It’s not a secret that as an online store owner or marketer, you’ve put a lot of work just to build and launch your e-commerce business.
From brainstorming what to sell, designing, and setting up your website, to how to source your products and advertise them, you have done a great deal of work.
But are those enough to actually convert your traffic into sales ?
Buzzkill alert—It’s a NO. 👀
The digital marketing world is incredibly competitive, and conversions won’t come to your door unless you optimize for it. You also need to make sure your business is growing.
So, what is an online store conversion rate?
E-commerce conversion rate is a KPI metric defined by the percentage of visitors on your website that completes the desired action successfully, which is buying, in a set period of time.
Note that this metric is not the only one that you should keep track of for your e-commerce website. An e-commerce conversion can be:
If you are looking for an answer to “what is a good conversion rate for e-commerce, and how does yours compare?” Let’s find out.
An average conversion rate of 2%+ is considered to be a good e-commerce conversion rate, although it varies depending on the industry.
To calculate your e-commerce conversion rates, divide the number of conversions you get in a given time frame by the total number of visitors and multiply it by 100%.
Conversion rate = (conversions / total visitors) X 100%
For example, if your e-commerce store is getting 5,000 visitors and 50 conversions in a certain time frame, then your conversion rate is 1%.
Just as simple as that!
Here’s how Google Analytics defines e-commerce conversion rate:
"The ratio of transactions to sessions, expressed as a percentage. For example, a ratio of one transaction to every ten sessions would be expressed as an Ecommerce Conversion Rate of 10%".
Average e-commerce conversion rates fall around 2% to 4%.
By investing time and money in e-commerce conversion rate optimization tactics, you can expect to see conversion rates as high as 3% to 4%.
A report by Statista shows conversion rates of online shoppers worldwide as of 3rd quarter 2020.
IRP Commerce provides valuable data about e-commerce conversion rate benchmarks by industry in 2021. As you can see from the graph below, “Arts & Crafts” leads the way with a conversion rate of 3.06%, while the “Baby & Child” category remains the lowest with a 0.39% conversion rate.
When measuring specific KPIs like conversion rate and comparing yours to industry averages, benchmarks for specific devices (smartphone, tablet, and desktop) are also worth considering.
The Kibo eCommerce Quarterly provides a valuable source on e-commerce conversion benchmarks segmented by devices. As you will see from the graph below, conversion rates are significantly higher for large-screen devices, namely desktop and tablet, than for mobile.
E-commerce conversion rates significantly increased across all devices in the US, considering the changes from 2020 to 2021.
We know that online shoppers are growingly inclined towards smartphones and tablets to make an online purchase. Therefore, as an e-commerce business owner, it’s vital to know which conversion benchmarks you should be aiming for on a smartphone.
According to the same report from Kibo E-commerce, the average order value by device has increased by 22% in the US since Q1 2021.
You know what that means—top-performing online retailers have their websites perfectly optimized for mobile.
For higher conversions on mobile, we recommend you start optimizing your conversion rates:
Apart from the device-only point of view, conversion rates on mobile vary based on the operating systems. iOS users (2.5%) have slightly higher conversion rates than Android users (2.3%).
From the overall perspective, mobile users seem to be less likely to buy since the benchmarks show that conversion rates are the lowest for mobile devices.
The comScore Mobile Hierarchy report sheds some useful light on the “whys” of this, which online retailers can use to understand and improve their customer experience on mobile:
Formulating a country-specific KPI can prove insightful when segmenting your customer base to assess e-commerce conversion rate benchmarks.
You must consider that conversion rates can highly differ based on country. For example, the conversion rate you’d expect from the Netherlands would be very different from that of the US.
This difference stem from many factors, including:
In the table above, Germany leads with the highest e-commerce conversion rate of 2.22% while Italy has the lowest with 0.99%.
Keeping up with the latest country-wise conversion rates, stats, and trends serves your business well, helping you understand how your business compares.
Besides country-specific and industry-wise conversion rates, segregating conversions based on the channel or source is also vital. E-commerce conversion rates by traffic source can help you set channel-specific goals while giving you a hint on which channel performs the best.
As you can see from the graph above, recent e-commerce conversion rates are highest through referral and organic traffic with 5.44% and 3.0%, while social media lags with 1.0%.
Referral traffic is driven from external sites that link to your store. This can be an expert post recommending one of your products or a comment on a blog post. If the traffic source is highly relevant, people often come with strong purchase intent. This is why the average Referral Conversion Rate performs so well. – Florian Schulze
Free shipping offers are one of the most powerful drivers impacting customers’ buying decisions. According to a study, 24% of consumers would spend more to qualify for free shipping.
Offering your customers a free shipping option not only helps boost the conversion rate but also gives you a potential advantage over your competitors. You may increase your product prices to clever for the cost of free shipping if needed.
Think about it. The only way people can see the product they purchase online is through images and videos.
They simply can’t touch it or put it on.
That’s why the least you, as an online retailer, can do is to upload detailed and high-quality product images and videos while considering your website speed as well.
Recent cart abandonment stats show that the average cart abandonment rate is 69.80%, and that’s a lot!
If you are getting a high amount of cart abandonment, meaning adding a product to the cart but leaving without completing the purchase, then you should start planning out a strategy.
What can you do to win back cart abandoners or convince them to buy before they leave?
Use exit popups
You can create a free exit popup with Popupsmart, a no code popup builder, which detects users’ intent to leave and shows your win-back offer.
Get Started With Popupsmart Today!
Create a follow-up email sequence
What you use in your email copy matters, but what’s even more critical to driving high open rates is to craft converting cart abandonment email subject lines.
18% of online consumers abandon their shopping carts because of a long and complicated checkout process.
Keep the forms clean and easy to fill in and get rid of unnecessary ones. Showing the image of the item in their cart while checking out is also a great tactic to keep prospects engaged.
In short, make sure to provide a smooth and easy-to-follow checkout experience for users.
Consumers LOVE coupons. In fact, statistics show that over 90% of all consumers have used coupons in some way.
The most used methods to offer coupon codes to customers are through popups and emails. However, test if your coupon codes are actually working because broken coupon codes are one of the reasons consumers abandon their carts.
Finding your way up to the top in the world of e-commerce is difficult and complex. Dozens of e-commerce benchmarks and studies get published every year. Which one should you compare yourself to, and which one should you just ignore?
I believe it’s best to rely on a handful of well-researched studies based on different aspects and metrics relevant to your KPIs.
Also, keep in mind that benchmarks are there for helping you understand your own performance better and shape your goals and conversion rate optimization strategy around it.
We have mainly tried to answer “what is a good e-commerce conversion rate,” and the answer is a conversion rate higher than 2%.
How does yours compare? Leave us a comment below.