Just in time for your Black Friday/Cyber Monday holiday campaigns, Shopify has just released its new conversion-rate calculator. Not only does this tool reveal the average conversion rate for your market and your business size, but it also provides valuable tips on improving those conversion rates, and saving money on ad spend, as you ramp up for this busy season.
What Is Shopify’s Conversion Calculator?
Shopify’s Conversion Calculator is an easy-to-use but powerful tool that combines data on the size of your business and your industry to give you benchmarks on what your ideal conversion rate should be, as well as suggestions for increasing your conversion rate.
With approximately 1.59 million websites using their platform, Shopify is in an extremely strong position to give you current stats about conversion rates in your industry, as well as provide recommendations on what will work best to improve your conversion rate.
How To Use the Conversion Calculator
Using Shopify’s Conversion Calculator is extremely easy. Simply go to the Conversion Calculator web page and enter the requested information. This includes the country you sell in most, your annual GMV (gross merchandise volume) and your industry. Industries include:
- Apparel and accessories
- Arts and entertainment
- Food and beverage
- Health and beauty
- Home and garden
- Sporting goods
With these details, the calculator will give you the average conversion rate for your market. For example, if you sell between $2 million and $5 million in electronics in the United States, your average online conversion rate would be 1.28%. If you sell apparel, with a GMV of $10 million, the average conversion rate would be 2.19%. Companies selling home and garden supplies in New Zealand with a GMV below $3 million have an average conversion rate of 1.32%.
Comparing Shopify’s Numbers to Your Own
To calculate the conversion rate for your own business, select any time period and divide the total number of conversions in that period by the number of visitors to your website. It’s important that you use this method so you are comparing the same numbers. Including retail sales or sales you made on Amazon, for example, will give you a different number.
Always keep in mind that every business is different. Your best conversion rate may be higher or lower than the average. As well, the size of your business and the length of time you have been in business will result in different conversion rates. A company that is just starting out will have a lower conversion rate than an established business that is relying on repeat sales from loyal customers.
Optimizing Conversions for 2021/2022
In addition to the average conversion rate, Shopify’s tool includes valuable tips and techniques for improving your conversion rate. Whether your current conversion rate is above average or below, these are some of the most important key takeaways for online businesses today.
AR/VR and 3D Images
Your choice in images has a huge impact on your product’s appeal to your customers. According to Shopify, the best investment in imagery you can make is to give your audience the best representation of your product as you can. Today, this means using augmented reality (AR), virtual reality (VR) or 3D images.
Why does this help? Just think about a purchase you have recently considered. If you want to buy new furniture for your home, AR or VR would allow you to see what that piece of furniture would look like in your own living room. If you like what you see, you’re more likely to take a leap on a big purchase.
Similarly, a 3D image gives you the ability to turn the image so you can view the product at different angles. If you’re buying a new outfit for example, a static image of the front gives you a very limited perspective, compared to being able to turn the image and inspect it from any angle.
According to Shopify, AR/VR and 3D images don’t only increase conversions, they also reduce the number of returns. In one case study, a Shopify store using 3D models of their products and AR-enabled images increased their cart conversion rate by 3% and order conversion rate by 40%, and reduced returns by 5%.
The second major factor in conversions is the speed of your website. Obviously, Shopify hopes that anyone concerned with site speed will be tempted to switch over to their platform. Nevertheless, site speed is deeply connected to conversion rates.
Just like in a store, if you have to wait around for someone to serve you, the odds increase every minute that you will leave and find what you need elsewhere. The distinction here is that website speeds are measured in seconds rather than minutes. How badly can a 2-second delay affect your conversions? Well, according to Cloudflare, conversion rates can slide substantially:
- 2.4 seconds: 1.9% conversion rate
- 3.3 seconds: 1.5%
- 4.2 seconds: less than 1%
- 5.7 seconds: less than 0.6%
Another cause of low conversion rates is a complicated checkout process. Imagine going to a grocery store and being asked to solve a CAPTCHA test, register with the store, provide proof of identification and then manually enter your credit card number in a terminal before being allowed to pay for your purchase. If this were the case, abandoned checkouts would be just as common in brick-and-mortar stores as they are on websites.
Keep the transaction process as easy as possible for your customers. If you do have a Shopify store, Shopify recommends you take a look at their Shop Pay option, which can securely save customers’ credit card data and other personal information so they can complete the checkout process as fast as possible.
Even if you don’t use Shopify, you can keep the checkout process easy by allowing customers to enter their payment info without registering for an account with your store.
Flexible Payment Options
Hand-in-hand with an easy checkout process is the fourth item on Shopify’s list of conversion enhancers: flexible payments. US Shopify store owners have the ability to let customers buy items today and pay for them in installments over time using its Shop Pay service. According to Shopify, this can double conversion rates for shoppers using mobile phones.
Not only is this convenient and takes the stress off of shoppers during the holiday rush, it can even save them money, depending on the payment plans, compared to credit-card interest rates — which average 17.14% annually.
Again, you don’t need a Shopify account to capitalize on this idea. Square, Affirm, Klarna, Sezzle, ZIP and a growing list of companies are now offering these services to online store owners.
Flexible Shipping Options
Amazon continues to raise the bar when it comes to shipping options for consumers. From free shipping and next-day delivery, they now offer same-day delivery for many products throughout the United States.
Unless your products are available on Amazon and stocked by Amazon, same-day delivery isn’t likely a viable option for your store. However, this doesn’t mean you can’t compete on shipping. Consider offering a variety of shipping options at different price points for your customers to select from.
Shopify recommends using free shipping as a promotional device, with expedited shipping for those who don’t mind paying extra to get their hands on your products ASAP. Shopify also recommends you consider:
- Flat-rate shipping. Customers aren’t penalized for living in remote regions. This is ideal for small packages or for product lines with similar weights and parcel sizes.
- Overnight shipping. This has the same appeal as same-day shipping without the extra cost to the vendor. Most carriers in the United States offer this as an option, with overnight shipping available for the next business day.
- Expedited shipping. Offer this as a premium option for customers who don’t mind paying more to get a product fast. Keep in mind that in 2021, most consumers expect the standard to be 3.3 days on average, so your expedited option needs to be faster than that.
- Two-day shipping. Nearly as good as expedited shipping, this is a term you can use if you’re willing to pay the extra cost. Consumers love two-day shipping but resist paying for it. In fact, 29% will abandon a purchase if they discover two-day shipping isn’t free.
There Is Always Room for Improvement
Whether you use Shopify as your eCommerce platform, BigCommerce or WooCommerce, there are always ways to improve your conversion rates and keep excelling in your digital business. The expert consultants at Hawke Media have helped thousands of companies lower their marketing costs and improve their conversion rates. To find out what Hawke Media can do for you, get in touch. Your first consultation is free of charge.