Why more SKUs can lower overall conversion

The product catalog grew from 500 to 1,200 SKUs. More options for customers, more opportunities to sell. But conversion rate dropped from 2.6% to 2.1%. More products correlated with fewer purchases per visitor. Selection expanded while sales efficiency declined. More didn’t mean better.

The assumption that more products equals more sales is intuitive but incomplete. More SKUs create more choices. More choices create more decisions. More decisions can create paralysis, overwhelm, and abandonment. Understanding when catalog expansion helps versus hurts helps you make smarter inventory decisions.

Why more products can reduce conversion

Catalog expansion creates dynamics that work against purchase completion:

Choice overload paralyzes decisions

Too many options overwhelm visitors. Choosing becomes difficult when alternatives are endless. Rather than picking one option from many, visitors choose nothing. The famous “jam study” principle applies: fewer options often produce more sales than more options.

A visitor facing 15 similar products might struggle to decide which is best for them. A visitor facing 5 products can more easily identify the right one and buy it.

Comparison shopping extends indefinitely

More products mean more to compare. Visitors who might have quickly chosen from limited options now spend time evaluating many alternatives. Extended consideration sessions might not end in purchase—visitors get tired, distracted, or decide to return later.

Search and navigation become harder

Larger catalogs require more sophisticated browsing. Categories multiply. Filters become essential. Finding the right product becomes a task rather than a discovery. Friction increases with catalog size.

Visitors who can’t find what they want don’t buy. More products mean more to sort through, and sorting through more means more opportunities to give up.

Product page traffic dilutes across more pages

With more products, views spread thinner. Each product page gets fewer visitors. Less traffic per page means less data for optimization, less social proof accumulation, and less momentum for individual products.

Inventory spreads thin, creating out-of-stock issues

Same inventory budget across more SKUs means less depth per product. Popular items might go out of stock while slow-moving items sit. Visitors find wanted products unavailable while unwanted products have plenty of stock.

Quality control becomes harder

More products mean more to manage. Photography, descriptions, pricing, and inventory accuracy become harder to maintain across large catalogs. Quality issues that hurt conversion multiply with SKU count.

The math of catalog dilution

Consider how metrics work across growing catalogs:

Fixed traffic, more products: If traffic stays constant while products multiply, traffic per product decreases. Products that would have converted visitors don’t receive enough exposure. Catalog expansion doesn’t automatically bring proportional traffic expansion.

Conversion by category: New products might be in categories that convert differently. Adding low-conversion categories dilutes overall conversion even if existing categories maintain their rates.

Discovery versus consideration: More products might improve discovery (visitors find something interesting) while hurting consideration (visitors can’t decide among options). Net effect depends on which stage matters more for your visitors.

When more SKUs do help

Catalog expansion isn’t always negative:

Filling genuine gaps

If customers search for products you don’t have, adding those products converts previously lost visitors. Gap-filling additions create sales that didn’t exist before. These additions improve conversion because they satisfy unmet demand.

Serving distinct customer segments

Different customers want different products. Expanding to serve additional segments brings visitors who now find what they want. Segment-expanding additions improve conversion for those segments without necessarily affecting others.

Providing complete solutions

Complementary products that complete purchases increase cart completion. A customer who finds the main product plus accessories converts better than one who must shop elsewhere for accessories. Strategic additions improve rather than dilute.

Improving SEO reach

More products mean more pages for search engines to index. Product pages targeting specific long-tail keywords attract visitors searching for those exact items. Traffic grows alongside catalog, potentially maintaining or improving conversion.

Finding optimal catalog size

The right number of products balances selection with manageability:

Analyze conversion by product count buckets

Do categories with more products convert better or worse than categories with fewer? This reveals whether your customers respond to selection breadth or suffer from choice overload.

Track conversion as catalog changes

Plot conversion rate against SKU count over time. If conversion drops as products increase, you might be past optimal size. If conversion improves, expansion is working.

Measure zero-result searches

High zero-result searches indicate gaps where products would help. Low zero-result searches suggest adequate coverage—additions might create more clutter than value.

Evaluate per-product performance

What percentage of SKUs actually contribute to revenue? If 20% of products generate 80% of sales, the long tail might be diluting attention without contributing value.

Managing large catalogs effectively

If you need many SKUs, minimize conversion damage:

Improve navigation and filtering

Help visitors narrow options quickly. Effective filters, smart search, and clear category structure reduce overwhelm by making large catalogs feel manageable.

Curate and feature selections

Don’t present all products equally. Highlight bestsellers, staff picks, and recommended items. Curation guides visitors toward products they’re likely to buy rather than leaving them to evaluate everything.

Use recommendations strategically

“Customers also bought” and “You might like” suggestions direct attention toward relevant products. Personalized recommendations cut through catalog size by surfacing the right products for each visitor.

Prune underperformers regularly

Remove products that don’t sell. Every SKU that generates zero sales but consumes attention and resources dilutes catalog effectiveness. Regular pruning keeps catalog focused on products that actually convert.

Organize by decision criteria

Structure categories around how customers decide, not how inventory is organized internally. Groupings that match customer mental models help visitors navigate to right products faster.

Frequently asked questions

How many SKUs is too many?

Depends on category and customer behavior. Some stores thrive with thousands of products; others convert better with dozens. Monitor conversion as you grow and watch for declining efficiency.

Should I reduce my product count?

If many products don’t sell and conversion has declined as catalog grew, pruning might help. Test removing the lowest-performing products and measure conversion impact.

Does this apply to marketplaces differently?

Marketplaces often benefit from breadth because customers expect vast selection. But even marketplaces suffer if search and filtering can’t help customers find products efficiently.

How do I add products without hurting conversion?

Add products that fill gaps rather than create redundancy. Improve navigation simultaneously. Feature new products appropriately rather than burying them in overwhelming catalogs. Quality additions with good merchandising help rather than hurt.