What Is Conversion Rate Optimization: The Only Answers You Need
Most marketers get as much site traffic as they can, thinking that it’s the only metric that matters. And while there is merit in that, it’s by no means the only way to gauge the success of a marketing campaign.
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Most marketers get as much site traffic as they can, thinking that it’s the only metric that matters. And while there is merit in that, it’s by no means the only way to gauge the success of a marketing campaign. In this post, you’ll learn all about conversion rate, what it can do, and how to optimize your pages for conversion rate. To be more specific, we’ll dwell on the role that conversion rate optimization (CRO) plays in paid advertising and landing pages. We’ll show you how you can use both channels to improve your marketing efforts.
What Is Conversion Rate?
Before we begin, it’s best that we talk about what conversion rate is. So, what is it?
Conversion happens when a user performs a desired action. As to what that action is will depend on you and your goals.
For an online seller, the goal would probably be to sell a product or a service. But for other types of sites, the goal could be different. It could be as simple as signing up for a newsletter, creating an online account, downloading content, and more.
Conversion rate, therefore, is the rate at which users complete a desired action.
There is a formula on how to calculate conversion rate which we’ll discuss later on.
What Is a Good Conversion Rate?
As mentioned earlier, there are two cases where you’d want to measure the conversion rate. These are ads and landing pages.
It’s important that you measure your conversion rate.
Why?
It’s because your conversion rate will tell you if you’re getting a good return on your investment. Should you spend more or less? Are you getting your money’s worth? Do you need to do more? What campaigns perform better? Which campaigns should you stop?
These are just some of the questions you could answer by calculating your conversion rate.
If you work with clients, conversion rate might be a better metric to use compared to site traffic as the former gives them a better sense of how you’re helping them reach their goals.
But what is a good conversion rate?
Paid Advertising
The average conversion rate lies between 2% to 5%. Anything lower would indicate that there are problems with your campaign that needs fixing.
However:
It’s not really all that simple. There are different factors that could affect your conversion rate. For starters, what ad are you trying to measure? Are you talking about Google Ads that appear in the search engine result pages (SERPs)? Or are you measuring ads that you placed on your website?
Also, what is your niche? Some industries record lower or higher conversion rates.
In one Instapage article, it noted that the average conversion rate across all industries is 4.40% for SERPs results. In-display ads (or those ads you embed on a page) have an average of .57%.
There are outliers, of course. In the graph above, Instapage indicates that pages in the law and government field, as well as ads in the automotive sector, have a conversion rate of 7.45% and 7.98% respectively. This is way above the 2% to 5% average.
Search Engine Journal’s post on Google Ads conversion rate isn’t that far off either. They put the average conversion rate of search networks at 3.75% and display networks at .77%.
According to the post, the niches that have the strongest conversion rate is dating with the legal, automotive, and consumer services not far behind.
Both posts indicate that conversion rate performance is better on SERPs than ads that you place on your website.
Landing Pages
But what about the conversion rate of your pages? These refer to purchases made on your domain, your newsletter subscriptions, data collection, downloads, webinar sign-ups, etc.
What’s the ideal conversion rate for these pages?
As with Google Ads, the niche of your website is a factor. That’s why online marketers can’t come up with a solid number. The percentage would differ from one industry to another.
For example, Unbounce states that the higher education niche has an average conversion rate of 2.6%. That is significantly lower than the average conversion rate for domains in the vocational studies and job training market which is 6.1%.
But your niche isn’t the only factor.
You also have to take into account the medium you’ll use to promote your landing page. There are cases when marketers use emails to push a landing page. This means that while not all pages rank on search engines, there’s a good chance that they would still convert when sent to business leads.
According to Campaign Monitor—a cloud-based software company that specializes in email campaigns—the average landing page conversion rate across industries is 2.35%.
For e-commerce sites, the conversion rate is even lower based on a Crazy Egg article. It states that the average conversion rate for e-commerce sites is 1.6%.
Food services and travel have the highest rates at 21.23% and 2.42% respectively. This is good news for those who are in the food industry.
But of course, there are other factors to consider. Things like how many products you sell and at what price, the tone of the marketing language used, and how you promote the landing page.
Those who are just starting their CRO campaign can set an initial goal based on their industry. You can then adjust that number based on your performance every month. If you’re hitting way above your initial number, you can raise your conversion rate target.
How Do You Calculate for Conversion Rate?
To calculate your conversion rate, you will need access to an analytics tool. Google Analytics is the most commonly used source of data but other options exist.
What kind of data are you supposed to look for?
Two things: you need to know how many people have visited your page and how many people converted (bought your product, signed up, or whatever your goal is).
Once you have the information, you can compute for your conversion rate.
Conversion Rate Formula for Paid Ads
Depending on your goal, you can use one of three formulas to compute your conversion rate.
