How a 1% Rise in Conversion Rate can lead to a 3% Rise in Sales

A small increase in sales conversion rate has a much greater impact on sales, even when no other factors are changed.

Sales conversion equation

  • 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

  1. Increase Average Shopping Time
  2. Increase staff interaction with shoppers
  3. Improve signage in the store

The effectiveness of all of these can be measured. Small improvements lead to big financial gains.

Keep measuring, keep testing, keep improving. Learn more: email or  call +44 (0)161 839 6437.

Retail Sensing

Retail Sensing manufacture the Video Turnstile people counting, vehicle sensing and smart city equipment. Our systems not only measure footfall and traffic, but monitor queues, display occupancy, track shoppers around stores, show heat maps of most visited areas, record passenger numbers, count pedestrians and provide retail intelligence and key performance indicators.

Tags: ,

Leave a Reply

Your email address will not be published. Required fields are marked *