{"id":19532,"date":"2022-12-12T09:30:42","date_gmt":"2022-12-12T16:30:42","guid":{"rendered":"https:\/\/www.vdigitalservices.com\/?p=19532"},"modified":"2024-01-18T16:24:50","modified_gmt":"2024-01-18T23:24:50","slug":"calculate-conversion-rate","status":"publish","type":"post","link":"https:\/\/www.vdigitalservices.com\/calculate-conversion-rate\/","title":{"rendered":"Website Conversion Rate: What it is & How to Improve it"},"content":{"rendered":"

Whether you\u2019re taking your first foray into the world of digital marketing, or you\u2019ve been here for quite some time, mastering all of the various terms and metrics is no small task. If it seems like digital marketing has a language all its own, that\u2019s because it does – but once you learn that language, there\u2019s no stopping you.<\/span><\/p>\n

\u201cConversion rate\u201d is one of the most commonly used terms in digital marketing, usually used in the context of describing the success of a specific campaign. Even if you can\u2019t quite define the term yet, you\u2019ve probably figured out that a higher conversion rate is generally equated with a higher marketing success rate. And in turn, that brings better profitability for your business.<\/span><\/p>\n

We\u2019ve created a guide to teach you everything you need to know about conversion rates, including what they are and how to calculate the conversion rate for your website. Plus, we\u2019ll cover effective strategies for increasing conversion rates and making progress towards your marketing goals.<\/span><\/p>\n

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<\/h2>\n

What is Conversion Rate?<\/strong><\/h2>\n

In simplest terms, the conversion rate is the exact percentage of online users that visit your website or landing page and then \u201cconvert.\u201d Converting can look like anything, but ultimately, it\u2019s a website visitor completing the specific action that you want them to. The specific conversion itself will depend on your marketing plan and larger goals, which is why it can take so many different forms.<\/span><\/p>\n

For example, here are some of the most common types of conversions:<\/span><\/p>\n

    \n
  • Submitting a form (such as a lead generation form or a contact information form)<\/span><\/li>\n
  • Making an appointment or reservation<\/span><\/li>\n
  • Making a purchase<\/span><\/li>\n
  • Interacting with your online chat service<\/span><\/li>\n
  • Contacting your business via phone or email<\/span><\/li>\n
  • Registering as a user on the website<\/span><\/li>\n
  • Signing up for a paid or free subscription (such as an email newsletter)<\/span><\/li>\n
  • Downloading something (such as a mobile app, free trial, or eBook)<\/span><\/li>\n
  • Using a feature or your app<\/span><\/li>\n
  • Upgrading existing services they receive from your company<\/span><\/li>\n
  • Engaging with your website in other ways (measured by metrics such as number of repeat visits, time spent on site, number of pages visited, etc.)<\/span><\/li>\n<\/ul>\n

     <\/p>\n

    You might see some of your goals on the list above, or your ideal conversions might be more specific to your business. Essentially, the purpose of a conversion is to serve as a measurable action that an online user takes, supporting their progress through the sales funnel to eventually become a paying customer.\u00a0<\/span><\/p>\n

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    Tracking Conversion Rate<\/strong><\/h2>\n

    Before you start searching for an online conversion rate calculator (hint: you\u2019re not going to need one after reading this guide), you\u2019ll need to make sure you\u2019re actually tracking conversions. Conversion rate may be just one of the many ways to measure your success, but it is a highly effective means for assessing the quality of your marketing campaigns and website as a whole.<\/span><\/p>\n

    There are many options for tracking conversion rates within popular advertising and analytics platforms, so gathering your data shouldn\u2019t require that much extra effort. The exact process for implementing tracking will vary by platform, but you can typically find step-by-step guides in each site\u2019s help or support sections.\u00a0<\/span><\/p>\n

    Here are some of the most widely used platforms out there, all of which offer conversion rate tracking capabilities:<\/span><\/p>\n

