Retail-Blog

Until recently, technology for increasing online conversion rates has generally been the domain of large retailers.

The high ROI (Return On Investment) associated with increasing online conversion rates is driving retailers of all sizes to now focus on the technology. Online conversion occurs when a website visitor becomes a buyer. A conversion rate of 5% means that 5% of the new visitors to the site have searched the site, found the item or items they want and have made a purchase. Even small changes in conversion rate translate into big revenue dollars. For example, if a site doing $20 million in revenue increases its conversion rate from 3% to 4%, revenue would increase by almost $7 million.

Fortunately (by luck or design) the security breach at Massachusetts-based TJX Companies Inc in the heart of the December shopping season did not become public knowledge until mid January. It would have given customers both online as well as in-store reason to pause.

The breach of the database allowed computer hackers to steal credit and debit card information from thousands of customers that were being stored in the TJX database. Retailers should be especially concerned about what happened and how it was handled by TJX.

The Nielsen NatRatings report for December 2006 Online Retail Results are in. The top 146 Online Retailers generated more than 140 million visitors and served over 41 million customers with an average order size of $72.30 for the month compared to 124 million visitors and an average order size of just over $74 in December 05.

In December 2006, the top 5 online retailers were:

1 eBay
2 Amazon
3 Wal-Mart Stores
4 JCPenney
5 Overstock.com

eBay recorded more than 69 million visitors in 06 compared to 64 million in 05 almost an 8% increase. Barnes & Noble slipped from number 4 to number 6 in 06 and Overstock moved up from number 6 to number 5 in 06.