Using the conversion rates to measure whether an e-commerce is profitable is simply wrong. E-retailers that have an extremely high number of visitors can have a small conversion rate and still make money on their e-commerce. E-retailers with few visitors and high conversion rate can also be profitable.

Misconception number 1

E-traders measure conversion rate by divided the visitors with orders while the visitor´s goal with his or her visit does not need to be a purchase. It can be anything from obtaining information about a particular product to whether the e-retailer has a physical store nearby.

Tips

Find out which goals your visitors have when they visit your e-commerce site.
Measure conversion rate on your visitors’ goals with their visit.
Make changes so that more visitors meet their goals and find ways so that the visitors’ goals are in line with your goals for your e-commerce site.

Misconception number 2

Although the average conversion rate for e-commerce sites is around 2% does not mean that your e-commerce site is great because you to have a 7% conversion rate. What conversion rate your e-commerce site has is due to thousands of factors, from which industry the company operates, what image the company has, the e-commerce site structure, your value proposition and right down to which color and design the buy button has.

Tips

You cannot draw any conclusions by just looking at the conversion ratio. This number needs to be put in context in order for you to come to some form of insight. It can be done by comparing the conversion rate over time, with a competitor, on a given campaign, for a given product or for different segments.

Misconception number 3

The conversion rate is not an instrument to measure or produce changes in an e-commerce. Of course the conversion rate can be used in a follow-up but then as a superior ratio.

Tips

Break down the site into micro conversions. A micro conversion can be an event or activity that a visitor can make on e-commerce site. It may be to add a product to the cart, enlarge the product picture, rate or write a review on a product and so on. What you then need to do is create the connection between these micro-conversions, which ultimately leads to the final conversion rate. This allows you to identify activities in your e-commerce site and testing different versions of a page and features.