When you list an item on Amazon, what do you want most from the people who visit it?
Just open your listing and close it.
Alternatively, visit your listing and perform the desired action (buy something).
We all know which situation is the correct answer.
This desired behavior of a visitor clicking on your page/listing and buying something is called a conversion.
The ratio of the number of orders to the number of visits (sessions or clicks) is called the conversion rate (CVR).
CVR is one of the most important KPIs on any Amazon list. Therefore, every seller must understand how it is calculated.
What is the exact CVR formula on Amazon? How do we calculate CVR for ASINs and keywords? And how to improve your Amazon CVR?
You will find answers to all these and similar questions in this article.
How to Calculate CVR on Amazon
To many people, Amazon's conversion rate means just one thing, the number of orders divided by the number of page views. However, this CVR definition doesn't tell the full story.
On Amazon, sellers don’t just track conversion rates for a specific/SKU. Since they also run paid marketing campaigns, they need to know the conversion rates for the keywords their PPC campaigns are targeting.
Here, we'll walk you through the steps to find/calculate the CVR of both.
How to Find CVRs for Amazon ASINs
To calculate conversion rates for your listed ASINs, you must go to your Seller Central account.
From the Seller Central home page, expand the Reports drop-down menu and click Business Reports. It will open the business dashboard.
Then, look at the vertical menu on the right. Click on the parent item's detail page Sales and Traffic.
Column 10 "Percentage of sessions per unit" gives you the conversion rate of ASINs for a given time period (you can choose a specific time window to analyze).
Amazon basically uses this formula to calculate this value.
Percentage of sessions per unit (conversion rate) = (units ordered/session) x 100
Units Ordered is column 8 and Sessions is column 3 of the above page.
It's worth mentioning here that sessions are slightly different from visits/pageviews. According to Amazon, a session is a 24-hour window in which a visitor spends time browsing one or more product pages on the Amazon marketplace. So you can also say that the number of sessions is the total number of page views by unique customers within a 24 hour window.
On the other hand, page views/visits record all instances when the same visitor or unique visitor sees your listing.
Suppose a shopper opens your listing, clicks on another product page from the suggested product carousel, and eventually returns to your product page and places an order. It will be treated as one session and two pageviews.
Therefore, the number of sessions and page views are not necessarily the same every time. So use page views instead of no. of sessions may skew conversion rates.
This is why Amazon uses sessions instead of page views when calculating the CVR of an ASIN, because it gives a clearer picture of how a visitor becomes a customer.
How to Find CVR for Amazon Advertising
Pay-per-click (PPC) advertising is the preferred method of promotion for most Amazon sellers. The CVR for Amazon PPC Ads shows you how many orders have been placed from the clicks you get through paid marketing.
CVRs for PPC campaigns can also be found in Seller Central.
Again, expand the Reports tab from the main menu and open Advertising Reports.
You can view the latest advertising reports compiled and uploaded by Amazon on this page. Click the Download button to download them in Excel file format. You can also create custom reports by clicking the Create Report button.
The report you'll download from here will give you basic performance metrics for all the keywords you're targeting with your PPC budget.
One of the columns provides a 7-day conversion rate for all target keywords you specified for exact, broad, and phrase match.
Amazon uses this formula to calculate this conversion rate:
Conversion Rate: (Orders/Clicks) x 100
If you notice, sessions here are replaced with clicks. This is because PPC campaigns are based on clicks/views. Sellers pay per click, so must use no. Clicks to calculate CVR for Amazon Advertising campaigns.
How to Improve CVR on Amazon
As mentioned earlier, the ultimate goal of any Amazon seller is to “convert” visitors to their listings into buyers. Therefore, you can list a series of measures to increase the conversion rate of your ASIN and PPC ads.
Live listing content
Product images, bullet points, descriptions, A+ content—all of these things in your listing are integral to convincing visitors to try your product. So, always stay ahead of the curve when it comes to creating and curating your listing content.
Short and easy-to-read content addresses potential customer pain points, product photos showcasing the product inside and out, and informative, easy-to-read A+ content will ensure that a large number of people end up paying attention to your listing and buying from you.
Ratings and Reviews
Ratings and reviews are social proof and word of mouth for products sold online. No matter how compelling your listing is, if you don't have enough positive reviews and your rating doesn't exceed 4.0, you won't be able to convert more visitors into customers.
So make sure satisfied customers always leave reviews on your listing page. You can use Review Automator for this purpose. This tool only sends reminders to those customers who have no dissatisfaction with the order they received. Such customers are more likely to leave positive reviews and 4+ ratings. A reasonable aggregation of reviews and ratings for your listing will increase its conversion rate.
The Amazon marketplace thrives on competition, and it’s common for competitors to have the same product quality, listing content, and reviews/ratings. In this case, customers break the tie between competing listings by comparing their prices. Therefore, if your prices are slightly lower than your competitors, you are more likely to witness better conversion rates.
Whether you want your listings to rank better organically on the Amazon SERPs, or reach your goals through PPC marketing, you need to be very diligent in choosing your keywords. First, fill and optimize your listings with keywords that best describe your products and align with shoppers’ search intent.
Additionally, you need to choose long-tail keywords with high search volume and low competition for your PPC bids to increase the CVR of your ad. This keyword research tool can come in handy to find the best keywords for your listing optimization and PPC campaigns.
CTR vs CVR: What's the Difference?
A Simple Explanation of CTR and CVR
Click-through rate (CTR) and conversion rate (CVR) are two important performance metrics for PPC advertising running on Amazon. CVR tells how many visitors become customers, while CTR tells how many impressions convert into page visits.
The formulas for CTR and CVR are as follows.
CTR = (Total Clicks / Total Impressions) x 100
CVR = (Total Orders / Total Clicks or Sessions) x 100
It’s worth mentioning that a campaign with the right keyword targeting can increase the click-through rate of your listing ads. It shows that people searching for a product think your listing fits their requirements. However, advertising can only help you at this stage of the funnel – whether or not a visitor becomes a buyer will depend on the factors discussed in the previous section (how to improve CVR).
Therefore, a high CTR simply indicates that the keywords you're targeting in your PPC campaign are getting good traction. A higher CTR doesn't necessarily mean higher sales. Sales largely depend on CVR.
Before wrapping up this article, let's answer some frequently asked questions about Amazon CVR.
What is the Amazon CVR formula?
The Amazon CVR formula for an ASIN is:
CVR = (Number of Orders / Number of Sessions) x 100
The Amazon CVR formula for a PPC campaign is:
CVR = (Clicks/Impressions) x 100
What is CVR in Digital Marketing?
Conversion Rate (CVR) is the percentage of visitors who click on a product page (ad) and take the desired action (place an order).
What is a good conversion rate on Amazon?
Depending on the product and niche, 10-20% can be considered a good conversion rate on Amazon. A 10% conversion rate means that 10 out of 100 visitors to your product listing are placing an order.
From the discussion above, it's clear that you don't need a CVR formula to calculate your Amazon conversion rate. Amazon does this for you. You can find it just by looking at the correct location in Seller Central. Additionally, Amazon offers two slightly different CVR values: one for ASINs and one for targeted PPC ads and keywords.
If you want to increase the CVR of your listings and PPC campaigns, you must choose the right keywords and optimize your listing content accordingly.
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