What is Conversion in Retail? And How to Boost It!
When it comes to retail, the question of what is conversion in retail can mean a lot of things. For some business owners, it might refer to the number of sales made. But for others, it could be about the number of customers who come into the store and make a purchase. Personally, I think of conversion as something that happens when a customer is persuaded to buy something they may not have otherwise considered.
In other words, it’s about turning browsers into buyers! And while there are lots of different ways to boost conversions in your business – from improving your store layout to offering incentives – one thing remains true: understanding what is conversion in retail is essential if you want to succeed.
What is conversion in retail?
In retail sales, the conversion process turns shoppers into buyers. Customer conversion rates are often measured as a percentage that compares the two.
In the world of retail sales, conversion is the percentage of customers who make a purchase. This measurement is important because it tells retailers how well their processes are working.
How to Calculate Retail Conversion Rate
Here’s the conversion rate formula for your brick and mortar store:
Number of sales / total number of store visitors x 100 = conversion rate
So, if one person purchased five individual items, you’d still use one as the number of sales. ). To calculate a store’s retail conversion rate, divide the number of sales by the number of shoppers and multiply by 100. This will give you the percentage of people who made a purchase during their visit.
Lets say you have one customer who buys five items. Even though they bought five items, you would still say they made one purchase.
If you made 75 sales on a single day when 500 people visited the store, your retail conversion rate would be 15%.
75 (number of sales) / 500 (total number of store visitors) x 100 = 15% (conversion rate)
The Sales by Location Report in Shopify allows you to view your sales numbers by specific locations.
To see the number of orders each of your retail stores had for the day, go to Reports > Sales > Order Summary.
The average conversion rate for retailers?
On average, 20-40% of customers convert into sales. This is the benchmark you should compare your conversion rates to.
Of course, your customer conversion rates can vary depending on different factors. For example, if you’re running a 24-hour flash sale, you may see an increase in conversions.
If your sales associate is absent, you are likely to see a decrease in the sales conversion rate.
To accurately measure your conversion rates, you should calculate the rate over longer periods of time – such as a week, a month, or a quarter. This will provide you with a more accurate picture of how your rates change over time.
Conversion Rate – Make More Informed Business Decisions
Your conversion rate is the percentage of people who visit your retail store who make a purchase.
Test out different changes against your baseline. Then, see which change influences customers the most to purchase.
To figure out your average conversion, take the total number of sales and divide it by the total amount of customers. This will tell you your baseline. Then, test your layout, products, and discount strategy to see which ones lead to more purchases. You could, for example, try out a “grid” format where you group related products together. Or, you could offer a 15% or 20% discount on certain merchandise.
Key Performance Indicators (KPIs) for Retailers
Key Performance Indicators (KPI) are retail metrics that measure how well a store is doing. These should be set for each store and should be reviewed regularly.
If you fall below your KPI, it’s an indication that you need to put in some extra work.
The conversion rate is a more accurate indicator of retail store performance than other KPIs because it doesn’t fluctuate as much day to day.
For instance, the number of customers that visit your store on a given day can vary greatly depending on the day of the week and any special events going on in town.
If your store is close to a festival, it’s likely that you’ll see a surge in sales on the day of the festival. However, this increase in sales is not likely to be sustainable, so don’t expect to see the same results every day.
If failure is what you want, then setting that as the goal will help you achieve it.
The conversion rate of retail locations is the most accurate indicator for overall performance because it isn’t as susceptible to drastic fluctuations. This metric helps you understand how the customer experience impacts a shoppers’ decision to make a purchase, regardless of the sample population.
Gap’s Staffing Study Boosts In-Store Sales
A store’s conversion rate is greatly affected by the in-store customer experience.
The quality of service provided by a retail store’s employees has a significant impact on the store’s overall sales. The sales staff plays an essential role in providing a positive shopping customer experience.
Before the experiment, the retail store’s employees had confusing and varying work schedules.
