Ecommerce retailers should be concerned with their conversion rate, but when it comes to luxury products, there are subtle nuances to keep in mind. For years, the high-end goods market has been struggling to move online, and it's only now, five years after Johann Rupert issued a rallying cry to the industry, that ecommerce for luxury products is taking off.
The sudden rise in sales has many retailers wondering what a good ecommerce conversion rate for luxury products is. Comparing rates from other industries may not provide a clear picture of a luxury retailer’s actual performance. Another factor to keep in mind is that ecommerce conversion rates aren’t static. Everything a retailer does online can have a drastic impact on conversion rates.
For luxury items, a good conversion rate won't be the same as sites targeting customers who make impulse purchases or buy regular items online.
High-end items depend on converting discerning customers who spend enough on a single purchase to make it worth your effort.
Ecommerce sites track their conversion rates to calculate their spending (measuring their efforts) against revenues (expressed as sales). The goal is simple: increase the number of visitors to your site and provide an experience that concludes with a purchase. The ways you go about this vary by industry and product, but the intention is the same.
To drive up conversion rates, companies use a myriad of strategies that mainly focus on providing a superior user experience. Yet users evolve and customer behavior changes. It means the goalposts are always moving, and ecommerce retailers need to adapt strategies often just to keep up.
The same applies to luxury ecommerce sites, which need to deploy a different user journey from other retailers when marketing and selling high-end products online.
Globally, the average ecommerce conversion rate for all industries is roughly 3.1% according to XP2. If you go by the average website conversion rate and industry-specific numbers for April 2021, you’ll find that:
From the above, it’s clear that most consumers are making buying decisions based on the product involved. For jewelry and luxury items, April saw an average rate of more than 2.5%, up by almost 1% from March this year.
The main lesson here is that conversion rates for all industries will vary from month to month, by sector, and for individual products. While you should always be working to increase your conversion rate, you shouldn’t read too much into monthly numbers and rather establish a benchmark for different periods of the year.
A quick search online will give you access to multiple different ecommerce conversion rate calculators. You’ll need to be armed with your site’s metrics, which are often provided by your ecommerce platform or external tools like Google Analytics.
The equation is simple. You take the number of visitors over a specific period (like a single day) and then work out the percentage of orders you received in that time. The more people purchased in that period, the higher your conversion rate will be.
Your ecommerce strategy (regardless of industry) should be to attract visitors, convert them into buyers, and have them come back in the future because they had an amazing user experience.
Luxury items have a lower conversion rate compared to items like food and beverage, pet products, and beauty or healthcare. On average, it’s still higher than home and garden or multi-brand retail. If you are receiving conversion rates somewhere between these figures, you’re probably doing okay with your site.
When your rates are below the average, you’re likely making mistakes that are keeping people from making purchases on your ecommerce site.
It's best to set your expectations accordingly and focus on attracting more customers. This doesn't mean that you will be less successful as an ecommerce retailer, just that you may have to spend more time and effort to attract new, high-paying customers.
Some of the things that can reduce your conversion rates are:
The best way to combat this is to make sure your site looks professional, has the right information, and uses high-quality images with 3D renderings to promote your products.
You can also offer product customization, allowing shoppers to tailor your product to their personal style.
Knowing your customers and understanding their motivations is critical if you want to increase your conversion rates. A willingness to spend more for a product won’t be enough if your site has multiple friction points and a user journey that leads to frustrated customers.
By getting the site’s design, product personalization, and sales funnel right, you can optimize your conversion rates exponentially.
Optimizing your conversion rate for luxury items depends on providing a superior customer experience for every visitor. The more discerning your customers, the more attention to detail they will expect.
Assigning more resources and increasing marketing efforts to convert every visitor should be justified by the product’s cost to make it worth your while. It's important not to skip the basics and ensure that you include all the standard features that every ecommerce store has in place.
Once have this, you can then go beyond the average retailer by focusing on:
Product customization and personalization options will also help drive conversions and increase revenue for luxury and high-end ecommerce sites.
ConfigureID is the ideal platform to enable shoppers to customize your luxury ecommerce products. You can provide interactive 3D product visuals and unlimited customization options, generate analytics, and conduct product research using ConfigureID.
When it comes to luxury ecommerce, shoppers want options, exclusivity, and a visual experience that goes beyond regular online retail. ConfigureID allows you to build a personalized product offering that exceeds their expectations.
To see ConfigureID in action and discover how it can help increase your ecommerce conversion rates, get in touch with our experts today.