How Can Network Latency Improve Your eCommerce Website?

How much revenue could you be losing due to a slow eCommerce site?

It could be as little as 1%, and as much as 14%. This is what the Obama Administration experienced:

“Obama’s fundraising campaign during the 2011 Presidential Elections raised an additional $34 million when the Obama for America website shrunk page load time from 5 seconds to 2 seconds — that’s a 14 percent increase in donation conversion with a mere 3 seconds of website performance improvement!”

Customers reward companies with fast websites by increasing their revenue.

“…studies have found that people are — and always have been — most comfortable, most efficient, and most productive with response times of less than 2 seconds.” — Unbounce

We recently discussed how to measure the effects of network latency round trip time (RTT) on your page load times.

Below, we are going to take our formula, and show just how significant of an improvement network latency can have on an eCommerce website.

Calculate Website Load Times

First, we will review the formula we presented in our last article. The formula that can be used to determine page load times is as follows:

(HTTP requests/simultaneous browser requests) * network latency in ms = Page load time in ms

Or:

network latency in ms = Page load time in ms / (HTTP requests/simultaneous browser requests)

We have simplified this formula to provide an easy estimate for calculations.

The precise formula for determining these metrics, which includes bandwidth calculations, can be seen here.

An example of this formula would be as follows:

(100/4)*200ms = 5,000 ms or 5 second page load

How Great Are Your Improvements?

To see how significant of an improvement we can make on a website by improving network latency, we will use the formula above, and only adjust the RTT number in ms.

As we take the formula above and hold all things constant except network latency, we can see the effects latency can have on website performance. For example:

(100/4)*200 ms = 5,000 ms or 5 seconds

Improving the network latency to 100 ms, we get the following result:

(100/4)*100 ms = 2,500 ms or 2.5 seconds

The above example shows that a 50% improvement in network latency could yield a 2.5 second difference in page load times.

We do acknowledge that this would only be possible under perfect circumstances, and we do not always have perfect conditions. There are a number of variables that can affect page load times, and network latency is one of them. Given the evidence above, network latency is arguably a very important factor.

What This Means for Revenue

Walmart.com has determined that 1 second in page load times is 2% in revenue, and Amazon has seen that 100 ms is 1% in sales. Applying these percentages to your current business, you can see how much revenue you might be missing.

“If your site receives high volumes of traffic that are globally distributed, third-party solutions can be a tremendous help. For AWS users, a network optimization tool such as Datapath.io on average improves latency by 60%, thereby decreasing RTT (round trip time) from 3.7 seconds to 1.6.” — ConversionXL

The speed of your eCommerce website can be addressed at the network connection. By improving the speed at which your website loads, you can see a significant increase in revenue.

Article originally published on the Datapath.io Blog.