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Definitive Guide: eCommerce Conversion Rate Optimization

This series has been moved to its own page. 

You can find it at

Conversion is important.

Today we begin a new series on how eCommerce stores can optimize conversions on their site.

We're going to dissect key pages from the most successful sites of 2018, including home, category, product, and checkout pages.

This guide will equip you with the exact tactics and strategies top eCommerce stores are using today, and how you can replicate their success.

Why Every eCommerce Store (including you) Should Care about CRO

You know conversion is important.

Unfortunately, there is a wide gulf between knowing you should do something - and actually doing it.  To get to action, you need to be both intellectually and emotionally convinced that it is worth the time and investment.

The good news is that conversion optimization will always matter and always pay off in the long run.

Here are just a few reasons why.

1. Directly Multiply Profits

First, and most clearly, multiplying your conversion rate will directly impact your revenue and profits.

What is less obvious is how conversion rates have a disproportionate effect on your profits.

This is due to the way your costs are structured. Your business incurs fixed costs everyday, regardless of what your sales are. But, every incremental sale only incurs the variable cost of the product being sold.

Let's assume your store pays $100,000 in payroll and facilities a year, and currently creates $120,000 in revenue. 

Your store currently converts at 1%, with an average purchase price of $100, and an average profit of $50. 

Doubling your conversion rate to 2% would

Increase your revenues from $120,000 to $240,000 (2x).

Increase your profits from $20,000 to $80,000 (4x)

In other words, doubling your conversion rate (revenues) does not double your costs. Because of this, when you double your conversion rate, you'll double your revenue and more than double your profits.

2. Lower your Cost per Acquisition

Second, when you increase your conversion rate, you are also lowering your cost per acquisition. 

While this is another obvious point, the implications are tremendous. Spending less on your variable cost of business means you generate more profit per sale.

This is great by itself, but the real power comes in what you can do with that extra net margin - specifically unlocking additional channels of lead generation.

3. Add Channels for Lead Generation

Advertising is getting more expensive.

It's actually kinda scary.

MarketingDrive reported in February of 2018 that Facebook ads cost a whopping 43% more on average. 

The cost to reach audiences in Facebook is expected to continue to rise, with the company tightening inventory and increased competition. 

The trend is real across marketing channels.

As the image above shows, over the course of a single year, most categories in Amazon's sponsored product listings increased by healthy double digits - with Electronics increasing 89% year over year.

However, companies with higher conversion rates are at a distinct advantage when bidding against other companies.

The added margin you have allows you to profitably outbid your competitors, converting still more customers, and on in a virtuous cycle.

4. Increase Affiliate Benefits and Pay

Similarly, your ability to partner with affiliates grow in lock-step to your ability to convert traffic.

Affiliate partnerships through Instagram influencers, Youtube, Snapchat, and even Twitch continue to drive attention and massive sales.

In 2016, a study was released showing that the average ROI from these campaigns were 11x that of display advertising.

However, currently the major way influencers and affiliates are compensated is based on their reach. It is up to you, as a store, to convert that traffic.

Increasing your conversion rate not only makes influencer marketing possible, it allows you to invest in your relationships and reward affiliates with higher than average benefits.

Sneak Peak: Next Week's Example

Next week, we're going to analyze one of the biggest eCommerce success stories of 2018 -, looking at how they optimize eCommerce conversions starting with their homepage.

Next Steps

Ultimately, conversion optimization is about presenting the right offer to the right customer in a compelling, relevant way.

To speak to your prospects at an individual, 1:1 level, you need to leverage personalization techniques.

  • Understand eCommerce Personalization  - Check out this post full of detailed eCommerce personalization examples.
  • Understand Personalization Challenges - We built a complete guide detailing the 4 major personalization challenges, and what questions to ask your personalization vendor here.

Finally, to see how Barilliance helps hundreds of eCommerce stores increase conversion rates, you should request a demo here.

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