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What is Conversion Rate and How Do I Improve It?

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What is Conversion Rate and How Do I Improve It?

Read time 11 min read
What is Conversion Rate and How Do I Improve It?

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What is Conversion Rate?

Conversion rate definition refers to the user action achieved after total clicks on a digital asset or display ad. The conversion rate meaning mainly explains an equation used by online e-store owners, their advertising team, and marketers to compare the total number of visitors to a website to the number that performs the desired action. A desired action includes purchasing products, becoming subscribers, or users. Understanding the conversion rate meaning is essential to propel the business forward and achieve an excellent online presence. 

What is the conversion rate in sales?

The conversion rate meaning in sales refers to the number of individuals that completed the desired action of a website. The conversion rate in sales refers to the actual number of targets achieved by the chosen company. It provides an avenue to properly analyze and determine what visitors are doing on the website and how many remain. Thus, understanding what is conversion rate in sales focuses on how a business is strategically utilizing different online platforms to enable it to push sales and increase the number of subscribers to their platform. 

Conversion rate formula

The conversion rate refers to an equation used to measure the performance of an advertising campaign. It uses a conversion rate calculator to determine how good different marketing strategies produce a required goal. A conversion rate thus measures the quality of an online marketing strategy and enables an advertising team to analyze their targets comparing it to the actual results properly. When analyzing what is conversion rate in retail, we focus on using a conversion rate calculator to determine revenue generation. Some of the conversion rate formulas to utilize include; 

CR= (Number of conversion /number of clicks) * 100 

For example, if an online store sells jewelry and runs an ad promoting their products and creates traffic to the store by having 1000 people visiting the store and 20 buying, the conversion rate calculation shows the total number like 2% as shown below; 

CR=20/100* 100 = 2% 

The above conversion rate formula shows what percent of business the online store created by running an ad and gives them a clear picture of the campaign, allowing them an avenue to strategize to generate more leads. They can also use this formula to get interested clients who left products at the cart and target them by remarketing to increase their conversion rate. If a business can ensure a 2% conversion daily, then their online advertising will have outdone itself as most online companies experience far less than this. 

Now that we have understood what the conversion rate is in sales. It is essential to understand different ways to improve your grades and use conversion rate calculations to achieve the desired results. Conversion rates tell you how effective your website is. For those whose business is entirely online, this information is vital to ensure you not only remain competitive but provide your clients with the best service to convert them into buyers easily. 

A conversion rate is a clear indication of how much you are making and a reality call of what efforts need to be put in place to ensure you remain in business in an ever competing and evolving business world. Finding new ways to improve conversion rate calculation and the outcome is essential. It reduces the amount of money used for advertising strategies while improving their quality in terms of revenue generated. 

How to improve your conversion rate 

There are several ways to increase and optimize the conversion rates.

Conduct A/B testing

A/B testing is also known as a bucket or split testing. This process compares various web pages to see which one gets more conversions and understand the reasons for the actions. Here is an example of an A/B test:

What is Conversion Rate and How Do I Improve It?

(Image Credit: OneSignal)

Some of the areas to focus on during A/B testing include; 

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Where is the site losing guests? 

Understanding where you are losing your visitors helps devise corrective measures. You can utilize google analytics, user behavior tools, or any other analytical tool to help you determine the loopholes that make clients leave products at the cart or not reach that far. 

Decide which conversion behavior you are testing 

Narrow down to what client behavior you want to understand, whether it is the mailing signups, the number of purchases, or promotional email clicks. This act helps you properly analyze the different marketing strategies and see which one brings better results to your page or your competitors. A/B testing tool uses different techniques on various guests allowing you to have customized solutions to visitors coming to your page. 

You will be interested

FACT: 44% of companies use testing software to split test or A/B test their landing page.

Develop a list of fixes 

Having a list of fixes provides a guide that helps your marketing team close loopholes. Fixes get derived through an A/B testing tool as it creates an excellent image of all shortfalls allowing you pinpoint which marketing strategies are working for you.

Analyze results 

Utilize the results of the A/B testing to see which variations work for your site. Ensure the process gets enough time to play out properly and offer conclusive results. If one is not working, then change the technique and continue trying out till you find one that fully works for your site. 

Shorten your forms

One of the most significant hurdles to conversion rates is the form application required by sites. Having long forms creates a barrier as visitors may easily get distracted online or be too impatient to complete the process preventing them from converting. To ensure your conversion rate rises, ensure your forms are straight to the point, precise, and easy to understand. Avoid ambiguous questions or detailed records that make the process too long, discouraging the visitors. You should also ensure that your forms are creative and enticing and have minimal instructions to ensure clients stick around to the end. 

