Conversion rate: definition, level and calculation in online marketing
Conversion Rate – Conversion rate is one of the most important metrics in online marketing. It indicates the percentage of website visitors who perform a desired action on the website, such as making a purchase, signing up, or filling out a form. A high conversion rate is crucial to the success of a website and shows how effectively it converts visitors into paying customers or leads. In this article we will take a closer look at the conversion rate, define a realistic target and learn how a good marketing agency can increase the conversion rate.
What is conversion rate?
The conversion rate is the ratio between the number of conversions and the number of website visitors. A conversion can represent various actions that a company considers a success, such as a product purchase, filling out a contact form, signing up for a newsletter, or downloading a file. The conversion rate is expressed as a percentage and indicates how effective a website is in converting visitors to conversions.
For example, a conversion rate of 5% means that out of 100 visitors, five performed a desired action.
What is a realistic conversion rate?
The realistic conversion rate depends on various factors, such as the industry, the type of product or service, the target audience and the website itself. As a rule, a conversion rate of 2% to 5% can be considered realistic. Some industries with particularly compelling offers or a well-optimized website can even achieve conversion rates of over 10% (mostly landing pages).
Conversion rate usually can’t be drastically increased overnight, that requires continuous improvements.
How to calculate the conversion rate?
You calculate the conversion rate by dividing the number of conversions by the number of website visitors and multiplying the result by 100.
Formula: Conversion Rate = (Number of Conversions / Number of Website Visitors) * 100
To determine the conversion rate, you first need to determine the number of conversions and the number of website visitors for a certain period of time. Conversions can be different actions, depending on what you consider a success on your website. For example, they can be product purchases, registrations, contact requests or downloading files.
Example: 5% conversion rate
Let’s say you had 500 conversions in a month (for example, 500 product purchases) and a total of 10,000 website visitors in that month. Then the calculation of the conversion rate would look like this:
Conversion Rate = (500 / 10,000) * 100 = 5%
This means that your conversion rate for this month is 5%, because 5% of visitors made a conversion.
How can a good marketing agency increase the conversion rate?
An experienced marketing agency can employ various strategies and tactics to increase a website’s conversion rate:
- Website analysis: The agency conducts a thorough analysis of the website to identify weaknesses and uncover optimization potential.
- Target group analysis: The agency understands the target group and optimizes the website accordingly to better address their needs and interests.
- Usability and user experience: the agency improves the user experience and usability of the website to increase the conversion rate.
- Call-to-action optimization: The agency optimizes the call-to-action elements on the website to motivate visitors to take action.
- Content optimization: The agency creates relevant and compelling content that encourages visitors to convert.
- Conversion funnel optimization: The agency designs the conversion funnel as efficiently as possible to guide visitors through the buying process.
- Split testing: The agency performs A/B testing to compare different versions of the website and determine the best possible configuration.
- Tracking and analysis: The agency continuously monitors the conversion rate and analyzes the data to identify weaknesses and adjust the strategy.
By using these strategies in a targeted manner and continuously optimizing them, a marketing agency can sustainably increase the conversion rate of a website and thus improve the success of the company.
