Five per cent conversion: success or 95 per cent failure?

Posted: Friday 23rd September 2011 in Retail Strategy, Thought Leadership.

Multi-variate testing to measure different conversion rates

Many retailers would be pleased with a conversion rate of 5 per cent and ecstatic with ten. However, that means 90-95 per cent of consumers leave your site without making a purchase.

Large retailers spend millions of pounds each year on marketing. But how much of that do you spend on converting those customers who come through your virtual door?

The truth is, not enough.

“A business is only as good as its employees” is a sentiment I agree with. However, in this context, you can translate it into: “Your marketing is only as good as your website”.

If you can shift your conversion rate from 5 per cent to 6 per cent, you increase your revenue by 20 per cent – and open up the opportunity to turn on marketing activity that previously would not have performed.

But don’t make assumptions about what’s correct, test everything. On-site MVT is a very cost-effective way of identifying what works best and quantifying the performance improvement against your KPIs. What’s more, there are many testing techniques for content and/or functionality that you can apply before publishing on your site, giving you an understanding of how things will perform.

Understanding how consumers behave on your website is paramount to shifting that conversion point. You need to be monitoring your site, identifying the hurdles and stop points. However, you should do it in conjunction with an agile development roadmap – and make sure you align a portion of the development budget and time to improving conversion.