Under the hood with “negative revenue”
How should we handle online measurement of rebates, discounts, and coupons? It’s an important question, especially for online retailers implementing SiteCatalyst. Not only do these data factor into your bottom line, but they can provide meaningful insight into your user experience. Let me begin by telling you how not to do it:
Do not do it by passing negative values in the revenue portion of the s.products string. Take a look at the following made-up examples of this all-too-common mistake:
s.products=";Nikon SB-600 Speedlight Flash for Nikon Digital SLR Cameras;1;229.99,;discount;1;-29.99"
s.products="Computers;Apple MacBook MB466LL/A 13.3-Inch Laptop;1;1349.99;event1=-49.99"
Okay, so in the first example we have a Nikon speedlight Flash retailing for $229.99, and then we have a $29.99 discount. This makes sense, right? Total revenue to the company is $200.00, and that’s what they want to report in SiteCatalyst. It’s completely logical. In the second example, they’re using a custom event to receive the rebate, and they’re reporting it as -$49.99. Their idea is to make event4 a negative number, showing the amount to subtract from revenue.
Why is this a problem? First, what happens if you ever want to report on “pre-discount” revenue for any reason? If you’ve subtracted the discount directly from your revenue numbers, you don’t have a quick and easy way to provide this data. Along those same lines, you don’t have a way to report on the total amount of discounted/rebated/returned revenue.
What should I do?
You should set up custom currency events representing the rebate amount, discount amount, etc. and pass the amount as a positive number. Here’s the first example from above handled correctly.
s.products=";Nikon SB-600 Speedlight Flash for Nikon Digital SLR Cameras;1;229.99;event2=29.99"
The second example above was on the right track; you should always use a distinct custom event to track discounts or any dollar value that isn’t exactly revenue. The correction you see here shows event2 as a positive $29.99.
Okay, but how do I report on it?
It’s a good question. After all, the whole point of using negative numbers—by subtracting directly from revenue, for instance—is to report an accurate revenue total taking discounts into consideration. If you follow the example described above, using a custom numeric event to pass the positive discount amount, then you can create this calculated metric:
[Actual Revenue] = [Revenue] — [Discount Custom Event]
Voila. And because “Discount Custom Event” (e.g., event2 in the example above) is subrelated, as is Revenue, you can pull this new calculated metric into any report that accepts conversion events (e.g., Products, Campaigns, Custom Conversion, etc.).
Believe me—the integrity of your data is worth the extra step of using a calculated metric to report on post-discount revenue. You do want data on your discounts and rebates, and you can absolutely have it. Just make sure you do it in such a way that all of your reports will be able to handle what you’re passing into them.
If you have anything to say about this (or anything else Omniture-related, for that matter), please feel free to leave a comment, and I’ll respond as quickly as I can. You can also follow me on Twitter (@OmnitureCare) or e-mail me at email@example.com. Let me know how I can better take you “under the hood” of the Omniture Online Marketing Suite!