In plain words
Revenue per visitor is the revenue an offer brings in for each person who sees it. It multiplies how many visitors buy by how much they spend, so it does not reward an offer simply for being cheap.
It stops one step short. Two offers can bring in the same revenue per visitor and keep very different amounts, because one ships a gift, a second unit or a free parcel and the other does not. Revenue per visitor counts none of that.
Formula
- Revenue per visitor = revenue ÷ visitors = average order value × conversion rate
- Profit per visitor = margin per order × conversion rate
Worked example
The $40.00 bag converts 3.0% of visitors: $1.20 of revenue per visitor. Add a free mug and suppose conversion rises to 3.6%: $1.44 per visitor. On revenue, the gift wins.
The engine puts the two orders' margins at $15.36 and $10.91. Profit per visitor is $0.46 without the gift and $0.39 with it. On profit, the gift loses.
The example order
A $40.00 bag of coffee, shipped free, every cost counted
2 declared kinds cost nothing on this option
| Step | Grain | Amount |
|---|---|---|
| Revenue | – | $40.00 |
| Cost of goods | per unit | −$12.00 |
| Pick and pack | per order | −$1.18 |
| Packaging | per parcel | −$0.50 |
| Shipping label | per parcel | −$7.50 |
| Card fee per order | per order | −$0.30 |
| Refunds | percent | −$2.00 |
| Card processing | percent | −$1.16 |
| Contribution margin | – | $15.36 |
| 2 kinds costing nothing | – | $0.00 |
Computed by the margin engine in Offer Suite's own code, in whole cents, from a $40.00 bag of coffee with a $12.00 unit cost.
Revenue per visitor is not profit per visitor
It treats every dollar of revenue as equally good. A dollar from a full-price single and a dollar from a discounted bundle with a gift are not the same dollar. A test decided on revenue per visitor will favour whichever arm gives the most away.
Using it
Use it when you have no cost data at all, and say so. As soon as you know what each option costs to fulfil, switch to profit per visitor. If the two metrics disagree about a test, look at what the winning arm on revenue gives away: that is usually the whole explanation.
In Offer Suite
Offer Suite's experiments decide on profit per visitor. Conversion, buyers, average order value and refunds are shown beside it to explain the result, and none of them decides it.
Source: Offer Suite's experiment design.