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Why Conversion Optimization is Key to Ecommerce Success

Stable, long-term ecommerce success occurs when you focus on a customer-centric testing and optimization process.

Ecommerce success isn’t optional for most companies. For many, it’s the entire ball of wax. If website sales or lead generation activities don’t provide a healthy return on investment, the rest of the ship is in trouble.

I’ve seen companies struggle for years, trying one thing after another to jumpstart a failing ecommerce site – running from one guru to another, one workshop to another, one flavor of the month idea to another – getting a bump in sales now and then, but not finding an avenue to stable growth.

If that’s you, let’s put an end to it today.

To be successful, your ecommerce site must help your prospects and returning customers achieve their goals (note that I said achieve THEIR goals, not YOUR goals), and conversion rate optimization (CRO) is the key to making that happen.

To be successful, your ecommerce site must help your prospects and returning customers achieve their goals Share on X

Getting anchored in the basics of CRO is an essential pathway to leadership in your niche and to learning how to run a successful ecommerce business for the long haul.

Setting up and maintaining a high-performing ecommerce website isn’t easy. There are plenty of bases to cover. To make it even tougher, you get slammed with emails, advertisements, social media messages, and phone calls by people promising to solve all your problems with one convenient solution.

Don’t fall for that: There is no magic bullet for ecommerce. But there is a key.

In this article, I’ll cover the fundamentals of conversion rate optimization and why CRO is vital to your business. Then, I’ll give you a CRO roadmap to help you make sure your team is either on the right track presently or knows what the track looks like and where to find it.

So, what is conversion rate optimization?

Conversion rate optimization is the process of leveraging data collected on your website to inform iterative website structural improvements using A/B testing and other CRO tools.

The CRO process first looks at the current path to sales you’ve set out for your ecommerce website visitors. That initial analysis (the landing page assessment provided by The Good is an example) identifies points like these:

  • Key areas for performance improvement
  • Potential roadblocks to success
  • Opportunities to grow revenue on your ecommerce site
  • How you can unlock those opportunities

Here’s why conversion rate optimization is the key to ecommerce success:

Conversions occur when your website visitors take the next step along your path to sales. Micro-conversions (making a size or color selection, for instance) lead to macro-conversions (like purchasing an item or opting into an email campaign).

In other words, conversions lead to sales, and sales revenue fuels a thriving business.

How does conversion optimization lead to ecommerce success?

Conversions are the lifestream of ecommerce. If you want to survive in business, conversions on your site must be consistent and plentiful.

Conversion rate optimization makes sure that happens.

An ecommerce site is a bit like a race car. You may be able to get from start to finish with a clunker that’s blowing smoke, sputtering, and burning enough gasoline to fuel a dozen cars in good repair – but you’re not going to win any races and nobody is going to be impressed by your performance.

CRO is having competent mechanics diagnose the problems, clean out the fuel system, replace faulty parts, and get you back in the running. CRO is key to a high-performance ecommerce website experience.

Conversion optimization is key to a high-performance ecommerce website experience. Share on X

How does conversion rate optimization work?

Here’s a short list of the benefits you can expect. Conversion rate optimization can:

  • Help improve the customer experience (CX), making it easier for visitors to navigate your ecommerce website and accomplish their goals. Better CX is a catalyst for cost per acquisition (CPA), meaning you’ll get more results for the same outlay.
  • Provide critical information about your visitors and their desires. It can help you separate the wheat from the chaff and make changes hyper-targeted to your best prospects.
  • Reduce the risk of design changes that could negatively impact sales. Rather than make major changes to your site, then hope they boost sales – CRO makes incremental, proven improvements that definitely increase revenue.
  • Benchmark your key ecommerce KPIs, look for ways to improve those KPI’s, and then monitor changes.
  • Positively impact the business metrics smart executives pay attention to. Much of marketing (social media marketing, for instance) is super-difficult to track. It’s tough to tell how much impact your marketing dollars are having. With CRO, the return on investment is simple to calculate and easy to prove.
  • Lead to overall business improvements that can provide a competitive advantage in your niche. It can give you the edge you need to excel.
  • Help move your return on investment in the right direction. Relatively small bumps in your conversion rate can translate into big wins for ROI and your return on ad spend (ROAS). Get an eye-opening look at how an increased conversion rate can impact your website here: ROI Calculator.
ecommerce success
In this example (see the screenshot above), bumping the conversion rate from two percent to six percent grew monthly revenue from $600K to almost $2M.

The CRO getting started roadmap

  • Embrace data. The amount of information the typical ecommerce vice president or marketing manager can access today is astounding. The data flood can be mind-boggling without the right filters in place. It’s a tough proposition to face for many old-school marketing professionals, but data is your friend. Use it to inform and mold your decisions.
  • Define your revenue goals and nail down your key performance indicators. You don’t need to track and measure everything, but you do need to keep a watchful eye on some things. Before you begin investing time and money in CRO, make sure you know which KPIs are most meaningful to your business, then establish baselines for them.
  • Begin by finding the sticking points on your customer journey. Look closely where visitors are entering your website (and it’s not always via your homepage), what they do when they get there, and where they are when they leave. At The Good, we use a comprehensive conversion audit to understand what’s standing in the way of conversions and how to open up those bottlenecks.

Find Ecommerce Success with an Optimized Website

Search your data for insights on behavior and develop hypotheses about how to improve that behavior with website copy and design changes.

Conversion rate optimization isn’t a luxury, and it isn’t a “Wait until we have the budget” option. CRO (done properly) will jumpstart sales, boost ROI, and give you an edge on the competition.

CRO (done properly) will jumpstart sales, boost ROI, and give you an edge on the competition. Share on X

If you need help launching your CRO work – or you’re seeking deeper insight than your current CRO efforts are providing – call The Good.

We can help you shine.

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About the Author

David Hoos

David Hoos is the former Director of Marketing at The Good and a trusted advisor to marketing experts.