Exploring the Factors That Affect the Average Retail Conversion Rate

Conversion rates are crucial not only for eCommerce stores but also for retail stores. Retail stores can benefit from the latest technological advancements that allow for more significant insights into store visits and purchase amounts while also benefiting from the still-growing trends of webrooming and showrooming.

Keep reading to learn the key factors affecting the average retail conversion rate and how to evaluate your store to make more sales.

What is a Retail Conversion Rate?

A retail conversion rate (CVR) is the same as an eCommerce conversion rate, yet it’s measured differently. An eCommerce conversion rate is the percentage of visitors to your website that make a purchase. So, a retail CVR considers visitors to your store instead of a website.

The average conversion rate by industry demonstrates how even among eCommerce stores, there is a significant difference in what constitutes a great CVR. For example, one study found that retail CVRs are generally higher than eCommerce stores, ranging between 20-40%. So, it can be a challenge to understand what your target CVR should be when it comes to retail stores.

Varos gives you advanced tools for benchmarking the industry average conversion rate eCommerce right alongside your own performance. Additionally, our platform can monitor Stripe and paid ads to help you monitor your industry-specific retail conversion rate benchmark.

Factors Affecting Your Retail Conversion Rate

What encourages or dissuades customers from making purchases after they’ve entered your store? While some of the same principles that apply to eCommerce stores do carry over, many others are unique to retail stores. So let’s discuss some of the top factors influencing your retail CVR.

Tracking Technology

It’s much more challenging for a retail store to track visitors than their eCommerce counterparts. The good news is that visitor tracking technologies have advanced rapidly in recent years to help make tracking visitors much more accurate.

The older method of light beam tracking can lead to many issues and inaccurate results, as these technologies just count how many times a light beam is disrupted. Fortunately, new tools with advanced computer vision technology can track true customers and give accurate retail results.

Just like an eCommerce website, you’ll struggle to enhance your CVR without the right tracking tools in place. Invest in the latest technologies that will give you an accurate understanding of how many actual visitors enter your store so that you can correctly calculate conversion rates.

Store Layout and Visual Merchandising

How easy can people find what they’re looking for after they walk in? Beyond that, how many other opportunities are there to make additional sales while they shop?

Your store layout is vital for the overall experience, while visual merchandising allows you to cross-sell or upsell as customers shop. 

Tracking technology can also help you evaluate how customers move throughout your store. Then, continually evaluate how to change your merchandising or overall layout to create a better customer experience and increase sales.

Discounts and Promotions

Discounts or promotions are a tried and true technique for earning customers. Both of these tactics give the customer a deal and convey a sense of urgency for making the purchase now instead of later.

You’ll likely advertise any sales in your ads or front-facing signage, but don’t neglect signage within your store that highlights the given sale. Remind customers of the discount and that it’s a limited-time offer to help make more sales.

Staff Performance

Your team is essential to the overall customer experience of anyone who enters your store. Even if they don't interact with every customer, the environment they create significantly impacts the customer’s shopping experience.

Retail associates and management must follow best practices for assisting customers, making sales, and keeping the store in good condition. Otherwise, you risk losing customers who may have otherwise made a purchase and kept coming back.

Checkout Process

A common misconception of retail checkout processes is that once a customer decides to buy something, that decision is final. However, a recent study found that 97% of retail shoppers have backed out of a purchase because checking out was inconvenient. 

Implementing self-checkout or having more than enough lanes open at all times significantly minimizes the friction that may cause customers to leave. 

A checkout process involving a loyalty program or digital receipts also gives you the tools to track a retail customer’s lifetime value. This critical metric can help you understand what keeps customers returning and what’s losing them.

How to Boost Your Retail Conversion Rate

The average conversion rate for ecommerce allows online stores to set accurate targets and make strategic improvements to reach them. 

Retail stores can follow a similar process to help generate more sales. The above factors shed light on how you can improve your CVR; let’s discuss a few additional strategies you can explore:

• Allow local pickup for online purchases: Webrooming is a relatively new trend in which customers make purchases online, then pick them up locally. Build an easy-to-use online store that allows customers to pick up their purchases the same day to cater to this emerging trend.
• Allow local purchases to be shipped: Showrooming is the opposite of webrooming, where a customer might visit your store to see the physical attributes of a product but then buy it later online. You can cater to these customers by allowing them to buy the product in-store still but have it shipped to their homes, which can be ideal for large or expensive items.
• Offer free samples (if applicable): If you sell any consumables, make samples readily available during peak hours. Showcase the quality of your product to motivate on-the-spot purchases.
• Showcase social proof: Online stores benefit from reviews, but retail stores can also leverage social proof to grow. Simple signage that shows your Google Maps score or excerpts from genuine reviews. This practice allows you to convey how other customers feel, which motivates customers to check out.
• Train staff effectively: Your team plays a massively important role in creating a great shopping experience, which in turn creates more conversions. Provide comprehensive initial and ongoing training for managers and associates to always provide the best experience.

Boosting your CVR begins with the suitable tracking systems in place. Then, you can strategically encourage any customer who enters your store to make purchases by providing an excellent customer experience.

Sign Up with Varos for Real-Time Retail Conversion Rate Benchmarking

Retail and eCommerce stores both need to track, analyze, and increase their conversion rates to continue growing the business. Above, we’ve evaluated the factors to be aware of and how you can take specific action to enhance your retail CVR.

It’s crucial to stay on top of your CVR, especially as related to paid ads, generating foot traffic, or payment processor transactions. Varos gives you the tools to always understand real-time competitor benchmarking so you can catch up to the pack or stay in the lead.

Are you ready to improve your retail CVR with real-time benchmarking? Sign up for Varos today, or contact us for a demo.

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About the Author

Sarah Clowes-Walker 

Head of Marketing at Varos

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