No matter what type of products you sell, every eCommerce business has 3 key goals:
- Get more traffic
- Sell more products
- Sell more products to those who have bought products already.
Conversions are the most important metric for any e-commerce business. By increasing your conversion rate, your business will generate more revenue, earn a larger profit, and expand its audience of customers. Without that, you’ll struggle to reach a point of profitability.
Understand the terms we’ll be navigating:
- A Conversion is the action that takes place when a visitor on a site makes a purchase.
- A Conversion funnel illustrates the route your customers take from first becoming aware of your business to making a purchase. It also includes some deeper aspects like customer retention, upselling, cross-selling, and subscription-based models.
- The conversion rate is the percentage of your website visitors who take the desired action.
Understanding conversion rates
In any eCommerce business, the first challenge is getting enough traffic at the top of your conversion funnel to give you the greatest possibility of a sale.
These days, there are so many options for you to tackle this challenge: paid advertising, affiliate marketing, organic Google search, social media, content marketing and more. Find out more about these strategies.
Unfortunately, not all traffic is the same. Traffic from a better source will be more likely to convert to a sale than other traffic. The key is to get ENOUGH.
For example, let’s say you received 100 visitors from a referral partner who sent an email out on your behalf telling their customers all about you and how great your product is. The quality of that traffic is going to be fantastic and highly qualified.
That’s what we call good traffic, but it’s actually the best kind.
Of those 100 people:
- 20 come in and don’t do anything or go further than the first page.
- 50 travel through the product catalogue and some add products to the cart.
- 10 get to the cart or checkout page but don’t buy.
- 20 sales are made.
This means you have a 20% conversion rate from your 100 visitors.
Understand what the conversion rate is from each of the ways you get traffic. Then, you can do more of what works and tweak your campaign to eliminate what’s not working, to increase your conversion rate.
Essentials for increasing your conversion rate
If this is the first time you’ve seen eCommerce conversion rates, you might be thinking that those are some low numbers. Unfortunately, that’s just the nature of the current internet landscape. 81% of customers do research online before purchasing, so you really need to stand out and make sure your product is perfectly positioned to be the one that people will buy.
At a minimum, you need:
- A website that’s easy to navigate and search
- Good, high-quality images
- A competitive price
- Easy returns policy
- Social proof, like reviews
- A site that responds well on mobile (remember, over 50% of your audience will access your site via mobile)
High shipping costs are the #1 reason why customers don’t check out in eCommerce. So if you are getting a lot of traffic to your website and then to the checkout, but they’re not buying, shipping is usually the first problem to solve.
eCommerce and conversion rates can be a very confusing space to navigate. We hope that we’ve helped you make sense of some of it.
Feel free to get in touch with Spring Digital if you’re starting out on your eCommerce journey.
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