When you’re starting a new online store–or any other business–it can be hard to track the success of your marketing efforts. But one of the most important things you need to know is how many visitors are turning into customers. This metric is one of many factors that can be considered in your conversion rate. A high conversion rate means that people who visit your website or landing page are taking action and signing up for services or buying products from you.
What's a Conversion Rate?
Your conversion rate refers to the percentage of people who perform a certain action after visiting your website or landing page, such as signing up for a newsletter or making a purchase.
A conversion can be almost anything you decide it is, but here are some of the most common ones:
- Making a purchase
- Registering Interest or Submitting a form
- Engaging with your online chat
- Registering on the site
- Downloading something
- Upgrading their service
- Engaging with your site
There are plenty more, but you probably get the idea. Conversions are measurable actions that move a potential customer toward becoming a paying customer.
A high conversion rate is something you should always aim for. It means that your website or landing page is compelling and converting visitors into customers. However, this isn’t always easy to do—especially if you don’t know what people want or why they visit your site. More on that later.
Calculate Conversion Rate
The formula to calculate your conversion rate is pretty simple.
Take the number of people who took X action and divide it by the number of people who had the opportunity to take X action.
For example, Conversion rate = (conversions/total visitors) * 100 (%)
If you're selling cute puppy knitted sweaters, it might look like this:
- 396 people visited your https://selworthy.com/knittedpuppysweaters/
- 7 people bought the most adorable sweaters ever made
Conversion rate = (7/396) = 0.0177. 0.0177 * 100(%) = 1.77.
In other words, you have a 1.77% conversion rate.
Measuring Conversion Data
Ultimately, for this number to be calculable, you only have 2 things to measure: first, the number of people who have the opportunity to take your action, and second the number of people who took that action.
But as with everything, it gets a bit more complex if you want to ensure what you're measuring is actually useful for your business or eCommerce store. One potential process could flow is as follows:
Step 1: Pick the Right Goal
You can't measure conversions if you haven't decided what that means for your business. Do you want people to sign up for your email newsletter? Purchase a product from your online store. Fill out a contact form. Once you've decided on your goal, you can start measuring conversion rates.
Make sure you're keeping in mind what goals you ACTUALLY have. If your email signup has a high conversion rate, but none of those subscribers turn into customers, have you really accomplished your goal?
Step 2: Measure the Right Data, Correctly
Once you know what goal you're going for, it's time to start measuring the data that will show you whether or not you're achieving it.
There are a few different ways to measure conversion rates:
- Use tools like Hotjar, Google Analytics, or tools within Hubspot to track how many people take your desired action after landing on your website or landing page.
- Use conversion tracking pixel installed on your website or landing page.
- Manually keeping track of conversion data using a spreadsheet.
No matter which method you use, make sure you're measuring data accurately. This means ensuring that all the necessary data is being collected and that there's no bias in your results.
Step 3: Analyze and Test
Once you have conversion data, it's time to start analyzing it. Look for trends and see what's working well and what could be improved.
You can also use conversion rate data to test different changes on your website or landing page. For example, if you want to increase the conversion rate of your email signup form, you could test different headlines or button colors to see what gets more people to sign up.
Step 4: Revisit Your Goal
Did your increased email subscribers actually turn into fewer customers or more spam hits on your email newsletter? Did your increased sales decrease your average lifetime or average cart values?
Make sure you are revisiting all your data and resetting goals as necessary.
Conversion rate optimization is a continuous process, and you should always be looking for ways to improve your website and increase conversions.
Set Conversion Rate Benchmarks
In order to determine what a good conversion rate is, you need to first establish benchmarks before you start. The best way to do this is by looking at your industry and competitors and seeing what rates they have been getting. If you are in an industry where the average conversion rate is 1%, then 1% would be a great place for you to start. But if your industry has a higher average rate of 3%, then 3% may be more realistic for where you should begin.
What is a Good Conversion Rate?
A good conversion rate is different for each industry, but it's generally considered to be anything higher than 2%. The best way to determine how well your company's website performs is by using a third-party eCommerce platform like Google Analytics or Shopify. These platforms allow you to measure how many visitors become customers on your site and what percentage of those visitors actually buy something.
If you don't have access to these tools, consider creating a small survey asking people if they found what they were looking for and if they bought anything while browsing the site.
Contact Your Customers and ask Them Why They Chose You
There are a number of ways to monitor your conversion rate. The most common method is to use an analytics tool, which will provide you with data on how many people visit your website and what they do when they get there. If you’re not using Google Analytics (or another similar tool), then this guide isn't for you!