      \n
    • Google Analytics<\/span><\/li>\n
    • Google Ads<\/span><\/li>\n
    • Facebook Ads<\/span><\/li>\n
    • Instagram Ads (part of Facebook)<\/span><\/li>\n
    • Twitter Ads<\/span><\/li>\n
    • Pinterest Promoted Pins<\/span><\/li>\n<\/ul>\n

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      The easiest way to set up conversion tracking is to partner with a professional. However, if you\u2019re flying solo, for now, it\u2019s worth investing the time and brainpower into figuring out how to do it yourself.<\/span><\/p>\n

      Getting meaningful data with the right time frames<\/strong><\/h3>\n

      When you begin learning how to track conversions, keep in mind that there are many factors that can affect the quality of your data. Without a doubt, the time frame of your conversion data carries the most significant weight. Here\u2019s why.<\/span><\/p>\n

      Imagine that you have a web page that shows a 100% conversion rate – great news, right? Well, once you realize that there was only one visitor within the time frame, that 100% rate isn\u2019t quite as impressive.\u00a0<\/span><\/p>\n

      Without a large enough time frame, it can be difficult to collect a meaningful traffic sample. Your results can be easily skewed, and the process ends up being unproductive. Situations like accidental conversions, low traffic rates, random periods of high or low conversions, and others will dramatically impact a small time frame or sample. But with a larger, well-rounded sample, you can more confidently trust your results.<\/span><\/p>\n

      There\u2019s not necessarily just one \u201cright\u201d timeframe for tracking conversion rates, especially because every business and marketing campaign is different. A month is often a good rule of thumb, but small businesses might find that they need several months to collect substantial data.\u00a0<\/span><\/p>\n

      Why conversion tracking is so important<\/strong><\/h3>\n

      We probably don\u2019t need to explain why it\u2019s important to track conversion rates, but just in case: if you don\u2019t know how to track and calculate conversion rates, how will you know whether or not your marketing efforts are working?<\/span><\/p>\n

      It\u2019s virtually impossible to optimize a website or a marketing campaign if you don\u2019t have the data to direct your course of action. You\u2019ll end up taking shots in the dark, aimlessly implementing new ideas with no real way to determine if they\u2019re effective or not.\u00a0<\/span><\/p>\n

      On the other hand, being well-prepared to track, calculate, and analyze conversion rates will give you an edge over your competition. You\u2019ll be able to take smarter steps towards improvement, saving yourself considerable time and energy (and expense) by decreasing wasted marketing efforts.\u00a0<\/span><\/p>\n

      One of the many benefits of conversion rates is that they can be very specific or extremely broad – it\u2019s completely up to you. Different types of conversion rates allow you to evaluate different aspects of campaign and website performance, making them one of the most versatile metrics in marketing. Here are just some of the ways you can use conversion rates to measure performance:<\/span><\/p>\n

        \n
      • Overall conversion rate: <\/b>How effective is your website at converting visitor traffic from any source?<\/span><\/li>\n<\/ul>\n
          \n
        • Campaign conversion rate: <\/b>How well did specific targeting improve conversions?<\/span><\/li>\n<\/ul>\n
            \n
          • Marketing channel conversion rates: <\/b>Which channels (e.g., Facebook Ads, Google Ads) produce more conversions?<\/span><\/li>\n<\/ul>\n
              \n
            • Individual ad conversion rates: <\/b>Do certain ads drive more highly-qualified traffic and result in more conversions? Which ones underperform?<\/span><\/li>\n<\/ul>\n
                \n
              • Page-level conversion rate: <\/b>Which web pages convert more traffic?<\/span><\/li>\n<\/ul>\n
                  \n
                • Keyword conversion rate: <\/b>Are there certain keywords outperforming others? If so, should I dedicate more budget to these keywords?<\/span><\/li>\n<\/ul>\n

                   <\/p>\n

                  Conversion rates allow you to answer all of the questions above and more. But more importantly, they empower you to take the next step in marketing optimization: asking <\/span>why <\/span><\/i>your conversion rates are better in certain situations than others.\u00a0<\/span><\/p>\n

                  Learning what strategies, mediums, and channels deliver the best conversion rates can help you become a better marketer and a better business owner in general.<\/span><\/p>\n

