What is a Good Conversion Rate?

Mar 22, 2019

We have worked with a lot of online marketers. We know that, for many, their clients want them to try to drive traffic and get more people to use their website or app. They’re under a lot of pressure to find new and effective ways to improve their presence in search engines and get more potential visitors to their website. It is the #1 number they use to measure success and performance.

But it’s also not the only way to measure success, and at some point, there may be diminishing returns until you can improve another number that haunts far too many businesses: Conversion rate.

What is Conversion Rate?

Chances are you are already familiar with conversion rate, but briefly, your conversion rate is the percentage of visits or users that meet some goal that you’ve determined is important to your success.

Usually that goal is financial, like making a purchase on your website. If you get 100 visitors, and 2 make a purchase, that is a conversion rate of 2%.

Now, the goal doesn’t have to be purchase related. It can be the number of people that sign up for a newsletter, make a download, or even just click to an important page on your website. One business I worked with calculated conversions as the number of people that clicked to take a survey, for example. As long as it is indicative of a success on your part and somehow related to revenue.

But no matter what you choose for your conversion, the percentage of visits that turn into conversions is your conversion rate.

How Do I Know if I Have a Good Conversion Rate?

So you know what conversions are, and chances are you know how to calculate your conversion rate. Now you have a number.

Great! Lots of businesses have conversion rates. The question now becomes – what the heck are you supposed to do with it?

Every business wants to know if their conversion rate is good. Do I want a 4% conversion rate? A 40%? If I have a 0.1% conversion rate, is that awful? Should I be ashamed?


Just kidding, no. At least, not necessarily. Because the answer is so much more complicated than that, it’s almost impossible to know if a conversion rate is worthwhile just from looking at the number alone.

Conversion rates are influenced by so many different factors, that even if you compared yourself to your direct competitor you may still not have the same exact rate.

Factors that Influence Conversion Rate

In a moment, we’ll look at how you can improve your conversion rate by as much as 5x or more all by utilizing the web conversion tracking software data that you (hopefully) already have.

But before we get there, let’s briefly take a few moments to remember WHY conversion rate can vary so much between businesses.

The issue is that conversion rate is based on so many different factors – factors that are often completely ignored and forgotten when you look at your aggregate data. These include:

1.       Incoming Keyword or Website

Let’s say we have an eCommerce cheese business. We sell delicious raw cheeses. If someone searches for “buy aged cheddar” in Google and we show up, there’s a good chance this person is going to make a purchase.

But what if that person searched for “recipe for how to make a pizza with cheddar I already own?”

The odds of that person making a purchase are close to zero.

Since you cannot control Google, you cannot always ensure that the people that click on your website via search are also the ones that need your product. You’ll often find that there are plenty of unrelated search terms that generate clicks.

This is true not only of Google, but also most forms of ads, most social media, and more. Spammers can also mess up your results. One business we know received 40% of their traffic for a funny blog post they made that had nothing to do with their business, but ended up showing up for a major key term.

Apps are slightly better in that regard, but no two apps are ever the same, so the conversion rate is going to be unique to your business.

2.       Type of Product or Service

What you offer is almost never going to be the same as what someone else offers, even if all factors seem similar. For example, two dentists may offer similar services on paper, but in reality they accept different forms of insurance, they have different prices, they have different backgrounds, and more.

Similarly, on a gaming app that offers in-app purchasing of outfits for players, the skins you sell for your characters are going to be completely different than the skins someone else sells even if they look the same, because the game is different.

3.       Industry, Location, and Other Factors

One of the reasons that we are so insistent on prioritizing segments is because of conversion rates. Location, for example, matters so much. The people that live in New York City are extremely different than the people that live in the Bahamas. Women make different purchasing decisions than men. Recurring visitors make different purchases than new visitors, and so on.

Across industries, target markets – even economic uncertainties unrelated to your business – there are factors at play that make your conversion rate different than someone else’s conversion rate. There is no such thing as a “Good” or “Bad” conversion rate. There is only value.

If No Conversion Rate – What?

Your conversion rate matters. But it doesn’t matter right away, and it certainly doesn’t matter how it compares to others.

Instead, what matters is the following:

The value of each lead by segment.

That is going to sound confusing so let’s explain.

First, some leads convert, others do not. No matter. What you want to know is how much each potential lead or customer or long term user is worth.

For example, say you have a website that gets 1000 good hits a month and makes $2,000 in sales each month. Even though only a fraction of those hits made a purchase, you can say still calculate how much each hit was worth - $2,000/1000 =$2.

So for every additional lead you get, you can expect that you’ll receive about $2 in revenue. It won’t be exact, but it will be roughly accurate. If you double your hits, you should expect to have $4,000 in revenue.


As we talked about, not all visits are created equal.

Now, instead of looking at the overall value of each prospect, what if instead we looked at the value of each prospect by referral source using our web analytics tools. And let’s say we find something like this:

  • Google: 800 hits, $1200 sales
  • Facebook: 150 hits, $500 sales
  • Newsletter: 50 hits, $300 sales.

Here we have something interesting:

  • Google: 800 hits, $1200 sales = $1.50 per prospect.
  • Facebook: 150 hits, $450 sales = $3.00 per prospect.
  • Newsletter: 50 hits, $300 sales = $6.00 per prospect.

