"I'd love to see this chart republished and segmented by industry."
by Daniel Burstein, Director of Editorial Content
We are currently fielding our latest marketer survey, so we thought this would be the perfect time to share published data from a previous survey — the MarketingSherpa Ecommerce Benchmark Study. Below is one of the most popular charts from the study, where we explore ecommerce conversion rates broken down by product type based on responses from 2,885 marketers.
In the MarketingSherpa Ecommerce Benchmark Study survey, we asked:
Q. What is your average conversion rate for ecommerce sales (%)?
We also asked:
Q. Which product categories does your organization sell through ecommerce? (Select all that apply)
Below is the chart of responses from 2,885 marketers to these questions. Keep reading for analysis of the data, and feel free to comment with your own analysis as well.
What is the best way to compete with the mega retailers like Amazon and Walmart?
Some business strategists have suggested going niche — focus very narrowly on a specific product type and better serve that audience.
While that may work in some instances, the above data suggests there could be flaws in that strategy. We found that the average conversion rate for companies selling only one product was 16.3%, while those selling multiple product categories had a higher conversion rate at 17.2%.
This wasn't the case for all product categories, so there could still be opportunities to have a successful niche-focused value proposition — if you choose the product category wisely.
These six product categories had average conversion rates exceeding the multiple category group:
It should be noted that three product categories had insufficient responses for analysis and were not included in the above chart.
You should not view the above conversion rate data in a vacuum. To see the data in context, it helps to download the free MarketingSherpa Ecommerce Benchmark Study, made possible by a research grant from Magento, an eBay company.
You must understand that the above data shows averages, which have been skewed up due to some responses that were much higher than average. You can gain an understanding of the distribution of conversion rate responses by reading previous MarketingSherpa Charts of the Week:
The entire point of tracking conversion rates should be to identify opportunities for improvement.
While this Chart of the Week focuses on conversion rates by product type, you will get the most value from your conversion rate data if you segment it in a way that illuminates these opportunities.
This will vary by company, but here are a few examples to get you thinking on which view of conversion rates will help you improve performance.
Which channels overperform and underperform the investment your company makes in them?
Where in the buyer's journey are customers dropping off and how can you increase conversion in that stage?
How can you better focus on the needs of specific customer segments to increase conversion? Which customer segments are you currently targeting aren't really ideal prospects?
Stop investing resources on these areas, and focus on the customers you can best serve.
As one Benchmark Study survey respondent replied:
"We segment our customer base on the basis of end use of the product. We have several product categories, and hence, market products specific to their end-use customers."
Take the 2015 MarketingSherpa Marketing Practices Survey and get the first look at consumer purchase preference data.
To prepare for MarketingSherpa Summit 2016, we just completed a survey about marketing, online shopping and brand relationships with 2,021 American consumers. Customers told us what they think about social media, email and other topics, and now we want to see what you think. In your experience, why do customers connect with brands on social media? What are their preferred ways of receiving updates and promotions?
Take 15 minutes to complete the 2015 MarketingSherpa Marketing Practices Survey and answer questions like these. At the end of the survey you'll receive a free pre-release copy of the August 2015 MarketingSherpa Consumer Purchase Preference Survey to see how your responses match to what consumers say they want.
As a bonus, one marketers who completes the Benchmark Survey will win a free, three-day ticket to MarketingSherpa Summit 2016 at the Bellagio in Las Vegas , February 22-24 or an iPad Air 2. The deadline is September 28.
In response to a reader question, Dr. Diana Sindicich, Director of Market Intelligence, MECLABS, explains the above data.
In this survey we had some respondents list conversion rates all the way across the spectrum from 0-100% (Figure 1). Although it is hard to believe that a site would have 100% conversion, it is theoretically possible if the only people who arrived at the site were those who already wanted to convert. We did not allow respondents to select impossible responses (like 125% or text), restricting responses to numbers between 0% and 100%. The bulk of responses were below 10%, with a median of 5%.
Looking at a stem and leaf plot, we see that the mean was very low, as would be expected (Figure 2). The 363 responses above 47% were outliers (N=4,346).
The second point brought up in the reader's question was to provide statistics for those companies not engaging in optimization testing, which is an interesting idea. One of our questions did address what percent of marketing budget was spent on conversion optimization, so we can split out that group (Figure 3).
As a logical extension of this, we now ask the question: Does percent of budget spent on conversion optimization have a consistent impact on CR overall? The percent of marketing budget question had significantly fewer responses than CR, so keep in mind that the number of responses falling into each of the categories below is lower than what we would like. The results in Figure 4 don’t show a direct trend; CR doesn’t increase proportionately to the increase in spend on conversion optimization. There are probably other variables in play that have a direct influence on baseline CR, possibly including the type(s) of products being sold, industry, B2C/B2B, company size, etc. Unfortunately we do not have enough responses on percent spent on conversion optimization to examine the interactions between how that variable and others impact conversion rates.
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Get the first look at consumer purchase preference data — Take 15 minutes to complete the 2015 MarketingSherpa Practices Survey, and get a free pre-release copy of the August 2015 MarketingSherpa Consumer Purchase Preference Survey plus a chance to win a free, three-day ticket to MarketingSherpa Summit 2016 in Las Vegas or an iPad Air 2. The deadline is September 28.
MarketingSherpa Ecommerce Benchmark Study — Made possible by a research grant from Magento, an eBay company
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Ecommerce Research Chart: How can companies increase conversion rates? [Video]
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