Although there are so many factors, many data points, and Key Performance Indicators (KPIs) to monitor in the digital marketing sector, few are as essential to your business as the conversion rate. Understanding the conversion rate and its relation to other crucial KPIs is critical to ensure your business’s growth and continued success.

Essential Definition of What the Conversion Rate Is

The conversion rate is a crucial metric in digital marketing that measures the percentage of users who complete a desired action, transforming them into converted users or converts. The definition of conversion can vary depending on the business objectives, goals, and industry specifics. Based on the numbers, companies invest also in conversion rate optimization.

A conversion rate measures what happens when a user of your website, app, or digital property successfully completes a desired action. The conversion rate is the measure of all user actions and the percentage of users who have completed such actions, transforming them from regular users into converted users, also known as converts.


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In digital marketing, the meaning of a conversion varies depending on your business objectives and particular goals. Traditionally, the term “conversion” comes from the retail industry. In this context, a conversion occurs when a visitor buys a product, turning into a paying customer. This particular definition is employed by most eCommerce platforms and similar properties, where the primary business objective is increasing sales or acquiring more customers.

However, there are many other definitions of a conversion. For example, if your business conversion goal is expanding your web page’s readership and gaining more subscribers for your newsletter. You may define a conversion as a reader submitting their email address on your web page and becoming a new subscriber.

Another example of conversion events is registration forms. To grow your website’s user base and turn more visitors into registered members, for example, you may define filling out a registration form as a conversion.

Why Conversion Rates Matter

Knowing your conversion rates offers critical insight into your business performance. It provides information regarding your marketing efforts and serves as a metric to evaluate whether you are currently meeting your business goals. A good conversion rate shows that your chosen marketing channels are successful.

Relationship Between Conversion Rates and ROI

The Return on Investment (ROI) is another essential metric regarding your digital property’s performance and overall conversion tracking. Measuring your ROI helps you determine the cost-effectiveness of your advertising and marketing campaigns, especially if your conversions result in increased sales or revenue.

The higher your conversion rates, the better your ROI becomes, as your advertising campaign effectively brings you more traffic and more converts for the same amount of money spent on marketing.

Consequently, focusing on increasing your conversion rates typically benefits your ROI.

What is a Good Conversion Rate?

While a higher conversion rate is always better, knowing what constitutes a good conversion rate is crucial to set achievable business goals and ensuring steady growth. The definition of a good conversion rate varies significantly depending on the type and industry your business belongs to, your advertising campaigns, the nature of the products or services you offer, and many other factors.

The best way to determine a good conversion rate for your business is to research average and median conversion rates in different channels in your particular industry. These numbers provide essential information (conversion data) on how typical competitors in the target market usually perform and where to set your own goals to increase sales and ensure growth.

Average Conversion Rates by Sector

The numbers in this table show data on the median and average conversion rates for websites of various industries. Median rates indicate the middle value across all recorded conversion rates, while the average conversion rates measure and show the sum of all conversions and rates divided by the number of entries, sometimes per landing page.

Agency industry
Real estate
Software as a Service (SaaS)
Family support services
Business services
Medical services
Home improvement
Travel industry
Leisure and events industry
Legal industry
Fitness and nutritional advice
Finance and insurance
Media and entertainment
Restaurants and catering industry
Median conversion rate
Average conversion rate

Conversion Rate Formula

Conversion rate = (Conversions ÷ Interactions) ✕ 100 

What is a Good eCommerce Conversion Rate?

Although the median conversion rate for eCommerce digital properties is 5.2%, you shouldn’t expect your site to achieve this metric immediately unless it is already among the best-performing in the sector. A good conversion rate for sites, apps, and other properties in this sector is typically between 2 and 5%, with rates exceeding 5% considered high-performing.

Remember that your particular business may want to target a higher or lower conversion rate depending on other factors than the sector. For example, the type of products sold can affect your expected conversion rates. If your eCommerce store or website primarily sells niche or specialized products, your conversion rates may be lower than a generalist platform.

How to Calculate Conversion Rate

Knowing the know-how of calculating conversion rate is essential in any marketing strategy, even if your conversions and business objectives aren’t about increasing sales and revenue. There are multiple methods to define conversions, and learn how to calculate your conversion rate based on your conversion goals.

