Conversion Rate

Percentage of visitors or users who complete a desired action out of the total number of visitors

Overview

Conversion rate measures the percentage of visitors who complete a desired action, such as making a purchase, signing up for a trial, or filling out a form. It's a fundamental metric for understanding the effectiveness of your marketing campaigns, website design, and user experience.

Conversion optimization is critical for maximizing ROI from your traffic and marketing investments. By improving conversion rates, businesses can generate more revenue from existing traffic without increasing acquisition costs.

Formula:
Conversion Rate = (Number of Conversions / Total Visitors) × 100

Macro Conversions

Primary business goals like purchases, subscriptions, or qualified leads that directly impact revenue

Micro Conversions

Smaller actions that indicate engagement like email signups, downloads, or social shares

Industry Benchmarks

E-commerce: 2-3% average, 5%+ excellent
SaaS Free Trial: 15-20% visitor-to-trial, 15-25% trial-to-paid
Lead Generation: 2-5% typical, varies by industry

Why It Matters

  • ROI Optimization: Maximizes value from existing traffic and marketing spend
  • User Experience: Indicates how well your site meets user needs
  • Marketing Effectiveness: Shows which campaigns and channels perform best
  • Revenue Growth: Direct impact on sales and lead generation
  • Competitive Advantage: Higher conversion rates mean more efficient customer acquisition
  • Product-Market Fit: Indicates how compelling your offering is to visitors

How to Measure It

Track conversion rates across different time periods, traffic sources, and user segments to identify optimization opportunities.

Basic Conversion Rate Analysis

-- Calculate conversion rates by traffic source
WITH daily_metrics AS (
  SELECT 
    date,
    traffic_source,
    page_type,
    SUM(visitors) as total_visitors,
    SUM(conversions) as total_conversions,
    SUM(revenue) as total_revenue
  FROM web_analytics
  WHERE date >= '2024-01-01'
  GROUP BY 1, 2, 3
)
SELECT 
  traffic_source,
  page_type,
  SUM(total_visitors) as visitors,
  SUM(total_conversions) as conversions,
  ROUND(100.0 * SUM(total_conversions) / NULLIF(SUM(total_visitors), 0), 2) as conversion_rate,
  ROUND(SUM(total_revenue) / NULLIF(SUM(total_conversions), 0), 2) as revenue_per_conversion
FROM daily_metrics
GROUP BY 1, 2
HAVING SUM(total_visitors) >= 100  -- Minimum traffic for statistical significance
ORDER BY conversion_rate DESC;

Funnel Conversion Analysis

-- Analyze conversion funnel step-by-step
WITH funnel_steps AS (
  SELECT 
    user_id,
    session_id,
    MAX(CASE WHEN event_name = 'page_view' THEN 1 ELSE 0 END) as viewed_page,
    MAX(CASE WHEN event_name = 'add_to_cart' THEN 1 ELSE 0 END) as added_to_cart,
    MAX(CASE WHEN event_name = 'checkout_started' THEN 1 ELSE 0 END) as started_checkout,
    MAX(CASE WHEN event_name = 'purchase' THEN 1 ELSE 0 END) as completed_purchase
  FROM user_events
  WHERE event_date >= '2024-01-01'
  GROUP BY 1, 2
),
funnel_summary AS (
  SELECT 
    COUNT(*) as total_sessions,
    SUM(viewed_page) as page_views,
    SUM(added_to_cart) as cart_additions,
    SUM(started_checkout) as checkout_starts,
    SUM(completed_purchase) as purchases
  FROM funnel_steps
  WHERE viewed_page = 1
)
SELECT 
  'Page View' as step,
  page_views as count,
  100.0 as conversion_rate,
  0.0 as drop_off_rate
FROM funnel_summary

UNION ALL

SELECT 
  'Add to Cart' as step,
  cart_additions as count,
  ROUND(100.0 * cart_additions / page_views, 2) as conversion_rate,
  ROUND(100.0 * (page_views - cart_additions) / page_views, 2) as drop_off_rate
FROM funnel_summary

UNION ALL

SELECT 
  'Checkout Started' as step,
  checkout_starts as count,
  ROUND(100.0 * checkout_starts / page_views, 2) as conversion_rate,
  ROUND(100.0 * (cart_additions - checkout_starts) / cart_additions, 2) as drop_off_rate
FROM funnel_summary

UNION ALL

SELECT 
  'Purchase' as step,
  purchases as count,
  ROUND(100.0 * purchases / page_views, 2) as conversion_rate,
  ROUND(100.0 * (checkout_starts - purchases) / checkout_starts, 2) as drop_off_rate
FROM funnel_summary;

Time-Based Conversion Trends

-- Track conversion rate trends over time
WITH daily_conversions AS (
  SELECT 
    DATE_TRUNC('day', event_date) as date,
    COUNT(DISTINCT session_id) as unique_sessions,
    COUNT(DISTINCT CASE WHEN event_name = 'conversion' THEN session_id END) as converting_sessions
  FROM user_events
  WHERE event_date >= CURRENT_DATE - INTERVAL '90 days'
  GROUP BY 1
),
conversion_trends AS (
  SELECT 
    date,
    unique_sessions,
    converting_sessions,
    ROUND(100.0 * converting_sessions / unique_sessions, 2) as daily_conversion_rate,
    AVG(100.0 * converting_sessions / unique_sessions) OVER (
      ORDER BY date 
      ROWS BETWEEN 6 PRECEDING AND CURRENT ROW
    ) as seven_day_avg_rate
  FROM daily_conversions
)
SELECT 
  date,
  unique_sessions,
  converting_sessions,
  daily_conversion_rate,
  ROUND(seven_day_avg_rate, 2) as seven_day_avg_rate,
  ROUND(daily_conversion_rate - LAG(daily_conversion_rate) OVER (ORDER BY date), 2) as day_over_day_change
FROM conversion_trends
ORDER BY date DESC;

Measurement Best Practices

Track multiple conversion types, segment by traffic source and device, use statistical significance testing for changes, and consider the full customer journey.

Best Practices

1. Conversion Tracking Setup

  • Define clear conversion goals and events
  • Implement proper tracking across all touchpoints
  • Use attribution models to credit traffic sources
  • Track both macro and micro conversions

2. Segmentation Analysis

  • By traffic source (organic, paid, direct, referral)
  • By device type (desktop, mobile, tablet)
  • By user demographics and behavior
  • By landing page and content type

3. Optimization Strategies

  • A/B Testing: Test different page layouts, copy, and CTAs
  • User Experience: Improve page load speed and mobile experience
  • Trust Signals: Add testimonials, security badges, and guarantees
  • Form Optimization: Reduce friction in signup and checkout flows

4. Landing Page Optimization

  • Clear value propositions and headlines
  • Prominent and compelling call-to-action buttons
  • Minimal distractions and clear navigation
  • Mobile-responsive design and fast loading

5. Testing and Iteration

  • Run statistically significant A/B tests
  • Test one element at a time for clear results
  • Monitor long-term impact, not just immediate conversions
  • Document learnings and build optimization playbooks