In this post-COVID world, Ecommerce is hotter than ever – it looks like we are on track to reach 22% of all retail sales made via online as forecasted by Statista. The success of bricks-and-mortar-turned-eCom and established or startup Ecommerce-only brands seems to be on everyone’s minds – the dream of a business built from the comfort of home without the headaches of traditional retail all-too appealing, and outright essential for businesses who could no longer sell traditionally during a global pandemic. As with anything, if it’s successful for the early movers, people notice and want a slice. Consequently, it becomes more competitive and more saturated as more businesses jump online to sell. Although selling online isn’t exactly new, the last two years have accelerated certain behaviours, such as now “more than half of internet traffic shopping from a mobile device”. This rapid change is unprecedented and has left a lot of online Ecommerce businesses stuck with poor performance due to low conversion rates.
Conversions and conversion rates in Ecommerce
We should start by defining what we mean by “conversion” and “conversion rates”. In Ecommerce, a conversion is, quite simply, a purchase/transaction made, and Google defines Ecommerce Conversion Rate as “the ratio of transactions to sessions, expressed as a percentage”. So this would be:
[number of transactions] ÷ [number of visitors or sessions] x 100 = Conversion Rate (%)
A dedicated Ecommerce platform like Shopify provides both of these pieces of information by default, whereas a platform like WordPress’s WooCommerce only provides sales data. Either way, we recommend the industry standard for Analytics, Google Analytics, to get data on the number of visitors/sessions. Of course, to meaningfully make decisions about your Ecommerce website and what this percentage means for your business, it’s important to understand what industry averages might look like.
Typical Ecommerce Conversion Rates
Looking at real-time market data from IRP Commerce, we can see that the average conversion rate for February 2022 was 1.72%. Interestingly, this is down from 2.01% for the same time (February) in 2021. We are yet to understand if this almost 0.3% drop (which is pretty significant) is meaningful or an outlier. Looking at a single month is generally not good practice, so it’s important to understand that conversion rates generally sit pretty comfortably between 1.7% and 2.5%. As a marketing agency, we typically pick a nice easy 2% to benchmark against, but it very much differs by industry and a number of other factors.
Ecommerce Conversion Rates by industry
Using the same data from IRP Commerce, we can see that the Ecommerce Conversion rate varies widely by industry, dipping as low as 0.94% and as high as 4.17%. See below:
|Industry||Ecommerce Conversion Rate Feb 2021||Ecommerce Conversion Rate Feb 2022|
|Arts and Crafts||3.01%||4.17%|
|Baby & Child||0.94%||0.84%|
|Cars & Motorcycling||1.28%||1.06%|
|Electrical & Commercial Equipment||2.01%||1.47%|
|Fashion, Clothing & Accessories||2.08%||1.54%|
|Food & Drink||2.02%||1.51%|
|Health & Wellbeing||3.32%||2.96%|
|Home Accessories & Giftware||1.52%||0.98%|
|Kitchen & Home Appliances||2.51%||2.64%|
|Sports & Recreation||1.37%||1.36%|
|Toys, Games & Collectibles||1.98%||1.98%|
Improving your Ecommerce Conversion Rate
Now you know your Ecommerce website’s conversion rate, and what industry averages look like, which begs the question: is it good or bad? If you sit sorely below the industry average, that tells you there is a lot of opportunity for improving your website’s performance, but either way there is a whole lot you can do to increase your conversion rate. The process of increasing conversion rates is called Conversion Rate Optimisation (CRO), which involves making changes, improvements and optimisations with the distinct goal of increasing this magic number. There are a lot of CRO considerations that should be made as your website is built, such as your copy/messaging, overall design, Call To Actions (CTAs), visual hierarchy, load times, ensuring a simple user journey and much more. Whilst this is not the focus for us here as these can involve fairly major reworks, this is a huge area to be looking at if you want to make significant leaps in your conversion rate. Where we want to focus instead, is on little features, tactics and improvements that can be easily made with plugins, 3rd-party applications or some light development. There are also plenty of strategies that outright cheapen the brand, which I think we can all agree we probably want to avoid here.
Simple Ecommerce CRO Tactics
There are many options available to you, and it is for you to decide which fit your brand and make sense for your customers. All should be done carefully and with consideration to add to the online shopping experience, and we recommend that you don’t make too many changes at once as you won’t know which have made a difference (either positive or negative). One at a time is actually the best option, ensuring you give it ideally a month or two so you can easily tell whether it has made a noticeable improvement or not. To find out if a feature can be easily added via an app/plugin, we recommend Googling “[feature name] [website platform] plugin”. For example, you might Google “Sticky Add to cart WooCommerce plugin”. If an off the shelf solution exists, it should show here, along with instructions on how to set it up.
In no particular order, here is our growing list of Ecommerce CRO tactics:
Sticky Add to Cart
On product pages, the add to cart button is made to be always visible as it becomes “sticky” and follows the user as they scroll. This is particularly important mobile, where there isn’t a great deal of real estate and it can become easy to get lost by scrolling too quickly.
Cart tray instead of page
The cart is rebuilt to function as a tray that slides in from the side rather than loading a new page. This means the user remains on the product or category page and can easily add additional items or proceed directly to the checkout, essentially skipping a whole step.
This is essentially a script that senses when someone is about to leave the site and, when certain conditions are met, it might pop up with a voucher to incentivise staying on the site.
This may require a decent amount of thought to build this in properly, but if your products would operate under a subscription model quite well, this is something we recommend considering. This is particularly common for consumable or food sites.