                  How to Calculate Conversion Rate<\/strong><\/h2>\n

                  Learning how to calculate conversion rates might sound intimidating, but it\u2019s actually fairly straightforward. The conversion rate formula itself is pretty simple and requires only basic math.<\/span><\/p>\n

                  Here is a step-by-step guide to calculating conversion rate:<\/span><\/p>\n

                    \n
                  1. \n
                      \n
                    1. First, find <\/span>the number of people that visited your site or landing page <\/b>within a given timeframe.<\/span><\/li>\n
                    2. Then, find <\/span>the number of conversions<\/b> within that same timeframe<\/span>. 3<\/b><\/li>\n
                    3. Divide<\/b> the number of conversions by the number of visitors<\/span>.<\/b><\/li>\n
                    4. Multiply <\/b>that result by 100% to calculate the conversion rate total.<\/span><\/li>\n<\/ol>\n<\/li>\n<\/ol>\n

                       <\/p>\n

                      So, the conversion rate formula is as follows:<\/span><\/p>\n

                      (Conversions \/ Total Visitors) x 100% = Conversion Rate Total<\/i><\/b><\/p>\n

                      Let\u2019s walk through an example so you can see the formula in action:<\/span><\/p>\n

                      Say your website had a total of 12,000 visitors and 1,500 conversions. First, you would divide 1,500 by 12,000 and get 0.125. Multiply 0.125 by 100%, and you end up with a conversion rate total of 12.5%.\u00a0<\/span><\/p>\n

                      (1,500 \/ 12,000) x 100% = 12.5%<\/b><\/p>\n

                      Many analytics and online advertising platforms will calculate the campaign conversion rate for you, but it\u2019s always helpful to be able to do it yourself.\u00a0\u00a0<\/span><\/p>\n

                      Conversion rate vs. click conversion rate<\/strong><\/h3>\n

                      A common assumption is that conversion rate and clicks conversion rate are the same thing. However, they\u2019re actually each a distinct metric, though both are equally informative:<\/span><\/p>\n

                        \n
                      • As we\u2019ve covered, the <\/span>conversion rate <\/b>is the total number of conversions divided by the total number of visitors<\/span><\/li>\n<\/ul>\n
                          \n
                        • Click conversion rate <\/b>calculates the percentage of visitors that converted, without counting multiple conversions by a single visitor more than once<\/span><\/li>\n<\/ul>\n

                           <\/p>\n

                          As you can see, your conversion rate doesn\u2019t account for a single visitor that may have completed multiple conversions. For example, one person might make a purchase, sign up for your email list, and complete a form for additional service information. The conversion rate would consider that three conversions, whereas the click conversion rate would consider it one.<\/span><\/p>\n

                          It\u2019s not unusual for businesses\u2019 click conversion rates to be either identical or very close to their conversion rates, which is why the terms are so often used interchangeably.\u00a0<\/span><\/p>\n

                          What is a Good Conversion Rate?<\/strong><\/h2>\n

                          It\u2019s impossible to say what the \u201cbest\u201d conversion rate is, mainly because the rates can differ so dramatically. Everything from your industry and business size to your traffic quality and tracked conversion action is going to alter your concept of a successful conversion rate.\u00a0<\/span><\/p>\n

                          While you might see statistics that discuss conversion rates, a good conversion rate is ultimately going to come down to what matters for your business and the specific marketing campaign.<\/span><\/p>\n

                          Let\u2019s take a closer look at an example to see this idea in action.\u00a0<\/span><\/p>\n

                          A construction and remodeling company is currently averaging about $3,500 in total revenue for every new paying customer, which comes out to a 50% profit margin. They have five active marketing campaigns, all of which aim to convert an online user submitting a lead generation form on their website.\u00a0<\/span><\/p>\n

                          When they assess conversion rates, the totals come back as follows:<\/span><\/p>\n

                            \n
                          • Campaign 1: 15%<\/span><\/li>\n
                          • Campaign 2: 10%<\/span><\/li>\n
                          • Campaign 3: 8%<\/span><\/li>\n
                          • Campaign 4: 8%<\/span><\/li>\n
                          • Campaign 5: 10%<\/span><\/li>\n<\/ul>\n

