The conversion rate is one of the most commonly used terms in online marketing. Many marketing and sales teams can no longer imagine their daily work without the conversion rate. Wherever leads are generated, products are sold, or paid campaigns are carried out, the conversion rate is used. In this article, we take a closer look at what is behind the conversion rate, what you need it for, how you calculate it, and what measures can be used to increase it.
How is the conversion rate defined?
The term conversion rate (abbreviation CR) is translated as a conversion or conversion rate. In the marketing language, it also occurs as a conversion rate. The marketer can individually define a conversation. The conversion rate is one of the most critical success indicators.
The conversion rate is the ratio between the number of website visitors and the transactions made on the website. A sale (e.g., an order) can take different forms. The conversion rate indicates the percentage of visitors that are required to achieve a conversion.
A conversion does not necessarily take place after a purchase has been completed. A translation can also be measured when a seminar is booked, a catalog is ordered, or test access to an online tool is booked on a website. The download of a white paper or a newsletter registration can also be counted as a conversion.
Note: Each website pursues its business model and defines itself in achieving its own goals. Therefore the calculation of the conversion rate must be determined individually.
The conversion rate is not only measured for successful actions on your website. It is also used to compare the performance of marketing campaigns. So you can compare the different Google AdWords campaigns with each other and measure the success of varying traffic channels (email, organic, paid, etc.). The conversion rate can be measured for the entire website (macro conversion) or only for individual landing pages (micro conversion).
That may sound complicated, but it is not! Continue reading…
What do you need a conversion rate for?
The question is pretty easy to answer: at the end of the day; we want to know how successful we have been. So the task of the conversion rate is to measure the success or failure of digital marketing activities in the company. We have a vast database in online marketing. If clean tracking is stored on the website, we can measure all imaginable transactions on a website. This is what makes online marketing work so incredibly exciting!
However, many website visitors are not sufficient if they do not make the desired transactions on the website. It follows that the conversion rate provides valuable help for every marketing and sales team. On the one hand, it supports strategic decisions, and on the other hand, it shows the way to the best possible solutions. As the link between marketing and sales, the conversion rate shows whether marketing campaigns and landing pages are performing correctly. After all, visitors should become leads!
If you have your paid campaigns controlled by an external agency, you can use the conversion rate to check the quality. But don’t make the mistake of only evaluating the success of a landing page or marketing campaign based on the conversion rate.
Why? Imagine that you run an online shop for greeting cards. In the past, your traffic was primarily brought to the website via expensive Google AdWords campaigns. In your campaigns, you mainly created keywords relevant to the purchase, such as “order greeting cards online” or “greeting cards online shop.” The conversion rate of your online shop was, therefore, relatively high.
At some point, you discovered content marketing for yourself. That is why you have integrated a blog into your online shop. In the blog, you write articles about what to look out for when writing a condolence card or how to formulate business Christmas greetings correctly.
Now you get a lot of organic visitors to your website via Google. For the most part, these visitors are not interested in buying a page; they just want to find out more. As a result, the conversion rate of your website has dropped. Is that negative now? No, it is not!
The traffic and visibility of the website have increased significantly. At the same time, many of the visitors who were initially been not interested in buying nevertheless placed an order in your shop. This, in turn, is reflected in increased sales.
The same principle applies to paid campaigns: If you only display your ads as an exact match when entering the keyword “order cheap running shoes,” the conversion rate will be higher than if I only show my ads as a broad match for all search queries related to this Play the keyword “running shoes.” In addition to the CR, other vital figures must also be used to evaluate the campaigns, such as the CPC or ROI.
Note: The conversion rate is a significant key figure. It can be used to control which sources, channels, devices, etc. perform best. However, it must never be used in isolation for evaluation!
How do you calculate the conversion rate?
The conversion rate calculation is relatively simple and can be supported by digital analysis tools (Google Analytics, Econda, Matomo, etc.). Depending on the marketing budget and individual needs, both free and fee-based tools can be used for this purpose.
The conversion rate formula is: Take the total number of conversions made (e.g., downloads of a white paper), divide this by the number of visitors, and multiply the result by 100.
It is worth noting that the conversion rate is displayed as a percentage. The total number of desired transactions and website visitors relates to a predefined time frame.
Here are two typical examples from practice:
Example of an online shop: An online shop recorded 1. million visitors to the site last year. During this period, 20,000 orders were placed. Accordingly, the conversion rate is 2 percent:
page. To get traffic to the landing page, a campaign was created at Google AdWords. In the first month, 1,000 visitors came to the site in this way. Fifty visitors downloaded the white paper. The conversion rate is 5 percent:
To prevent falsifications when calculating the conversion rate, you should make sure that you eliminate the fake traffic by referrer spam in your Google Analytics account. Otherwise, the conversion rate will be worse than it is.
But what is the percentage of a reasonable conversion rate? We take a closer look at this below.
What is a reasonable conversion rate?
There are some studies on the Internet (including smartinsights.com and wordstream.com ) in which conversion rates are shown and compared according to industries, device types, and countries. If you compare different studies with each other, you often get an average value of 2-4%.
From my own experience, I also know that there are website projects with a conversion rate of 15%. In my opinion, there is no generally valid comparison value! If I run a website with a conversion rate of 15% and have 10,000 visitors per month, while my direct competitor with a conversion rate of 5% has 50,000 visitors on his website, this leads to more conversions than at the end of the month. Here we are again at the point that the conversion rate should never be viewed in isolation. The conversion rate says nothing about the revenue generated and the marketing budget used.
If you look closely at your website’s conversion rate, you will quickly realize that there are significant differences in the source of visitors. Such analyzes provide useful insights into which channels are working well and which are not. For holistic evaluation, it is again essential to include further vital figures.
