When you think of conversion rates, you’re probably picturing monetary values like the difference in conversion value between the U.S. dollar and the Euro. But, if you run an ecommerce or e-business, you should think about the conversion rate ecommerce requires.
Understanding Conversion Rates
This type of conversion rate means the difference between failure and success. It is what your marketing campaigns should aim to improve. It should also indicate whether your target audience is reacting or acting on your CTAs.
Definition and Significance
So, what exactly is an ecommerce conversion rate? And what does ecommerce conversion optimization entail? The conversion rate of your ecommerce business refers to the percentage used in digital marketing to determine how much website traffic it gets and how well your marketing campaigns perform. It also calculates the number of conversions (paying customers) you get during a specific period.
It is easy to calculate your conversion rate. Divide your monthly conversions by the total number of visitors for the same month. For instance, if you got 100 visitors in one month and made 50 sales, your conversion rate is 50 divided by 100. This equals a 50% conversion rate.
However, conversions don’t only refer to sales. You can set different conversion goals for every marketing objective in your ecommerce business. For example, you can set a conversion goal for free eBook downloads. Or you can set up a goal for CTA clicks. You can even set up conversion goals for newsletter downloads or pop-up click-throughs.
Ecommerce conversion rate optimization means improving the customer experience, so it drives a marketing objective. You can optimize your website landing pages or customer touch points to drive conversions.
Key Metrics to Measure Conversion
While you’re improving and optimizing various parts of the customer or online shopping experience, you must implement ways to measure KPIs. There is no point in trying to increase conversions and implement ecommerce conversion optimization if you don’t know how well your marketing strategies perform.
Some of the most crucial metrics include sales conversion rate and average order value. Most metrics have an easy-to-follow calculation formula. For instance, your sales conversion rate would be the number of purchases times the number of online sessions times 100. If you multiply by 100, you get the correct percentage.
The average order value formula is total revenue divided by the total number of orders. This calculation will help you determine how many customers need to buy from you to bring in a specific profit based on the value of a single order.
Other metrics you should measure include customer lifetime value and customer acquisition costs. You should also keep track of your website bounce rate, impressions, and pay-per-click campaign success rates. These all factor into whether your conversion rate will improve and how fast you can get it to the optimal level.
Factors Influencing Conversion Rates Inside Ecommerce
Ecommerce is all about simplifying the shopping experience. But, because buyers cannot physically see or test a product before buying it, websites and dedicated ecommerce platforms must be credible, trusted, and user-friendly. They must also provide all the information a person needs before making a purchase. These and several other factors influence conversion rates, including the following:
Website Design and User Experience
A website’s design may seem irrelevant, but first impressions count in ecommerce. If a website is inviting and easy to use without unnecessary filler, it positively impacts conversion rates. People would rather buy from a platform where they click three times compared to a platform where they first need to search for what they need and then try and figure out how the checkout works.
If you’re designing a new website or revamping your existing one, choose a clean product layout with clear descriptions.
Product Descriptions and Visuals
Speaking of products, nothing will make your conversion rate tank as fast as false advertising. What your customers see on your website or ecommerce platform should be what they get when they buy from you. If you sell multiple products, each one needs a clear description, including price and benefits. You should also add sizes if relevant.
The reason this is so important is that most customers compare products before they buy. And most of them read online reviews before even thinking of paying for a product. If your products are not what they seem online, people will write negative reviews about them. This will severely impact your conversion rate.
Trust-Building Elements
Also, because buyers rely on reviews when they decide to buy from you, it is good to increase the trust factor on your website. You can add trust-building elements like trust badges so potential buyers can see that your business is legitimate and that others have bought and continue to buy from it.
Some buyers abandon their cart when they feel distrust in a website. If this happens on your website, it will reduce your overall conversion rate. This is also why design and trust elements are so crucial.
Add different payment gateways and a guaranteed safe checkout. Highlight free shipping and free returns. One of the best trust badges you can add is a money-back guarantee.
Mobile Optimization
None of these optimizations will mean much if your website is not mobile-friendly. Not only will Google penalize your site or platform, but you will most likely experience a sales decline. Your ecommerce website must work as fast on mobile as on a laptop. Your ecommerce shop shouldn’t lag or load too slowly.
After all, online users spend more than 90% of their time on mobile, and if they struggle to view products on their phone, they won’t bother trying to buy them. This is also why your advertising and marketing efforts should be mobile-first.
Customer Support
Moreover, you must have an excellent customer support system in place. This is the one factor that will make your website’s conversion rates increase or decrease. If your business gets a reputation for bad after-sales service or customer support, you can kiss your conversion rate goodbye.
Good customer support increases the chance of referrals. It gives your ecommerce business an edge over the competition. It allows you to resolve issues quickly before they become massive problems. If you want to impress your customers, personalize your customer support service and offer multiple self-service channels.
What is a Good Conversion Rate for Ecommerce?
So, what is a good conversion rate for ecommerce businesses? And what should your business’s conversion rate look like?
The average ecommerce conversion rate is around 2.5% to 3% in 2024. This means you should expect a sale around three percent of the time. The ideal conversion rate for your ecommerce platform should be more than three percent. That is a basic conversion goal to strive for. When you consistently achieve it, you can tackle advanced conversion rate strategies.
The average conversion rate ecommerce percentage may seem low, but industry leaders consider this to be the benchmark. You can also work towards a rate of over three percent, but you will have to put several optimization strategies in place.
