Conversion rate in e-commerce – how to increase it?

What is the conversion rate in e-commerce? How to increase it and get better results from your marketing efforts? Perhaps the most accurate and professional indicator to determine the effectiveness and profitability of marketing activities is the conversion rate. How can it be harnessed to optimize the strategy used to reach customers? What is the conversion rate? And how to start exploiting its potential?

Conversion rate in e-commerce. Table of contents:

1. Conversion rate in e-commerce – what is it?
2. How to calculate conversion rate in e-commerce?
3. What conversion rate is good?
4. Conversion rate optimization: can you effectively improve conversions?
5. Summary

Conversion rate in e-commerce – what is it?

What is a conversion?

To discuss the topic of conversion rate in more detail, let’s first discuss what a conversion is. By definition, a conversion is a customer interaction with an ad or product information (e.g. clicking on a link, watching video content), followed by an action that the advertiser cares about – an online purchase, making a voice call or leaving their contact information (e.g. registering on the site, or signing up for a newsletter).

Where does the conversion rate come from?

Conversion rate is nothing more than the number of conversions divided by the number of total interactions with an ad at the same time.

For example, a 5% conversion rate means that for every 1000 interactions, 50 people will perform an action that the advertiser cares about.

Why is conversion rate in e-commerce important?

It is an important parameter because the vast majority of advertising campaigns and affiliate programs pay for the number of conversions – i.e. the number of clicks, views of the advertising material, or other types of interaction.

Tracking the conversion rate allows you to assess whether the expenditures on marketing activities bring the expected results and whether it is worth continuing with the chosen strategy. This will make your advertising decisions more accurate and productive.

How to calculate conversion rate in e-commerce?

While terms like conversion or conversion rate may sound complicated, it’s not particularly difficult to calculate – especially if you get a bit of practice at it. Bearing in mind how important this factor is for getting the most out of the money you invest in marketing, it pays off calculating it regularly.

What does that mean in practice?

What conversion rate is good?

It depends on many variables. When it comes to conversion rate in e-commerce, much depends on the industry in which you operate, the source of your orders, as well as the location of the market in which you operate. Thus, the most effective are the ads placed on affiliate sites, thematic blogs, and discussion forums – here, according to some data, the rate can be even almost 5.5%. Technical and substantive sources recommending your products are therefore very well received by customers.

Conversion rate in e-mail marketing

The results achieved by email marketing are slightly lower, although the difference is not significant – some studies indicate a range between 5 and 5.5%. The most common way to reach customers is through newsletters or by using the database of existing contractors.

Conversion rate achieved with organic traffic

Classical acquisition of customers through the so-called organic traffic, i.e. through the presence in search results, is not one of the most effective ways to achieve high conversions. In this case, sources speak about the conversion rate oscillating around 2%, which is not an impressive result. In addition, you have to wait for the results for a long time and the competition can be really huge.

Conversion rate in social media

The lowest conversion rates occur in the case of social media and oscillate between 0.7 and 1.7%. Undoubtedly, the best results are achieved by Facebook, which is both the largest and the most expensive of all possible social media.

Conversion rate optimization: can you effectively improve conversions?

Obviously, not only does the source of interaction influence conversion – it is possible to optimize its rate. It’s worth thinking about such aspects as functionality, graphic design or the content included on the website – if it’s easy to use and the website looks attractive, the chances of completing a visit exactly according to our plan increase significantly. That is why it is so important to constantly monitor the conversion and track the effects of all actions taken and changes made.

Ways to improve conversions rate in e-commerce include:

• posting comprehensive and interesting product descriptions,
• expanding the range of payments accepted,
• constant analysis of the market and customer demand,
• A/B testing,
• keyword selection,
• customer-tailored call to action.

Summary

The conversion rate is a very effective way to calculate whether the resources spent on advertising bring the expected results.

Its calculation allows you to compare available sources of acquired interactions and, taking into account the price of each of them, choose the optimal solution.

High conversion means high profitability of your shop or company website. So it is definitely worth paying attention to this issue.

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