Customer experience may be one of the most important factors to your success in digital commerce, but there’s an inconvenient truth brands and sellers sometimes overlook: curiosity doesn’t always equal sales.
While it’s been estimated that 63 percent of global consumers begin their retail searches on Amazon, a recent survey from AI analytic firm Adeptmind indicates almost 60 percent of shoppers are increasingly frustrated with their search results, citing irrelevant outcomes as their chief concern.
What’s true for Amazon may be true for the entire eCommerce landscape. Precision and refinement may be positively vital in converting idle screen shoppers to loyal converts; but how do you improve your conversion rate if consumer habits seem to change daily?
Making Sense Of Your Conversion Rate
It’s common to define conversion rates solely by the percentage of customers who ultimately make a purchase. But while that percentage is a key performance metric, it’s a variable one by default. Seasonal fluctuations, demographic growth and expanding market potential can influence your conversion rate optimization (CRO) just as much as your quarterly or annual sales volume. Other KPIs influencing your affecting your CRO can include:
Promotional email signups.
Social media shares.
Average session duration and page depths.
The number of bounce rates vs return visitors.
Minimum advertised pricing advantage.
Promotional email signups.
Unfortunately, these are rarely predictable metrics at all. That’s largely because digital commerce is not necessarily predictable. Forecasting based on demand is impossible when you don’t know what that demand even looks like.
5 Key Factors Influencing Demand Forecasting
Previous sales history based on both category and individual SKUs.
Profit margins based on seasonal vs. year-round performance.
Average disposable income of your target audience.
Market saturation and retail channel competition.
National and global economic factors, including unemployment rates, job growth, GDP and widespread health crises.
Conversion Rates on Amazon
A survey conducted in May 2020 estimated the average global conversion rate was roughly 1.3 percent across all devices, further suggesting that any rate higher than 3.3 percent could land sellers in the top 20 percent of best performing listings. But as early as 2015, data compiled by Millward Brown Digital found that the average Amazon conversion rate was approximately 13 percent, reaching all the way up to 74 percent for Prime members.
Except what those numbers don’t tell you is that a high conversion rate is not the same as a successful product on Amazon. While a 60 percent conversion rate on Amazon might seem laudable, that figure becomes less impressive if you only receive ten visitors to your storefront in the course of a week—particularly if you’re ranking much lower in Amazon search results than your competitors.
There’s only so much that conversion rate data can provide. While conversion rates can give you an applicable and quantifiable measurement to work with, they don't address exactly why shifts in consumer trends occur so rapidly. They don’t measure the need for a marketing campaign which addresses consumers directly. And they don’t qualify your product’s innovation and product development. The most they can provide you with is a verifiable ratio of sales volume to spending.
But on Amazon, that counts for more than you might think. New sellers can frequently be dismayed to find that marketing solutions which proved profitable through other channels don’t always translate to the Amazon landscape. That’s because a customer-centric approach doesn’t just demand an entirely new suite of solutions. It demands an entirely new way of thinking.
Calculating Your Conversion Rates on Amazon
After logging in to Seller Central, navigate to Reports and click Business Reports.
On your Sales and Traffic Report, your conversion rate will be listed under Order Item Session Percentage.
Note that this row can only give you a rate based on all products currently listed. To obtain a rate for individual SKUs, choose the “by ASIN” option.
Tips on Improving Your Conversion Rates
Measure Intent, Not Impulse
When is a conversion not a convert?
When it fails to convert to customer loyalty. Despite recent reports of an 18 percent increase in impulse purchases during the coronavirus pandemic, the fact remains that impulse buys are frequently limited to a single purchase and are hardly a reliable barometer of your potential volume. They may affect your short term CRO, but they rarely provide a decent baseline worth measuring. Research shows that increasing customer retention by as little as five percent can increase profitability by as much as 25 percent. Shoppers want both diversity and personalization; and they’re willing to pay more for it. If you’re seeing an uptick in 1-click shopping on a single product during the holidays, that’s not necessarily an indicator of year-round sales performance. But if you’re seeing that same product line consistently gaining high duration visits in excess of two minutes, the purchasing intent of those visits are much higher. Compare your sales volume to your competitors, and see what advantages they’re providing over your own long term traffic.
Sell Your Benefits, Not Your Product
Long term traffic may signify high buying intent. But it also implies meeting an unfulfilled gap in customer needs.
The average consumer typically has up to 10 tabs open on their browser at any given time. But it’s not always because of quick access or easy distraction. If they’re in the process of product research, they’re likely in the middle of comparison shopping. They don’t have the time to read through lengthy descriptions. They’re interested in the facts, the whole facts and nothing but the facts. And they don’t just want to know how they fit into your brand narrative; they want to know what your brand narrative can do for them.
Constructing an effective keyword research strategy based on the benefits of your product isn’t always just a question of defining trends in your market but defining a solution—a solution which should be aligned with all aspects of your marketing, from your landing page to your Amazon presence. Consumers have more than enough clever slogans and enticing graphics at their disposal. But they need solutions more than they need window dressing.
And so do vendors.
Make It Easy on Your Customers
Conversions depend on customers, not on a distant science. The end result may be cold, hard data; but it’s cold, hard data which is driven by customer needs. And those needs can seem contradictory at times. Consumers demand diversity in content and purchasing options, but also demand a singular customer experience across all channels. Consumers may have begun shopping online out of convenience, but are willing to wait longer times if their purchase is something they can truly believe in. And above all, they demand choice and personalization.
Hard sell tactics are becoming virtually obsolete in marketing. Shoppers want credibility but they also want to be more than just a consumer; and one of the chief reasons for the success of eCommerce is the inherently democratic nature of a digital exchange. Make certain your campaign is rich in information, not hyperbole. Give consumers multiple payment options, including digital wallets and BNPL installments. Make certain your visuals reflect their lifestyles and needs, not an unrealistic ideal. Establish mutual trust, not a one way trade.
In short? Convert without converting.
Conversions: A Never Ending Story?
It’s no longer enough to capitalize on the right market with the right product at the right time in digital commerce. Whether it’s split testing or investing in PPC advertising, you need both quantifiable results and solutions for success—not wishful thinking.
But results and solutions change constantly. What was effective in 2018 may not necessarily meet the demands of a post-pandemic world. Priorities change and so does customer experience. And if you’re not careful, you may fail to adapt. Conversions aren’t a guarantee of success. But innovation and experience is.
And neither ever seem to sleep.
Color More Lines provides white glove, global account management of your eCommerce platforms so mission-driven companies can focus on new product development, branding and growth strategies. Find out more at Color More Lines.