Formula 1:
Conversion Rate = (Number of Conversions / Number of Sessions) * 100
Formula 2:
Conversion Rate = (Number of Conversions / Number of Unique Visitors) *100
Formula 3:
Conversion Rate = (Number of Conversions / Number of Leads Generated) *100
Note: The reason why we multiply the quotient by 100 is to get the percentage.
Let’s use an example. Say you have an ad for your lipstick company on Google. Last month, that landing page generated 10,000 unique visits. Out of 10,000 users, 200 of them converted to paying customers.
Let’s find out what the conversion rate is for the ad.
(200 / 10,000) * 100 = 2%
This would mean that your lipstick ad has a conversion rate of 2%.
Conversion Rate Formula for Landing Pages
The formula for landing pages is almost the same as the formula for paid ads. You also want to divide the number of conversions by the number of visits your page received.
Say you have an e-commerce site that sells pens. And your landing page got 348,265 unique visits in a month. 4,672 visitors bought pens from you. What would your conversion rate be?
Let’s compute.
(4,672 / 348,265) * 100 = 1.34%
So your landing page’s conversion rate would be 1.34%.
But what if you’re not an online seller? What if you want to use it to calculate how many people signed up for your webinar?
The process would remain the same. You just have to substitute the values.
Say you have a dedicated landing page for your webinar. By the end of your campaign, you saw 7,389 users drop by. Out of that number, 234 people signed up for the webinar.
The formula would now be: (Number of signups / Number of Visits) * 100 = Conversion Rate.
Let’s substitute the values.
(234 / 7,389) * 100 = 3.17%
That would mean that the conversion rate of your webinar campaign is 3.17%.
What Are the Steps of Conversion Optimization?
Marketers who compute for their conversion rate might walk away surprised at their low numbers.
What could have gone wrong? Why am I not converting anywhere near my goal? What can I do to improve my conversion? These are just some of the questions they ask themselves.
So what is the secret to performing better? How can you improve your ad or landing page to get better results?
The answer: conversion rate optimization.
Just because you have an ad or a landing page does not mean it’ll get the kind of results you’re looking for. You need to optimize it for conversion.
But how?
Below are a few steps that you could take to improve your conversion rate. Most of these will apply to both ads and landing pages.
Develop a Strategy
First, you should have an idea of what your goals are and how you plan on achieving them.
This covers more than setting up a strategy though. You have to also understand your audience. Who is your intended audience? What kind of copy would work for your target demographic? What colors do you use on your landing page? What offer do you put in your ad?
Your strategy will depend on the site you’re running. Conversion rate for ecommerce is not the same as the one for a blog.
These are some of the things you need to think about.
Only when you’re able to plan your CRO strategy should you move on to the next bit.
Implement On-Page Optimization
On-page optimization makes sure that you have the right keywords in your metadata, title, main content, and URLs for search engines.
Keywords have a profound effect — whether they’re for ads or landing pages. That’s because search engines will always try to match the user’s query with the right ads and landing pages.
Matching the right keywords with the proper ads and landing pages will help you immensely. It’ll make sure your pages end up where they need to be so more eyes land on your pages which will lead to more conversions.
Add Social Media Pages
Potential customers need to see some proof of your legitimacy. They won’t convert if they have no idea who you are.
In this regard, social media pages help.
They can see posts from previous customers who can vouch for you. Customers can check out your ratings, products, reviews, and other information that help them decide to buy from you. If you have verified accounts, that’s even better.
Use Facebook, Twitter, Pinterest, LinkedIn, and other platforms to tell customers about the products or services you’re selling.
Social media also gives your brand a voice. It shows people the people behind the company. If used correctly, social media can translate into better sales.
Get Feedback From Customers
Speaking of social media, you can use it to get feedback from users. This is important if you want to get a better sense of what you’re doing wrong.
Are customers tired of your page design? Don’t they find your offer alluring? Do you need more perks for them to dive in?
If you want to know what you need to make your conversion get back on track, asking previous customers can give you an unbiased answer. Allow them to help you make improvements to your landing pages or ads.
Make Your Landing Pages Simple
Too much information can lead to fewer conversions. Why? Because it tends to overwhelm users. Eliminate as many distractions as you can from the page.
How can you accomplish this?
- Highlight a single call-to-action — Focus on a single action. If you want them to sign up for your newsletter, don’t have other buttons that distract them from signing up.
- Write Better Copy — Keep the copy simple. Use words that are easy to understand. It’s also crucial that you don’t introduce technical jargon unless it really needs to be there.
- Clean Up Your Landing Page — Stick to simple fonts and don’t use too many colors. Don’t add design elements that would detract from your main message.
Be Mobile-Friendly
You want a page that’s optimized for mobile devices given how many people today use their mobile devices to search online.
And if your pages won’t load on phones and tablets, then they’d leave before they can even figure out what your page is about.
