Conversion Rates For Ecommerce – A Quick Guide
A conversion rate is a very useful metric in ecommerce. It can be extremely helpful in evaluating a potential website purchase to assess upside potential or downside risk or as a key metric in assessing one’s own website and areas for potential improvement. Conversion is basically a calculation for what percentage of one’s existing traffic end up making a buying decision or end up buying something before they leave your website. Therefore, if you have 100 visitors to your website in a given day and one of these customer ends up buying something before they leave, you have a 1 percent conversion rate. As I have mentioned before, 1 percent is about the industry average with top tier websites generating conversion rates as high as 4 or 5 percent. In fact, some industry pundits assert that Amazon.com produces conversion rates of 6 percent. While these constitute paragon conversion rates for large well funded sites, I have found that most owner operated smaller webstores produce conversions of around 1-1.5 percent when they are being run at full efficiency. Here are some quick tips and strategies to enhance your website’s conversion rates:
1) I always suggest streamlining your checkout process. That means that if you shopping cart is cumbersome and your checkout involves to many steps, you may want to think about making your checkout as easy as possible. Sites with a one step checkout process generally see an immediate jump in conversion rates through this simple settings adjustment in their backend. One other caveat on checkout is to avoid mandatory registrations during the checkout process and allow customers to checkout as a guest without necessarily having to set up an account or having to log in to buy something on your site.
2) Offer as many payment options as possible. If you don’t offer American Express and only provide Visa and Mastercard, find a way to include this with your merchant bank or credit card processing company. If you don’t have Paypal or Google checkout find a way to include these. The more payment options you offer, the greater the likelihood your customers will convert and complete their checkout through to order confirmation. I also recommend looking into the many “buy now, pay for it later” or installment options now being offered by companies like Paypal if you are selling higher price point items.
3) Be sure that your website translates into a mobile friendly format for smart phones and tablets. Given the vast number of shoppers that now use these devices it is essential that you have this capability. Most decent shopping carts now offer this but be sure to double check the formatting of your website. A quick way to check this is to use the Google mobile friendly tool at the below link. This tool will provide quick analysis of your website to ensure your website has a mobile friendly design that meets their standards: https://www.google.com/webmasters/tools/mobile-friendly/
4) Review your Google analytics and the abandoned shopping cart tool on your website’s dashboard to determine pages and areas on your site where your customers are leaving. I generally refer to this as a ‘defection page’ or pages where a customer is clicking back on their browser and leaving your website or where a customer is closing their browser altogether. Using the web analytics of your website is a powerful way to track click paths on your website. In particular, if you have a number of customers that are leaving your website from a particular page, it makes sense to go to that page yourself and determine what may be going on there. Is there a broken product image, is the product over-priced versus competitors, is the page replete with typos, etc. There are all issues that might turn off a customer and encourage them to shop elsewhere.
5) Incentives are also a great way to enhance conversion rates. This may include a free products or ebook upon checkout. It may also provide customers with coupon codes upon checkout for future orders or coupons that may be emailed to a friend. While free shipping is also a powerful incentive most websites offer this already therefore we recommend looking for other forms of incentive that will enable your website to stand out.
6) Don’t forget about the basics – products and pricing. Offer a strong selection of products and be sure to offer competitive pricing. Sites that offer the basics in their industry will suffer in comparison to websites that offer all the basics plus unique items customer cannot find elsewhere. Also, don’t make the mistake of pricing yourself out of the market. Remember that price checking or comparative pricing analysis is crucial online as it only takes your customers seconds to double check how your prices compare to other competitors. Be sure to always offer the most compelling value proposition to your customers!