What's A Good Conversion Rate? (And Other Important Questions)

Conversion Rate Optimization (CRO) is more than just tweaking conversion rates. At its core, CRO is the systematic process of increasing the percentage of website visitors who take a desired action — be it making a purchase, signing up for a newsletter, or any other goal that moves the needle for a business. 

The allure of CRO lies in its direct impact on a company's bottom line without necessarily increasing web traffic, making it an efficient and cost-effective strategy.

People often are wrestling with what success looks like for their CRO efforts. 

Questions like: What is considered a "good" conversion rate? Is there more to CRO than just tweaking conversion rates? This blog post aims to clear the air of what a good conversion rate looks like across different industries and page types, using data from reputable sources.

More importantly, make the case that successful CRO doesn't end with conversion rates. Introducing you to other vital metrics such as time on page, pages per session, and customer feedback through surveys that are equally crucial in painting a picture of your website's performance.

The Basics of Conversion Rates

At the heart of CRO is a fundamental metric: the conversion rate. Understanding this metric is crucial for any business looking to optimize its online presence and performance. But what exactly is a conversion rate, and how do you calculate it?

What is a Conversion Rate?

A conversion rate is a simple yet powerful indicator of your website's effectiveness in turning visitors into customers or leads. It measures the percentage of users who take a desired action out of the total number of visitors. This action can vary depending on your business goals and could include making a purchase, signing up for a newsletter, or filling out a contact form.

The Importance of Benchmarks

Knowing your conversion rate is one thing, but understanding how it stacks up against your industry average is another. Industry benchmarks serve as a critical reference point for assessing the performance of your website's conversion rate. They help you to:

Set realistic goals: By knowing the average conversion rate in your industry, you can set more informed and achievable targets for your CRO efforts.

Identify areas for improvement: If your conversion rate is significantly below the industry average, it may indicate underlying issues with your website's user experience, value proposition, or marketing tactics.

Measure success over time: Tracking your conversion rate against industry benchmarks over time can offer insights into the effectiveness of your optimization strategies.

Different industries have varying average conversion rates due to factors such as customer behavior, purchase decision complexity, and product or service nature. For instance, e-commerce websites might have an average conversion rate of around 2-3%, while a B2B software company could expect a lower rate due to a longer sales cycle and higher ticket prices.

Understanding these nuances and where your conversion rate stands in relation to your industry's average is the first step in identifying potential areas for improvement and setting the stage for successful CRO initiatives.

Industry-Specific Conversion Rates

Understanding the landscape of conversion rates across various industries is crucial for benchmarking your own performance and setting realistic optimization goals. Let's dive into some key sectors and their average conversion rates, backed by data from reputable sources.

E-commerce

The e-commerce sector experiences a wide range of conversion rates, heavily influenced by product type, market saturation, and consumer behavior. That’s why ecommerce conversion rate optimization is so important. The overall average ecommerce conversion rate was reported at 1.81% (Intellimize). Within this sector, specific niches such as fashion and apparel see an average conversion rate of 2.7%, while health and beauty products enjoy a slightly higher rate at 3.3% (Adobe). These variances can be attributed to factors like product demand, pricing strategies, and the effectiveness of marketing efforts.

B2B Sectors

The B2B (Business-to-Business) sector presents a different scenario. Conversion rates here are generally lower, reflecting the longer sales cycles and the complexity of transactions. For example, B2B landing pages have varied conversion rates across industries, with construction specifically noted at a 1.9% conversion rate (First Page Sage). These figures highlight the importance of designing geo-targeted, conversion-optimized landing pages for each service and subservice within the B2B realm.

Factors Contributing to Variances in Conversion Rates

Purchase Decision Complexity: High-value items or services that require significant investment often have longer research phases, leading to higher conversion rates as buyers are more committed by the time they take action.

Marketing Strategies: The effectiveness of a company's marketing efforts, including targeting accuracy and message resonance, can significantly impact conversion rates.

Product Demand and Pricing: Consumer demand for specific products or services, along with competitive pricing strategies, plays a critical role in influencing conversion rates.

Website Experience: The usability and overall experience of a website, including its design, navigation, and checkout process, directly affect the likelihood of conversion.

Conversion Rates by Traffic Source

Social Media

With an impressive conversion rate of 17.2%, social media stands out as a powerful channel for lead conversions. This high rate can be attributed to the targeted nature of social media advertising and the ability to engage users in a more personal and interactive environment. The direct connection with brands on platforms like Instagram, Facebook, and Twitter can significantly increase trust and conversion likelihood.

