Not long ago, I read an article on steps you can take to convert visitors to buyers on your online retail web site. This 5-point checklist for increasing conversion made a lot of sense to me, and I wanted to share some thoughts on the first item on their list — checkout.

Simplify your web site’s checkout process

One of the top reasons that users abandon their shopping carts is because the checkout process is too long. Other reasons cited in a Global Millennia Marketing Study include requiring too much personal information, poor navigation, poor download times, confusing checkout process, and requiring registration to purchase.

Checkout is a key area of your online retail site because when people decide they want to buy, your site shouldn’t prevent them from doing so. Here are some ways to reduce checkout complexity and make the user experience better:

Don’t make a user log in or register

People don’t use your site every day, so chances are they will not remember their login or password for their site account. Allow people to bypass this step, but let them know that they may be losing advanced capabilities like order tracking or viewing order history. Instead of requiring registration pre-sale, incent them to create an account after the sale.

Keep it simple

Ask for the minimum amount of information it takes for the user to complete the sale. Anything that distracts your user from the task of checking out is taking money out of your pocket.

Additionally, you’ll need to find a balance between the number of screens you’ll need in your checkout flow and breaking the information up into manageable chunks. Hint: don’t make your checkout flow one long screen since this requires scrolling through many pages and reading through cluttered text. Also, seeing one large form may scare a user away — remember, they don’t want to have to fill in a bunch of personal information. Breaking up screens can give the perception that you’re collecting less information.

Finally, now’s not the time to ask a user to fill out a marketing survey. Information that users fill out during checkout should be mission-critical data only. Save the survey for after the sale.

Reduce download times

Make sure your server is equipped to handle the demand that people will put on it, and make sure your pages are “lean and mean.” Reduce graphics as much as possible. Many sites do this effectively by simplifying their navigation at the top of the page and not displaying what a user would see if they were outside of checkout. Pages should load in two seconds or less.

Measure checkout effectiveness

So how can you measure the effectiveness of your checkout flow? The most common measure is called “cart conversion,” or the ratio of the number of people that order and the number of people that begin the checkout process. Theoretically, you would expect 100% cart conversion, but this isn’t the case. High shipping costs and other factors cause cart abandonment in checkout, and you’ll have to find ways to combat these barriers elsewhere.

Higher cart conversion has a direct effect on your bottom line — it’s not hard to monetarily justify investments aimed at improving the checkout process.

Examining your checkout flow and correcting even small issues and usability problems can have a positive impact on your bottom line.

A new report from Forrester Research indicates that online retail sales will double in the next five years to $329 billion. Travel sites are expected to reap the biggest gains. The sales growth online will come at the expense of offline retail sales.

Part of the growth is expected to be the result of how retailers’ views of the web are changing. Retailers are beginning to view the Internet as a channel to improve customer service and retention instead of merely a low-cost sales channel, according to Forrester.

Another factor that could contribute to online retail sales increases might be high gasoline prices. A recent Shopzilla.com survey found that 40 percent of consumers surveyed have increased their online buying as a result of high fuel prices, with 15 percent saying they are shopping online much more and 25 percent saying somewhat more.

Clickz has word of a new study out this morning from iProspect. The study finds that only 40% of search marketers are being evaluated on actual business goals. Instead of being evaluated on campaign ROI or total sales generated, success of search marketing campaigns tends to be based on total traffic to the web site as a result of the campaign or top search engine ranking.

The study goes on to surmise that search marketing campaigns are evaluated by intermediate results because marketers can’t tie conversions back to a campaign.

Unfortunately, this is the story with so many small-to-medium sized businesses. In one online marketing forum I belong to, many web site owners have given up on paid search marketing due to the inability to tie conversion and sales to paid campaigns.

Even many large corporations don’t have enough focus and resources dedicated to making sure they are tracking sales, conversion and ROI from their campaigns.

If you’re a beginner to paid search or online marketing, it’s imperative that you track sales, conversion and ROI from each marketing campaign. You should be able to track your paid search activities separate from your natural search activities, your banner advertising separate from your email marketing. I usually go a step or two further, evaluating each keyword I bid on in both Yahoo Search Marketing and Google Adwords, for example. After all, I don’t want to spend money on terms that aren’t producing a return on my investment.