Conversion is one of the most important indicators of the effectiveness of marketing activities. When calculating it, you can easily detect existing flaws in the sales chain, check the effectiveness of advertising methods, as well as identify points of growth in the profitability of the Internet resource. We decided to prepare a detailed guide that will help everyone to understand what is conversion, what factors affect it, as well as what role it plays in advertising.
The top Ad networks in affiliate marketing can be found on Affiliate Wave website.
What is conversion rate?
This term refers to the ratio of the number of targeted actions (purchase, registration procedure, applications and others) to the total number of guests on the site. This indicator helps to check how effective marketing and business processes, financial return from advertising and how in general the site works.
Suppose that through contextual advertising went through a hundred visitors, of which ten made any targeted action. This indicates that the indicator is at the level of 10%.
What affects the conversion rate?
The indicator is not static, it regularly changes under the influence of a number of external aspects:
- Website promotion. Includes the use of relevant keys to the queries, the expansion of semantics, as well as the selection of phrases that help to promote the site in the search engine output.
- Features of the chosen niche. The activity can be influenced by fluctuations in demand for products depending on the season, or the activity of other companies that have interesting new products and more tempting alternatives.
- Business Features. In the case of the site snack bar with delivery service conversion can reach 30%, as everything is very obvious here: many people go to it exactly to order a meal, and not just consider the catalog. In the case of online stores with household appliances or products for sports the figure of 2% will already be a decent result, because buyers need to long compare rates, technical specifications and take into account other nuances.
In addition, there are internal factors concerning the performance of the site:
- Design attractiveness;
- usability;
- complexity of the application form;
- availability of product descriptions, photos, videos;
- whether there is a variant of the site for tablets and smartphones;
- the degree of code optimization, how fast the pages load.
The role of conversion in advertising products and services
In the case of advertising, many people mistake conversion for click-through rate (CTR), which refers to the ratio of clicks to the total value of ad impressions. If clickability is low, it is more rational to pay for clicks. If the CTR is quite large, then it is better to invest in displays.
Any webmaster will be able to make their own calculations, simply using the following formula: the number of clicks on the banner / total number of users who paid attention to the ad * 100%.
Clickability closely overlaps with conversion. If the CTR is at a low level, it is likely that already at the initial stage of the funnel there will be undesirable trends due to the lack of a unique selling proposition, incorrect targeting settings or banner design, which the potential audience does not pay attention to.
Conclusion
Conversion in the case of advertising is always tied to a specific action: going through the registration procedure on the site, downloading a list of prices/booklet, subscribing to the newsletter. In addition, only those guests of the resource who came through banners are taken into account – other sources of traffic do not play a role.