The Most Important eCommerce Success Metric
We work so hard to bring visitors to a site but sadly for eCommerce professionals, we don’t celebrate traffic, we celebrate orders. The relationship of orders or transactions to sessions and visits is the conversion rate. The best sites consistently see something above 2% but all sites struggle to convert more than a small percentage of site visitors.
Start by calculating your overall site conversion rate and then identify products that are dragging down that overall rate. You can’t really blame any site-wide features for these products, but you can assume that this product has an issue (price, incomplete description, lack of reviews, not enough images). Compare this product to other products that convert well to look for clues about how to improve.
Track conversion rate by product category and look for changes. A significant increase in conversion rate (especially over a short period of time) suggests that your competitors are losing ground. You will want to understand why. Generally speaking, after seeing an increase in conversion rate across a category is a good time to consider raising the price for products in that category.
Alternatively, what happens if the conversion rate falls all of a sudden? It’s a sign to look beyond your site and understand the customer’s alternatives. In all likelihood a competitor has taken a pricing action and it’s time to consider reducing the price for the category in response.