Another way to track conversions is by monitoring how many visitors become customers or leads over time—and then collecting qualitative feedback from them about why they chose your business, what could be improved upon, and more. This form of customer service can be especially effective because it allows businesses to take action on their customers' suggestions in real-time, rather than waiting until after the fact (when it may already be too late).
How to Improve eCommerce Conversion Rates
You can often improve average conversion rates by improving your website’s design and functionality. The first step to increasing conversion rates is to identify what you can do to make your website more appealing, such as testing different types of images and videos or adding a blog post that explains why customers should buy from you instead of another vendor. Something as simple as adding product categories can have a profound effect if it makes your site easier to navigate.
You can install software like Hotjar to monitor and test your website, so you can determine which changes are most effective. The second step in improving eCommerce conversion rates is to improve the quality of your products or services. If customers don’t think that what you’re selling is worth the price, then they won’t buy from you. To improve average conversion rates, set some goals for how many sales or leads you want to generate each month or quarter.
Create an Exit-Intent Popup
An exit-intent popup is a message that pops up when someone is about to leave your site. This message encourages them to stay on the page by offering them a discount, free trial, or other incentives.
You can create this type of popup with software like Hotjar or Drift. Here's how:
- Install the software on your website and select “Exit Intent” from the list of options under “Behavioral Segmentation” in the dashboard (you'll need an account).
- Create some variations of your popups based on where they appear on your website (e.g., top right corner). Test which one works best for you by experimenting with copy and design elements until you find something effective at converting visitors into customers.
- Track their effectiveness through analytics tools like Google Analytics or Kissmetrics so that you know which messages worked best during certain periods of time each week so they continue working well in future months!
Try Adding Live Chat to Your Site!
The addition of live chat to your website can help you improve conversion by improving your customer service.
Live chat gives customers a direct way of contacting you and getting their questions answered, which means they’ll be more likely to finish the purchase process. It also gives you an opportunity to get valuable feedback from users about what works well on your site, what doesn’t work as well, and where there are opportunities for improvement. Remember that good eCommerce conversion rate optimization is an ongoing process, and eCommerce businesses should always revisit their goals.
Which Pages are Dropping Users?
Now that you know how to identify which pages are dropping users, it's time to make some improvements. You'll need a way to track the effectiveness of your changes so that you can monitor your conversion rate over time.
There are lots of ways to do this, but for now let's focus on just one: Google Analytics (GA). To start tracking these improvements in GA, go back into your website traffic report and look at the list of dropoff pages again. Let's say that you see there were 1/2 million visitors who hit one particular page—but only 10% became customers. This means that 90% of people dropped off before completing any action on the site (i.e., making a purchase). If we want more people who visit this page to become customers, then we need to find out why they're leaving early!
Once you know what your conversion rate is and where people are dropping off, you can start making improvements.
Once you know what your conversion rate is, you can start making improvements. You can:
- Improve your website design so that it's easier for visitors to find what they're looking for
- Improve the copywriting on your site so that it more clearly communicates your product or service benefits
- Create landing pages that are optimized for conversions (i.e., where visitors will be asked to complete a form) instead of just sending them back to the homepage or product page during their visit
Frequently Asked Questions:
What's the average eCommerce conversion rate?
The average eCommerce conversion rate is between 2% and 4%. It’s a good starting point to measure how many visitors become customers on your website. You can use this metric to understand how good or bad your current marketing efforts are, and how you should adjust them in order to increase customer acquisition. However, bear in mind, this "average" varies wildly, depending on your industry, product type, and price point, among many other factors. For example, the average eCommerce conversion rate for a clothing retailer is much lower than that of an electronics store.
Are conversion rates higher on mobile devices?
The short answer is no, but it depends on your industry, website, and what you're actually measuring, among other factors. If you have a mobile-friendly site, conversion rates are likely higher than if your site is not optimized for mobile devices. For example, the average eCommerce conversion rate for desktop computers in the United States is 3.5%, while the average mobile conversion rate is 1.22%. Again, this varies widely depending on industry and product type.
The time is now to start measuring your conversion rates
There’s no better time than now to start optimizing your conversion rate. E-commerce websites–and any other online businesses–will always do better by collecting data and adjusting as needed. The more data you have on how your site converts, the better equipped you’ll be to make improvements. With these tips and tricks, you can turn visitors into customers—and keep them coming back for more!
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