Global retail ecommerce revenue grew at a compound annual growth rate (CAGR) of 24.8% in 2017 to reach $2.304 trillion, according to figures from eMarketer. The analysis determined that 58.9% of sales came through mobile devices, underscoring the increasing importance of mcommerce to online efforts.
Overall retail sales increased at a significantly slower rate, 5.8%, to hit $22.640 trillion. Globally during 2017, ecommerce represented 10.2% of all retail – a rise from 8.6% of the total in 2016. Sales from mobile hit $1.357 trillion in 2017, up an incredible 40.3% over 2016 and accounting for 6.0% of all retail sales.
As ecommerce continues to grow and become an ever-more-impactful area of the economy, each individual company looks for ways to expand its own online sales. This report explores a study on key performance indicators and statistics that provide insight into ecommerce conversion rate and revenue. It then reviews a few specific strategies to increase your site’s conversion rate.
Benchmark KPI analysis of ecommerce
The 2017 E-Commerce Benchmark KPI Study from Wolfgang Digital is one of the most prominent sources of information to analytically review the effectiveness of your online sales presence. The study uses more than half a billion dollars ($531 million) in Internet revenue and 143 million website visits to create its benchmarks for a quantifiable understanding of ecommerce strategies. It helps people grasp the aspects of analytics that are most critical for growth.
Three of the most interesting insights from this study are related to mobile vs. desktop, stickiness, and average website conversion rate:
- Desktop is still dominant. Mobile was at 52% of ecommerce sessions in 2017, followed by desktop and tablets at 36% and 12% respectively. While mobile may generate more traffic, desktop sessions still accounted for 61% of all revenue, with 20% more per order and a 164% higher conversion rate than mobile.
- The greatest correlation of all data collected by the researchers was the 0.6 correlation between time on the site and conversion. Conversion rate increased 10% when 16% more time was spent on a site.
- Need a bar against which you can measure your site? The average conversion rate for all sites, according to the voluminous data set used for this study, was 1.6%.
9 ways to improve your conversion rate
Many of these ideas are from a piece by Douglas Karr for marketing technology conference MarTech. Others are from communications executives at organizations that either benefit from strong ecommerce or are charged with helping clients do the same.
#1 – Create a simple shopping experience.
Directions that you can go with your ecommerce presence are abundant, and the complexity of the challenge can make it easy to forget how important it is to remove any unhelpful complexity from the user experience, noted William Topaz of Anxiety.org. The visitor should feel that your site is easy and that they do not need to figure anything out. Topaz’s perspective is that site visitors should immediately be able to see the most fundamental content and call-to-action elements. Ensure that all information you collect from the customer is essential. Focus on clarity and clearing up any potential confusion the buyer might have, said Topaz, who added, “Most importantly – always be testing. Always!”
#2 – Bolster your social media.
Improving your social media will lead to higher conversion rates and stronger sales. That may sound counterintuitive if your sales are all through your site. Social is key because the vast majority of online shoppers (84%) will look over at least one of your social media profiles before they buy, per Karr.
#3 – Let people speak with people.
Many people like to be able to get what they need and be done with it, noted Holly Chessman of Glance Networks. Still, when users try to decide between different products, are unable to locate a certain item, or are otherwise in need of help, access to a person is essential. You can facilitate better support of your shoppers through co-browsing, phone, and chat, said Chessman, thus introducing broader and more personalized options for help than what might be provided otherwise. In this way, you can “[h]umanize your company, make customers happy and solve problems in one fell swoop,” said Chessman.
#4 – Display ratings and reviews.
It should be your goal for customers to get from your site whatever they might otherwise leave to obtain. A key example is product ratings and reviews. Keep people on your site by providing this information.
The importance of these elements is indicated by FreeLogoServices CEO Craig Bloem, who noted the following stats in Inc.:
- Nearly everyone, 91% of people, read reviews either on occasion or consistently when shopping online.
- Most people, 68%, determine the product they want by looking over just 1 to 6 reviews.
- The vast majority of online shoppers, 84%, say that they give more weight to reviews than to recommendations from friends.
#5 – Make sure that your product images captivate.
The photographs of your products that are presented on your site will help you present a sense of its quality to potential buyers, noted Lin Grosman of GoDataFeed. It will also better establish a sense of trust. Imagery should be complex and diverse, said Grosman, with images that intrigue, shots from various angles, and a zoom feature.
#6 – Move away from guesswork.
In order to get a better sense of how to improve your sales, you must determine how your product meets the needs of your target customer, explained Seth Waite of RevUnit. Understanding what they want and molding your site to reflect their expectations will boost conversion. Multivariate and split testing will help you systematically collect data on customer preferences, said Waite, who added that “[a]ssumptions about user experience can be the biggest conversion killers.”
#7 – Focus on your return policy.
Return policies are critical to ecommerce success. The 2017 UPS Pulse of the Online Shopper report found that nearly 4 in 5 consumers (79%) prioritize free shipping on returns when they decide where to buy. Returns are not all bad, though, as another statistic indicated: almost half of shoppers (44%) said that they made an additional purchase once the return had been processed.
#8 – Be careful with shipping fees.
The average abandonment rate for ecommerce shopping carts is 69.23%, per a study from the Baymard Institute. The top reason people leave a cart behind is because of unexpected extra charges, with Baymard finding that 61% of would-be shoppers leave behind carts because they are scared away by shipping, taxes, or other fees. A different study, from Barilliance, supports the critical nature of shipping costs as well, finding that unexpected shipping charges were the #1 reason people leave their shopping carts.
#9 – Improve your speed.
Finally, Karr stressed the need for speed on a site, saying that conversion will fare horribly in the context of latency. This comment is backed up by a high-profile study that showed nearly half of consumers expect a load time of no more than 2 seconds. Failing to meet that expectation could mean that a potential customer is gone forever.
High performance for better conversion
As seen above, there are many different ways in which you can improve your site’s conversion rate. Related to the final point on speed, probably the most critical element of site speed is the infrastructure that backs your site. At Total Server Solutions, we know what it takes to keep busy sites running fast. See our high performance web hosting for ecommerce.