Conversion Rate

Conversion Rate is a metric that measures how effective the sales team is at converting a prospective customer, called a lead, into a paying customer. The generation of leads is the responsibility of marketing, and the conversion of these leads into customers is the responsibility of sales. The conversion rate is the total number of conversions divided by the total number of visitors.

Conversion Rate = (Total # of sales / Total # of leads) * 100.

For example, if an ecommerce site receives 200 visitors in a month and has 50 sales, the conversion rate would be 50 divided by 200, or 25%. Knowing your conversion rate is critical to understand how your sales team is performing, and to establish which marketing channels are most impactful.

What is a good conversion rate?

Conversion rates vary considerably depending on your traffic quality, industry, business, what you’re selling, and even the specific conversion action you’re tracking. As a result, while you can find broad conversion rate statistics out there, what qualifies as a good conversion rate for you will ultimately be specific to your business and your marketing campaign. Across industries, a good conversion rate is above 10%, with some businesses achieving an average of 11.45%. Earning a good conversion rate places your company in the top 10% of global advertisers, which makes your conversion rate two to five times better than the average conversion rate.