Abandoned Cart email automation
When people leave your website before completing the checkout but after having added a product to the cart, you may be able to send automated emails to allow them to “pick up where they left off”. This is baked into Shopify, but there are considerations for asking for the email at the right time so that you can email market to them. Otherwise/additionally we’d strongly recommend retargeting ads.
Click & Collect
Click & Collect has been popularised in the last few years as an easy halfway point between pickup & delivery. Where delivery costs to individual addresses may be too high for you or your customers, you can deliver in-bulk to central hubs to make it easy for customers to pick up from.
Product Reviews + Review program
Product reviews are an extremely valuable form of social proof that help build trust and credibility for your products and brand. The problem is, they can be hard to get, because users generally do not naturally leave reviews, or do only when the experience has been negative. A well-planned review program offering some incentive is a good solution to this, as well as ensuring the reviews have some prominence, yet done subtly and with class.
Newsletter subscription with an entry voucher
A very common practice these days, integrating a free Email Marketing platform like Mailchimp with your website and a simple “subscribe to receive $10 off your first order voucher” offer is a good way to build your database and incentivise an initial purchase.
Product cross-sells & upsells
Upselling to a more expensive option with better features, or alternative products is a good way to educate customers about your range and ensure they pick a product that fits.
There are many ways these can work, but the goal here quite simply is to incentivise loyalty. It could be “for every $200 you spend, you get a $10 voucher” or a points system, or even something as simple as birthday vouchers.
Bulk ordering discount/sliding scale pricing
This may only be appropriate for consumables or similar products, but if there are genuine use-cases for multiple of the same product you can offer bulk discounts or pricing quantity thresholds – E.g. order 10 meals for the price of 8.
A referral program is an offer and incentive for your existing customers to invite people from their networks to also become customers. This could be a core focus for scaling quickly, by offering a “you get a [free product] or [discount] and so does the incoming referral”-type incentive.
Again, this may be more applicable for consumables, but simply encouraging and simplifying the ability to re-order the same as past orders is a good way to get repeat buyers. You might also configure email automation to softly re-sell to customers who have ordered after a certain timeframe.
Pretty self-explanatory, but simply offering gift cards as a product option is the first step. There is a whole marketing play you could make here, such as building a campaign around “gift buying for your friends or family”.
1-click ordering (or at the very least minimising the number of steps to purchase)
There is the cart/checkout simplification component to this and the payment gateways offered need to allow this. Google Pay/Apple Pay are good examples that we recommend offering on your store
Broaden payment gateway offering
In addition to the above, offering a range of popular payment gateways reduces friction. The lowest fee payment gateway may not be the best pick if your customers do not feel comfortable using it. Although this can also agitate customers, you can pass on the fees if that is a concern.
“Notify when back in stock”
For products that may be seasonal or rotating, you may offer to keep them visible on your store and give users the ability to sign up to a database (which is hugely valuable in and of itself) to be notified if/when it returns.
A live chat gives your customers the ability to ask questions that otherwise would simply be a barrier to purchase and see them go elsewhere. This is especially valuable for high-ticket purchases, where there may be a long sales cycle and a range of considerations at play. It does require someone who can operate the system, but for small businesses, this may be more than manageable. For larger businesses, if it does prove valuable it may be a team that warrants scaling to match the demand.
Simple shipping options
Shipping is actually a pretty large factor in conversion rates, in fact, 93% of online shoppers state that free shipping would encourage them to make more purchases online. It’s very easy to simply look at the cost of shipping, but what usually isn’t considered is the opportunity cost in lost sales due to complex or expensive shipping. This is something for you to weigh up and, product margins allowing, we recommend you look to reduce the number of options, offer simple flat rate shipping or even consider free shipping. You can set a free shipping threshold (e.g. orders over $100 get free shipping). The unfortunate reality is that so many big brands offer free shipping now, that it is almost an unfair expectation that all brands, even smaller businesses, should offer this.
If your products can be or already are affiliated with regulating or certification bodies (certified organic, vegan, Fairtrade etc.) that add credibility or goodwill to your products, then make sure you highlight this. It may also make sense to utilise a category system so people can search based on these and ensure they also appear prominently on the product page.
Product filtering & searching
Ensure that you have a robust and responsive product filtering & search experience. Try to “think like your customers” in how they would browse your products. This might be price, category, size or something else. Ensuring your customers have enough control over the search and filtering, particularly if you have a large range, will increase engagement and ultimately your bottom line.
A scarcity notice might flag when a product is in high demand or low on stock (e.g. “only a few left, order now to secure this product”). This creates a sense of urgency and a perception that the product is popular, and can be used legitimately or otherwise. We recommend that this is used cautiously so as not to feel cheap or fabricated.
A/B split Testing
A/B split testing is the process of creating two versions of the same thing and running them side by side to see which performs better. An app or plugin will randomly serve one version to 50% of your site visitors and the other to the remaining 50%. This could be two versions or a button, some copy, a feature or even pricing. In an ideal world, every major “improvement”, such as the items above, should be tested.
That about sums up our list for now. Ecommerce CRO tactics and recommendations are always changing and being added to. This is not an exhaustive list by any means but is a good reference point if you’re seriously considering how to improve your Ecommerce website’s conversion rate. If you’re interested in adding any of these features but don’t know where to start, we recommend reaching out to your website team. If all else fails, there is always us, and we’d be more than happy to help you out!