A small increase in sales conversion rate has a much greater impact on sales, even when no other factors are changed.
- Suppose your store had 400 visitors a day. Of these 400 only 120 actually buy something. Your sales conversion is 120/400: 30%.
- Suppose also that the average spend of these 120 shoppers was £30. Total take for a day would then be £3600.
If you could increase your conversion by just 1 percentage point, to 31%, how would the figures look then?
- 124 people would buy each day (31% x 400 = 124)
- They would spend 124 x £30 = £3720
- Increase in sales is £120/£3600 = 3.3%
In our example, with all other things remaining equal, an increase in sales conversion of 1 percentage point gives a 3.3% increase in sales.
Sales conversion is one of the most useful metrics available. It is easily measured simply by connecting the people counts to the point-of-sale system.
Is a 1% increase in sales conversion realistic? It’s actually a very low figure. We have helped a European retail chain improve sales conversion by 25% in just three months, and a Middle Eastern chain of pharmaceutical stores improve sales conversion by 15% in seven months.
Some stores even track their conversion rates in real-time, so dips can be immediately flagged up and dealt with.
Three Ways to Increase Sales Conversion Rate
- Increase Average Shopping Time
- Increase staff interaction with shoppers
- Improve signage in the store
The effectiveness of all of these can be measured. Small improvements lead to big financial gains.