What is conversion rate? A quick guide to conversion rate and how it’s used.

Driving traffic to a website can be costly. To achieve maximum value from this investment it is essential to convert anonymous website visitors into customers. This is why conversion rate is a crucial metric for the savvy marketer. Evaluating the conversion rate for different campaigns and user segments is essential to gauge the effectiveness of marketing activity.

Conversion rate is the percentage of sessions or users on your website who have completed an important business goal, such as a transaction or signup. Imagine you had 10,000 visitors last month and 100 visitors bought something from you, your conversion rate for that month would be 1%.

Conversion rate = Number of goal completions / Number of visitors

This is typically measured by default in your Google Analytics account if you have ecommerce or goal tracking set up. You may want to consider tracking some extra goals like newsletter signups, or other secondary goals so you can see the conversion rate for them individually.

Knowing your conversion rate is the first step towards improving it through user research and conversion optimisation.

Conversion rate can change over time, it may vary month on month, by the day of the week, or by the week of the month. You can look at your conversion rate by specifying the previous period of time you’d like to see. If you are comparing your current conversion rate to a previous period, you need to make sure you keep it to a similar time period to avoid any extra variables – don’t compare 2 days this week with 6 days last week, for example.

It’s worth noting that conversion rate may also fluctuate due to seasonality, for example a lot of ecommerce websites will have a higher conversion rate over Black Friday & Christmas because demand is higher and purchases are more time-sensitive. So you don’t want to compare February with December.

We mentioned ‘user’ conversion rate before. Generally speaking, the ‘conversion rate’ you’ll see in Google analytics is the ecommerce conversion rate and this is based on sessions and not users. We recommend to most of our clients to start using user conversion rate instead as sessions are another variable in the mix.

What is conversion rate vs conversion count?

Conversion rate is different to conversion count as conversion count is the hard number of conversions, whereas conversion rate is the percentage of conversions proportional to the number of visitors your website receives. You should keep an eye on both as proportions can change. If you added a lot of PPC traffic to your website, your average conversion rate will change based on how well or poorly that new traffic converts. Also if you removed a large chunk of poorly converting traffic, like display traffic, you may have the same amount of conversions as before, but with fewer users on the website your average conversion rate would be higher. If you spot any changes, it’s worth checking both figures to see what the real situation is.

So you should now be able to answer ‘what is conversion rate’ yourself, and be a step closer to being able to optimise it on your website.

If you’d like to find out ways to improve your current conversion rate, you can give us a call on 0161 713 2434 or email [email protected] and get a free 15 minute website conversion audit call with a senior optimiser.