What is a Conversion Rate? How is it Calculated?

Your company's success inevitably requires keeping the website up-to-date and constantly improving it. These improvements, far from being a straight path, will be done by trial and error.

In order to evaluate which modifications end up being positive, one calculation is essential: that of the conversion rate. But first, what does the conversion rate stand for and why should it be calculated?

A brief definition of the conversion rate

If we want to share a brief presentation, we can say that the conversion rate represents the proportion of sales or subscriptions that you get on your website compared with the number of visitors. 

How to calculate your business website's conversion rate

A simple calculation allows you to determine your conversion rate: you must divide the number of visitors you have gotten on your website by the number of subscriptions of sales (if you have an e-commerce website) and then, multiply this number by 100. It can be said that the conversion rate = the number of clients/visitors x 100. 

As an example, think of the following situation: In one day, you got 125 clients out of a total of 1000 visitors? Therefore, your conversion rate is 12.5%. Here is the full calculation: 125/1000= 0.125 x 100 = 12.5. 

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Measuring a conversion rate: a few tips and precisions

Beyond this summarized presentation, it should be specified that the conversion rate possesses a larger sense than that of transforming visitors into clients. Indeed, the case may be that the conversion rate we are looking for concerns the number of people signing up for a newsletter or asking for a quote. Any step that requires a level of engagement can be evaluated.

Although no direct financial benefits arise directly from one or the other, going from a visitor status to that of signing up for a newsletter is still relevant. This represents an important step in the journey that will lead you to the acquisition of this customer. 

Therefore, it is entirely possible that each phase of this process is evaluated according to its' own conversion rate. Note that each of these steps is an integral part of the conversion funnel, which is covered in section 7 of our article "12 ways to improve your conversion rate". 

Why should you calculate a website's conversion rate?

Evaluating the conversion rate of the different steps leading to a customer acquisition will allow you to identify the aspects that compromise your success and can indicate the necessity to use A/B testing to identify which corrective measures could help increase your success rate. 

It goes without saying that calculating the conversion rate for each aspect and functionality associated with your website is a part of the daily follow-ups you should complete to ensure that your company website is at its' best. This will help you make adjustments and rethink your web strategy.

How to compare your website's conversion rates

When it comes to comparing your conversion rates, a cautionary note is in order. If you want to compare two different versions of your subscription form, try to do your test at the same moment of the week. Omitting to do so will distort your analysis, as it is widely known that the number of visitors on a website tends to vary depending on what day it is, as well as the time of day. 

It is also strongly recommended to take into consideration the one-off events that could affect your results. To this end, if you compare the results you got during a marketing campaign with those at a moment where no campaign is on, you will probably see a decline in your conversion rate.

However, this will not necessarily mean that every aspect has a flaw that needs to be corrected, but instead, that a period where the site is not under a promotional campaign will obviously be less busy in terms of visitors.  

Read the following article for ways to get better results with your conversion rates: 12 ways to improve your conversion rate