If you can’t tell if your pages are ready for mobile, Google has a tool that you could use. It’s a mobile-friendly test.
All you need to do is enter the URL and Google will check if it’s up to their standard.
And while you’re at it, be sure that your pages load fast too. There is another Google tool called Page Speed Insights that will check how fast your page loads.
Simplify the Signup/Checkout Process
Be as straightforward as possible. In his blog post, Neil Patel claims to have increased his conversion rate by 672% — and all he had to do was make some tweaks to his forms.
What kind of changes did he make?
Neil did things like placing the form above the fold, created a strong call-to-action, made some of the fields optional, and removed unnecessary ones.
These kinds of decisions will not only make your pages look better, but they will also encourage users to convert. If possible, you should make all the signup and the check out process transpire in one page.
Highlight Special Offers
Do you offer discounts? Are you having a special promotion? Great. You should include that in your content.
Not only should it be in your main copy, but it should also be in the metadata and title of your landing page or ad. To make your offers more enticing, add words and phrases like “limited time offer”, “sale”, “discount”, “off”, and other related terms.
If there’s an expiration date on the offer, make sure you indicate it as well. This encourages users to act quickly.
Free shipping is also a popular offer in case you were wondering.
Find Where Customers Are Dropping Off
At what point do customers leave your landing page? Google Analytics has features (Behavior Flow and Heatmap come to mind) that would tell you where customers decide to exit your page. Maybe they find filling out forms cumbersome. So they stop the process.
It’s also likely that they got distracted by another button and decided to click on that instead.
You can use the same features to see what you’ve done right. If a page works great for you, use the features to see what customers like about the page and replicate it for your other landing pages.
Perform A/B Testing
A/B testing, for the unfamiliar, is the process of launching two versions of a page at the same time. The goal is to see which one would perform better so you can roll it out.
One popular test, for example, is button colors. Users have an affinity for certain colors. And you might find that some colors work better than others. What you want to do is retain the button color you’re using now and create a second version where you experiment with another button color. After some time, compare which buttons are getting more clicks.
You can do the same for all aspects of a page — the copy you use, the layout, or even the offer.
What Can Help You Analyze Conversion Rate Optimization?
Monitoring CRO can be challenging especially for those that are running a one-man operation. But there’s no need to worry as there are tools that can help you not only with monitoring but with implementing your campaigns as well.
Some of these tools are free while some are tools that you have to pay for. However, all of the products mentioned below are worth getting.
Why?
That’s because these would be responsible for gathering data and insights. You can use these to create actionable steps towards improving CRO performance.
Google Analytics
For most online marketers, Google Analytics needs no introduction. This free analytics tool can track how many users have gone to your site, what pages they look at, and what the conversion rate is for each page.
Neil Patel has a guide on how to use Google Analytics to track conversions.
Basically, you want to create a custom goal for your CRO campaign. Choose revenue when asked for a template to use and tick any of the options that apply to your case. You need to define what a transaction means to you (Are you selling products? Asking for email addresses?).
Once you’re able to set up your goal, you can monitor your progress whenever you log into your Analytics account. Always check your account to see if you are anywhere near your target goal. If not, you should make some adjustments.
Note: Google Analytics cannot track any progress made prior to installation.
Unbounce
Unbounce is a landing page builder. It makes it possible to create your own landing page without help from web developers.
Because of its drag-and-drop builder, you can make stunning landing pages without having to learn how to code. You can even add pop-ups and sticky bars if you need to.
It has a user-friendly interface that would make designing web pages a breeze.
It’s not cheap though. Plans start at $79 but the company does offer a free trial.
WordStream
Why do you need WordStream?
This tool will help you manage all your pay-per-click (PPC) campaigns from a centralized location. It’s commonly used by marketers and agencies to monitor all their existing campaigns.
You can set budgets for your campaigns and pull detailed reports when necessary. You won’t even have to log into your Google Ads account. And if you run into issues, WordStream has a team of experts waiting for you.
Crazy Egg
Crazy Egg is a heatmapping tool. What does that mean exactly?
It shows you how customers interact with your site. With this tool, you’ll see what users click the most, how your customers found you, what elements are they interacting with, and more.
The heatmap tool is really powerful and will let you know what improvements you can make to your landing pages.
Qualaroo
If you want to get feedback from your customers, you can either use social media or have a tool like Qualaroo at your disposal.
This tool can gather valuable information from users quickly and efficiently. It creates surveys about your site and analyzes the data it receives. It checks how potential customers browse pages, how long they stay there, and what referral terms they use.
It then sends you feedback that you can use in your conversion rate optimization campaign.
Conclusion
Armed with the right knowledge and tools, you can improve your conversion rate through CRO. By using conversion rate as a metric, you can launch more meaningful marketing campaigns that won’t rely on page views alone.
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