Communicate value proposition

Having a well appropriately written communicated value script captivates visitors and improves their conversion rate. Ensure you develop sales scripts that focus on providing a solution to your buyer’s needs and wants. Explaining to the buyers how a product meets their needs and allowing them to form a mental image of why they need it is essential to ensure they envision their life having the item and utilizing them. Instead of focusing more on the product features, write sales scripts that include how these features answer the needs of their users. Incorporating this in the features section ensures a person reads through them rather than features that are easy to skim through and ignore. This act provides an opportunity for them to want the project, increasing conversion rates. 

Have strong CTAs

A strong Call to Action ensures you provide clear directives on why customers should buy the product immediately. Excellent calls to action convert undecided buyers and allow them to make a choice. Words like ‘BUY,’ or “SIGN UP “provide a clear direction of what you want the client to do. However, ensure your call-to-action gets backed by explaining why the client should buy or sign up to the site. Avoid using a generic call to action as this does not offer proper motivation to shift conversion rates. Work with your marketing team to ensure their call to action is understood by your market base and fun enough to lure clients without making them feel like it’s a command. A strong CTA helps entice clients and draws them to a project without coming out as forceful or commanding. Here is an example of a call to action done by Diib:

What is Conversion Rate and How Do I Improve It?

Eliminate unnecessary pop-ups

Unnecessary pop-ups not only discourage visitors but distracts their attention from the product reducing their chances of converting. Studies show that numerous clients leave a page due to extreme pop-ups not because the product was not excellent or the price competitive, but the pop-ups were distractive and seemed invasive, making them not trust the site. Extreme pop-ups work against a website as some clients may get confused on the way. You should thus focus on using at least one pop up that draws the client to the project and provides a call to action. For example, having constructive pop-ups that allow a client to sign in or retain their information is essential as it makes the client feel at ease and provides avenues that make their visit to the site easier. 

Include social proofs

Visitors like to read and see what other people are saying about the product or the help they have received from their purchases. Having creative and compelling social proofs is likely to increase the conversion rate of a site. Talk to your previous clients to make short videos using the product or saying why they love the product. Your marketing team can then compile such to come up with fun videos that compel others to convert and buy from your site. Having testimonials of a product is an excellent strategy for a product review that works in increasing the conversion rate of a business. Here is an example of a social proof:

What is Conversion Rate and How Do I Improve It?

(Image Credit: HubSpot Blog)

Use a CRO planner

It can sometimes be hard to understand where the problem is in your site and why your conversion numbers are not working. Blindly trying to understand such an issue may be draining and have you punching in the air. Using a Conversion rate planner provides a clear guideline on strategies to use and indicate loopholes giving your team a clear indication of what is working and what needs effort. CRO planners also monitor your progress, enabling you to see your activity and know whether your tactics are bearing fruit or need to be changed. The image below shows an example of a CRO planner:

What is Conversion Rate and How Do I Improve It?

(Image Credit: Hotjar)

Track individual interaction to your site

Individual interaction with your site enables you to understand visitor behavior. A unique search helps you analyze your website and understand the buying behavior of your visitors. Knowing your visitors is essential as it guides your conversion rate strategies and enables you to know which ones are likely to provide positive results. 

Add live chats

Unanswered questions or unresolved matters may hinder conversion rates. Having live chats enable your marketing and advertising team to offer advice and help to visitors answering their questions on products or delivery suggestions. Answering client’s questions and meeting their needs goes a long way into converting them. Live chats also provide a vibrant conversation on your website, creating a steady flow of traffic. New visitors may find valuable answers to their questions or explanations that make it easy for them to convert. 

Adding live chats also gives your team a chance to increase its customer service quality and offer personalized help to visitors. This individual attention to clients not only converts them but ensures they keep coming back to your site, improving the quality of your conversion rate. Here are a few examples of helpful live chats:

What is Conversion Rate and How Do I Improve It?

Test your offers

You may be doing everything right but still not getting the conversion rate numbers you hoped to achieve. You can overcome this by testing your offers. Some of the areas you need to focus on include; 

The language used- is the language friendly? Is it answering the needs of the clients? Do they feel welcomed? 

Visuals _ what is the overall quality of your visuals? Can clients see product images, and are they captivating? 

Carrying out various tests ensures you look at your website and fix every section providing your client needs to get adequately resolved. They are motivated to increase your conversion rates. 

Increase trust

One of the critical ways of increasing conversion rates is by increasing the trust level between your site and the visitors. Ensure visitors feel your site is trusted by answering their questions and resolving their grievances in time to avoid losing trust. Complaints from other visitors are likely to erode trust and make other visitors shy away from your site affecting the conversion rate. Establishing trust ensures the traffic your account receives increases your conversion rate as visitors get reasons to stay and transact using your site. Once you develop confidence, visitors are likely to feel comfortable signing up for email updates and other options you provide. 

