The world of digital marketing is full of buzzwords and technical-sounding metrics designed to help businesses boost organic traffic and drive growth.
While some of these metrics may seem a little pointless or superfluous, others could transform your marketing strategy for the better.
One of these golden metrics is your lead conversion rate, a figure that will indicate whether your sales funnel is working as it should.
If you’re allergic to math and a little scared of Google Analytics, don’t fret!
Calculating and analyzing your average conversion rate is easy when you’re equipped with the right formulae and know-how.
To help you start working out conversion metrics and allocating your advertising spend effectively, we’ve put together a quick guide below.
What is visitor conversion?
Lead conversion occurs whenever a site visitor performs an action that turns them into a lead.
Such actions include a wide range of conversion goals that could positively affect your business, such as:
- Submitting information (such as a personal email address)
- Subscribing to a newsletter
- Making a purchase
- Downloading assets such as help guides, e-books, or white papers
- Engaging with the site regularly
- Creating an account
- Taking out a subscription
What is a lead conversion rate?
In short, a lead conversion rate represents the proportion of visitors to a site or page who complete a certain action, represented as a percentage.
If you’re hoping to optimize your conversion process, however, you may need to supplement your analyses with other more specific types of lead conversion rates.
The most common forms of lead conversion rates include:
1. Overall conversion rate
This figure assesses all site traffic and measures the success of a single conversion goal, whether it be the number of visitors creating accounts or the number making purchases.
2. Page conversion rate
This metric tells you how effectively a given page converts visitors to leads.
It can be used to divert traffic to the highest converting sections of your site.
3. Channel conversion rate
Your channel conversion rate refers to the number of leads secured by a particular channel, such as Facebooks Ads, Google search pages, or email campaigns.
It will help you determine which channels to improve or invest in.
4. Keyword conversion rate
You’ll need to include keywords in all your organic and paid marketing content, so it’s well worth finding out which words and phrases generate the best lead conversion rates.
5. Campaign conversion rate
This metric tells you whether a specific ad campaign has done better than others.
If one campaign does particularly well, you may wish to push more traffic in its direction.
What is the difference between marketing qualified leads (MQLs) and sales qualified leads (SQLs)?
Depending on how long you’ve been in the marketing game, you may have heard the acronyms MQL and SQL thrown around every so often.
An MQL is a lead who has engaged with your marketing materials or brand, thus demonstrating their interest in your service.
These actions could include signing up for a webinar, repeatedly visiting your site, or subscribing to your mailing list.
An SQL, on the other hand, is a customer who has moved further down the sales funnel and is ready to interact with your business.
Typically, your sales team will research and vet an SQL before nurturing their interest.
SQL conversion rates are almost always higher than MQL conversion rates, as they have been identified as very interested in your goods and services.
How are conversion rates used?
Calculating and monitoring conversion rates allows marketers and sales teams to improve their operations in several vital ways, including:
- Allocating resources more effectively
- Hiring sales team where appropriate
- Creating a smoother sales funnel
- Scaling advertising spend appropriately
- Boosting organic traffic rates
- Nurture marketing qualified leads more effectively
- Increase your number of sales qualified leads
- Improve calls to action (CTAs)
How to calculate your lead conversion rate
Calculating your lead conversion rate is deceptively simple, although you’ll need to select an appropriate formula.
Here are the three main ways to calculate conversion rate:
- Lead conversion rate = Total number of converted prospects / Total number of leads * 100
- Lead conversion rate = Total number of converted prospects / Total number of unique site visitors * 100
- Lead conversion rate = Total number of converted prospects / Total number of sessions * 100
All three formulae are perfectly valid, but you should select one that suits your conversion goal. For example, if you define your leads converted as unique site visitors, you should opt for calculation #2.
Still confused? Here’s a simple example of how a marketer may wish to calculate a conversion rate:
Imagine your e-commerce brand sells scented candles.
Your conversion goal is to encourage visitors to pass through your sales funnel and purchase their very own candle.
Your site racks up around 200,000 unique visitors in the month of September and you manage to sell 1,000 candles.
Here’s how to work out your conversion rate:
Conversions (1,000) / Visitors (200,000) * 100 = 0.5%
How to implement tracking on your site
Okay, so now you’re familiar with the math, how can you find a quick and easy way to measure conversion rates across your sites and marketing channels?
Here are a few tips to enhance your analytics strategy:
1. Set up tracking with Google Analytics
Google contains tons of granular options for measuring digital marketing success, including various lead conversion metrics. Getting started involves a few quick and easy steps.
2. Include various conversion tracking events in your sales funnel
You’ll need to identify a tracking page or event when getting started with most analytics tools, so try to identify your conversion goals at an early stage.
3. Use your tracking data
Once your conversion rates start coming in, you can use them to create actionable insights for your brand.
Review your data at least once a month to ascertain what’s going well and what could be improved in your marketing strategy.
What makes a good lead conversion rate?
This question is really difficult to answer, as it varies widely between industries.
As a general guide, the average landing page conversion rate across industries is 2.35%.
However, high-performing marketing teams can expect to achieve conversion rates upwards of 5 or 6%.
How HelloBar could boost your conversion rates
Are you struggling to achieve the conversion rates you need?
HelloBar is here to help.
Our compelling display popups, banners, and page takeovers could help to supercharge your conversions quickly and with minimal effort on your part.