Many companies within e-commerce work with conversion rate optimization, and view conversion rates as a key performance indicator: a way of analysing their website’s success through the percentage of shoppers who make it from browsing online catalogues to reaching the checkout. But what do they really tell us about an online retailer’s success and about the customer experience?
When we talk about conversion rates in e-commerce we usually refer to the percentage of shoppers who have successfully completed a purchase and actually parted with their cash at the checkout. Other examples might include the number of people who have added items to their cart, signed up to a newsletter or social media page, or who have created an online account with the company. The conversion rate is usually used as a positive measure of how well a business is performing; the higher the better. However, as with any performance indicator, conversion rate figures can be manipulated to mislead and create false impressions of how well a company is performing. If the only goal is improving conversion rates this can be achieved, either knowingly or unwittingly, through bad practices, short-cuts and manipulations which can harmfully affect the long-term success of the company.
Bad short cuts to healthy numbers
In an attempt to plump up their conversion rates and make online sales appear healthier, many companies fall into the trap of taking short cuts at the expense of the customer experience. While they may look good on paper, so-called ‘bad’ conversion rates are often the result of two types of trickery: forced conversions and conversions made by hiding information from shoppers.
Forced conversion means that a business “forces” the customer to do something, such as creating an account to finalise a purchase, or sign up for the company’s e-mail updates in order to access a downloadable document. While the customer may complete the transaction, or download the document, the short-term boost in conversion rate says nothing about the long-term value for the business, since the customer is less likely to return or recommend the business to their peers. This goes against building long-term relationships with customers, to encourage repeat purchases, loyal customers and even brand ambassadors. Therefore, forced conversion with no value for the customer, can negatively impact how your company is perceived.
Another bad practice of conversion rate, is hiding key information from shoppers, which cultivates the impression that a company is less than trustworthy and reliable. Deliberately concealing shipping fees, taxes or other additional costs until a customer has reached the till is one of the most underhand short cuts a company can take. While they might have been lured in by the bargain price they first saw on-screen, customers will inevitably be deeply put off to find the price shoot up once they reach the checkout. This can lead to cart abandonment and, worse still, negative reviews and a loss of potential new customers.
Care about the customer experience
If conversion rates are to genuinely reflect how well a company is doing, as a business, you need to look beyond the numbers to the consumer experience. Online retailers won’t keep customers who feel they have been unfairly treated whilst shopping online – whether that’s frustrating them with compulsory accounts and newsletters, or tricking them to the till with less than honest pricing. Underhand tactics and short-cuts might boost the conversion figures in the short-run, but word quickly spreads and brands can be broken by negative online reviews and social media posts.
To build and maintain a sustainable customer base, any business that operates in e-commerce needs to examine how it can create the optimal shopping experience for customers. And one of the most important ways in which that can be achieved is through simplifying the checkout processes and making them more enjoyable and user-friendly. Improvements to online checkouts not only ensure that shoppers leave a site with a more favourable impression of a company and brand, but reduce the risk of cart abandonment and ensure that long-term conversion rates are sustainable and meaningful.
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