What Is Conversion Rate and How to Improve It?

The internet is full of a great variety of websites with different purposes. They all have a goal and they create strategies to achieve it. Building a website solely is not enough for the desired result in the new internet world. Websites need specific user actions and feedback, a.k.a conversions. A ratio called conversion rate is used to evaluate whether site visitors are taking the desired action and to shape marketing strategies according to these evaluations. But what is conversion rate?

What Is Conversion Rate?

Everyone who enters a website in the internet world is considered a visitor. Conversion rate is the rate of visitors who take action according to the website's purpose. The rate of visitors becoming purchasers -or taking the desired action- is called conversion rate, while advertising practices carried out over this rate are called conversion marketing. This return may be a sale or an appointment, filling out a form, or clicking on an affiliate link.

The conversion rate can also show, for example, the rate at which people in the mailing list click on the sent link. As a result of these practices carried out as conversion marketing, it is concerned with how much feedback is received from the target customer group.

One of the most important advantages of the internet is that it gives us precise data. It provides exact numbers of how many people see the ads and how many of these people clicked on the ads. In fact, demographic data of these people such as age, gender, location, marital status, educational status can also be acquired accurately. In the light of these data, analysis can be made, and maximum efficiency can be obtained from online advertising.

The most important thing when creating an ad is how much it contributes to the purpose of itself. The conversion rate gives this rate numerically. Simply clicking the ad is often not enough. For example, if the aim is to sell the product when an ad is published, it does not matter how many people review it. What matters is how many people buy the product in the ad. With precise ratios, it can be measured which advertising strategy gives correct results.

How to Calculate Conversion Rate?

The formula generally used for conversion rate calculation in e-commerce is:

Total conversions / Total visitors

E-commerce conversion optimization is very important for e-commerce companies. It is a factor that directly affects the number of sales and earnings. The metric that measures return by sales is called the sales conversion rate. But all sectors can measure the advertising results presented in this way. Calculations using this formula will allow you to see what should be considered and where the ads usually bring along successful conversions.

As a result of the calculations made by e-commerce experts using the conversion rate calculation, the response given to the conversion rate in e-commerce is usually between 2% to 5%. However, these rates can be increased to 10% easily with some specific improvement works.

Factors Affecting Conversion Rate

If one out of ten visitors purchased a shopping site, the visitor rate is determined as one in ten. The most important visitor conversion rate factors that directly affect the site's visitor rate are undoubtedly the speed and quality of the site. Sites that load slowly or have mixed themes will have fewer visitors. Therefore, increasing the number of visitors will directly affect the conversion rate.

Product presentation is the most crucial issue affecting the conversion. The trust of the visitor to the website would increase the conversion rate. The diversity of purchasing and shipping options, practical check-out system, and user-friendly interface are the factors that affect the conversion. Campaigns, discounts, and affordable price options are also essential factors that directly affect conversion rates.

Giving priority to popular products in the internet world will increase the sales conversion rate. Product quality, variety of sales options, convenient payment options, fast shipping options, and live support options directly affect sales.

The factors that directly or indirectly affect conversion rates can be listed as follows:

• How long does it take for the user to find the product they are looking for?
• Whether the user can reach detailed information about the product they are interested in or the comments of other users
• Visibility and easy accessibility of action buttons such as buy, add to cart, add to favorites.
• Which channel the visitors came from and how relevant they are to the content presented to them
• Whether unique content and advantages are offered according to the visitor's shopping profile
• Whether private content is shared or not
• How quickly the user can complete their shopping
• Whether the content has been customized based on the user's previous visits

How to Increase Conversion Rate

There are numerous methods for increasing conversion rates. Since each company's marketing strategy and goals are unique, the methods they will take to increase conversion rates will differ. However, if some of the key rules outlined below are followed, regardless of strategy, the conversion rate may increase.

• Discounts and campaigns should be created according to the website’s purposes.
• Alternative product options should be increased.
• Only products sold online should be offered for sale.
• A/B testing should be done during UX & UI editing processes.
• Complementary products should be brought to the forefront.
• The reasons for shopping should be well analyzed, and these reasons should be taken as a basis.
• Online shopping benefits should be offered, and visitors should be given confidence.
• The reasons for giving up shopping from the basket should be well determined.
• It should be possible to reach the site through different channels. Particular attention should be paid to social media referrals.
• Collecting NPS data for shopping is advantageous.
• Help options should be offered for those who have difficulty in finding products.
• Shipping, purchasing, and ordering processes on the site should be practical and fast. The design of the website should be user-friendly. The themes should not be eye-straining. The site's speed should not be slowed down with unnecessary GIFs and videos.

For the site to be flooded with visitors, the visitor expectation should be analyzed in the best way, and arrangements should be made in light of these analyses.

What Is a Good Conversion Rate?

A good conversion rate is over 10%, but for some businesses, the average rate is 11.45%. Earning a good conversion rate places the company in the top 10% of global advertisers, making the conversion rate two to five times better than the average conversion rate.

Conversion rates often vary by medium and channel, affecting what qualifies as a ‘good’ conversion rate. For example, sellers on Shopify maintain an average conversion rate that outpaces what the industry considered as ‘good’. Organic search conversion rates also exceed 10%.

Despite these differences, a conversion rate of 10% -or higher- should be targeted. In order to achieve these goals, improvements can be made, such as the A/B testing mentioned in detail above. Getting a double-digit conversion rate is a good conversion rate for many industries.