Conversion Rate

What is Conversion Rate?

Conversion rate is a percentage that measures the effectiveness of an element, website, or marketing campaign in encouraging users to perform a specific action. This ‘specific action’ is called a conversion, and varies from signing up for a free trial, buying a product, to registering for a webinar.

Conversion Rate Formula

Conversion rate is calculated as:

Using a blog subscriber form as an example, where the desired action is submitting the form, the conversion rate is the percentage of people who submit the form out of the total number of people who view the form.

If 100 visitors viewed the form but only 20 filled it out and submitted, the conversion rate is 20 divided by 100, which is 20%.

Why Does Conversion Rate Matter?

It is one of the most critical metrics in digital experimentation, business growth, and efficiency.

• In A/B testing, conversion rate is usually the primary metric used to determine which variant performs better.
• In conversion rate optimization (CRO), it is used as the north star. The practice, of the same name, is built around making the conversion rate better, i.e., generating more value from the same input, such as web traffic.
• In marketing, conversion rate often informs the return on investment (ROI) of a campaign.
• In product management, conversion rate describes how effective the product experience is at helping users achieve their goals.
• And in business in general, the conversion rate often represents revenue growth without extra expenses (improved ROI).

But conversion rate is not always the single source of truth, especially in conversion rate optimization.

“When doing CRO initiatives or any form of experiment, it’s easy to look at conversion rate as a default metric—it’s right there in the name, after all. But remember that CRO is about finding ways to alleviate a pain point, bridge a gap, or solve a problem.

Sometimes, conversion rate can’t capture and reflect what we’re trying to measure. For instance, a test variant saw an increase in conversion rate (say a 10% lift, and that’s a win), but checking your test design, you’re reminded that your problem is a decline in revenue. So, instead of defaulting to conversion rate, consider average transaction per customer or average ticket size as your test KPI. It could be more reflective of your performance.”

Carla Quizon, Head of Client Success Management, Spiralytics, Inc.

What is a Good Conversion Rate?

There’s no single “good” conversion rate. It depends on your industry, audience, traffic source, and how you’re defining the conversion.

Conversion rates can be calculated in different ways:

• Page-level conversion rate measures how many people complete a desired action, like submitting a form, out of everyone who visited the page. This includes users who never engaged with the form or CTA. Because of the wider range of user intent, this number is usually lower.
• Interaction-level conversion rate narrows it down to users who actually interacted with a macro-commitment (e.g., clicking into a checkout or beginning a form). These rates are higher because you’re measuring a more engaged subset.

Make sure you know which one you’re looking at.

To give some benchmarks:

• In the travel industry, the average form view-to-submission conversion rate is 34%. When measured from form start to completion, it rises to 51%.
• Application forms have the highest average view-to-completion rate at 52%.
• Contact forms convert the lowest at just 9%.

Wherever you’re starting, it’s best to track your own baseline and focus on steady, incremental improvements. Small wins compound.

Factors That Impact Conversion Rate

Many factors influence how well your site or app converts. They include:

• UX and design
• Copywriting
• Traffic source and quality
• Device type
• Geography
• Your product or offer, etc.

How to Improve Your Conversion Rate

You can improve your conversion rate by:

1. Behavioral analytics: Use tools like heatmaps or session recordings to identify friction points.
2. Experimenting: Test different changes to discover what performs better.
3. Personalization: Tailor content based on user behavior and segments.
4. Optimization: Continuously test and improve your website or app’s performance again and again.

Conversion Rate Optimization Tools

1. Convert Experiences: To improve run tests and improve conversion rates of your website and apps.
2. Mixpanel: To track granular event-based conversions and funnels.
3. User Testing: To collect user feedback to optimize product experiences.
4. Hotjar: To visualize user behavior to spot user experience (UX) issues.
5. Optimizely: To personalize digital experiences at scale.

Learn more about conversion rate optimization tools.