How to boost your e-commerce conversion rates by 54%
In 2016, consumers in Denmark spent 101bn DKK on shopping online, which represents a 16% growth in comparison to the previous year. The most popular categories, travel, fashion and IT, increased up to 18%.
According to Danish E-commerce Association (FDIH), Danes spent 23,8bn DKK on traveling, which is a 3,7bn DKK more than in 2015. The fashion industry increased in 1,8bn DKK, which makes 14,3bn DKK in total and the IT industry sold items online in an amount of 11,5bn DKK, which is an additional 1,5bn DKK.
The research shows that e-commerce in Denmark is growing in numbers and popularity at a fast pace. However, the question remains: how to keep it running and increasing? The best way is by constantly improving performance and growing the revenues generated online. For that VTEX may provide an efficient solution.
VTEX, a supplier of cloud-based e-commerce platform, has recently emerged on the list of Gartner´s e-commerce Magic Quadrant´s latest competitors. Last year, it reached over 1,5 billion USD worth of gross merchandise volume (GMV) and it still guarantees that its innovation is 68% quicker to put into practice; conveys a 30% growth in organic traffic and increases conversion rates up to 54%.
Every e-commerce platform is motivated to boost its conversion rates. The more people get to visit the website and purchase the items, the number of conversion rates increases rapidly.
Why is it important to keep a close eye on the conversion rate? Because you want to turn more visitors into customers. Growing your conversion rate from 3% to 6% may not seem like a big difference, but it may drastically affect your revenues. The conversion rates not even help you to get an overview of your current business result in the present but also help to develop a better strategy for future calculations.
What strategies does a seller need to implement to reach higher conversion rates? One of the latest effective e-commerce strategies is the simplification of the online payment procedure by discarding passwords has proven to increase conversion rates by 54%.
Payments without passwords
Alexandre Soncini, VTEX’s general manager for North America clarifies: “When we launched our password-free checkout, we had around 600 online stores. They were already using our regular VTEX platform checkout process. For that sampling, they had a 28% increase in revenue… not just conversion rate. We then measured a sample of new clients migrating to VTEX and looked at their conversion rate one month before migrating and three months after the migration. We measured an average 54% increase in conversion rate for these new customers. One of the main reasons is the seamless checkout experience.”
Another example is Amazon, a global company which is well-known for its efficient e-commerce strategy. In 2016, it noticed a phenomenal 53% increase in conversion rates. Due to sophisticated automation, such as Alexa (the artificial intelligence engine), Amazon is also enhancing the online shopping experience on a wider scale, specifically the payment procedure.
The only problem is that the customers are obliged to set up their online showcase in the Amazon-monitored field only. However, VTEX is supplying a huge number of customers with payment alternatives which are much efficient, such as payments with no passwords required.
High conversion rates and satisfied buyers – a result of simplified online payments
VTEX isn’t the only company which targets this goal. Every e-commerce platform thrives on finding innovative and appealing methods to make online shopping as convenient and accessible for the buyers as possible. For instance, due to a collaboration of Facebook and Shopify, Facebook users can easily access several shops online via Facebook Messenger, Engadget informs. SnapChat is also aiming similar direction which is a significant step for e-commerce, especially when most of the social media is frequently used via the app in smartphones, such as Facebook Messenger or SnapChat.
The consequences are evident. Why should social media users leave their favorite mobile apps, just to do online shopping? If e-commerce platforms reach out to already existing online platforms, then they can easily conform their online shopping strategy with social media environment, which is so popular nowadays.
Once the shopping online runs smoothly by simplifying the payment process, e-commerce platforms can expect not only a boost in conversion rates but also the return of their satisfied buyers eager after purchasing even more products.
Innovative methods to enhance the online shopping experience, for example, purchasing items online excluding password entry, may direct e-commerce platforms into a success in a very near future.