The conversion rate serves to indicate the result of the applied strategies and identify the bottlenecks that can be improved. That way, you’ll be able to convert as many leads to the action you want.
It is common for entrepreneurs to believe that this fee applies only to conversion to sales. However, each step of the sales funnel can be measured by the formula, from when the individual is just a visitor to the moment of closing the purchase.
Want to understand how to calculate conversion rate and optimize your digital business results? See the article we have prepared and follow our tips.
What is the Conversion Rate?
Conversion occurs when the company manages to get the individual to perform a certain action within the shopping journey. As such, conversion rate is a metric that reveals whether your marketing strategy is achieving your goals.
It is noteworthy that it is not limited to the number of sales made, as it can represent other conversions, from the lead filling out a form to following a Call to Action (CTA).
Thus, it is possible for the entrepreneur to understand the result obtained at each stage and which one of them needs to improve. Certainly, if there is a failure in the early stages, the number of people who will make it to the purchase will be less.
How to measure conversion rate?
The first step in calculating your conversion rate is to define what your goal is, that is, what action your leads want to analyze. Then, just find the numbers and calculate using the following formula:
Conversion rate = number of conversions divided (/) by the number of people who made it to the previous step times (x) 100
For example, let’s use a physical store. If 1000 people entered in one day and 100 made a purchase, the conversion rate for that day was 10%. Look:
Conversion rate = 100 / 1000 x 100 = 10%
The same happens in digital marketing, but the metric is calculated by other perspectives, such as ad clicks or landing page visits.
What percentage is a good conversion rate?
It depends! It’s no use comparing your result with that of competitors or other segments, as there are a number of factors that can differentiate between one business and another.
It is best to have a goal set and identify whether it has been achieved or not. Another good practice is to analyze the rate along with other metrics important to your business:
- Email open rate;
- CAC (Customer Acquisition Cost) ;
- ROI (Return on Investment) ;
- Among others.
With each new analysis, you will better understand your own reality and be more precise in interpreting the results.
How to optimize conversion rate?
Understand the audience
Around the year 2010, a US retailer discovered that diaper sales were tied to beer sales. After understanding this habit of the public, he left the two products on nearby shelves. So he instigated that custom and increased sales.
This was possible thanks to the use of stored data. So imagine the amount of things you can notice with the information a digital business has. If the infoproducer can do a good analysis and focus on the right strategies, it will certainly increase the conversion rate.
The analysis can be quantitative or qualitative. In the first case, look for tools like Google Analytics:
- Devices used by customers;
- The marketing channel that attracted the customer;
- Page drop point.
Qualitative analysis, on the other hand, is more difficult to perform, as it depends on more in-depth answers, such as a satisfaction survey. However, it is recommended to do it to know directly the preferences of the public.
Perform A/B tests
The A/B test consists of leaving the same page with two different versions to understand which will have the highest conversions. The differences between one and the other are few and often subtle, precisely to understand which aspects make the result change.
Modifications can be, for example:
- Page colour;
- Call to Action (CTA) ;
- URL ;
- Offer description;
- CTA button location.
One tool that can assist in the landing page (LP) testing is Unbounce. It allows the creation of LPs and provides visitor statistics to facilitate insights gained into conversion rates.
Create automation to nurture leads
Imagine that many people know your company and even visit your website. However, the portal is soon forgotten, either because it does not deliver content or because the materials are not suitable for the potential customer.
The first step is to create content with consistency and quality. However, marketing automation allows you to deliver personalized content, to the right leads, and on a large scale.
This strategy can be used for the famous triggering of emails. Thus, the sales funnel will be optimized and leads will evolve until they reach the purchase stage.
Use Spark Funnels
To have a high converting sales funnel, we recommend using Spark Funnels. The tool allows you to assemble the funnel in less than 5 minutes, with a free and intuitive platform. The free version, among many features, includes:
- Unlimited Leads;
- Unlimited landing pages;
- Automation and sending unlimited emails;
- Online page editor.
In addition, it already has a ready-made funnel model that streamlines the entrepreneur’s work, which can focus on other tasks. Spark Funnels even allows you to track the results obtained in each funnel. Thus, it is possible to identify the data that is used in the conversion rate formula and study ways to optimize the results.
Achieving good performance in digital business encompasses a number of factors and conversion rate is essential to make it easy to identify strengths and weaknesses. So be sure to use this simple and powerful formula.