What is conversion rate optimization?
Conversion rate optimization is the process of optimizing your website, its product pages, and especially landing pages to convert as many visitors as possible.
To effectively optimize, you need to:
Understand your users in detail, including what drives them, what makes them stop on certain websites, and what persuades them to take a desirable action (like make a purchase).
Understand the reasons why your target audience members behave the way they do (in conjunction with hard data and statistics).
The “conversion rate” is the proportion of site visitors who “convert” by taking at least one positive action. This can mean making a purchase, signing up for an email newsletter or loyalty program, logging into your product, or anything else your business is based on.
In theory, if you optimize your site for more conversions, you’ll see more sales, have a larger email newsletter list, or see other positive signals. However, conversion rate optimization is important for another key reason: the inconsistency of online traffic.
Many online visitors are inconsistent in their browsing habits. Often, visitors won't ever return to your site, so you need to convert them in their first visit. Because of this, you need to maximize the conversion rate potential for your site from the get-go.
The sooner you can convert visitors, the better it'll be for your brand overall.
How to calculate conversion rate
Fortunately, calculating the conversion rate for your current website (or a specific page, like your landing page) is fairly straightforward. Use the following formula to calculate the conversion rate at any point:
Conversion rate = (Number of conversions / total number of visitors) X 100
By following the above formula, you’ll end up with a percentage. Note that you can count “conversions” as any desirable actions for your brand. Once more, this can mean making a purchase, signing up for a loyalty program or newsletter, or anything else you need.
Say that you have a landing page that saw 500 visitors over the last month. However, you only had 75 conversions. Plug these numbers into the formula, and you get:
(75/500) X 100 = 15%
That’s not a terrible conversion rate, but it can be improved through smart conversion rate optimization tricks and techniques.
What is the average conversion rate?
Different industries average different rates. Indeed, what counts as a “good” or “average” conversion rate can vary based on:
The demographics of your target audience
How often people in your target audience make purchases or sign up for things
That said, the average conversion rate for landing pages or websites across industries usually hovers between 2% and 5%. Of course, it’s always good to pursue a higher conversion rate if at all possible.
Remember that any conversion rate is meaningless unless you understand what it signifies and how to give your target audience what they want and need from your brand.
What are the primary elements of conversion rate optimization?
Conversion rate optimization is a detailed, multi-step, and comprehensive process. In fact, most conversion rate optimization strategies implement six distinct elements or stages.
For your optimization efforts to be successful, you’ll need to:
Leverage in-depth, statistically valid data to analyze important results.
Run a lot of tests, understanding how many different pages perform (focusing on lower-in-the-funnel pages is the best place to start).
Tweak content as necessary to improve your conversion rate.
The six major elements of conversion rate are:
Calls to action
Conversion rate optimization further calls for tweaks and improvements to your calls to action (CTAs). Put simply, a call to action is any request or call for a visitor or potential customer to take a desired action.
Your website should include several calls to action centered around buttons that let customers make purchases, sign up for newsletters, and so on.
However, your calls to action need to be persuasive and compelling to be effective. Generally, the best CTAs are:
Persuasive, so they use forceful and imaginative language
Optimizing your CTAs is one of the most important things you can do to improve conversions.
Landing page design
The landing page is arguably the most important page for your website regardless of your niche or industry. Why?
Because it’s where your target audience members will arrive after clicking on a PPC (pay per click) ad or reaching your site via organic search engine results. In addition, the landing page is the first impression a new visitor sees of your brand.
To that end, you need to make sure that your landing page is well designed, highly usable, and highly converting. Good landing pages are aesthetically pleasing, streamlined, and very easy to navigate through.
To master CRO, you’ll need to take another hard look at your landing page and optimize it for top-tier performance.
The third major element of conversion rate optimization lies in analyzing and improving your website copy. Website copy is any text you may have on your site, including:
Product or service descriptions
Text on your homepage or landing pages
Text on your conversion forms
Text anywhere else
In addition, website copy includes the major headlines: the important elements that visitors see when they first arrive at a landing page or anywhere else on your site.
