What is Conversion in Ecommerce?

In ecommerce, a conversion happens when a visitor to your website completes an action you want them to take. The most important conversion is a purchase, but stores also track smaller actions, such as signing up for a newsletter, adding a product to the basket or creating an account. Your conversion rate shows how well your site turns visitors into customers.

How to calculate conversion rate

Conversion rate = (number of conversions ÷ number of sessions) × 100

For example, if your store had 10,000 sessions last month and 200 orders, your conversion rate was 2%.

Conversion rates vary widely by industry, product price, traffic source and device. A store selling low-cost consumables to returning customers will usually convert better than one selling expensive furniture to first-time visitors. The most useful comparison is your own performance over time, and between your own channels, devices and pages.

Macro and micro conversions

• Macro conversions are the main goals: completed purchases, and for some businesses, quote requests or subscription sign-ups.
• Micro conversions are smaller steps that show progress: product views, add to basket, starting checkout, email sign-ups and account creation.

Tracking both helps you see exactly where shoppers drop out of the journey.

Why conversion rate matters

Improving conversion makes every other part of your marketing more efficient. If you double your conversion rate, you get twice as many sales from the same traffic, without spending more on advertising. It also lowers your cost to acquire each customer, which gives you room to compete in more expensive channels.

What affects conversion rate

• Traffic quality: visitors searching for exactly what you sell convert better than casual browsers.
• Site speed: slow pages, especially on mobile, lose shoppers.
• Product pages: clear information, good images and reviews reduce doubt.
• Price and value: including how delivery costs are presented.
• Trust: secure checkout, clear policies, contact details and reviews.
• Checkout: the number of steps, forced account creation and available payment methods.
• Delivery and returns: fast, affordable delivery and easy returns reassure buyers.

How to improve conversion

1. Measure the funnel. Set up ecommerce tracking so you can see where shoppers drop out. See Analytics & Reporting Tools.
2. Fix the biggest leak first. Focus on the step with the largest drop-off.
3. Improve product pages. Better images, descriptions, sizing information and reviews. See Product Photography & Imaging.
4. Simplify checkout. Guest checkout, wallets, address lookup and clear costs. See Payment Processing Solutions.
5. Answer questions quickly. Use live chat and clear FAQs. See Live Chat Solutions.
6. Recover abandoned baskets. Automated emails and SMS bring shoppers back. See Email & SMS Marketing.
7. Test changes. Run A/B tests where you have enough traffic, and keep changes that improve results.

Conversion is one part of the picture

A high conversion rate is only valuable if sales are profitable. Watch conversion alongside average order value, customer acquisition cost, return rate and repeat purchases. For a wider view of growing revenue, read How to Increase Ecommerce Sales.