Related Content: How To Calculate Conversion Rate

How to Boost Your Conversion Rate

Regardless of your industry, target audience, or business objectives, applying the best available methods to make user interactions and boost conversions while gaining new unique visitors,  is essential to ensure the highest number of users and visitors complete the tasks that matter and become converts.

1. A/B Testing

Testing any planned changes before implementation is crucial to ensure they work as intended. A/B testing involves two versions of your digital property: Version A, the current version, and Version B, which features any changes you’ve made to boost the conversion rate. A/B split testing lets you directly compare both versions’ performance before implementation, ensuring you retain only the most efficient modifications.

2. Headline Optimization

The headlines of landing pages are the first thing viewers see when they visit your site and its digital properties. Optimizing them with short, highly descriptive copy and relevant keywords is a cost-effective method to boost your conversion rates.

3. Refined Audience Targeting 

Analytics tools on mobile devices and software can provide you with crucial information and insights on engagement metrics, such as the consumer profile of your conversions. Understanding your audience better helps you improve your targeting and attract more visitors with a similar profile.

4. Keyword Optimization 

Optimizing keywords for conversion rates is called Conversion Rate Optimization (CRO). Using keyword research tools such as Google Keyword Planner or the keyword tool in Google Ads Reports can help you find the best high-conversion keywords for your sector.

Developing Your Offer with a Robust Conversion Funnel

One of the most efficient methods of ensuring higher conversion rates is developing your offer and creating a process that encourages users and visitors to complete the desired task. Whether you want to encourage regular website visitors to become paying customers or get new visitors, new registered members, or subscribers, this process is known as the conversion funnel.

A sales funnel is comprised of four stages whose end goal is for visitors to convert. Each stage brings a visitor closer to becoming a convert:

  • Awareness: A visitor becomes aware of your product, brand, or service through advertising, social media posts, or word-of-mouth. Building robust ad campaigns can improve visitor awareness of your brand, helping make more people aware of your platform.
  • Interest: Once a visitor knows of your brand, the next stage is to get them interested. Visitors will compare your offerings with their needs and problems to determine whether you offer the best solution. The most reliable way to increase interest is to use audience analytics tools to understand your visitors better and ensure your products and services match their needs.
  • Decision: Although many visitors may be interested in your product, interest doesn’t necessarily guarantee a conversion. At this stage, they will look into the conditions. For example, when trying to secure a sale, potential customers at this stage will pay close attention to deals, pricing, and packages. Ensuring your conditions are as clearly defined as possible is crucial to bringing them to the next stage.
  • Action: The final stage is whether or not a visitor decides to complete the task necessary to convert. Making the conversion process as easy and convenient as possible is critical. Overly complex conversion processes can instead drive visitors away and make them reconsider at the last moment.

Enhance Your Digital Properties with CodeFuel

While adopting the right strategies to get more website traffic and boost your conversion rates and obtain maximum ROI is necessary to ensure your business’s success, it can sometimes be challenging without expert assistance. CodeFuel’s team of digital marketing experts can help you analyze your business goals and find the best strategies to increase your website’s organic traffic and conversion rates. Contact us today to get started.


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What do you mean by conversion rate?

The conversion rate is calculated with the percentage of conversions achieved divided by the number of total users or interactions. The calculated conversion rate provides an easy-to-read value that helps compare the number of users or total interactions with the number of conversions.

What does conversion rate mean in sales?

In the context of retail, eCommerce and web analytics, and other sectors where the primary business objective is increasing sales, a conversion represents a visitor that spent money and was converted into a customer. In this context, the conversion rate represents the percentage or actual number of visitors that became paying customers.

What is a 2% conversion rate?

A 2% conversion rate means that out of a given number of total visitors or a total number of interactions, 2% of them were converted. For instance, if an eCommerce platform were to record 20,000 visits and 400 sales in one month, its conversion rate would be 400 ÷ 20,000 = 0.02, or 2%.

How do you calculate conversion value?

To obtain the total number of conversions before calculating the conversion rate, define a period (e.g., one month) and count the number of successful conversions during that period. Ensure you compare the number of conversions with the number of total interactions within the same time period to calculate an accurate conversion rate.

Is a 3.5% conversion rate good?

A given conversion rate is the percentage of a high-performing website and its business in one industry, but if below average, it can be low performing in another. To check whether a 3.5% conversion rate is good, compare it with the median rates for your business sector. Conversion rates approaching or exceeding the median for your sector are typically considered good.