Conversion Rate: What Is It and How to Boost It?
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If you’re a business owner or a marketer and you’re not familiar with the conversion rate, you’re in big trouble! Why is conversion rate (CR) such a big deal?
Let’s see it this way. When you’re a student, your professors monitor and measure your learning progress, and exams prove your educational success.
In digital marketing, conversion rates are that!
So, you see, you can’t do marketing without relying on conversion rate. And, you can’t afford to omit it. But, what is the conversion rate? What does it mean for your business? How do you use it in marketing?
We answer these and more questions in this post, so read on!
What is conversion rate?
Conversion rate is the percentage of users who have taken the action you want them to take. This can include CTA clicks, subscribing to your email list, making a purchase, or any other goal your marketing strategy aims to reach.
Most common types of conversions
While the exact conversion depends on your marketing goal, the most common ones are filling out a form, signing up for any kind of newsletter or contest, requesting a demo, downloading/installing an app, and of course – buying goods. Here you will find a full guide on conversion types:
Conversion Rate Formula
No one likes calculations! 😎 Fortunately, you don’t need to be Einstein to calculate your conversion rate.
All you need to do is take the number of total visitors and divide it by the number of conversions.
total number of visitors / conversions = conversion rate
Let’s say you’ve sent an email to 10,000 subscribers with a discount code and 400 of them opened the email and used your code to make a purchase.
To calculate your email conversion rate, divide the number of people who bought something by the number of people you’ve emailed.
That would look like this:
400 / 10,000 = 4%
What to look at when measuring your conversion rate?
The factors to consider for calculating your conversion rate depend on the type of conversion you want to measure. Here are several examples:
- General CR – the number of clicks, form fills, and downloads.
- Email CR – the number of subscribers who took an action from within the email.
- eCommerce CR – the number of purchases and “Add to shopping cart” clicks.
- Social media CR – the number of direct messages vs followers.
- Organic search CR – the number of blog posts read vs search traffic.
- Click-through rate – the clicks on an ad/banner vs impressions.
Why is conversion rate important for your marketing?
Conversion rate is a key factor that shows the success of your marketing efforts. It tells you whether your marketing strategy works or not, or that it needs to be adjusted.
Evaluating your CR, you can see if your strategy needs adjustment, analyzing each step of the sales funnel and seeing when and where your users decided to leave. As such, you will see which weak spots need optimisation, either your funnel is too complicated or your chosen marketing channel works well for your brand/offer.
And, last but not least, the conversion rate is tightly related to the amount spent on marketing. A higher conversion rate means less money spent on marketing. And, that’s every business owner’s dream!
How do you know if the conversion rate is good?
The average conversion rate marketing falls between 2% and 5% across different industries. A good result is considered the one above 10%.
What factors affect conversion rate?
Many factors can affect the conversion rate, from something as simple as UI design to something we can’t always control, such as location.
The most common ones are page design, SEO, adaption to device types, language, etc.
CRO: How to improve your conversion rate?
CRO stands for conversion optimisation, the process of improving conversion rates. It involves the following steps:
- Creating hypotheses about why visitors don’t convert and analysing their behaviour on different stages of user journey
- Identifying the current average CR
- Gathering and analysing multiple data (website engagement metrics, SEO, e-commerce, and CRM data)
- A/B Testing – comparing 2 or more versions of the same variable (web pages, ads emails, or other digital content) to see which version works best.
Examples of a successful CRO
Do you feel pessimistic about CRO? Don’t! Making even the smallest changes to your website, ad, or email design can greatly improve your conversion rate.
Here are two stories of a successful CRO.
Each color has a different influence on us and HubSpot have proven that with the color change of the CTA button on their homepage to red. This minor change has resulted in a 21% increase in conversion rate, as they claim in their A/B testing results report.
Spotify and immediate jump-in experience
A couple of years ago, Spotify reported that their CR among those users who used free trial to premium subscribers bounced by 46%. This is a great result! And the reason is an opportunity for users to preview the live product right after they appear on the landing page, which is really convincing. Experience is everything!
Tips to increase your conversion rate
Not sure where to start with CRO? Here are 8 tested and proven tips to help increase your conversion rate!
- Use active verbs and phrases in your CTAs like “buy”, join”, and “Sign me up!”
- Highlight users’ pain points and how your product can solve them.
- Use social proof, such as customer reviews, testimonials, or a “just bought it” feature.
- Go for a short and simple sign-up process.
- Make your CTA visible, right in front of visitors’ eyes.
- Your page’s design should be neat and clean, with one CTA.
- Have special landing pages for your ads.
- Offer incentives like bonuses, freebies, and discount coupons.
Summing up
The conversion rate is vital for measuring the effectiveness of your marketing strategy. It shows whether you’re doing it right or need to change something. That’s why it’s important to track all this metric continuously and optimise campaigns.
Optimisation helps your business grow, boosts conversions, increases sales, and improves revenue. To see what works and what doesn’t, follow the CRO process and the tips above, and enjoy the increase in your conversions.
Don’t forget to be patient – your CR can’t increase overnight. It may take time and effort, but it will pay off.
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