Conversion Rates

Hello, I am new to the ecommerce game. I am putting together a plan to add a shopping cart our site. The site is currently a niche informational site. The products will be related to this niche only, and most are not found all over the net. There will eventually be about 100 products. The average price tag for these items will be around $300.

I have the following stats:
About 15,000 unique IP's per year (only one visit per IP counted per year)
About 150,000 unique visitors per year (IP counted only once per day)
About 6 million page views.

I have seen stats for ecommerce conversion rates around 1%-2%.

My questions:
Which number do people use to count conversion rates? (uniques per year, or per day)
Since my site is very much a niche site, can I expect a higher conversion rate? lower?
Do items with higher price tags have worse conversion rates (the site currently serves mostly upper income clientele)

Thanks in advance for any responses. Any additional input or resources would be appreciated.

Tim

"Which number do people use to count conversion rates? (uniques per year, or per day)"

In businesses in which I am involved, neither. We look at uniques per month and per week.

"can I expect a higher conversion rate? lower?"

It depends on:
1. your products and pricing and how they compare to equivalent products and pricing offered by competitive websites
2. how good your website is at converting visitors into customers (2 websites offering identical products with identical pricing can have vastly different conversion rates)
3. the quality of your web traffic eg. I can generate huge volumes of traffic to a website but 99% of the visitors won't be interested in it's products, so it's conversion rate may be 0.001%. In contrast, I could generate a fraction of that traffic, but the traffic is highly targeted and the conversion rate is 7% - i.e. the shotgun vs the rifle approach.

The only way to be sure which is the most productive (best Return on Investment) is to try both methods and see.

Unless you have a large budget, I would start out by adopting approaches where the upfront investment is lower. Experienced hands can 'guestimate" which approaches are likely to give the best ROI for your products on your site, but it's only by getting "down and dirty" that you really find out.

HTH.

OAC,
Thanks for your comments.
I have been able to minimize my initial investment. I have arranged a dropship agreement with a few distributors/mfgs. so that I don't have to inventory, ship, etc. The shopping cart was under $100 and has been customized slightly.

My site, as I mentioned, is very much a niche site with niche traffic. It has been in operation for 5 years. My keywords have been optimized for this, and continues to be. (The subject matter is houseboats.)

There are really only 2 other sites similar to mine,and one has not been updated in 18 months. None sell products. Many of these products are very hard to find. Many need to be ordered directly from the mfg., as there is a limited market (houseboats only)

Getting back to my original question, you mention that you look at uniques per month. I understand there is no surefire way to determine sales, but I am looking for some general parameters, to set some goals. If you look at uniques per month, and I get 12,000-16,000 uniques per month, can I expect a .001%-7% conversion from this number? Because this number would very widely if I compare it to my uniques per year (per my numbers in previous post above).

i.e.
15,000 unique IP's per year x 1% conversion= 150 sales per year.
15,000 unique IP's per month x 1% conversion = 150 sales per month.

Thanks again.
Tim

The ecommerce conversion rates of 1%-2% are referring to visitor conversion. If you have 150,000 unique visitors per year then that is 12,500 uniques per month. 1% conversion = 125 sales per month. Does that answer your question? Let me know if I misunderstood.

Cheers.

I would not use your number of unique visitors to predict future sales, but rather try to imagine the potential market:
How many houseboats are there in the world?
How many of these products are bought every year per houseboat?
How many of these purchases are made online?
And then finally, how many of these online purchases can be expected to be made from your website?

This exercise would give you a far better estimate than applying some sort of general conversion rate on your traffic. You/we know too little of who your current visitors are, and why they are visiting your website, to predict any sales based on that. Furthermore, your product doesn't exactly sound like your typical "buy-it-online" gear.

Just my thoughts though, don't take them too seriously.