Practical Ecommerce

Dollars per visitor more important than conversion rate

Conversion optimization has been discussed in ecommerce circles since, well, the dawn of ecommerce. Improving conversions can have a major impact on revenue. Making small tweaks to your website — such as changing the add-to-cart button or moving elements on your product page — seems enticing, especially if they can increase conversions by 50 percent. Since the vast majority of visitors do not buy anything, there is a lot of room for growth.

While I agree that usability changes to a website can have an impact, we should all remember that shoppers are intelligent, if not always rational. They are attempting to solve a problem that we provide a solution for, hopefully. All conversion optimization efforts should therefore start with the customer in mind, not an arbitrary testing of elements and colors.

Our methodology at OverstockArt.com is simple but effective. I will share it in this article.

5 steps to grow revenue per visitor

  • We start with a goal. This is true for everything that we do. Our overall goal at OverstockArt.com is established: Increase revenue by increasing dollars per visitor, not the conversion rate. This is a more significant measurement as it directly relates to profitability, while the close ratio may not.
  • Our next step is to monitor customer behavior on our site. We use three separate tools for this. The first is visitor recordings, which allow us to see specifically how shoppers are using, or misusing, the site. This has prompted many small alterations that help shoppers with a more intuitive navigation.

The second tool we use is simply Google Analytics. It provides aggregate data of what is happening in our site.

The third tool is much less technological and exciting, but just as important: feedback from our customer service representatives. They speak directly to shoppers and can hear the pain, or excitement. We have a formal monthly meeting for receiving this feedback and reinforcing our commitment to customers.

  • Our third step, after monitoring customer behavior, is to create a hypothesis based on the data or other ideas of what will help us achieve our goal of increasing sales per visitor. This hypothesis typically involves removing an obstacle or improving the navigational experience. Some changes are small, simple, and obvious. We don’t bother with a formalized hypothesis for those. Other changes are more involved.
  • Our forth step is to evaluate the cost or effort of creating the change and compare it with the expected benefit. If it’s a major undertaking, we might start with a simple, lower investment or by asking customers to see if there is an interest before we make the change.
  • Our fifth step is to measure the performance. Our measurement looks at the entire system, not just the specific change. For example, if we change an element on the product page, we don’t just measure if visitors use the element. We also measure dollars per visitor, to see if there was in increase. If there was no increase, the change is not working. We measure the output. That is true for every system in our business.

Every ecommerce business is different. But the need for converting visitors into buyers is universal. For OverstockArt.com, we start the process by identifying with our customers. What will truly help them? If you start by asking these questions, conversion increases will flow naturally.

How do you improve conversions on your ecommerce site? Please share your experiences, in the comments.

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  1. Carlos Rivera May 12, 2016 Reply

    Great example of how the scientific method can be applied in controlled ways into eCommerce. I really enjoyed your approach and explanation. Very helpful and sage advice. Thank you!

    • David Sasson May 19, 2016 Reply

      Carlos thanks for the nice comment. We like to find the simple solutions that do not require a very large investment but create positive results.