Suddenly, we know so much more than we did previously when looking at the value of each lead alone. In fact, we’ve learned many things:

  • We’ve learned by conversion rate isn’t as useful. In this example, Google converts worse than all other referral sources, but if you had to get rid of one you would not want to choose Google. Google is the majority of your revenue. We’d want Google to keep going up, even though that would cause conversion rate mathematically to go down.
  • We’ve learned that there may be opportunity in other sources. Maybe we cannot sign up many people for our newsletter, but now we know that Facebook may be worth looking into more as the per-prospect rate is higher.

And of course, we’ve learned that different sources lead to different conversion rates. That implies there is SOMETHING different about them even though it doesn’t say what.

You can also take it a step further. You can look, for example, at what page they land on. You can then see if there are some pages converting better than others, or some pages that are affecting your data, like an unrelated blog that is getting lots of hits.

Depending on your web analytics platform, you can also look into other segments as well, such as frequent visitors vs. infrequent visitors or the leads most associated with high profits vs the behaviors of one time new visitors.


First, please stop yelling, you’ll wake the kids.

But second, yes, we get it. You were hoping to figure out what a good conversion rate is so that you could compare it to yours. But I think it is clear that figuring out what a good conversion rate is can be impossible, because of all the factors above.

So, rather than see how your conversion rate compares to others - which is almost entirely meaningless – you should first:

  • See how your conversion rate looks broken down into segments.
  • Play around with the data to exclude those that were never leads, like unrelated searches.
  • Look for ways to improve your conversion rate and see what happens.

In a way, it’s not where your conversion rate is now that matters. What matters is where it can be. By looking for ways to improve your conversion rate, you can genuinely know if it is as good as you want it to be.

Simple Ways to Improve Conversion Rate

Entire books can be written on ways to improve conversion rate, and you’ll want to look for ways to tailor it to what you offer. A gaming app is going to have a very different conversion rate than an eCommerce website for senior women.

Well, probably.

But we don’t want to leave you hanging with this idea that you have to improve your conversion rate and not at least give you some ideas of where to start.

So, with that in mind, try the following:

Add and Monitor Your CTAs and Conversion

One of the simplest and fastest ways to get people to convert at a higher rate is to make it easier for them to do so. Amazon added 1 click buying for this reason. The more a person has to do to make a sale, the less likely they will complete the purchase.

You don’t want to overload your content or website with calls to action or purchase steps. But adding a form to each page, or making sure that people can buy from each page, letting people know what the next step is in the content, and more all help make life easier on the consumer.

Give Them a Reason

One of the best companies I worked with never asked anyone to buy a product. They knew that most people wouldn’t shell out $100 on a whim to a website they found online.

So instead, they created a task that had implicit value to the visitor.

They created a 100% free test that scored the user based on their answers, and gave them a free report that outstanding insight into their life.

The test was so valuable on its own, that new visitors were always extremely excited to take it. The website had an almost un-heard of 40% click through rate with a 20% conversion rate, because not only did almost half of all visitors want to take the test, but once they did they found it so valuable they were happy to also try the product as well.

The website’s ability to create something that was valuable for people as a way to move them forward in the pipeline absolutely was responsible for their high profit margins.

You don’t necessarily have to come up with some type of test or free giveaway, but make sure that whatever you’re using to convert or move people down the funnel is compelling. Give them a reason to move to the next step.

Prime People

There was a company that offered a percentage of sales to affiliates. Most of the affiliates were extremely successful, making a considerable profit by selling their product. But one was completely unsuccessful, and called the company to complain.

After working through it together, they realized that the affiliate was selling the product incorrectly. They were pushing tons of traffic, but that traffic was unrelated, so the person came to the website without being essentially pre-qualified to make a purchase. They created a YouTube marketing strategy that amped people up for making a purchase, and then when they clicked the link they were excited to buy the product.

You can do this yourself both onsite and offsite. For example, if you have a game that sells in-app purchases, let people know when a really great deal is about to go live and give it a short timeframe to purchase. Get people excited about it so that when it’s ready they are all rapidly buying it.

Of course, you’ll need to deliver on that promise. But if you do, you’ll have a surefire way of increasing purchase rates.

Use Detailed Analytics to Know Your Market

Did you know that when it comes to healthcare decisions within the family, women are statistically almost always the decision makers? Research has shown women make as many as as 80% of the decisions for health care coverage and choosing a doctor.

So if you had a health insurance website written entirely for college bros, would you make any conversions?

Insights like this are not always so obvious. But here’s the thing – these insights exist right now within your data. By installing event tracker software that also collects user data and other information, you can find out what your market is and adjust your content to that customer.

Keep People Engaged

One of my personal pet peeves is when I visit a website for the first time and immediately, before I have had an opportunity to read the content, an email capture page pops up asking me:

“Like what you’ve read? Want to read more? Sign up today to get the best articles right to your email.”

Here’s the thing…

I don’t know if I like it yet, because the popup prevented me from reading any of the content.

But now that I work in analytics, I understand that desire a lot more. I still think those ads pop up too quickly, but users that sign up for newsletters, or create an account, or otherwise stay connected to the website are the ones that will be more likely to make a purchase in the future.

Find a way to keep people engaged even if they never bought anything from you. Chances are they’ll buy something down the line.

Discover Your Own Conversion Enhancement

What is a good conversion rate?

A good conversion rate is a conversion rate that is better than you have right now.

That’s the truth. Instead of comparing to the rate of others, see if there are strategies that can improve upon your current rate. And if you utilize segmentation and analytics, you may discover opportunities for conversion improvements that are extremely valuable, and help you profit substantially in the future.

For more information about the Air360 analytics platform, or to schedule a demonstration, contact Air360 today at www.air360.io.