Organic Search

Organic search traffic, which includes visitors that come from search engine results, typically sees a conversion rate of around 3.1%. Users from organic search often have a specific intent, searching for information or solutions that directly relate to your product or service.

While lower than social media, the conversion rate from organic search is still valuable due to the high level of intent behind these searches.

Retargeted Traffic

Retargeting efforts, which aim to re-engage users who have previously interacted with your brand but did not convert, show a conversion rate of about 1.1%. Although this might seem low compared to other sources, retargeting is crucial for nudging those on the fence towards making a purchase or completing an action.

Direct Traffic

Direct traffic, where users enter your URL directly into their browser, shows conversion rates ranging from 3% to 4%. This traffic usually consists of returning customers or users who are already familiar with your brand, explaining the relatively high conversion rate.

Conversion Rates by Page Type

Landing Pages

Landing pages are designed with a single focus or goal, such as signing up for a newsletter or purchasing a specific product. Due to their targeted nature and the absence of distracting navigation options, landing pages often achieve higher conversion rates. The effectiveness of a landing page in converting visitors largely depends on its design, clarity of the call-to-action (CTA), and how well it aligns with the expectations set by the traffic source.

Product Pages

Product pages serve to provide detailed information about a specific product or service. Conversion rates on product pages can vary widely depending on the quality of the product descriptions, images, and reviews available. High-quality content that accurately represents the product and addresses potential customer concerns can significantly boost conversion rates on these pages.

By focusing on optimizing the channels and page types that are most conducive to conversions, businesses can improve their overall online performance and achieve better results from their digital marketing efforts.

Beyond Conversion Rate

While conversion rate optimization (CRO) traditionally focuses on increasing the percentage of visitors who take a desired action on a website, it's crucial to understand that optimizing for conversions doesn't stop at merely improving this singular metric.

A comprehensive approach to CRO involves diving deeper into user behavior and satisfaction metrics to gain insights that can lead to more meaningful and sustainable improvements. Here are several key metrics beyond the conversion rate that can significantly impact your optimization efforts:

1. Time on Page

Time on page is a critical metric that indicates how engaging your content is and how well it resonates with your audience. Longer time spent on a page typically suggests that visitors find the content valuable and relevant to their needs or interests. By analyzing this metric across different pages, you can identify which types of content perform best and use these insights to refine your content strategy and improve overall site engagement.

2. Pages per Session

Pages per session measure the average number of pages a visitor views during a single session. This metric helps gauge the overall navigability and interconnectivity of your website. A higher number suggests that users are more engaged, exploring various parts of your site out of interest. It can also indicate that your internal linking strategy is effective, guiding visitors to more relevant content and encouraging them to continue their journey on your site.

3. Customer Feedback through Surveys

Direct customer feedback is invaluable for understanding the user experience from the perspective of your audience. Surveys can uncover insights about what users like and dislike, what features they might find missing, or any difficulties they face while navigating your site. This direct line of communication allows for precise adjustments to your website and offerings, ensuring that your optimization efforts are aligned with actual customer preferences and pain points.

4. Customer Support 

Analyzing complaints received by customer support related to the website can provide a goldmine of information for CRO. These complaints are direct feedback on the barriers or frustrations users encounter, such as navigation issues, unclear information, or technical glitches. Addressing these complaints not only improves the user experience but can also directly influence your conversion rates by removing obstacles that prevent users from completing their desired actions.

Incorporating these broader metrics into your CRO strategy allows for a more holistic view of website performance and user satisfaction. By moving beyond the conversion rate and considering how users interact with your site, what they think about it, and what obstacles they face, you can implement more comprehensive and effective optimizations. Ultimately, the goal of CRO should be not just to convert visitors but to create a satisfying and engaging user experience that encourages loyalty and repeat visits.

Check out this episode of The Lucky Orange Show to learn more about conversion rate optimization from our friend Will Laurenson:

Conclusion

In conclusion, an effective CRO requires a wide lens, focusing not only on converting visitors but also on creating a satisfying experience. By considering a variety of performance metrics, businesses can gain a deeper understanding of their audience's needs and preferences, leading to more informed and impactful optimization efforts.

Now is the time to take your CRO efforts to the next level. Begin by assessing your current strategies and metrics, looking beyond conversion rates to understand the broader user experience on your website. Use tools like Lucky Orange to gain real-time insights into how users interact with your site, identify areas for improvement, and implement changes that can lead to significant enhancements in performance and user satisfaction.