Your conversion rate is how many visitors or users complete a desired action on your website or app so knowing what is a good conversion rate is a key to eCommerce success.
The action might be purchasing a product or service, signing up for a membership or subscription, downloading content, or any number of other things. Displayed in percentage, your conversion rate can drastically fluctuate and vary between products and pages. It is an essential metric for measuring the success of your marketing and sales strategy.
Just as your conversion rates may differ across your products and pages, what is a "good" conversion rate varies from industry to industry. Below, Triple Whale discusses how to find your conversion rate, how to determine if it's good, and how you can improve it.
There are three basic formulas for finding your conversion rate. The one that works best for your situation will depend on what you define as the conversion event and how you intend to measure traffic.
Essentially, the numerator will represent your conversions, determined by your conversion rate goal. The denominator will measure your total pool of traffic, which usually includes leads, unique visitors, or session count. A good conversion rate is relative to your industry, product, and goals.
Conversion Rate = Total number of conversions / Total number of leads
Conversion Rate = Total number of conversions / Total number of unique visitors
Conversion Rate = Total number of conversions / Total number of sessions
A percentage will represent your conversion rate. For example, if your website has 50,000 visitors and 1,500 of those visitors fulfill your desired action, then the rate will be 3%.
When it comes to determining what is a good conversion rate and whether or not your conversion rate is where it needs to be, you must consider several factors. Generally, a rate between 2% and 5% is reasonable. And an increase of 0.5% can make a significant difference in revenue.
That said, industry plays a critical role in deciding how good your conversion rate is. For example, finance sites typically result in much higher rates than eCommerce sites, so you can't compare apples and oranges.
Many variables play into your website conversion rate. For example, mobile optimization, site navigation, UX design, page load time, copywriting, SEO, and forms can significantly influence how many people take action. Moreover, you must consider the averages in your specific industry.
B2B companies average 2.23% conversions as a whole and the top 25 percentile of B2B companies maintain an average of 4.31%. The top 10% produces a good conversion rate of 11.70% on average. So, you can see the discrepancy between the top 10% and the overall median of all B2B websites.
What does this mean for your business?
If you are converting at least 2.23% of your leads, unique visitors, and sessions, then you are on pace for growth. If you are lower than that number, it's critical to make improvements as quickly as you can. But don't get too comfortable; even if your conversion rate is steady at around 10% and you are outperforming most of your competitors, there is still room for improvement.
Another way to measure the efficacy of your conversion rates is to compare them over time. To do this, you must track your conversions. Most advertising and analytics platforms will allow you to easily track your conversions, including Google Ads, Google Analytics, Facebook Ads, Twitter Ads, and more.
If you work with a web developer, it will make conversion tracking even more manageable. But if you have to learn to do it yourself, it is well worth the effort. After all, it won't be easy to improve your strategy without analyzing your online marketing results. Start regularly tracking and reviewing your conversions to identify what is working and what isn't.
It is also essential to consider the prices and specifics of your products when you are trying to figure out if your conversion rate is reasonable. Typically, higher-priced items produce lower conversion rates while lower-priced ones see higher rates. And this inverse relationship tends to hold across automatic and manual campaigns.
If you think about it, the relationship aligns with general consumer behavior. A laptop, appliance, or other high-priced product is considered a higher consideration item, meaning a customer is more apt to shop around rather than purchase after a click. That said, this does not mean that cutting prices will significantly boost your conversion rates on products. Many factors are involved, and higher-priced items come with lower variance than lower-priced ones.
The answer to this question is yes and no. For the most part, a good conversion rate will apply to every channel. However, there are a few key differences between them.For example, email marketing tends to produce relatively high conversion rates. The average email marketing conversion rate is between 2% and 5%, with the best performers achieving rates as high as 15% or even higher.
Similarly, for organic search, a good conversion rate is above 10% but can be as high as 12%.
Overall, a good conversion rate varies depending on the channel.
Now that you have a grasp on what is a good conversion rate, it's time to consider practical methods of improving yours. This improvement is called conversion rate optimization (CRO), which essentially entails optimizing your website, landing page, and other elements to yield more conversions from your traffic. CRO helps your company to work with the traffic you already have.
For instance, boosting your conversion rate from 2% to 2.5% can significantly increase revenue without even increasing traffic to your site. Here are a few steps you can take to achieve a good conversion rate:
Even if someone develops a general affinity for your business, they may not be inclined to purchase a product or service if it appears they are the first ones to try it. Providing testimonials and reviews from other customers can help put their minds at ease.
