Understand what the e-commerce conversion rate is and learn how to estimate it

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In the digital age, especially for online businesses, those who can undertake competitively are those who know how to use information to their advantage.

Data-driven management is a strategy for defining and tracking metrics that identify strengths and weaknesses that must be worked on to continue growing.

The e-commerce conversion rate is a very important example of this: knowing and calculating this metric gives those who invest in their own online store all the clues they need to figure out how to sell more and build customer loyalty. Learn all about this indicator below!

What is e-commerce conversion rate?
While crucial to the success of an online store, conversion rate is a relatively simple metric. It’s the percentage of total leads (people who are interested and engaged with your brand in some way) who make it through the entire journey from discovery and consideration to completing a purchase .

In traditional retail, it is often a calculation made from the thailand mobile phone number relationship between how many people entered the store and how many actually purchased something.

The most commonly used e-commerce conversion rate follows the same idea: the percentage of visitors to the store's website who became customers. However, in the digital environment, this metric can expand significantly.

The conversion rate can take into account, for example, the number of conversions within the total engagements in a social media promotion, or how many people served by WhatsApp purchased from you.

In other words, the indicator can be used to investigate various issues related to the performance of the online store .

How to calculate the conversion rate?
In any of these cases where you want to analyze your performance, the calculation is the same. You will only need three elements:

total number of visitors/leads;
total number of conversions;
period of time to be investigated.
With these values ​​defined, the calculation to be made is: (total conversions ÷ total visitors/leads) × 100 .

To illustrate, let's assume you had 200 visits in a week and managed to make 5 sales. The calculation is: (5 ÷ 200) × 100 = 2.5 . In other words, in one week, your conversion rate was 2.5%.

What is the ideal percentage for e-commerce?
There is no ideal conversion rate to consider an e-commerce successful, since other indicators such as average ticket , profit margin and loyalty greatly influence its sustainability as a business.

An important point to be made is that many people imagine before starting a business that they will achieve 50, 60% conversions and set up their plan accordingly. This type of percentage is unrealistic even for the most famous and sought-after companies.

The average conversion rate for e-commerce is between 1% and 2% , and most businesses, when successful, fall within this range. When you achieve great success and a very well-targeted campaign, you can reach values ​​such as 3% and 4% , already impressive results that guarantee the growth of a digital business.

So, work within these limits, but don’t limit yourself to them. As we said, there are other e-commerce metrics that help you get a complete picture of your business.

How important is it to monitor this metric?
Conversion rate can be considered the pillar indicator of growth for online retail. But did you know that it wasn't like that before?

When the ways to promote a brand were more limited locally and in large media outlets, retailers relied more on quantity than on the profile of the audience they reached. There was a consensus that greater reach was the only way to increase sales.

With the internet, this vision has changed a lot. As communication channels are more democratic, niche and decentralized, an online store can put the accuracy of the message ahead of its reach.

The higher this rate, the more convincing your campaign and products are . It is a more efficient way of advertising, where you spend less to convert more.

That's why this metric is so discussed in the online retail sector. Working to improve your conversion rate means working to grow sustainably and with a closer relationship with your audience .

What can you measure with the conversion rate?
In addition to being a general indicator of e-commerce success, monitoring this metric can provide clues about points to be addressed in various aspects of your management. See what can be inferred and worked on by monitoring this KPI:

User experience within your e-commerce
When your store is attracting a lot of visitors but they’re not even close to converting, this could point to user experience issues: slow website, confusing navigation, little information, etc.

Efficiency in Marketing Campaigns
Inbound campaigns aim to not only bring in more visitors, but also those who are more likely to buy one or more of your products. If your conversion rate is increasing, it means you are targeting the right people with your message .

Possible conversion bottlenecks
In addition to a poor overall user experience , the conversion rate can be combined with other indicators such as cart abandonment rate and website exit pages to understand if there is any bottleneck or obstacle hindering the purchasing process.

This is usually due to insufficient information about the product, very long registration forms or even a lack of reliability in your payment system.