Friday, January 22, 2010
I was chatting to my mate Tom Davies who's recently launched a bike website Chappelli Cycles. They do single speed fixed gear bicycles which are very popular at the moment.
The plan for their business is to do custom bicycles but to keep things simple and test the market they launched their site with 3 designs. And one month after launching sales have beat their expectations and they've already sold out of one model. Their conversion rate (the number of people who purchase as a percentage of people who visit the site) is fantastic.
In comparison, our conversion rate is abysmal. About 1 in 600 visits to our website results in a sale, that's 0.167%. A good retail website should have a conversion rate around 1-2%. Fortunately our traffic has been fantastic, so sales are still reasonable, but if our conversion rates were 1-2%... wow.
So that got me thinking about why our conversion rate is so low. After talking to some customers one key reason we think it's low is that people can't make a decision, we give them too much choice. With over 3 trillion possible shoe combinations they design 20 pairs of shoes they like, then they're paralysed when it comes to making a decision, so they don't make one.
In addition to their bike's looking fantastic, that theory would also help explain Chappelli Cycles excellent conversion rate - 3 choices keeps it simple. Custom bikes will no doubt drive lots more traffic via word of mouth and PR attention, then perhaps Tom should keep the ready made bikes available in addition to doing custom bikes. Perhaps we should do that with our shoes.
I'd love to hear your thoughts. Do you think too much choice paralyses people when it comes to making a decision? How do we help customers overcome this?
Posted by Michael Fox at 2:31 PM