When GAP implemented a weekly schedule, it saw 7% more sales and 5% more productivity.
9 million people were affected.
Store Layout and Conversions
No matter the size of your store, the layout and flow of your retail location will impact your conversion rate.
What do you think is the best way to pair a t-shirt with other items? Would this increase the average value of an order?
But for the people who enter the store just to browse, walking from rack to rack and looking for them can be annoying.
The layout of your store plays a big role in how many customers buy from you. In the wake of the COVID-19 pandemic, social distancing has become more important to shoppers. Sixty-two percent of consumers say that they feel more comfortable shopping in a store that practices social distancing. This is good news for your bottom line.
That will definitely have a positive impact on your business.
Visual Merchandising – Achieve Higher Conversion Rates
Did you know, on average, that 3 out of 10 customers will buy something they didn’t intend to buy while shopping? This is why it’s important to make sure your products are being displayed in the best possible manner.
Trying out different lighting and arrangement techniques, as well as using models, can help you increase your conversion rate.
Shopify POS – Inventory Management
But you don’t want to run out of products and disappoint customers. stocking up on products so that you don’t run out and disappointing customers are the two biggest challenges when it comes to inventory management for brick-and-mortar stores.
You don’t want to have website visitors come to your site and not be able to sell to them.
Every business needs a way to keep track of their inventory, and Shopify POS provides that functionality. By being able to see how many items are available in each location, you can more easily keep track of your stock levels.
If your stock levels are running low, set up an alert to restock.
This way, you’ll never turn away a customer because they don’t have the product in their size, or the color they wanted.
Checkout Process and Options
Nearly all shoppers (97%) have abandoned a purchase because it was inconvenient, according to data from the National Retail Federation.
The overwhelming majority of customers will abandon their purchases if there are too many obstacles at the point-of-sale. This includes long queue times, no self-checkout options, and having to spell your email address out in order to receive a receipt.
It’s really annoying when retail stores try to sell me unsolicited emails after I make a purchase. It’s obvious that they’re not doing it for my convenience, but simply to get leads.
Increasing Your Retail Conversion Rate
Want to increase conversions in your retail store? Here are a few things you can try. First, offer a local pick-up option so customers can avoid the shipping cost. Second, provide both ship-to-home and buy-in-store options. Third, leverage shopping carts so shoppers can come back at their convenience. Fourth, train and incentivize your sales team to provide the best customer service possible. Fifth, use scanning and checkout technologies to make checking out faster. Sixth, offer free product samples so customers are enticed to buy. Seventh, highlight your positive reviews and customer testimonials.
BOPIS – How to Increase Retail Conversion Rate
Not all customers will walk into your physical store. Attractive retail signs and attractive storefront windows can entice people to walk in.
Some customers prefer to shop in a store, rather than online, because it is more convenient for you.
Online shopping is very convenient because customers can order or reserve an item and then pick it up at a local store. This eliminates the need to pay for shipping or wait at home for the package to arrive.
Local pickup is a great option for customers who want to buy or reserve items online. They can visit the location to collect and pay for the item. This type of buy online, pick up in-store (BOPIS) or curbside pickup service has been accelerated by the coronavirus pandemic. Some 64% of consumers are now interested in this type of service.
Did you know that offering a local pick-up option can increase your retail sales? It’s all about making smart decisions with your product placement.
2. Offer buy in-store, ship to customer order fulfillment
Having items in stock is incredibly important in retail sales. Not only does it prevent customers from leaving empty handed, but they can also become frustrated if they can’t find what they’re looking for.
You’re now able to sell items that aren’t physically in your store. With the ability to ship from other locations, you can fulfill orders that aren’t available in your physical store.
No longer are you limited to selling only what your store has in stock; you can now sell what you want.
So, there you have it! Now that you know what is conversion in retail, it’s time to start putting some of these tips into practice. Remember, even a small increase in your conversion rate can make a big difference to your bottom line. So don’t wait – get started today and see the results for yourself!