For the best results, well written headlines should be short, sweet, compelling, and engaging. Meanwhile, larger blocks of text, like the copy beneath headers, should answer visitor questions or provide useful information efficiently and persuasively.
Naturally, good website copy also means:
Double-checking your copy for grammar or typo issues
Ensuring that your website copy is cut up into relevant, brief paragraphs for easy absorption
Ensuring that website copy is the same font and size throughout your website to ensure easy navigation and a comfortable viewing experience
Navigation and site structure
Then there’s navigation and site structure, both of which contribute to conversion rate optimization for brands just like yours.
The structure of the site can be understood as the framework through which visitors proceed through it. For example, your website is probably set up with a landing page, which then has different pages for different products or services depending on what your visitors want to do.
To ensure good conversion rate optimization, you must:
Ensure that your site is easy to navigate and well structured. The homepage and landing page should make it very easy for visitors to reach where they need to go within three clicks.
Make sure that your site is mobile-optimized, especially since more than half of all internet traffic comes from mobile devices.
Double-check that your website loads quickly. Many site visitors will click away from a webpage if it takes too long to load.
You need to create effective, concise, and engaging forms. Generally, the best forms have as few fields as possible (i.e., as few things for customers to fill out as possible). You should also strive to make any forms on your site look nice; make sure that they feature clean aesthetics.
Last but not least, good CRO is contingent on fast page load speeds. Some studies show that a load time of even one second can reduce your total conversion rate by 7%, especially since most website visitors expect pages to load almost instantly.
Put another way, just a one-second load delay might mean that you lose up to 11% of potential customers in aggregate. To ensure site loads quickly:
Eliminate unnecessary graphics, especially videos
Host your website on servers with plenty of resources so they can handle additional traffic
You can measure your load time using Lighthouse.
Benefits of conversion rate optimization: Why is it important?
As you can see, there’s a lot that goes into practicing conversion rate optimization for maximum results. But why does it really matter, especially if you already have decent traffic to your site?
Conversion rate optimization is still crucial because it helps you understand:
Why visitors behave how they do, such as why they make purchases on some days and not others
How your visitors see your brand and, therefore, how you can improve their experience with your company
Put another way, a good CRO effort or program can optimize the efficiency of your website, make your brand more engaging, and yield better revenue across the board.
Let’s break down the benefits of a good CRO program in more detail by looking at two immediate, practical benefits.
Improving marketing ROI
Firstly, conversion rate optimization can improve conversion rates, improving your marketing return on investment. If your website converts more visitors into paying customers, that means every marketing dollar you spend is more valuable.
The CRO process helps you experiment to find the best combinations of site layout, page content, and other factors to maximize your ROI. The better your conversion rate, the less money you have to spend to make money overall.
Secondly, CRO helps you to enhance the user experience and user interface of your website for your target consumers. It pays to engage your customers and make them loyal by providing good user experiences from the first purchase to the last.
Conversion rate optimization can help you do just that. By understanding your visitors more deeply, you can:
Personalized experiences for them, resulting in a deeper emotional bond between them and your organization
Streamline your site’s navigation, resulting in a smoother and more enjoyable experience for your users
Since it costs more to acquire new customers than it does to retain existing ones, don’t discount the long-term benefits of quality UX.
Conversion optimization best practices and why they can be misleading
While every company can benefit from conversion rate optimization, you must practice CRO wisely in order to see the above advantages. So it pays to follow conversion optimization best practices.
That said, not all best practices are perfect for your company, even if they might be good advice in general. Therefore, you need to both understand and learn from your users by gathering data about them and analyzing strategic insights.
Armed with this information, you can determine:
How to optimize your site best for your users specifically
What your target audience members desire
How your brand can fulfill those desires most effectively
Who is conversion rate optimization useful for?
Even with the above benefits, some organizations aren’t sure whether conversion rate optimization is worth the time and money. CRO can be effective and important for all types of businesses.
