Digital Transformation

Average e-commerce conversion rates

By Hayden Sutherland |

December 28, 2012 | 5 min read

“What conversion rate I can expect?”

Is a question I hear a lot the days, as website owners try to understand more about the revenue potential of online retailing. But unfortunately it’s not as simple as quoting an arbitrary percentage figure in an effort to appease them… and “it depends” never cuts the mustard with a demanding client.

Before giving any figure, I think it is essential to get a common understanding of how conversion is measured. In principle it is the number of successful actions on a website (e.g. an e-commerce purchase) divided by the traffic to the site.

However, it worth knowing that there are two different figures that analytics packages give for those visiting eyeballs:

(Unique) Visitors

The number of people who come to your site, counting each person only once for the period you're measuring.

Visits

The number of times the site was accessed in a given time, regardless of whether visitors came once, twice or loads.

Usually the number of site visits you get will be greater than the number of visitors; this is because visitors (hopefully) come back once in a while.

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But sometimes these two figures can be considerably different, particularly if you have a popular site where content changes frequently and people return time and again. This obviously means that any conversion metric calculated from ‘visits’ will be lower (e.g. worse) than those derived from visitors. However to get consistency across the e-commerce industry, it is this lower figure of visits/goals that is typically used.

So now we all have the same definition, can we now give a specific figure? No!

Put quite simply, there really is no such thing as an ‘average’ conversion rate for all e-commerce sites. Furthermore, although there may be the temptation to quote average rates across specific vertical markets, in my opinion these figures are pretty meaningless too.

To see what I mean, take a look at http://index.fireclick.com. This is a site that compiles anonymous analytics information from participating sites. This data is even broken down by sectors, so you can compare yours (although some obvious and closely guarded ones are missing, such as Travel and Luxury Goods). This is probably one of the most useful conversion resources on the web, but what does it actually tell you about your own site?

Not a lot… as conversion rates depend upon a number of different factors, including:

  • Product (what you sell and the stock you actually have)
  • Price (what you sell your products for and what your discounting strategy is)
  • Promotion (how well you merchandise your products)
  • Usability (how easy your site is to search, navigate and ultimately transact with)
  • Imagery (how well your site conveys your brand and displays the products you sell)
  • Security (how well you convey and actually take steps to ensure the safety of customer data)
  • Content (how well the site text and imagery acquires customers and then informs & supports the sales process)
  • Optimisation (how effective you are at changing some or all of the above to improve your conversion metrics over time)
    • So before asking your supplier or consultant to give you a predicted rate of conversion for that new e-commerce site you’re planning… consider first of all how you can make it anything but average.

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