What is a conversion rate? Everything you need to know

What is a conversion rate? If you’re aiming to build an effective marketing strategy, understanding this concept is absolutely vital. While the calculation itself is straightforward, interpreting what it means for your business can be more nuanced. Assessing how much room there is for improvement depends on a range of factors. Once you start working to optimise your conversion rate, it’s crucial to monitor its progress to evaluate the impact of your efforts.

What is a conversion rate?

Let’s start by clarifying what a conversion actually is. It’s the action you want your website visitor to take. In e-commerce, this is usually a purchase, which is easy to define. However, depending on your sector and what you offer online, a conversion could mean:

• Signing up for a subscription
• Downloading a document
• Completing a form
• Installing a mobile app
• Entering a competition
• Subscribing to a newsletter...

So, when we ask “What is a conversion rate?”, we’re talking about the percentage of visitors who complete the desired action, compared to the total number of visitors over a set period. For instance, if your website receives 2,000 visits in March and 100 of those result in a sale, your conversion rate is (100/2000) x 100 = 5%. When analysing conversion rates, it’s important to distinguish between the SEO conversion rate and the Adwords conversion rate. The first relates to traffic from organic search, while the second refers to visitors acquired through paid advertising.

Conversion rate or transformation rate?

There’s no real difference between these two terms – they’re often used interchangeably. However, there’s a subtle distinction depending on the type of marketing campaign. “Conversion rate” is more common in e-commerce, whereas “transformation rate” is sometimes used in email campaigns to describe the ratio of clicks to leads.

How can I improve my conversion rate?

Now that we’ve defined conversion rate, let’s explore how you can increase it. There are several effective strategies. Using relevant keywords in your content helps attract qualified visitors to your site, boosting the likelihood of conversions. An intelligently designed and well-optimised landing page can further increase conversions by giving users exactly what they’re looking for. A website with a professional design, intuitive layout and smooth navigation builds trust and enhances the user experience. Providing excellent customer service ensures potential customers get prompt answers to their questions, making transactions seamless. Finally, running A/B tests on your web pages helps you quickly identify what works best for turning visitors into customers.

To take things further, Incremys offers innovative modules to help improve your conversion rate, such as personalised AI and optimised content production. These tools enable you to tailor your strategy, personalise the user experience and maximise the effectiveness of every page to generate more qualified conversions.

What is considered a good conversion rate?

It’s a fair question, but there’s no universal answer. For example, the average conversion rate for websites was 2.35% in 2022, but this figure should be treated with caution. There are significant differences between industries. The conversion rate in fashion (2.77%) is quite different from that in healthcare (4.63%). Moreover, while conversion rate is a key performance indicator, it should be considered alongside other metrics such as average basket value. If your conversion rate is high but each customer spends very little or only buys your lowest-margin product, it may not be ideal for the long-term health of your business.

Conclusion

Understanding “What is a conversion rate?” is important, but it’s only the beginning. You also need to know how you compare to your competitors and develop marketing strategies to address your site’s weaknesses. Using analytics tools like Incremys or Google Analytics is invaluable for tracking your conversion rate over time and measuring the impact of your actions.

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