CRO for B2B/SaaS companies
For example, CRO can be highly effective and is always critical for B2B or software as a service companies. That’s because these types of organizations rely on two primary points for lead generation: acquiring customer interest and converting interested visitors into loyal customers.
Essentially, converting new customers is the most important part of the process for B2B/SaaS companies. Once converted, those organizations need to keep those customers to maintain stable revenue streams.
Thomas combined FullStory and an organic A/B testing program to boost overall conversions by 94%.
CRO for ecommerce companies
CRO is also crucial for modern ecommerce companies. Shopping cart abandonment in particular is a major problem for small online businesses. Abandonment occurs when customers put something in a digital shopping cart, then click away to another site.
With good CRO, shopping cart abandonment should decrease, and ecommerce brands will see more profits across the board.
Shoppers Drug Mart reduced conversion drop-off by 45% with FullStory.
Read how they combined a conversion rate optimization program with FullStory to dramatically boost their bottom line.
CRO for Fintech
Fintech companies, like software developers that create banking or trading apps, can also leverage conversion rate optimization. Specifically, CRO can help fintech businesses increase audience reach and engagement, resulting in better brand awareness and more target consumer sign-ups or purchases.
CRO for online travel agencies or travel companies
Don't forget online travel agencies or even in-person travel companies. Both of these business types can benefit from conversion rate optimization; after all, their business models rely on bringing people to their brands and then they book travel.
CRO for agencies
Other agencies, like digital marketing agencies, can benefit from conversion rate optimization since it could help them gain revenue or recurring service requests from current customers and existing traffic.
Bottom line: all businesses can benefit from conversion rate optimization, so it pays to know how to practice it for your company.
Conversion rate optimization steps: Understanding the process
Good news: even though conversion optimization is a competence of process, you can start practicing it effectively by understanding the different phases of the customer journey.
Stage 1: The research phase—Identifying the areas of improvement
The first major phase of conversion rate optimization is research. Basically, you must identify the areas in which you can improve your site’s conversion rate before taking steps to do so. However, remember that you need to understand how your customers think and interact with your brand to effectively identify areas of improvement.
With this in mind, you should gather two different types of data: quantitative and qualitative data.
Understanding what users do (quantitative data)
Quantitative data tells you what your users do, such as where they click on your site, how long they spend on certain pages, and what products they tend to purchase. You can use visitor product analysis and digital experience analysis tools to gather this data over time. It’s the simpler of the two data types overall.
A few examples of quantitative data:
Understanding user behavior (qualitative data)
Qualitative data tells you why customers interact with your brand the way they do. This is more complicated, but is crucial to understanding your core audience’s psychology. You can gather qualitative data in many different ways:
Send out tests or surveys to customers and hope they respond. This is most effective if you already have a sizable audience base following an email newsletter.
Read case studies to extrapolate conclusions into your users’ behaviors and motivations
Watch session replays to see how your users are interacting with your site or app
Regardless, you must combine both quantitative and qualitative data to do research effectively.
Understanding the data gathered
Once you gather your data, you then need to analyze and understand it. To do this:
Gather up all the data you’ve collected so far
Analyze it to the best extent you can. FullStory can help with this goal by providing actionable insights for your company and by providing product analytics tools
Don’t forget to calculate a quantifiable “expected conversion rate”. This should be higher than your current conversion rate, naturally. It’s helpful since it gives you a target to work toward as you further your CRO efforts.
Qualitative vs. quantitative data
Still a bit confused about the differences between qualitative versus quantitative data?
Put simply, quantitative data:
Is numerical and allows you to map actionable events
Is primarily objective
Is more measurable than qualitative data
Provides concise information
Quantitative data is, for example, the number of customer purchases in a timeframe, the number of visitors, and the number of clicks a given page receives in a timeframe.
