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Conversion shows what percentage of efficiency has your site by its specific goals. For example, how many people from your site visitors have passed to this or that page, or how many of them have completed the journey on the site by the purchase.
By accurately defining these conversion data at each stage of your sales funnel you can clearly understand what needs to be paid attention to, where are the disadvantages, and when the potential customers “leave”.
WHAT IS GOOD CONVERSION RATE?
This question is very difficult to answer. However, it is absolutely clear that a good conversion rate for your site is one that is higher than the previous one. In other words, it is relative factor.
Many of the elements that affect the conversion rates are beyond the control of professionals:
• Existing company brand reputation. For example, if people like and appreciate the brand, the sales conversion will be higher than with a neutral attitude.
• Price. The cheap goods are easier to sell than the expensive ones, so it’s trivial to take into account the conversion rate – the quantity of sales.
• The complexity of sales. Products that are the impulsive purchases will have a higher conversion rate than the complicated services that require monthly research and contract signing.
• Required level of commitment. It’s easier to force users to read 5 free articles than to subscribe to email newsletters. Therefore, 5 articles reading will have a higher conversion rate than a newsletter subscription. Even if the actions take place on the same site.
Influence of time and usability on conversion
In the 2000s, online shopping sites usually had the average conversion rates of around 1%. In 2013 the value was about 3%. This example also shows that the expected conversion data is time sensitive.
Based on what you expect, the satisfactory conversion rate varies within1 – 10%. On the other hand, when we measure the success rates in usability studies, websites often gain around 80%.
How to explain the variation in the range of indicators?
The difference is simple: in the usability studies we ask the user to perform the task and then measure whether it is possible to do. Even if the price is too high, people still “buy” even when it is just a test, because they participate in accordance with the scenario. In other words, 80% of success means that 20% of visitors cannot use the site. It does not mean that 80% of the potential customers will become paid customers.
Another way to look at these two different statistics is to consider a site with the conversion rate of 4% and 80% success in usability studies. If we could eliminate all the problems of usability in order not to lose 20% of potential customers, the site will have a conversion rate of 5%.
Should the conversion be increased?
This is a controversial question, because, most likely, the answer is no. Your goal is not to maximize this indicator but to optimize it. The difference is that sometimes the price of the rate maximizing will be so high that it will be completely unjustified. The reactions of the page visitors should be studied regularly. Based on that the certain conclusions and the pages quality optimization should be done with the aim to improve sales and, therefore, to increase the conversion rates.
If only the price is taken into account
Depending on the elasticity of customer perception of prices, the number of sales may increase as you reduce the price:
• High elasticity of price sensitivity makes it clear that clients will convert at low prices only.
• Inelastic price sensitivity makes it clear that many customers will continue to buy at significantly higher prices.
For example, you raise the price on 10%. Even with a sales decrease of 10%, you still get a total income. At high rates of price elasticity, the sales can fall on 20% in average, and your profits will be reduced.
If your customers have a low perception of price elasticity, profitability may be higher if you take a slightly lower conversion rate that accompanies price growth and increase.
How the site conversion is calculated?
For example, 100 people have visited your site. At the same time, 10 people committed this or that action that we sought. Suppose they have bought a product. Therefore, to calculate the conversion of the sale, the quantity of people who has made the purchase, should be divided by the quantity of your site visitors and multiply all the figures by 100%. I.e:
(10/100) * 100%
Total conversion data is 10%.
Website conversion is not the only important indicator, but it is able to inform you about the many mistakes that were made on the site.
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