                             <\/p>\n

                            At first glance, it would seem like Campaign 1 wins with the \u201cbest\u201d conversion rate, while 3 and 4 are in need of improvement. But conversion rate alone doesn\u2019t give us the full picture. What is the actual profitability of these campaigns? How many leads are actually turning in sales? Going off of the conversion rate, we can\u2019t say.<\/span><\/p>\n

                            However, there is more data that can give us a better idea. The return on investment (ROI) for each campaign is the key to answering those questions.\u00a0<\/span><\/p>\n

                            When the company reviews ROI per campaign, here are the results:<\/span><\/p>\n

                              \n
                            • Campaign 1: 310%<\/span><\/li>\n
                            • Campaign 2: 275%<\/span><\/li>\n
                            • Campaign 3: 88%<\/span><\/li>\n
                            • Campaign 4: 775%<\/span><\/li>\n
                            • Campaign 5: 414%<\/span><\/li>\n<\/ul>\n

                               <\/p>\n

                              With that data in hand, it\u2019s much easier to see which of the campaigns are delivering the biggest payoff. Despite having a conversion rate of 15%, Campaign 1 doesn\u2019t even come close to providing the biggest ROI. Instead, it\u2019s campaign 4 – which had a conversion rate of just 8% – that offers the biggest bang for their buck.<\/span><\/p>\n

                              This is the perfect example of how conversion rate is a useful piece of data, but it isn\u2019t the gold standard for measuring campaign success. It\u2019s just one piece of a much larger puzzle, and it\u2019s vital that you zoom out from conversion rate to truly understand what\u2019s working and what\u2019s not.<\/span><\/p>\n

                              Conversion Rate Optimization: How to Improve Your Conversion Rate<\/strong><\/h2>\n

                              Now that you\u2019ve learned what a conversion rate is, how to calculate it, why it\u2019s valuable, and how to use it, it\u2019s time for the next step: conversion rate optimization (CRO).\u00a0<\/span><\/p>\n

                              CRO is a series of steps you take to optimize your website and landing page, with the ultimate goal being an increase in the total number of conversions. With CRO, you focus on improving conversions without necessarily needing to grow traffic. Instead, you\u2019re finding ways to make the most of existing traffic – working smarter, not harder.<\/span><\/p>\n

                              Even raising your conversion rate by a few percentage points can make a big difference for profitability, making CRO a foundational part of any solid digital marketing plan. So, what\u2019s the best approach to CRO? There are many different ways you can tackle the task, but here are some basic steps to get you started.\u00a0<\/span><\/p>\n

                              Start by testing your website.<\/strong><\/h3>\n

                              With CRO, you\u2019re honing in on lost conversions. Why aren\u2019t those users converting, and what can you do to change that?<\/span><\/p>\n

                              Conducting a test to assess your website is a good place to begin. You can get a clearer idea of your site\u2019s strengths and weaknesses, empowering you to make targeted improvements with CRO in mind.\u00a0<\/span><\/p>\n

                              Here\u2019s how to start CRO for a website now:<\/span><\/b><\/p>\n

                              1. Build a dedicated landing page.<\/b><\/h4>\n

                              Paid advertising should always be paired with a landing page, primarily for the purpose of page optimization. You\u2019re spending money to bring traffic to your site, so it makes sense to send them directly to a page that\u2019s designed to sell.\u00a0<\/span><\/p>\n

                              Landing pages also have the benefit of being excellent candidates for CRO. If you\u2019re currently sending paid ad traffic to your homepage, construct a landing page as a first step.\u00a0<\/span><\/p>\n

                              <\/b>2. Devise a hypothesis.<\/b><\/h4>\n

                              Like any good experiment, CRO tests must have a hypothesis. This means that you\u2019ll need to consider your site elements, then make informed guesses about which ones play the biggest roles in conversion and profitability.\u00a0<\/span><\/p>\n

                              Some site elements that can serve as a good basis for a hypothesis include:<\/span><\/p>\n