Is more subjective
Provides narrative information to characterize objective actions
Is more descriptive than quantitative data
Provides more exploratory information for deeper analyses
Data gathering methods
To master the research phase of CRO, you’ll also want to leverage specific data gathering methods and tools. Some of the best include:
Google Analytics, which is a free, integrated tool that provides you with tons of quantitative and qualitative data sources, like visitor activities, traffic inflow sources, content performance metrics, and more
Customer surveys, which can be sent to people already on your email newsletter list. Your customer surveys can be as detailed or simplistic as possible, but more detailed surveys often provide better qualitative information
Usability tests, which can help you determine things like page load speed, ease of use, and more
Stage 2: The hypothesis phase—construct an educated hypothesis
To further your conversion rate optimization, you’ll need to build a data-based hypothesis for why visitors behave the way they do. This phase itself can be broken down into three distinct stages:
The research phase, broken down above
The hypothesis phase. Here, you draft a hypothesis – for example, maybe your blog's conversion rate isn't as high as it should be for your industry. You hypothesize that it's because the page's layout is confusing
The hypothesis testing phase, in which you implement your hypothesis in the real world to see if it holds up
If the hypothesis does hold up, you can then take steps to correct that issue and hopefully boost your conversion rate. If it doesn’t, you have to go back to the drawing board and come up with a new hypothesis.
Form a hypothesis
You should form a solid hypothesis about your current conversion rate or a given consumer behavior by:
Analyzing the data you gathered
Considering that data in conjunction with what you already know about your target audience
Remember to always test a hypothesis before implementing corrections for it. The last thing you want to do is implement CRO efforts following a hypothesis that isn't relevant to your target audience members.
Stage 3: Decide how to change your pages
Next, you need to change your web pages for better conversion rates overall. You can do this in two different ways:
You can change one page massively and see what happens
You can change two pages slightly and see which of the two pages does better (this is technically a form of A/B test)
Both methods of page changes can work and give you valuable data. Choose the method that seems to fit best for your brand and conversion rate goals.
Stage 4: The prioritization phase—choose an order
Then it’s time to prioritize which website elements you’ll test. We recommend using the P.I.E. framework, developed by Chris Goward. It works like this:
Prioritize the elements of your website you believe will have the most immediate, positive impact on your conversion rate
Ideate ways to improve those elements
Execute those improvements immediately
By following this prioritization cycle, you’ll implement good conversion rate improvements consistently and quickly without getting bogged down in ideation.
Stage 5: The testing phase—A/B, split, or multivariate?
Of course, you’ll need to test your website changes to see if your conversion rate will truly benefit from them. There are several different tests you can use to this effect, including:
A/B tests, in which you set up two very similar pages or elements and see which does better. Once you know which does better, implement the better performing page’s layout or other elements throughout your site
Split testing, which is advanced A/B testing in which you conduct randomized controlled tests across several pages simultaneously
Multivariate testing, in which case you test several elements across multiple pages simultaneously
What is statistical significance and why is it critical?
Don’t forget to consider statistical significance when analyzing your test results.
Simply put, statistical significance is the probability that the result you get from a test is generally correct in the real world.
This is important because whenever you receive results from a test, there’s a possibility that those results are a “false positive." In other words, they don’t reflect reality or true consumer behavior. You can measure statistical significance by comparing your result to the probability of that result occurring by chance.
If you run any of the above tests and they meet the statistical significance threshold, you can stop them. Rest assured that your results are accurate or are at least informative and helpful for your conversion rate efforts.
How long do you need to run an A/B test for dependable results?
That depends on what elements you plan to test and how many elements you want to test at the same time. Generally, you should run an A/B test for a minimum of one to two weeks.
Regardless, always define the length of your upcoming test before it starts running so you have clear benchmarks to aim for and know when to cut off your data collection for analysis.
CRO testing methods
As you can see, there are lots of different ways in which you can test website elements for conversion rate optimization. But lots of business owners may wonder which they should use.
What should you use —A/B, split, or multivariate?
For example, A/B testing is best for simple tests or for analyzing basic website elements. It’s also the most common type of CRO test leveraged by website owners and marketers.
