How to Increase Amazon Conversion Rates with 5 Proven Hacks
It is not news that brands on Amazon face increasing competition in the marketplace. Regardless, it is arguably the online market with the highest conversion rate potential. Therefore, the golden question is how can Amazon brands exploit this potential and increase their conversion rates?
This article explains what Amazon conversions are, where to find them, and five hacks to increase them based on best practices.
What Are Amazon Conversions?
Amazon conversion rates are the percentage of clicks on the product listing that converts into sales. It is an important metric to monitor as it can be benchmarked to competitors and industry averages. According to Big Commerce, a widely considered acceptable conversion rate on Amazon is around 15 percent which is astonishingly almost five times greater than many eCommerce sites. Undoubtedly, Amazon presents a promising conversion rate potential for sellers in the marketplace.
How to Find Conversion Rate Metrics on Amazon
An important first step to tracking a product’s conversion rate is knowing where it can be found on Seller Central. The path for finding the conversion rate is as follows: find reports in the upper hand bar and select business report. Afterward, on the left-hand bar, select detailed page sales and then traffic reports by child item.
Amazon Conversion Hacks in Practice
A variety of studies reveal that five proven hacks work towards increasing Amazon conversion rates: exploit the social proof theory, simulate scarcity, employ discounts and product bundling, use external landing pages, and leverage eCommerce analytics tools.
Amazon sellers can exploit social proof theory by leveraging customer reviews and the FAQ section on their product listing. Potential customers will read these sections, and if they like what they see, this will motivate them to buy the product. Similarly, brands can leverage another psychological phenomenon, FOMO. Instilling a fear of shortage in the customer through announcements communicating low stock will make them feel nudged to buy the product quickly, increasing the chances of conversion.
Besides simulating scarcity, Amazon sellers can simply apply discounts to their products. This increases a customer’s purchase intention and conversion rate to a point where the product will still be ranked highly when the discount stops. The last two ways to increase Amazon conversions are using external landing pages and eCommerce analytics tools. The former allows brands to filter out customers with low purchase intentions, ensuring only customers willing to buy the product land on the Amazon product listing, increasing the conversion rate. The latter consists in using external tools to increase the conversion rate. The following sections explain each of these five hacks in further detail.
1. Exploit the Social Proof Theory
When faced with the uncertainty of online shopping, customers turn to others for guidance. They attempt to seek confirmation that the brand at hand delivers the promised quality and reliability. There are different ways businesses can leverage this behavior by exploiting the theory of social proof. The most common way is by cultivating user-generated content such as online reviews and comments. Research by Bright Local, an online SEO tool, shows that 98 percent of consumers read online reviews before purchasing a product, and 48 percent trust them as much as a personal recommendation. Evidently, social proof works to increase sales conversions.
Similarly, Amazon sellers can increase conversions by using the Frequently Asked Questions (FAQ) section on their product listing. This way, brands can answer all their customers’ overlapping questions. As a result, this personalized support increases the customer’s trust in the brand and product, boosting their purchase intentions.
2. Simulate Scarcity
Scarcity marketing is a subcategory of a new marketing concept coined FOMO or Fear of Missing Out. Traditionally used in contexts when a person fears missing out on a social event, FOMO in eCommerce refers to customers fearing a shortage of a product. In a study conducted by Hubspot, 45 percent of respondents were more likely to purchase a product when they knew there was little stock left. Thus, the goal for Amazon sellers is to create a sense of urgency.
How to Simulate Scarcity on Amazon?
In the context of Amazon, brands can simulate scarcity by increasing their stock transparency. For example, when there are less than five or ten units left, sellers may notify customers by sending them messages such as “only two left in stock, order soon.” This will rush customers who fear shortage as it creates a sense of urgency.
Similarly, another way is by employing the Amazon “buy before X hour and get it tomorrow.” This works incredibly well for Prime users who value next-day deliveries. This customer group will tend to buy the product as soon as possible to take advantage of their Prime subscription.
3. Discounts and Product Bundling
Offering discounts to customers seems like a basic solution. However, oftentimes simple solutions lead to big effects. Similar to simulating scarcity, applying discounts instills a sense of urgency in the customer and, in turn, increases their purchase intention and the product’s conversion rate. Another perk of discounts is that even when it ends, the product listing ranks higher than before because of the higher conversion rate. Simply put, it is an effective way to simultaneously increase page rank and conversion rates.
The same results can be achieved by bundling complementary products like cutlery with a cup set or by decreasing the cost per unit by selling, for example, in packs of 50. Product bundling comes in two forms on Amazon. The first form is the traditional bundle, and the second one is the “frequently bought together” option. Both are easy and persuasive ways for sellers to upsell their products to their customers.
4. Use External Landing Pages
The benefit of creating external landing pages of an Amazon product listing is that it acts like a filter. Without a landing page, the brand’s conversion rate will likely decrease because it attracts consumers with all levels of purchase intentions. Therefore, brands can filter out customers with the least purchase intentions by diverting traffic from Amazon to external pages such as Facebook or Google. This way, brands ensure that only customers who are going to buy the product continue to Amazon, increasing the conversion rate.
Another important consideration is that the URLs brands employ to direct external traffic should be optimized for SEO. Why? Because it accelerates keyword ranking, boosting overall Amazon SEO.
5. Leverage eCommerce Analytics Tools
Nowadays, there are a variety of eCommerce analytics tools and techniques available for brands seeking to boost their performance on Amazon. The purpose of eCommerce analytics is to gather and analyze data to better predict customer behavior and ensure product success by making informed data-driven decisions. Various metrics exist to evaluate a brand’s eCommerce performance, such as conversion rates, CTR, Buy Box percentage, and sales and product ranking. Therefore, to achieve product performance goals measured by these metrics, an important step which is explained below, is to optimize the product listings.
Optimize Product Listings
Amazon has a clear set of guidelines concerning how sellers should write and tailor their product listings. The list tackles a range of topics moving from product descriptions to even picture size specifications. However, manually optimizing product listings can be extremely time-consuming, diverting resources away from a brand’s vital operations.
Online solutions exist that help companies automatize product listing optimization. For instance, brands on Amazon can use product listing optimization tools to generate Listing Quality Scores to find out exactly which elements of their PDPs need to be optimized. The Listing Quality Score is a metric based on Amazon’s content guideline, which assesses the listing’s titles, descriptions, bullet points, images, and A+ content. It allows sellers to rapidly and efficiently detect the parts of their product listing that require immediate attention to ultimately increase their product’s organic rank and boost conversions.
A Brief Case Study
The DTC company, Profound Commerce, successfully exploited data to build a competitive advantage thanks to DataHawk’s Amazon analytics tool. The firm increased clicks, CTR, traffic, and its organic rank, which all worked to grow its Amazon conversion. In a nutshell, Profound Commerce managed to increase its sales by 64 percent by employing a data-driven strategy with DataHawk’s support.
Amazon brands face fierce competition in the marketplaces they operate in. Yet, as demonstrated throughout the article, there are different ways brands can increase their conversion rate and stay ahead of the competition. Besides measuring how many customers are buying the brand’s product, conversion rates also increase brand legitimacy, increasing the product ranking and thus helping win the Buy Box. Not surprisingly, conversion rates are sometimes considered to reap more benefits than just increasing revenues.