding your customers’ buying process is an essential part of an eCommerce business; it’s what guides how you optimize the website and which channels to focus on. By knowing how a customer progresses through each stage, we can know when they drop off and even the actual reason why they quit.
What is Activation Rate?
The activation rate is the percentage of users who visit your site, view a product, and purchase it. It’s also known as conversion rate or sales lift.
This metric is important because it shows how many people are buying what you’re selling. It’s an excellent way to measure the effectiveness of your digital marketing campaigns, and it helps you determine whether your marketing efforts are paying off or not.
You can use activation metrics to test different pages on your website, other digital advertising campaigns, and even further ad copy formats. This will help you better understand what attracts customers and how they interact with your products online.
The activation rate is calculated by dividing the number of users who take action by the number who visit within a specific timeframe. For example, if there are 100 visitors and ten complete a purchase, your activation rate would be 10%.
What is AARRR?
AARRR is a model that has been used by eCommerce businesses for years to track their customer lifecycle and understand how they can best serve them.
The acronym stands for the following:
- Acquisition
- Activation
- Retention
- Revenue
- Referral (or Repeat)
The acquisition is when people first find your product or service online and decide to buy it. Activation involves getting them to complete their first purchase by giving them access to the product or service they’ve paid for (i.e., by activating the account).
Retention occurs when you make sure your customers are happy and have a positive experience with your business to return for more purchases and referrals.
Finally, referral means getting customers to bring in new people who will become repeat purchasers themselves.
How Can AARRR Be Used for an eCommerce Business?
The AARRR framework is a helpful way to think about your business and the metrics you need to track. It helps you identify what’s working, what’s not working, and how you can improve your eCommerce business.
The AARRR framework is an excellent way to look at the data that comes into an eCommerce business, but it doesn’t tell you how to use it or interpret it. You still need to know what each metric means to make sense of the data.
The first step in interpreting AARRR metrics is identifying which metrics are most important for your business. The next step is figuring out if there are any gaps in your knowledge about those metrics. Once you have identified your goals for each metric and understand what each one means, you’re ready to act based on what you learn from analyzing them!
What are Activation Events?
Activation events are your actions to turn a visitor into a customer. They’re the specific tasks that lead to an increase in your conversion rate and revenue.
Your store needs to have enough of these activation events—enough steps that visitors take to become customers—to keep them engaged and make sure they don’t leave before making a purchase.
Several activation events can be used to measure the success of your eCommerce website, including:
- Newsletter signup
- Trial activation
- Downloads of various resources available on your website
- Sign up forms
- First purchase
Activation events are the first steps in a customer journey. They are what happens when a customer is introduced to your product or service for the first time. They are often the most critical part of your activation strategy because they set up the tone for everything that comes next. If you can get customers interested in your product or service right away, they’re more likely to become repeat customers and advocates for your brand.
How to Measure and Calculate Activation?
The actual meaning of activation is a signup or conversion event. This occurs when a user completes a goal that you have set in place. The process usually begins with an ad campaign that attracts new users to your website, leading them to convert into paying customers.
When it comes time to calculate these activation metrics, you will need to know how many impressions you had on your ads and how many clicks resulted from those impressions. This will give you an idea of how well your campaign performed in attracting new visitors who may be interested in purchasing items from your store.
Activation metrics are the most important measures of customer success in eCommerce. They tell you what your customers are doing after interacting with your brand and product, and how well you meet their needs.
There are three types of activation metrics:
- Registration
- Conversion
- Engagement
Each of these requires a different level of sophistication, but each is equally important in measuring customer success.
4 Analytics Tools to Identify and Measure Activation
Several tools can help you identify and measure activation. You can use these tools to track the success of your activation strategy, so you can make sure that your efforts are measured and accounted for. Here are four analytics tools to help you identify and measure activation:
- Google Analytics
- Facebook Analytics
- Twitter Analytics
- Instagram Insights
Activation is defined as turning an anonymous visitor into a registered user by encouraging them to take action like filling out a form or downloading an asset. It’s critical to know that activation doesn’t necessarily mean conversion or registration; it means getting someone to take the first step toward becoming a new customer.
Once you’ve identified your target audience and determined your goals for them, then it’s time to measure activation with one of these above-mentioned four tools.
3 Ways to Increase User Activation
If you want to improve user activation, there are a few things an eCommerce can do.
- Offer a free shipping offer for new customers. This will incentivize them to make their first purchase, and it’s free for you!
- Make the user experience as seamless as possible by offering coupons and discounts on products they might be interested in based on their browsing history. This way, you can keep the customer engaged with your site without actually having to do anything else.
- Create a newsletter that gets sent out when users make their first purchase. This will give them more incentive to continue shopping with you because they know they’ll get discounts and deals on future purchases if they sign up for this newsletter.
When optimizing your user activation, you should always start with the checkout process. The checkout process is what brings users from browsing your product pages to making their first purchase. It’s also where many people drop off because they don’t understand what they’re supposed to do next. So, it’s essential to make the process as straightforward as possible.
The best way to do this is by using a clear call-to-action that highlights exactly what the user needs to do (e.g., “Add to Cart”). This will help improve conversion rates, increase user activation, and make more money!
How to Track Activation Metrics on Verfacto?
With Verfacto, eCommerce brands cannot just evaluate the sessions to conversion rates, which broadly is classified as a key activation metric; they can also create their unique and niche activation metrics based on different milestones. This can be based on customer activity or events that bring them closer to a purchasing point.
Verfacto’s insightful dashboard gives a bird’s-eye view into actionable analytics that help you make real-time improvisations to your marketing. Having the data at your palm can help you analyze how customers engage with your brand after onboarding, and determine the friction points that lead to churn along the journey.
Once you understand the friction points, you can alter your communication to better convey the promise value to your customers. This can help eCommerce shops reduce dropouts, and ultimately streamline their marketing efforts to make customers move down the funnel, and improve their activation rates.
Conclusion
Activation metrics are essential to keep tabs on because they determine the success of your website. You can improve your site based on user behavior by analyzing key activation metrics. This is a vital step in continually improving your site’s conversion rate, revenue per visitor, and overall revenue. Those numbers matter when it comes to establishing if your eCommerce website is achieving its potential.
