Think Beyond Purchases: The Role of Micro-conversions in Generating Online Income

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Most retailers are setting up e-commerce storefronts for one simple reason: to take advantage of the growth in online shopping behavior in order to increase their income. There is a simple formula to follow to increase revenue through the ecommerce channel:

Sessions x Conversion rate x Average order value = Revenue

This formula is quite simple. Any increase in one metric, even if the other two remain unchanged, will lead to revenue growth. In a previous column, I explained why sessions are important. Now let’s take a look at the conversion rate and how merchants can increase that rate by looking at other smaller factors beyond buying.

Purchases are definitely the most desirable type of conversion for an online storefront, and this is the type of conversion we are referring to in the optimization formula above. There are definitely ways to improve purchase conversions, such as providing abandoned cart alerts or an expedited checkout page.

But there are other types of conversions that don’t necessarily translate directly into revenue, but serve specific business goals.

The importance of micro-conversions

These micro-conversions include several smaller actions and events that take place on a site, but may not immediately result in a sale. These include:

  • Register on the site to create an account and place orders online
  • Submit a form to request a credit, inquire or get a quote
  • Downloading content or applications such as product catalogs or installation guides
  • Downloading your mobile e-commerce application
  • Engage in a live online chat for instant responses
  • Register for training or certification training
  • Follow your business on social media via an onsite link to LinkedIn, Facebook, or other social platform
  • Call your business using a direct link from the site
  • Registration for a loyalty program
  • Use of specific functions such as a new on-premise tool or a featured feature

Now, why are these actions important? On the one hand, these are all forms of engagement with your brand and ecommerce operation, and any kind of engagement has value. The path to a sales conversion consists of four basic steps:

  1. Promote your website, products and services to people
  2. Generate interest in your offers
  3. Provide reasons to keep them interested; create a desire
  4. Ask the visitor to take the desired action

Micro-conversions all follow the same steps. In turn, they can also function as stages through which customers move towards a sales conversion.

Following a business on social media shows that potential customers are already familiar with the e-commerce site, and potentially the products and services that may be of interest to them. Using a new onsite tool or featured feature is one way to generate interest and create that desire to buy a product.

Going back to our simple formula, any increase in the conversion rate will result in more revenue, without having to change sessions or average order value. Micro-conversions are smaller actions that all help increase purchase conversion rates. If you can increase the number of micro-conversions taking place on your site, you can most likely increase the number of purchase conversions, thereby increasing the conversion rate.

The key to growing micro-conversions is increasing the functionality of your e-commerce site. While the overall goal may be to make your SKUs available online, the sites that generate the most revenue – and drive the most conversions – aren’t just online catalogs.

They advise and help your new existing and potential customers. Live online chat allows questions to be answered quickly and can potentially direct customers to a product they didn’t know you were carrying. Downloadable manuals and product information give customers a reason to come back, so they have the power to increase both sessions and conversion rate.

So, when trying to increase the conversion rate, think about other smaller micro-conversions that will get customers to engage more with your ecommerce site. The more you can do on this front, the more likely you are to increase conversions and, therefore, income.

Scott Frymire is Senior Vice President of Marketing at Unilog.


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