Conversion Rate

Formula: Conversion Rate = (Conversions / Total Visitors) × 100 Example: 1,000 people visit your landing page, 50 sign up. Conversion rate = (50 / 1,000) × 100 = 5%. Why conversion rate matters: Doubling your conversion rate is equivalent to doubling your traffic. If you're spending $10k/month on ads at 2% conversion, improving to 4% gives you the same result for half the cost—or double the customers for the same spend. Conversion funnels: Track multiple conversion points. Homepage → Signup (5%), Signup → Activation (60%), Activation → Trial (40%), Trial → Paid (20%). Identify where users drop off, optimize that step. The leakiest part of your funnel is your biggest opportunity. Benchmarks by type: SaaS trial signup: 2-5% is typical. Free trial to paid: 10-25% is healthy. E-commerce checkout: 2-3% average. Landing page email capture: 10-15% is good. B2B demo request: 1-3%. Your mileage varies—focus on improving your own baseline, not hitting industry averages. Optimizing conversion rate: (1) Reduce friction—fewer form fields, clearer CTAs, faster load times, (2) Increase clarity—better headlines, stronger value props, customer proof, (3) Create urgency—limited time offers, social proof, scarcity signals, (4) A/B test relentlessly—small changes compound. Micro vs. macro conversions: Macro = primary goal (purchase, signup). Micro = steps toward goal (add to cart, watch demo video, download guide). Track both. Micro conversions predict macro conversions. If micro conversions are low, macro won't happen. Conversion rate vs. absolute conversions: High conversion on low traffic is better than low conversion on high traffic if you can scale the high-converting source. But don't ignore volume—1% of 100k visitors (1,000 conversions) beats 10% of 5k visitors (500 conversions).

Dropbox increased signups 10% by changing 'Sign up for free' to 'Try Dropbox Business free for 30 days'—specificity converted better. Basecamp's landing page converts at ~2.5% for trials, industry-leading for B2B SaaS.