What is considered a “good” ecommerce conversion rate? Is yours good enough? And, perhaps more importantly, do you even know what yours is?
But wait, what is a conversion? Well, in a nutshell, it’s a potential customer who buys! Aka, a sale. In the old-school example of brick and mortar stores, a person who came into a store but didn’t buy anything was sometimes called a “tire-kicker.” For example, an art dealer in Los Angeles complained that his neighborhood was mobbed by tourists, and remarked that if they had a $2 bill for every tire-kicker, they wouldn’t have to worry.
Let’s back up again and make sure we understand what a conversion rate is. Using the example of, say, an eBay seller, a sales conversion rate would be defined as the number of a given seller’s sales transactions divided by the number of their total listing page views.
So a conversion rate is about how many people actually see your products vs. actually buy them.
One report of an average conversion rate for Internet-based commerce is 2%. Another statistic, updated in 2020, and based on 15 studies that were mostly published over the last 5 years, is that an average ecommerce conversion rate is 2.63%.
However, some sellers find this standard percentage statistic too vague. That’s because there are many factors that can go into a conversion rate. One ecommerce business owner and consultant, Jon Warren, says, “What I consider a good conversion rate will depend on what I’m selling and the market I’m selling it in. “I’ve worked on stores selling $3000+ items where a good conversion rate is 0.5%. I’ve also worked on sites that sell $40 products where I would be disappointed if the conversion rate was less than 5%,” he added.
He also says another major consideration is where your traffic comes from.
Warren says that generally, a good conversion rate for paid traffic is going to be higher than a good conversion rate for organic traffic, as you need a higher conversion rate to support the cost of paid traffic. (This is not surprising, of course, that paid ads/promoted listings, etc., will usually bump up your conversions. With my eBay items, I’ve actually come to view a “promoted listing” as a necessity in order to make many of my products get the views they need). Similarly, another online entrepreneur, Jon Shyman of A Great Name For A Website, says, “It’s an interesting question of what makes a good conversion rate. Different products have different margins, so I wouldn’t say it’s a question you can answer in a vacuum.”
But whatever your type of product, knowing your own actual conversion rate is an important piece of data to have, so you can know what you need to tweak or implement to drive up sales. You may even want to consider different products, re-stockable products, or a tangential line of products, if the data leads you there.
If you have a standalone website, and not an eBay store (or not just an eBay store), there are various ways to get this information, along with other BigCommerce accounting data. Some sellers use Google Analytics but if you need more BigCommerce reports you may need to look elsewhere for other tools.
As one online entrepreneur, Deanna Thompson, who has owned two luxury resale companies, and is the co-founder of MarqueMentor, explains, “between Google Analytics and WordPress, you can easily track everything from demographics, time spent on your website, products viewed and more.” Other solutions are optimised for certain platforms, such as PayHelm for BigCommerce. With PayHelm you can analyze your BigCommerce customers groups, product categories, and know account for your fees, sales, profits, and shipping cost.