Apr 16, 2019

What is a Good Conversion Rate for E-commerce?

by Digital Marketing Institute

A website’s conversion rate illustrates how successfully a brand is able to use its online presence to transform traffic into revenue. When a conversion rate is low, it means that a business may be losing out on lucrative leads and prospective customers.

This is a nightmare situation for marketers, as it means that an e-commerce site simply isn’t performing as well as it should. However, a low conversion rate can be corrected, and the solution may actually be relatively simple.

In this article, we’ll delve deeper into what a good conversion rate is and how a site can be optimized to encourage visitors to stick around.

Conversion Actions on an E-commerce Site

Let’s start with a brief refresher. A conversion is any desired action taken by a visitor on a website.

Examples include signing up for a newsletter, downloading a guide, or making a purchase. The conversion rate is the percentage of visitors who perform one of these predefined actions.

For e-commerce sites, the most relevant conversions are usually signing up for a new account, adding items to a cart, saving products on a wishlist, and completing a purchase transaction.

The conversion rate is useful because it tells you how successful your website is at guiding visitors into and through the sales funnel. A high conversion rate demonstrates that your website is successfully convincing visitors to become leads or customers, while a low rate indicates that there is room for improvement.

The practice of crafting and finessing a website to bring about the highest possible number of leads or purchase transactions is known as conversion rate optimization. There are several techniques to try, which we’ll look at later.

Conversion Rates Across Sectors

Conversion Rates Across Sectors

Conversion rates on e-commerce sites can vary widely across different sectors. This is due to the nature of the industry, the immediacy of purchase requirements, and the value of transactions.

Using Littledata’s information combined with Econsultancy’s Performance Benchmarks tool’s results on e-commerce conversion, we can start to see some of the lowest performing sectors:

Low conversion rates: Home Furnishings (0.4%) and Home & Garden (0.6%)

When making decisions about products for the home, consumers tend to spend a substantial amount of time researching and comparing their options, particularly when purchasing a high-ticket item.

People shopping for home and garden products are also more likely to make a purchase in a bricks-and-mortar store. While they’re likely to perform initial research online, they often like to see it in person before making a commitment.

Think about the last time you purchased a sofa, for example. It might look perfect online, but you’ll only know for certain whether it’s the right investment once you’ve sat on it. The majority of people are unlikely to take a risk on such a high-value purchase, which explains the extremely low conversion rate.

Low conversion rates: Travel (0.7%) and Tourist Destinations (0.7%)

Again, travel and tourism website conversion rates are low due to consumer behavior.

In this sector, widespread research is commonplace. It’s rare that someone will make a booking on their first visit to a travel website.

Most travelers will perform price comparisons, check offers across different providers, and reach the final stage of the booking process without putting any money down – to check that the final price is within budget.

Plus, travel agents tend to make all of the arrangements for those choosing to holiday through a travel agency which means that fewer people are online ‘converting’ themselves.

But, there are sectors that are performing well, including:

Good conversion rates: Personal Finance (2.9%) and Finance (2.5%)

Good conversion rates: Personal Finance (2.9%) and Finance (2.5%)

E-commerce sites within the finance sector include those for banks, building societies, and insurance providers.

The latter is fairly unique, in that insurance providers tend to receive a substantial bulk of visits from people who have been referred by price comparison sites. These prospective customers are already warmed up to the product on offer and have largely made a purchasing decision before they even land at the provider’s site.

Meanwhile, banks benefit from the strong pull of customer loyalty. Whether born of trust, risk aversion, or simply convenience, consumers tend to stay with their existing bank rather than have a portfolio of accounts across several institutions.

The internet banking revolution has made it easier than ever for people to manage their money, but interacting with a single app or website will always be a more streamlined experience than switching between several just to pay the bills.

Good conversion rates: Food and Drink (2.4%) and Food (2.1%)

Good conversion rates: Food and Drink (2.4%) and Food (2.1%)

While online grocery shopping has been an established part of UK consumer behavior for more than a decade, it’s still in its infancy in the US market.

But, interest is growing, and research has shown that a whopping 75% of consumers stick with the first retailer they order from. This explains, in part, the high conversion rate of food and drink sites.

