How to Calculate Conversions
Before discussing the formula, let’s define what we mean when we say conversion. This is a broad term that could refer to anything from newsletter signups, buying a product or service, downloading an e-book, completing a form, and so on.
Basically, a conversion occurs when a website visitor completes a desired action.
Which means: to calculate a conversion rate, you need to know what you’re trying to measure. It’s a matter of having clearly established business goals, and being able to translate those into quantifiable website metrics.
To determine a conversion rate, divide the number of goals achieved in a given time frame by the total number of visitors to your website, then multiply that number by 100.
Conversion rate = (Conversions or goals achieved / Total visitors) * 100
So if your landing page had 16,982 visitors and of those, 3,604 took a desired action, then your conversion rate is 21.22%.
How to Track Conversions
You can set up a system for tracking conversion rates with the help of the following tools:
- Google Analytics and AdWords. These tools collect large amounts of raw data, so remember to set filters and focus on specific data sets to avoid missing key insights related to your goals.
- Heatmaps. This feature captures users’ eye movements and clicks on your website; information that can identify top-performing or weaker elements on pages to steer your optimization strategy.
- Session recording and replay tool. Replaying user sessions sheds light on how visitors navigate and interact with your website. Seeing the user experience in action can help to identify bugs that were missed, or understand why there’ve been high bounce rates at specific sections in the funnel.
- Customer satisfaction surveys or Net Promoter Scores. Both measure how happy your customers are with your business, and in what areas you can improve. Focusing on the customer experience is essential for retention and driving more conversions. In fact, the London-based jeweler Taylor & Hart used customer feedback to transform its manufacturing process, doubling annual revenue to €4.5M.
What’s Considered a Good Conversion Rate?
This is a popular question, and the best answer is: it varies considerably from industry to industry.
Unbounce analyzed over 64,000 landing pages across 10 popular industries and found that a 12% conversion rate was a good standard for lead generating pages.
Then, there’s this chart from Marketing Sherpa study showing the average conversion rates for e-commerce sales, which varies depending on the product.
While these stats can be helpful in establishing a baseline, they shouldn’t be treated as the be-all-end-all for your business,
Peep Laja, Founder of ConversionXL shared this sentiment, saying:
So what’s the way forward?
First, don’t follow supposedly accepted figures blindly. Stay in the know, but remember the only thing you’ve got to do is bypass the conversion rates you achieved last month. That’s how you become better.
But is there a method to this madness? Read on to find out.
How Can You Increase Conversion Rates?
There are multiple tactics to boost conversion rates, with a few popular and effective methods listed below.
A/B testing compares two different versions of a web page or an app to see which performs better. From a conversion point of view, it gives you room to be creative and explore new and better ways to capture leads.
Fun fact: Conducting A/B tests helped former US president Barack Obama’s team generate an additional $60 million!
To get started with A/B testing, try focusing on the main elements of the page. This can be the:
- Headlines and copy: A headline should be convincing and directly linked to the main offer on the page. Experiment with long and short headlines, with or without subtitles. Keep the copy simple, succinct and scannable.
- Value proposition: Refine and articulate your offer so it resonates with prospects. WiderFunnel helped the Sims 3 team boost their game registration and achieve a conversion rate of 128% by improving their value proposition.
- Visual media: Images, videos—find out what’s a hit among your customers. eToro saw a 30% jump in conversions after adding a video to its landing page.
- Call to Action: Test the color, copy and CTA placement. Nature Air, for example, changed the position of its CTA which increased the conversion rate from 2.78% to nearly 19%.
- Page layout: Every page must be well-designed, aesthetically appealing, and functional. Work on visual hierarchy and make use of white space and colors. These take away the cognitive load for the visitor.
Basic, but one of the most important things you can achieve. First, it’s a matter of showcasing your site’s security.
84% of people will not make a purchase if they’re dealing with an unsecured website. If your site doesn’t appear to be trustworthy, it will cost you. Consider incorporating the following into your site:
- Add security seals on checkout pages to assure customer’s confidential data and information is in safe hands.
- Don’t ask for too much information on form fields. Ask only what’s required.
- Be accessible. Respond to incoming queries, and the sooner the better.
- Flaunt your dream team. Show off your team’s awesome skill set to further establish your credibility.
Then there’s a matter of building trust in your products or service—and customers’ satisfaction with them. A few ways to do this include:
- Add customer reviews. Studies show that nearly 70% of online shoppers go through product reviews before making a purchase. They also trust reviews 12 times more than product descriptions provided by the manufacturers.
- Publish client stories and case studies: Businesses want to see your past successes before they invest in your product or service.
A SalesForce survey of over 7,000 consumers revealed that 57% are willing to share personal data in exchange for personalized discounts and offers. Another study by Deloitte noted that people don’t just want personalized communication, but products and services that are tailored to them. To increase conversions, you need to deliver contextually relevant offers.
Personalize customer experiences through behavioral targeting (segmenting audiences based on their online behavior). To establish behavior personas you should collect the following metrics:
- Browsing history
- Type of device used
- Session behavior (page views, on-site searches, etc.)
- Geographic location
- Purchase history
You can then use this data to:
- Cross-sell and upsell products: Segment’s research found that 49% of consumers have purchased a product they didn’t initially set out to buy after receiving a personalized recommendation.
- Use dynamic content: This is called adaptive content marketing. Based on your customers’ history/location, you can show content that might interest them. (For instance, fashion retailers can showcase outfits that match the weather at a user’s location.)
- Reengage to reduce cart abandonment: Incentivize shoppers on your checkout pages with pop-ups, reminders, and so on. Create a sense of urgency because FOMO (fear of missing out) is real!
We’re constantly talking with our family and friends via messaging apps. Why not the same for the brands we do business with?
In a study by Twilio, 9 out of 10 customers wished they were able to speak with businesses over messaging.
Using a live chat tool can provide personalized and timely service to your customers. It also can boost conversions by moving potential clients into the fast lane. Apparently, website visitors are 82% more likely to become customers if they’ve chatted with you first.
Moreover, another survey found that 63% of customers are likely to return to a website that has a live chat option.
What’s more, Forrester noted that live chat results in a 48% increase in revenue per chat hour and a 40% increase in conversion rate.
Aware of the conversion benefits of having a live chat with customers, marketers are now embracing it and seeing results. According to Intercom, Tradeshift increased sales opportunities by 32% with live chat.
Drift also helped Keap build a chatbot to grow their sales pipeline by 50% in 50 days.
But simply having a live chat tool isn’t enough. Here are a few best practices to follow:
- Place the tool on high-intent pages where customers are likely to ask for a real-time response. For e-commerce brands, this would be the checkout page where customers may have last minute questions on delivery, returns, etc. For B2B companies, it’s pricing pages.
- Use real names and faces as it gives a human touch and makes virtual conversations more personal.
- Respond quickly and/or set realistic expectations. The main reason people click live chat option is they expect immediate answers. If someone contacts you outside of office hours, use a bot to show the average time you’ll take to respond or ask for contact information so you can follow up.
Reaching your conversion rate goals starts with having clarity on your business goals. That will determine what metrics you track, and what optimization strategies you employ.
Remember, while it’s important to stay updated on your industry’s conversion rate benchmark, don’t fall into the trap of implementing blanket advice from experts. Use various tools and data points to understand your customers’ motivations. Listening to your customers is the best way to drive conversions.