Conversion rate

What it means

Conversion rate is the share of visitors who took the tracked action: a purchase, an enquiry, a sign-up, a call. It is always measured against a precisely defined action and a precisely defined audience - otherwise the numbers cannot be compared.

Where CTR says whether the offer was interesting enough to click, conversion says whether the page delivered on the promise. The first is about the advertising, the second about the product and the site.

There is the main conversion, the one that brings revenue, and the partial steps before it: adding to the basket, downloading the price list, opening the form. Partial conversions show where the customer’s path breaks, but only the main one belongs in the return on ad spend calculation.

How it works in practice

In an online store most is lost in the basket and at checkout: forced registration, shipping costs revealed late, too few payment methods. In services the strongest factor is how fast an enquiry is answered.

Going from 1 % to 1.5 % means half as many orders again on the same advertising spend - which is why conversion is usually optimised before the traffic budget.

On the site of a small firm selling services, the conversions set up are a submitted form, a click on the phone number and on the e-mail address. The source of the visit is told apart with UTM parameters, so it is visible which channel brought the enquiry that later became a signed contract.

What to watch out for

A high conversion rate is not an end in itself. Discounts raise it easily while worsening unit economics. What is worth tracking is conversion alongside average order value and margin.

With small numbers the rate distorts easily: ten orders more or fewer move the result by whole percentage points. A decision taken on one week without an A/B test often follows chance rather than the real effect of the change on the site, and the next changes are then built on a mistake.