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An Introduction to Conversion Rates

Last Updated on Dec 22, 2010 by Jeff Lew

If you own or run a website of any kind, you must know what a conversion rate is, what it means to you, and how to make it better.  The success of your endeavor depends on getting people who come to your website to stick around and actually use it.  It doesn’t matter if you are an e-commerce, organizational, blog, or customer service site, website conversion rates are one of the most important tools for measuring the success of your site currently, as well  as predicting future success.  In this article, I will explain what a conversion rate is, and how it relates to several different types of websites.

What is a Conversion Rate?

Simply defined, the conversion rate is the percentage of total users on your site who perform a specific action or task. If you prefer formulas, it looks like this:

Conversion rate formula image

Conversion Rate Formula

Now, different types of sites will be measuring something completely different with their conversion rates, and success is in the eye of the beholder.

E-commerce or retail websites

Probably the most critical conversion rate you want to know is fairly obvious…SALES!!   Your conversion rate should be the total percentage of people who actually buy something once they reach your site.  Typically, if you have a conversion rate between 1 and 2 percent, your website is doing average business.  That means that out of every 100 visitors to your site, 1 or 2 of them actually purchase something.  If it is much below 1%, you have a lot of room for improvement.  If it is above 5%, you are one of the best.

Illustration of 5% Conversion Rate

Best In Class Conversion Rate.

Lead Generation Sites

A metric of success for a lead generation site would typically be the percentage of visitors who agree to be contacted or who request more information.  This usually means they have registered, and filled out the necessary forms indicating their interest.  For these types  of sites, a conversion rate of 2 to 3 percent is typical.

Content Sites

A content site will usually measure its success based on the percentage of visitors who register to become part of their community, receive their newsletter, or subscribe to their blog.  Rates here are similar to those of the lead generation sites.

Customer Service/Support Sites

Success here means solving the customer’s issue, or answering their question.  Therefore, the conversion rate we are looking for is the percentage of visitors who are able to locate the information you desire for them to find.  This might be finding the downloadable FAQ’s, sending an e-mail to tech support, or chatting with a customer service rep online.

So, regardless of the type of site you are building or running, knowing your conversion rate will help you to drive improvement, satisfy your customers, and build your reputation more quickly.  Stay tuned for more great articles on conversion rates in the coming days and weeks.

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