April 20, 2005, 12:00 AM

Conversion rates rise, but cart abandonment remains high, study says

Conversion rates are rising among online retailers – with 21% of retailers, nearly twice as many as last year, reporting rates of 2-3% -- but 90% of retailers have cart abandonment rates higher than 10%, the E-tailing Group reports.

 

Conversion rates are rising among online retailers – with 21% of retailers, nearly twice as many as last year, reporting rates of 2-3% -- but 90% of retailers have cart abandonment rates higher than 10%, the E-tailing Group Inc. reported today in its 4th Annual Merchant Survey.

The study, based on a survey of more than 250 online retailers, notes other improvements in conversion rates. 41% of respondents said their conversion rates were higher than last year, while only 23% said rates were about the same. 70% of respondents said their conversion rates were 2% or higher; 49% said their rates were 3% or higher; 35% said their rates were 4% or higher.

The survey notes that 24% of respondents reported cart abandonment rates from 11% to 30%; 33% had cart abandonment rates from 31% to 40%; 24% had cart abandonment rates from51% to 70%; 9% had cart abandonment rates of 71% or above.

In other findings:
-- 40% of respondents say they sell through a 3-channel strategy, up from 36% last year and 26% in 2003;
-- Online sales account for 1-10% of overall sales for 36% of respondents, but 41% of overall sales for another 34% of respondents;
-- 5% of respondents said they expect 2005 sales to remain static with last year’s sales, but 8% said they expect 2005 sales to rise more than 75% over 2004 sales;
-- 76% of marketing budgets are online this year, up from 71% last year and 55% in 2003;
-- 19% of respondents reported average marketing costs per order of less than $1; 39% reported average marketing costs per order of $1-$5.

 

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