Six keys to online conversion
A study from Shopify and Boston Consulting Group (BCG), “Leading Online Shoppers to the Finish Line,” points to the keys to converting online shoppers into buyers.
The study is based on analysis of more than 220,000 e-commerce sites and more than 1 billion data points, the researchers say, and it highlights six key areas of online conversion optimization that retailers can directly influence:
• Traffic sources. Analysis from Shopify and BCG indicates that organic channels such as word-of-mouth or social media recommendations are more effective than paid channels in overall conversion rate, particularly for smaller retailers.
• Basket building. Carts that contain more than five to 10 items tend to yield higher conversion, according to the study. The conversion rate can increase by as much as 63% when a customer who initially puts just one or two units in the cart continues to shop and ends up with more than 10 items.
• Checkout Experience. Automatically filling known or easily predictable information (such as a shipping address or credit card information) can increase the conversion rate. According to the study's research, 99% of stores enable autofill when it is available. In addition, to prevent customers from leaving mid-checkout, the retailer can move them directly from the product detail page to the checkout flow, increasing the number of checkouts that get started by upward of 18%.
• Payments. The analysis found that in North America, the use of accelerated digital payment methods such as Meta Pay, Amazon Pay, PayPal, Shop Pay, Apple Pay, and Google Pay can increase lower funnel conversion rates. The study found that offering these six methods, rather than a checkout experience that lacks any accelerated digital payment method, can increase lower funnel conversion rates by more than 50%.
Similarly, a buy now, pay later (BNPL) option can increase both traffic and sales for e-commerce sites with higher revenues and average order values. Data suggests that this option boosts traffic for sites whose average order value exceeds $50, while sites with $1 million or more in revenue are likely to see spending increases.
• Customization. Websites with front-end customization—such as a simplified user experience, obvious gateways to specific products, and an uncluttered product page—tend to achieve higher conversion rates than those with back-end customization only, according to study results.
The study also found that loyalty incentives are the most effective customizations across sites of all sizes. The analysis indicated that stores with average order values below $200 can see a lift of 4% to 6% on their conversion rate by implementing a loyalty program. Although customization has less impact on the smallest e-commerce sites, it produces a notable lift in lower funnel conversion for stores with revenues of $10 million or more.
• Performance. Counting from the moment the checkout experience begins, the conversion rate increases significantly if customers can complete the full checkout process in less than 90 seconds. If the process takes longer, the lower funnel conversion rate may decrease by around 47% on average.
"Conversion is at the heart of commerce and is the center of everything we do at Shopify," said Harley Finkelstein, president of Shopify. "The study reveals drivers like an optimized checkout experience, the use of accelerated payment methods, and selection of relevant customizations have a dramatic impact on conversion."