Another component is the explosion in popularity of ordering take out food online. In the UK, the sector for home delivery is growing at ten times the pace of the wider eating-out market.

Familiarity with a brand, as well as customer loyalty schemes, can be powerful pulls for consumers. Restaurant delivery sites and apps such as Postmates, Deliveroo, and Uber Eats have rapidly taken hold of the market, and by offering access to infinite restaurants under one umbrella, consumers are not bound by the same meal every time they want to order takeout. These services are therefore able to tap into the trend for exploring new cuisines, which helps to explain their conversion rate.

Unlike high-ticket items that are expected to last a long time, such as home furnishings, food and drink decisions are relatively inexpensive and transient, making them low risk.

Therefore, consumers are less inclined to shop around before making a decision – after all, one underwhelming meal is far less risky than an ugly sofa!

Conversion Rates Across Different Locations

Conversion Rates Across Different Locations

The global average e-commerce conversion rate falls between 1% and 4%. There is, however, a substantial disparity between countries.

While e-commerce sites in the United States hover around the global average with a rate of 1.4%, the United Kingdom has an average conversion rate of 1.8%.

In the Eurozone, Germany and the Netherlands, both have a conversion rate of 1.4%, France hits an average of 1.1%, while Italy lags behind at 0.99%. Meanwhile, the conversion rate leader in Asia is Vietnam, with an average of 1.3%, while Singapore comes in at 1.1%, and the Philippines at 0. 8%.

The reasons for this disparity are nuanced, and it’s difficult to draw conclusions without a thorough cross-analysis of each market. However, a clue lies in broader consumer behavior trends.

For example, mature markets with an established online brand presence tend to produce higher conversion rates, while a move away from bricks-and-mortar to online shopping will naturally increase the rate.

In the UK, for example, the prolonged decline of high street shopping, alongside a sustained rise in online retail, has seen off established brands that failed to make a convincing switch, in favor of new and legacy companies that have fully embraced digital selling. This provides some context for the UK’s slightly higher conversion rate.

How to Improve Conversion Rates for E-commerce

How to Improve Conversion Rates for E-commerce

The key to boosting conversion rates lies in optimizing an e-commerce site to prompt desired actions from visitors. There are several tactics to try, including:

Tailor to Your Ideal Customer

This might seem obvious, but a low conversion rate may be explained by a lack of website appeal. Always keep your target customer in mind when designing a website.

  • Is it easy for them to navigate?
  • Does it have a visual wow factor?
  • Is the checkout process straightforward?

Sometimes, simple tweaks to a site can make an enormous difference in its ability to convert visitors into leads or customers.

A Virtual Showroom

If you’re selling physical products, a couple of low-quality pictures and vague copy aren’t going to cut it.

Opt for high-quality images and video, alongside descriptions that provide pertinent and persuasive information. A good e-commerce site should showcase your products, not turn people away. Technology such as VR and 360 video can come in handy here.

Make Conversion Easy

Let’s say one of your website’s conversion metrics is the number of new account holders. It shouldn’t be difficult for visitors to speculate and open an account with you.

Utilize clear and direct CTAs, make the sign-up process simple, and include forms in intuitive places. If it’s laborious to make a conversion, visitors just won’t do it.

Don’t Overdo It

Whilst the conversion process should be quick and easy, don’t be heavy-handed with prompts.

It’s not necessary to have frequent pop-ups, several forms on the same page, or an aggressive pursuit strategy. Give visitors ample opportunity, but swerve away from being too pushy.

Show Off Rave Reviews

Trust is a key component of a consumer’s decision-making process.

Positive reviews and testimonials from existing customers can be incredibly persuasive, as they demonstrate that your brand is reliable. Give them pride of place on your website!


Conversion rates vary across sectors and countries, and these factors should be taken into account when deciding whether or not a rate is good.

It’s all relative, and there is always scope for improvement, and this is contingent on website optimization.

With some straightforward tweaks, an e-commerce site can rapidly improve its performance.

Learn how to optimize and improve an e-commerce site with a Professional Diploma in Search Marketing. Download a brochure today!

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