Tim from Great Ocean Road Torquay sent me a summary today of his online conversion rate.
It may sound obvious, but being able to measure your conversion rate is a critical first step to improving it. So many businesses online don’t know what their conversion rate is yet.
In our discussion, I pointed Tim to this article from eMarketer: Few Convert at Retail E-Commerce Sites
This text that goes with the chart is brief and to the point:
Many shop. Few buy. Online merchants convert an average of 2%-3% of their site visitors into buyers, according to the e-tailing group‘s “Sixth Annual Merchant Survey.”
Do you know your conversion rate? Is it better than the average for eCommerce sites?
Overall, I think beating the average is tough.
Tim and I discussed the relative merits of focussing on conversion. I think conversion is very important, but its not the only factor.
Profit. How much profit do you make from each conversion? Time spent increasing the profit from each conversion could benefit you more than increasing the conversion rate.
Product Diversity. If you already have a customer base, can you create additional streams of income? Adding a new income stream may be more effective than increasing the size of an existing one.
Geographic Diversity. Similar to product diversity, can you create a new stream of income by increasing your focus on a particular geography? I can’t fully explain why, but every time we create a more specific country based campaign in Google AdWords, more click throughs appear. So can you create a new income stream from a new country (if your product or service suits that model), or increase it from a small stream to a larger one?
Conversion is important, but it is only a contributor to overall profit.