The experience users have while browsing your store often determines whether they will go ahead with the purchase or not. It is why it is essential to optimize your store properly, but many owners are baffled on how to do that.
This issue motivated me to share some insights on optimizing an ecommerce, particularly a Shopify store. If you own one of them, make sure to read this article and find out more about CR, AOV, and the importance of loading time and other ways to maximize optimization.
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Tell Me More about CR and AOV
If you are a newbie, the chances are you are unfamiliar with these terms, although they play a crucial role in the success of your store. Here is a brief explanation:
- Conversion Rate (CR) – this marks the percentage of visitors to your website that go ahead with the purchase. For example, if you have a 20% CR, it means 20 out of 100 people that visited the website bought at least one product.
- Average Order Value (AOV) – this is quite self-explanatory as it marks the average value per customer order.
The question that arises now is which one is more important – CR or AOV? Many people would rush to say the former, but would they be right?
The Importance of Balance
Before we head into a discussion on properly balancing conversion rate and average order value, let’s discuss profit. After all, isn’t this what all merchants strive for at the end of the day? If you want to properly calculate net profit, the simple equation is:
CR * AOV * Visitors * Margin
You are now familiar with CR and AOV, but let’s mention that margin marks your profit from a product after its total cost is deducted. If you multiply these four factors, you can calculate your net profit. This is important because the ultimate goal is to maximize your revenue. Getting these four factors in the right balance is the way to profit the most from your ecommerce.
If you are wondering whether you should focus on CR and AOV, the key lies in achieving balance. Imagine this scenario – you do not have a large conversion rate, but the average order value is over $500. In this situation, you can still optimize your profit despite having a relatively small CR.
Alternatively, your CR may be huge, but that is not worth a lot if your AOV is under $10. It affects your profit and doesn’t deliver the highest efficiency of the store. That is why you should look to optimize your ecommerce in a way that will motivate more people to buy more products – that will increase both your CR and AOV and enable improved balance and, therefore, increased revenue.
How to Optimize Your Shopify Ecommerce?
There are numerous factors that you can utilize to optimize your ecommerce and provide the ultimate user experience. Here is some that are crucial for you to consider:
- Page loading time – nobody likes to wait for ages for the page to load. The general rule of thumb is that the conversion rate decreases as the loading time increases. If you want to check the speed of page loading, you can head to the Web Page Test. Choosing a good theme, optimizing image capacity, and deleting unnecessary plugins are excellent ways to accelerate loading times.
- Optimize product pages – it is only natural that the products you are selling have a critical impact on CR. However, optimizing product pages can increase the number of sales. Among other things, make sure to include a tempting and precise description, high-quality photos, and a clear call to action.
- Price – if your prices are unreasonably high, it will affect the number of sales you make. On the other hand, the low cost might mean that you are not making enough profit, so the key is in striking the right balance.
- Trust – establishing trust with the customers and boosting your online reputation is an excellent way to increase your profit and optimize your ecommerce. Some useful tricks for boosting your presence include SEO, utilizing social media, as well as reaching out to influencers.
We reached the end of our article. Did you enjoy it? I hope that you found some great advice on how to optimize your Shopify store, as well as why CR and AOV play an important role in managing ecommerce. If you would like to share your opinions on the topic, do not hesitate to do so. If you liked the article, please spread the word by sharing it with your friends on social media!