Conversion Rate: Why is it important ?

Retail conversion rate is the percentage of people who visit your brick-and-mortar store and leave with a purchased product.?

Retail metrics like revenue per store and total foot traffic might be high on your priority list when determining the success of each store. However, retail conversion rate is one of the most important KPIs for telling you how successful your store is.?

What does conversion rate mean in retail?

Retail conversion rate refers to the percentage of people who convert in-store.?

It’s often confused with ecommerce conversion rate, which is the percentage of people who visit your ecommerce store and purchase.?

Online conversion rates tend to be lower (around 2.86%), because it’s easier for people to window shop. Potential customers can start and finish their shopping experience in a matter of seconds. Just one annoying pop-up is enough to drive people to close their browser.?

In-store shoppers, however, have a more hands-on experience. Because customers can speak to store associates, touch items, and see products they’re thinking of buying in the flesh, brick-and-mortar stores claim?78% of all impulse buys.?

It also means in-store shoppers are likely to spend more during their shopping session: 71% of in-store shoppers will?spend more than 50 €, compared to just 54% online.?

How to calculate retail conversion rate

Number of sales / total number of visitors x 100 = conversion rate

(Remember that the number of sales differs from the number of individual items sold per transaction. Retail conversion rate calculates the percentage of people who’ve converted.)

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What is the average conversion rate for retailers?

Why is store conversion rate important?

Conversion rate is one of the most accurate indicators of retail store performance because it doesn’t fluctuate massively day to day.?

A festival happening around the corner from your store might bring 20,000 € in retail sales that day. Is that sustainable? Probably not—you won’t increase sales to meet that benchmark consistently. Using that as your goal sets you up for failure.?

Retail conversion rates are less affected by dramatic variables. It’s a KPI to help understand how the in-store experience you give to shoppers influences their decision to buy—regardless of how big your sample size is.?

In the next Article, I’ll share some tips about improving your conversion Rate.

S. Casimir

Source: Shopify