Breaking down your conversion rate: key metrics to benchmark against

Most e-commerce brand owners know their overall conversion rate. But many of the brands we speak to don’t know how they’re performing at each stage of the conversion journey. 

This is partly down to having minimal data to work with, but it’s also about not knowing what’s ‘normal’. If you have no sense of the average performance for each conversion milestone, how can you know where your website is ‘leaking’, and where you should focus your attention?

Below we’ve broken down the key conversion metrics to start tracking, as well as the industry average for each one (where available) to give you something to benchmark against.

1. Add-to-cart rate

What it is: The percentage of visitors who add at least one product to their cart during their session. The higher the add-to-cart rate, the better.

How to calculate it: (Number of add-to-cart events / Total number of website sessions) x 100. 

If you have a Shopify e-commerce store, you can see your add-to-cart rate in your Analytics tab. 

Industry average: 7.1% is the average global add-to-cart rate. 

2. Cart abandonment rate

What it is: The percentage of visitors who add a product to their cart, but leave the website without making a purchase. The lower the cart abandonment rate, the better. 

How to calculate it: [(Added to cart sessions - sessions converted) / added to cart sessions] x 100. 

These figures are available within the Analytics tab of your Shopify dashboard. 

Industry average: 70.19% of people abandon the items in their cart before checking out. 

3. Checkout abandonment rate

What is it: The percentage of visitors who start the checkout process, but don’t complete their purchase. The lower the checkout abandonment rate, the better. 

How to calculate it: 1 - (Number of orders completed / number of checkouts initiated) x 100. 

Shopify doesn’t show you information about how many checkouts are initiated, but it’s possible to get this information through Google Analytics.

Industry average: It’s difficult to find data to benchmark against for this metric, since most businesses only track their cart abandonment rate.

4. Payment failure rate

What is it: The number of transactions that fail because the payment is declined or simply doesn’t work, either due to human error, fraud protection measures, or technical glitches. The lower your payment failure rate, the better.

How to calculate it: (Number of failed payments / total number of initiated payments) x 100. 

Shopify doesn’t show this information, but you may be able to see it through your payment provider. 

Industry average: 2.9% globally, although reports vary greatly.

Factors that might affect your conversion rate

While these average statistics are a good place to start, there are plenty of factors that will impact your site’s performance at each step of the way, including: 

• Your industry: luxury handbag websites have a significantly lower conversion rate than food and beverage sites, for example.
• Your return rate: repeat customers will typically convert better than first-time visitors. If you’re selling one-time purchases, your repeat rate will be lower, and your conversion rate may in turn be lower, too.

That’s why it’s always best to benchmark against other ecommerce websites within your own niche wherever possible; this will give you the most accurate picture of where you’re doing well, or underperforming.

Going one step further

FERO is a Shopify app that not only helps you optimise your checkout conversion rate, but also provides extensive data and industry benchmarking to help you spot your strengths and weaknesses versus your competitors. 

We’ll not only show you how many people make it to each conversion milestone, but which segments are dropping off at which points, and why this might be. Try FERO free for 30 days to improve your conversion rate on autopilot.