The nuances of the Amazon conversion rate make for an interesting subject. For any ecommerce business, conversion rates are going to be one of the most scrutinized metrics when it comes to determining success.
So how should you interpret your Amazon conversion rates as a seller? What do you need to look out for? How do you use your conversion rate data to make business decisions? Are you missing out on other important details whilst focusing on your conversions?
This article is going to explain all of the following, and it will only take 5 minutes to read through and gain a solid understanding:
- Where to find conversion rate in Amazon Seller Central
- How to critically assess your conversion rate
- Pitfalls to watch out for (this part is important)
- Scenarios & tips for improving your conversion rate
Conversion Rate on Amazon: Order Item Session Percentage
Firstly, it’s worth stating that you won’t find your conversion rate listed under the title of “Conversion Rate”, within Seller Central. Jeff Bezos likes to confuse us here.
First of all, head to the menu and go to Reports > Business Reports:
Then under “sales and traffic” you can see a top-level overview of your daily business metrics, including “Order Item Session Percentage”, which is your conversion rate:
However, this report isn’t very useful as it groups all of your products together, so you will want to check out the same columns in the ‘By ASIN’ reports, to get information for each product (parent or child):
Your conversion rate is calculated by dividing the number of sales (“Total Order Items”) by the number of times people visited your listing, including return visitors (“Sessions”) to get a percentage which is your conversion rate.
How to assess your conversion rate
So, let’s assume you are checking your conversion rate on a weekly basis. What are you looking for? Ultimately, there is no hard and fast rule for what a “good” conversion rate is, and it will vary depending on the product, the niche and the sellers goals. The key things to remember here are:
- Conversion rate is relative
- Your conversion rate should also be considered alongside profit
Why is conversion rate relative?
At the end of the day, as a business owner, the main thing you are interested in is sales and profit. So if you have a fantastic conversion rate but aren’t making your target in daily profits, then your conversion rate metric becomes pretty useless.
For example, you could have a conversion rate of 50%, which sounds incredible, but if your product only had 4 sessions that means you sold a grand total of 2 products. Unless your product is unique, with a very high price and a solid margin, that probably isn’t going to cut it.
Here’s an example on the other side of the coin: your conversion rate is only 2% but your product listing had 2000 views and thus, you actually sold 40 items.
Profit is more important than conversion rate
At the end of the day, conversion rate is just an indicator of how well your listing is converting. What constitutes a “good” conversion rate is something that you need to identify based on your own situation and your own products.
Tip: Try Fetcher for advanced Amazon Analytics. Set up your dashboard in minutes & ditch endless spreadsheets and headaches exporting your important business metrics from Seller Central.
Obviously in an ideal world you would want to be achieving and exceeding your daily sales targets, AND having a great conversion rate. But the point here is that this may not always be the case, in which case you need to dive deeper. Let’s dig deeper right now…
Pitfalls to look out for
This leads us on to some of the pitfalls to avoid with Amazon conversion rates.
So many factors come into play here. It’s not just your product niche and price point either. I say this all the time but there are many moving parts on Amazon, and these can affect your conversion rate too.
For example, your rank will greatly determine how much exposure your product gets in the search results, and thus how many sessions you get. Another example is that your competitor behavior (their rank, their price etc.) will be having an impact on how many sales you get.
Always look at the bigger picture
With this in mind, the biggest pitfall is that you can rely on your conversion rate too much. It’s very important to consider the whole picture, including your sessions, sales, profits, product price, competitor movements and so on.
Tips for improving your conversion rate
Ok so we’ve already covered a few examples of how your conversion rate might look, how to interpret the data and how to avoid the pitfalls. So let’s take a look in a little more detail at how you can react in a few example scenarios.
Your product has a high conversion rate, but you are not getting many sessions or sales. Your product is not yet meeting your desired target in terms of units sold per day and is competitively priced.
If you are getting conversions, it means that your product listing is likely doing a good job for the time being. The problem you are likely facing is that your listing is not ranking well for relevant keywords in your niche. It’s no good having a high conversion rate if your product is buried several pages deep in the search results.
Providing you have done your product research, you will have identified a product that does have demand. So at this stage, your best bet is to figure out where that demand is:
- Do some keyword research and figure out what people are searching for to find products like yours, and make sure your listing is optimized with those keywords. You can use the Rank Tracking tool within Splitly to monitor your rankings for the keywords you are targeting.
- If your product was recently launched, you may need to increase sales velocity to give your BSR a boost: try running some Amazon pay-per-click (PPC) campaigns, or running a promotion.
- If you are feeling adventurous, you could also try some external marketing activities to drive traffic from outside of the Amazon platform.
Your product has a higher price point than competitors, because you saw an opportunity to provide a higher quality product within your niche. You are hitting sales of 40+ units per day with great profit margins. The conversion rate is still disappointingly low.
The good news is that you are generating healthy sales and making profit. Your conversion rate is still low though, and what entrepreneur wants to stop there?
If you are getting sales and still seeing a low conversion rate then there could definitely be room for improvement to increase profits even further.
- Try to optimize your product listing by split testing it – you can make significant improvements to your conversions, sales and profits by making small changes to your main image, product description and features.
- Take a look at your pricing in comparison to your competitors. Optimizing your pricing is the most hard-hitting way to maximize your profits on Amazon. This doesn’t mean a race to the bottom: with Splitly you can split test your price, or even automate your pricing optimization with Profit Peak, which will continuously find your best known price for profitability.
- If you are worried about changing your pricing being detrimental to your rank, you can utilize the Rank Boost feature within Splitly to ensure you are optimized for maximum profit, whilst maintaining your BSR.
Your product is not meeting daily sales targets and it has a low conversion rate. Profit is not high enough and the conversion rate is low.
No one wants to be in this scenario, but it can happen, and it can be resolved. Nothing is quite working as hard as it needs to be here. You aren’t generating enough sessions, sales or profit and your conversion rate is low.
In short, you have work to do and you should work through the suggestions made in the previous two scenarios in order:
- Go back to your product research and figure out how many sales per month you could expect from your product, if your listing was performing better. (Jungle Scout can give you accurate sales estimates for the top 10 products similar to yours).
- Figure out what keywords people are searching for to find your product and optimize your listing, and also consider running some Amazon PPC ads to target those keywords and get your product visible.
- Try running a promotion for a short time to increase sales velocity and increase BSR.
- Once you have tried these methods, and start to see an increase in sales, check your conversion rate again. Room for improvement?
- Move on to optimizing your product listing with split tests and pricing optimization to turn your listing into a slick, well-oiled machine.
When should I invest money into a product?
If you are tentative about throwing money at a product, so to speak, think about it’s lifespan. If it’s a brand new product that you have faith in (again, do back this up with accurate data from a tool like Jungle Scout, or even the free Jungle Scout sales estimator), then it probably needs a helping hand to get those sales coming in the door. Once you get to that stage, you can continue to optimize and tweak until you are reaching your goals and then some.
Of course, in some scenarios, it may be an older product that is time to say goodbye to. Here’s a useful video about figuring out if your product is a dud and when and how to give up on a product!
Hopefully this has made you see your conversion rate in a different light, or given you some ideas on how you can assess your business metrics.
Conversion rate is a really useful tool when used correctly, and when it’s not relied on as the naked truth of success. On the one hand it can indicate when there is room for improvement to generate even more profits. On the other, conversion rate can indicate that there are other issues at play, such as pricing, or a poorly optimized listing.
Did these scenarios help you? Do you have any other questions about Amazon conversion rate? Let me know in the comments below!