10 Conversion Rate Optimization Strategies for Ecommerce
Optimization strategies work for any ecommerce platform. If, for instance, you have an ecommerce-based flooring business, the following strategies can help you improve your conversion rates faster.
1. A/B Testing and Data Analysis
A/B testing and data analysis is a must-have strategy for new products. If you price your new product too high, people won’t buy it. If you set the price too low, you cut into your profit margin. Use A/B testing to offer different versions of the same product at different prices. Use the feedback data you get to price your products accordingly. Just make sure that your prices stay competitive.
2. Streamlining Checkout Process
You must have a streamlined checkout process. If it is too complicated for buyers to pay for a product on the checkout page, they will abandon their cart and move on to the next website. You should also have a notification system for abandoned carts, seeing as how up to 80% of them get abandoned the first time people search for online products. Reduce checkout form fields and make payment in a one or two-step process.
3. Implementing Clear CTAs
Do you want people to browse your flooring products? Or do you want to introduce them to a new flooring product? Your CTAs will guide website visitors into action. But they must be clear, short, and to the point. Use words like ‘Buy Now’ or ‘Get Yours Today’ to instill a sense of urgency.
If buyers feel like they’re going to miss out on a fantastic product, they will be encouraged to buy.
4. Personalization and Targeted Marketing
You must show website visitors the flooring products they want to see. Invest in an online strategy that allows you to show repeat visitors products based on their past purchases and demographics. Send visitors personalized emails when they visit your website, even if they don’t buy anything. Implement dynamic search options on your website or ecommerce platform so that people find products faster. And don’t forget to present loyalty programs and bundled offers. These will help you improve your conversion rate and create a loyal customer base.
5. Add a USP
What do your flooring products have that others don’t? Use that distinction to sell your products to more people. Your unique selling point (USP) is what will make people choose your products over those of your competitors. You can use humor or wit to create a fun USP.
6. Use Video Marketing
Flooring products are easy to showcase on video. Video will make it more appealing to potential customers, and it will explain how to use the products at the same time. Just make sure you shoot high-quality videos and include captions for those who do not want to watch them with the sound on.
7. Use Only High-Quality Images
The same goes for product images. Only use high-quality photographs that display your products from different angles. If you are adding product names, ensure the spelling is correct. Also, make sure the names on the photos are the same as on your product descriptions. This will make it even easier for people to search for and find them.
Better yet, link each image to the relevant product on the product page. This will make the buying process much more convenient.
8. Level Up on Pop-Ups
Create a bit of nostalgia by adding a gamified email pop-up on your website. Gamification is one of the easiest ways to convert visitors, especially the younger generation. But it also triggers pleasant memories in the older generation, making the decision to buy less complicated.
9. Don’t Force Logins
Another strategy that works well is to allow guest purchases. Don’t force people to create an account and log in. Sometimes, it puts potential buyers off if they have only a few minutes to spare, and then are presented with a long sign-up page. Cut down on the time it takes to buy online by offering both guest buying and logged-in buying.
10. Create a Detailed FAQ Page
Your ecommerce platform or website must have a detailed FAQ page. Here, buyers can find answers to common questions about your flooring products. If you have all the information they need in one place, you make your website a trusted platform. Remember to include contact details at the bottom of the FAQ section in case someone does not find the exact information they need.
Building Trust and Credibility with Clients
No matter which conversion rate optimization strategies you prefer, your primary focus should be building trust and credibility with your clients. Without it, your repeat business will suffer, and your conversion rate will not improve.
Customer Reviews and Testimonials
Social proof should be your go-to when building trust and credibility. But you must showcase both sides of the coin. If you display reviews and testimonials, you must go with the good and the bad. Addressing negative feedback publicly will help you build trust because it shows that you care about your customer’s experience with your business. So, do not only use the positive ones because it does not reflect the reality of business anyway.
Secure Payment Options
The last thing you want is for someone to buy something from you, and their payment disappears. You must ensure that you offer secure payment gateways to eliminate the risk of fraud and improve credit card security. Use the latest and best technology to ensure payments get processed quickly and securely every time.
Transparent Policies
Lastly, all your business policies must be transparent. If you do not do refunds, you must state it clearly on your website. If you have a seven-day return policy, display it underneath each applicable product. Fine print does not work in paper contracts and will not work for your ecommerce business. Ensure that all your policies are easy to find and understand to avoid issues down the line.
Using Technology and Tools to Increase Conversion Rate in an Ecommerce
Furthermore, technology and online tools play an unmissable role in the customer experience. Using technology will almost automatically improve your conversion rates because it simplifies and streamlines the online buying process.
AI and Machine Learning Applications
With AI and machine learning technology, you can analyze browsing history and present products to visitors with a high conversion potential. You can create pricing based on demand and personalize product and website content. Moreover, you can use AI technology like chatbots and virtual assistants to vastly improve customer service and support. AI can also help identify fraudulent transactions, which will help reduce losses and improve customer trust.
Analytics and Conversion Rate Optimization
Analytics tools help collect visitor data like page views, bounce rates, and clicks. You can use this data to optimize your conversion rate strategies. Analytics gives insight into user behavior, preferences, and frustrations. It will let you see which pages work the best and which need improvement. Using tools and technology will allow you to make optimization decisions based purely on data.
Ultimately, ongoing effective optimization will help you increase that all-important conversion rate in your ecommerce business.