Allow customers to write reviews of your products and services so that potential customers can know what to expect from converting. You can also add logos of any companies that work with your business, adding significant clout and proving what your offering can provide. Giving potential customers social proof can result in incredible improvement in your conversions.
If you do not have CTAs (calls-to-action) on your website, now is the time to add them. But you will want to go further than the generic phrases of "Start trial" and "Sign up," as they will not improve your conversions as you hope.
Put a little extra effort into making your CTA copy stand out and attract interest. For example, a straightforward method is to start your CTA with the word "Yes" because it puts the offer in a positive light and can prove highly effective in a psychological sense. It's easy to see the difference in potential of the following CTAs:
Generic CTA: "Sign up"
Positive CTA: "Yes, I want to save money."
Perhaps the easiest method of performing CRO is conducting A/B tests. This method entails establishing two different variants of a webpage and spreading your traffic between them. Therefore, half of your traffic would be directed to variant A, while the other half goes to variant B.
Some excellent CRO software will make running A/B tests quick and efficient. But if you are new to the game, you have a few less expensive options. Do your research to find cheap programs to help you get started on A/B tests and improve your conversion rates.
In short, your value proposition communicates to consumers why they should choose you over your competitors. While it is the core of your competitive advantage, your value proposition is also an essential factor in conversions. If you have not created a clear value proposition, that should be a top priority, and if you currently have one, begin looking for ways to improve it.
Your value proposition is more than a description of your product or service. It communicates the specific solution your company offers customers that other companies cannot provide.
Every value proposition should have a headline that concisely describes the benefits of choosing your company. The subheadline or paragraph will explain your offering in more detail and elaborate on the headline's information.
There also needs to be a visual element (e.g., video, image, infographic, etc.) that can powerfully convey your value proposition. Graphic features can work alongside creative and concisely written words to capture your audience's attention and influence them to convert.
There is no shortage of information on sales funnels. Many companies create sales funnels that are too complex to keep up with, making it difficult to utilize them effectively in a marketing strategy.
Simplifying your sales funnel process can provide you with an easy method of tracking your leads as they make the journey to becoming paying customers. At its core, a sales funnel has four stages:
The AIDA process outlines the progress that customers make from awareness to action. Find ways to create an attractive and informative landing page.
Each landing page should clearly describe your product or service's benefits by comparing copy. It should give potential customers an easy way to give their contact information. You also need to offer them something of value in exchange for their information, such as a free ebook, whitepaper, or online tutorial.
Then, continue sending the potential customers valuable content each week to keep them engaged. Any information or offerings you send should address their specific needs; you don't want to turn prospects off by giving them useless information.To close the deal, give potential customers an offer that is difficult to ignore, such as a free trial, a discount code, or a product demonstration. And continue this process to not only attain but maintain a good conversion rate.
Finally, make sure your landing pages don't ask too much of your potential customers. Each page should be straightforward, easy to navigate, and include only essential information. Don't include content unless it directly addresses your visitor's needs.
Remember the three elements of your value proposition, and minimize the content you add to that structure. You want the audience to focus only on your offering, so don't add anything that will distract them from your value proposition. That said, including a video, social proof, or a live chat box could prove helpful.
Conversion rates are essential to the success of your online business. Improving your conversion rate can have a significant impact on your bottom line, and even a small increase can make a big difference.
However, while we prioritize boosting our conversion rates, we should never overlook an equally valuable member of our CRO strategy, lead quality.
Leaving money on the table by not nurturing high-quality leads is a mistake. That's why it's essential to have a solid lead management strategy in place to help you identify and qualify the best leads for your business. Aim to attract your target audience by truly understanding what they want, being where they are, and giving them what they need.
Trying to increase your conversion rate can feel like a never-ending battle.The takeaway is this: don't sacrifice quantity for quality, or vice versa. A good conversion rate is the result of a well-rounded CRO strategy that takes both into account.
Improving your conversion rate can go a long way in boosting your bottom line. Keep the information and advice above in mind to calculate your conversion rates and determine how much improvement is necessary. And remember that the business landscape is constantly evolving, so keep looking for strategies that can help you improve your conversion rates as you pave the way for long-term success.
It may be a challenge but we at Triple Whale are here to assist you in leveraging your data to increase your conversion rate and achieve long-term success.
© 2023 Triple Whale Inc. – 7th Floor, Jaffa St 224, Jerusalem, Israel