Conversion Rates of the Top 400 Retailers

The 2005 Internet Retailer Top 400 Guide gives an estimated conversion rate for each of these top online e-tailers. These will provide you a guide to see how your online store's conversion rate stacks up with the best. Gives some of the top conversion rates, explains how the more average CRs compare with each other, and provides both bar and scatter graphs.

Just what is a good conversion rate for an online retailer? The answer, of course, is, "It all depends," but from the 2005 Internet Retailer Top 400 we get some interesting answers.

For each of the 400 top online retailers (with the exception of three), Internet Retailer estimated the conversion rate. One way to examine the results are by category. Apparel/Accessories, Books/CDs/DVDs, etc. But even within categories there were dramatic differences.

Conversion rate was defined as the percentage of all unique visits where a purchase was made. Conversion rates for particular landing pages may have been higher but all were averaged together for a site conversion rate.

Some florists had high conversion rates, such as FTD (18.8%),1-800-Flowers (11.6%), and ProFlowers.com (11.8%). Several online grocery delivery services did, too, such as Peapod (23%), FreshDirect (18.5%), and Schwan's (10.1%) -- though Safeway (1.5%) and Albertson's (1.7%) bucked that trend. Wine.com had a healthy 12.5%. In the Office Supplies category both Staples (12%) and Office Depot (10%) shone, but OfficeMax did a poor 1.5% by comparison. Online large furniture vendors did the worst, with Furniture.com at 0.4% and EverythingFurniture.com at 0.03%

But other than a few exceptions, most rates were under 5%. The average conversion rate was 3.19%, the median was 2.5%.

When I analyzed the top online stores in each category (tossing out the top 3), the average and median were higher: average 3.92%, median 2.68%.

Average Conversion Rates by Rank, Internet Retailer 2005 Top 400 (overall average 3.19%)
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You'll notice that stores in the top 100 averaged significantly higher conversion rates than the others, indicating that the top stores have probably worked harder than their smaller counterparts at optimizing all the factors that make the sale.

The top conversion rates indicate that a significant slice of customers are not just casually browsing, but are ready to purchase, just looking for the right item. Peapod (a grocery site), FTD, Staples, and Office Depot are in this category with customers regularly purchasing from them.

After separating out the sites that get lots of repeat purchases for goods and services that are used up and must be replenished, what makes the difference between the top sites and the average small business online store with many products? In my opinion, two things:

1. The best stores have incorporated specialized search systems that increase the chance of a customer finding what he or she is looking for. These systems don't require an exact match with the product name or category, but use synonyms, roots, misspellings, etc. to help customers find their products. Few smaller stores have gone to this expense or trouble. Companies regularly report significant conversion rate increases after installing such search systems.
2. Careful attention to web analytics and to relentless A/B split testing. The best sites are not on autopilot, but have people assigned to look at data, to test, and to provide incremental improvements.