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Improve your page speed

The most significant way to increase conversion rates is by having high-speed websites. Studies done show a large number of websites lose out on high conversion rates due to slow websites. A slow website can easily make a potential visitor disinterested or waste their time, making you lose out on a sale. It is essential to optimize your web pages to ensure they are fast and easy to use. 

Ensure the pages are also compatible with other devices such as phones, tablets and other devices to help you tap into a bigger market. You can utilize different Google options and SEO tools to help you increase the speed of your pages and have clients coming back to the site. You can also test your site speed with Google PageSpeed Insights, for example:

What is Conversion Rate and How Do I Improve It?

(Image Credit: Search Engine Land)

Enhance purchasing process

The purchasing process refers to various sectors of the buying process. Some of the ways you can enhance your purchasing process include; 

Having a straightforward process between identifying a product, placing on a cart and checking out. A comfortable straightforward process enables visitors to remember the things they want and make the purchase process easy. 

Another sector of the purchase process is the payment options. Ensure you have a variety of payment options such as credit or debit cards, cash cards, PayPal and other universal acceptable payment modes. Having various methods directly affects your conversion rate as clients who are not able to pay for their products are likely to abandon them at the cart section. Work with your team to ensure new payment modules are promptly integrated into your system to ensure you offer various options for clients visiting your page. 

Localize your content

Localizing content refers to strategically using keywords and information used to target the market in your area. Utilize different SEO tools that allow you to customize your content and generate keywords to help push sales. Localized content ensures you come top in search engines and provide an excellent client base in your area. Tapping into the local market offers an opportunity to reduce shipment costs and offer fantastic incentives to increase conversion rates. It also provides quality social proof, among other incentives that help improve conversion percentages. 

Other effective ways of localizing content include managing your mobile platforms and adding information on location and direction, making it easy for local users to access your shop or review your products. Ensuring that your data is easily accessible to those around you is a way of working from the known and helps correct mistakes as you expand the business. 

Create abandonment email campaigns

Abandoned carts are every store’s worst nightmare; seeing a sale so close yet so far away is not only financially damaging but demotivating to a staff. You can, however, use this data to turn around such clients and ensure they are back and to complete the sale by carrying out cart abandonment email campaigns. This process is actively pursuing clients who have abandoned products at the cart section, and forming detailed campaign mechanisms that motivate them to come back to the site and finish the sale is an excellent way of increasing your conversion rates. 

Design your email campaign to specifically talk to the client and motivate them to come back, and ensure you do not lose out on sales. Such movements are known to promote sales and increase the conversion rate making it a classic example of turning lemons into lemonade. For example:

What is Conversion Rate and How Do I Improve It?

(Image Credit: Bronto)

Diib®: Monitoring Your Conversion Rates 

Now that you have adequate information on conversion rate, meaning and what is conversion rate in retail, using the above tools offers you direction on how to improve your conversion rate and improve your sales. Knowing the conversion rate formula and how to do conversion rate calculation is essential to targeting your audience and formulate solutions that provide results. 

Diib® Digital simplifies this process for you; we give you up-to-date conversion information at the touch of a button. With custom alerts and objectives, you can optimize your conversion rate in a straightforward manner. Here are some of the features of our dashboard you’ll love:

  • Customized Objectives give you simple tasks designed to optimize your website
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Conversion rate is the measure (by percentage) of users taking a specific and desired action on your website. For example: people who sign up for a newsletter, add an item to their cart, finish a transaction or click on your buy now button.

Anything above 10% is a good rate, however, the higher the better. Earning a good conversion rate places your company in the top 10% of global advertisers, which makes your conversion rate two to five times better than the average conversion rate.

While above 10% is definitely the goal, realistically, the average landing page conversion rate was 2.35%. The top 25% of that average were converting at 5.31% or higher.

According to MarketingSherpa, the average software industry conversion rate is 7%. However, the average landing page conversion rate should be 20-25%, according to HubSpot.

The average conversion rate of a Google Ad is 4.40% on the search network and 0.57% on the display network.


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Daniel Urmann

Author Bio:

Daniel Urmann is the co-founder of Diib.com. Over the past 17 years Daniel has helped thousands of business grow online through SEO, social media, and paid advertising. Today, Diib helps over 150,000 business globally grow online with their SaaS offerings. Daniel’s interest include SMB analytics, big data, predictive analytics, enterprise and SMB search engine optimization (SEO), CRO optimization, social media advertising, A/B testing, programatic and geo-targeting, PPC, and e-commerce. He holds a Master of Business Administration (MBA) focused in Finance and E-commerce from Cornell University – S.C. Johnson Graduate School of Management.

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