How can you increase the conversion rate?
Conversion rate optimization is about removing all obstacles that prevent a website visitor from making transactions on a website.
Sometimes even small adjustments can lead to significant improvements. Depending on the business model, an increase in the conversion rate is directly reflected in sales. Also, it is often much more comfortable and cheaper to improve the website’s conversion rate than to attract new traffic to the site.
Here are twelve tips to boost your website’s conversion rate:
- Buyer Personas and Buyer’sBuyer’s Journey
The creation of buyer personas is the prerequisite for long-term sales success. If the landing page and the promotions are tailored to buyer personas’ needs, a higher conversion rate is achieved. Based on customer surveys and the analysis of existing customer profiles, ideal customers can be sketched precisely.
In combination with the Buyer’sBuyer’s Journey, you have a powerful tool in hand to provide your Buyer Persona with the right content in the respective phase of the buying process.
Vidoes can get to the heart of complicated products within minutes. For example, we use the following video on a landing page that we want to use to reach customers looking for a content marketing agency:
3. Live chat and meeting tools
A live chat is a great tool to increase the conversion rate. On the one hand, a potential customer can contact the company directly and without obligation, if they have any questions. On the other hand, a live chat symbolizes user proximity and customer service.
For companies that offer a service or a consulting-intensive product, meeting scheduler tools are a great way to optimize the conversion. On our website, a CTA is displayed in the header with the words “Make an appointment.” If you click on this, you land in the calendar of our company owner and can set an appointment for a free consultation with a few clicks.
4. Offer contact options on each page.
Offer the user as many options as possible to get in touch with you. Show your phone number popularly and allow your users to contact you quickly via contact forms. This creates trust, which in turn leads to a better conversion rate.
Small changes can have a considerable impact. It is, therefore, worthwhile to deal with the subject of color psychology. We have found through tests that red CTAs perform best.
The second important lever is the text in the call-to-action. The text should encourage clicks and make the user understand what happens after the click. A CTA with the text “Download now” will convert better than a simple “download.” If the word “free of charge” is added to the CTA “Download Now,” this has a positive effect on the conversion again.
The higher the CTA is placed on a website, the more often it is clicked on. There is nothing wrong with placing several calls-to-action on one page.
Don’t you believe that? Then run an A / B test. In the first step, test two CTA colors against each other. Then test two versions of CTA with and without the word “now” against each other. We are currently checking in the CTA shown below, whether the color blue or the color red performs better.
6. Employee pictures
Employee images create trust and give the company a face. Use the “About Us” site and the “Team Page” to present your visitors with a friendly picture. We even go so far as to integrate selected employees with a short profile into our landing pages. Potential customers then know directly with whom they will work with us.
7. Customer testimonials
People like to be guided by the recommendations and opinions of other people. By using customer voices, website operators can create credibility. And that increases the conversion!
Therefore, ask selected customers for a two to three lengthy sentence statement. Integrate the report into the landing page along with a customer photo, as well as your name and job title. Below is a customer statement as we use it on a landing page:
8. Customer references
Customer references give the company credibility. All the more so when it comes to well-known customers. While we only show the logos of our top customers on the landing pages, we describe our company page in detail how we helped our customers solve their problems. This enables us to demonstrate our expertise to potential customers.
9. Trust elements
Trust elements such as certificates, awards, and seals of approval are an effective means of increasing the willingness of website visitors to convert. If possible, trust elements should be placed several times on the page. So not only on the start page and in the landing pages, but also on the footer or the header.
It is highly recommended to make forms as lean as possible. Only ask for information that you need: the more information the user has to fill in, the less willing to send it.
You can also use the form to make an attractive and understandable value proposition to the user. The interested party must understand what they get when they fill out the form and what benefits they get from it.
You can also create additional familiarity in forms by incorporating an employee photo and demonstrably increase the conversion rate. Be sure to use real employee images and don’t make the mistake of choosing stock photos. Most users will recognize this directly. The effect would then be negative.
11. Pop-up banners
Pop-up banners that are used correctly are a great way to increase the conversion rate. If a pop-up window opens immediately after opening a website, most users find this annoying. The user experience is, therefore, interrupted directly and thus negatively influenced.
We, therefore, recommend using exit-intent pop-ups. These only open when the user intends to leave the page. Discounts, registrations, or assets can be offered on the banners. Depending on which phase of the buyer’s journey the user is currently in, you can be very successful.
12. Analyze user behavior
Use analysis tools to analyze how users behave on the landing page. This tells you how far the users scroll on the page, where they click, and where they may even stop. We use HotJar on our landing pages and blog posts to successively optimize the pages based on the findings.
The bottom line
Now you know what is behind the conversion rate, what you need it for, how you calculate it, and what measures can be used to increase it to generate valuable leads.
But don’t make the mistake of only evaluating the success of your website based on the conversion rate. Do not compare this value with other industries, either. These comparisons are not meaningful!
Conversion optimization should go hand in hand with generating high-quality website traffic and be part of everyday work in online marketing. Small optimizations can sometimes be very successful.
Also, look for benchmarks. You often see the same or similar patterns among the big players in your competitive environment. You can start here.
Do active A / B testing! Optimize continually and test different forms, CTAs, texts, and images!
If your Buyer Persona does not find your website, all efforts are in vain. Therefore, analyze your traffic sources’ conversions and use your workforce and budget correctly based on the findings!
And very important: Make sure to use analysis and testing tools – these should be used daily! This is the only way to find out whether your work is bearing fruit. You also have a strong line of reasoning to discuss with colleagues, supervisors, and agencies and justify your budget.