Split testing, on the other hand, is best if:
Your web design may need heavy modifications to boost the conversion rate
Your website might need backend changes to see desirable CR improvements
You need to test pages that simultaneously exist on different URLs
As you practice CRO more often, you’ll get a better understanding of the limitations and benefits of each testing method.
Conversion rate optimization best practices
To ensure your conversion rate optimization goes smoothly, keep these mistakes in mind to prevent them from affecting your practices or strategies. There are no golden rules to CRO—understand that each business and different, and you need to identify what works best for your website or app.
Mistake #1: Making changes based on opinions of statistical data
First, don’t make changes based on opinions you or a staff member have if they don’t match up with statistical data results. Opinions, even though they can feel true and important, are oftentimes flawed.
Mistake #2: Writing copy that doesn’t match your business goals
Next, don’t write website copy that doesn’t match your business’s goals, tone, and mission statement. Consumers need to identify with and connect with your brand, and website copy can do that better than lots of other elements.
Mistake #3: Going for small tests before the big ones
Always perform big, broad tests to identify major areas of improvement before running more targeted tests that take longer and that may require more qualitative analysis.
Mistake #4: Running too many tests and pop-ups at the same time on the same page
Don’t run too many tests at the same time and on the same page, as well. This can slow down page load times or clutter your results, making them worthless.
Mistake #5: Not paying much attention to basic design elements
Furthermore, remember to pay attention to and improve basic design elements like your site layout, background color, font, and overall aesthetic. All of this can have a bigger impact on your overall conversion rate than you may think.
Mistake #6: Undermining the importance of call-to-action buttons
Similarly, don't underestimate the importance and placement of call-to-action buttons. Always make these front and center and easy for visitors to see and use.
Mistake #7: Not creating a sense of urgency
To improve your conversion rate, don't skip out on creating a sense of urgency, particularly when writing call-to-action copy or advertisements.
Mistake #8: Not establishing business trustworthiness upfront
Modern consumers want to be able to trust brands like yours. To that end, don't make the common mistake of underemphasizing trustworthiness or building brand authority in your industry/niche. Consider things like awards or social proof.
Mistake #9: Complicating conversion funnels
Lastly, try not to overcomplicate your conversion funnels. The more steps or complications a customer has to pass to make a purchase, the more likely it is they’ll abandon the funnel at some point.
Conversion rate optimization tools
Fortunately, you can rely on lots of different conversion rate optimization tools to further your CRO efforts.
Optimizely is a versatile testing and analytics tool that can easily whip up full reports of test results. It also provides tools to see interactions, sign-up clicks, and other metrics from visitors interacting with your site.
VWO is another high-quality A/B testing and experimentation platform that can help you optimize your conversion rate through its high-quality tool suite.
As its name suggests, AB Tasty is an effective and AI-powered experimentation tool that focuses on A/B tests. It allows you to optimize and personalize your products and website for better performance and conversion rate.
Google Optimize is a free platform provides website testing, personalization tools, and even A/B testing for marketers and small businesses that need cost-effective solutions for their CRO programs.
Tools to collect data to help you design tests
Then there are tools you can use to collect quantitative and qualitative data, both of which you’ll need to design, carry out, and act upon tests and their results.
FullStory gives you the full story of your customers’ data and test results. Its robust tool suite provides complete data capture, custom dashboards, session insights, and product analytics tools so you can fully understand how how to maximize your conversion rate.
Identify your biggest problems and solve them with FullStory
Start gathering insights immediately from comprehensive, indexed, and searchable data. Then optimize to improve your user experience and boost revenue. FullStory makes it easy.
Google Analytics is a free and well designed toolkit for small business owners who want to better understand qualitative and quantitative data gathered by their web tests.
Adobe Analytics is another paid tool suite that lets you measure and analyze elements like clicks, purchases, sign-ups, and more.
Heap.io provides a data analysis and management platform for users who want to capture and fully understand user behaviors. It also includes security and privacy tools, as well as data governance solutions.