Conversion rates are important to both marketing and sales. However, the term is used so often - and so broadly - its meaning can be unclear or ambiguous.
What are Conversion Rates?
Conversion rate is the percentage of people who take a desired action. For example, if 100 people visit a webpage and 10 of them sign up for a newsletter, the conversion rate is 10%.
Conversion rates apply to all sales funnel stages. So if you take 100 Sales Qualified Leads (SQLs) and convert 5, the conversion rate is 5%.
What Do Conversion Rates Tell Us?
The conversion rate's role is to tell you how effective your sales and marketing campaigns are. High conversion rates show that you are reaching people who want your offer and driving interest. Meanwhile, low rates can signal issues with your messaging or sales funnel.
Studying and optimizing conversion rates can help your business boost revenue from your existing traffic. It can also help you understand when you need to make big, sweeping changes to a funnel that’s not working.
Conversion Rates Along the Sales Funnel
“Conversion” means different things at each funnel stage. Here’s a quick guide to help:
TOFU (Top of the Funnel): The goal here is to generate awareness and nudge your audience towards interest and consideration. Conversion actions include blog page views, newsletter signups, or social media sign-ups.
MOFU (Middle of the Funnel): Prospects at this middle stage are considering possible solutions. Their actions have more intent behind them, so marketing needs to be more focused. Conversions actions may include downloading a whitepaper or watching a webinar.
BOFU (Bottom of the Funnel): These prospects are ready to make a decision and are thus ripe to be sold to. This audience is narrow and highly targeted. Conversions here are usually final sales, although trials and demos - which bring prospects in contact with your product - are also conversion events.
A/B Testing for Conversion Rate Optimization
In marketing and sales, it's common to ask - "what if we do it this way instead?" A/B testing allows you to satisfy your curiosity by testing two versions of an asset (or process) at once.
Say you send two slightly different marketing emails to two customer segments. You can then track data to see which message attracts more clicks and opens. This testing helps you double down on the message that drove more conversions - and analyze why it worked.
Best Practices for Boosting Conversion Rates
- Understand Your Audience: Study your target audience's specific pain points, needs, and preferences. Avoid relying on vague stereotypes that translate to tone-deaf messaging.
- Use a Clear and Compelling Call to Action (CTA): If your audience wants to act, the last thing you want is for them to work for it. Obvious links and contact information simplify their next step and boost conversions.
- Build Trust: Showcase testimonials, reviews, or industry certifications to help your audience trust your brand more.
- Optimize for Mobile: Prioritize mobile over desktop when building your website and marketing materials. More and more people consume content on their phones first, and they expect a seamless experience.
- Address Possible Objections: Don’t only focus on the good stuff. Address common objections and sticking points upfront in your marketing content. Doing so smooths out the conversion process for more prospects by eliminating objections proactively.
- Dig Into Analytics: Find quality analytics tools to track audience interactions with marketing and sales. Understand where people drop off in the funnel and why, then create resources to help them buy more easily.
