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E-Commerce Conversion Rates
Definition
A conversion rate is a way of measuring the effectiveness of a sales technique.
Sales professionals refer to many different types of conversion rates, such as a sales conversion rate which is the number of sales divided by the total number of prospects contacted during a given period.
Other popular conversion rates are:
- Lead conversion rate: number of sales divided by the total number of leads during a given period.
- Up-sell conversion rate: the number of existing customers to whom you up-sell additional services divided by the total number of existing customers.
- Referral conversion rate: the number of sales divided by the number of referrals each of your customers gives you.
Thus, an e-commerce conversion rate is the number of online sales divided by the total number of visitors to your site.
More simply, it's the percentage of visitors who actually purchase something as a result of the site having ecommerce capabilities.
Average E-commerce Conversion Rates
According to a fairly extensive Intermarket Group (http://www.intermarketgroup.com) report from this past summer, the average conversion rate of online window shoppers into buyers is now around 2.7%. Intermarket found that 62% of current online merchants have a conversion rate 2% or less, 33% have a conversion rate of between 2% and 6%, while a slim 5% report conversion rates of 6% or higher.
The study found that only 32% of Internet users have made a purchase online, but that 64% have used the Net to research a purchase later concluded offline.
The main issues preventing higher conversion rates were:
- pricing(77% of users)
- potential problems with returns (67% of users)
- concern about credit card security (65% of users)
- personal privacy issues (58% of users)
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