What is a conversion with examples and strategies to improve it
Conversion is one of the most important metrics in online business. Whether you run an e-commerce store, offer digital services, or manage a small business, understanding what conversion means is key to a successful digital marketing strategy.
In this article, we’ll examine conversion in depth, explaining why it’s important to businesses, the factors affecting conversion rates, and advanced strategies and tools for improving them.
You’ll also find real-world case studies relevant to small and medium-sized businesses (SMBs).
What is conversion in online business?
Simply put, a conversion is an action your website visitors or audience takes based on a specific business goal.
For example, a conversion could mean a product purchase if you have an online store. For B2B companies, however, a conversion could be filling out a contact form to generate new leads.
Schedule a free 30-minute branding consultation session with our experts.
In other words, a sales conversion is any successful step that brings your business closer to your target audience. Conversions can refer to a variety of things, including:
- Signing up for a newsletter
- Clicking a CTA (call-to-action) button
- Filling out a contact form
- Downloading an e-book or white paper
- Purchasing a product or service
Conversions are calculated using a metric called the conversion rate. The formula is:
Conversion Rate = (Number of Conversions / Number of Visitors) x 100%.
The higher your conversion rate, the more effective your marketing strategy.
Why is conversion rate important for online business?
Why do we focus so much on the conversion rate? The answer is simple. Conversion rate has a direct impact on your revenue and business sustainability.
Here are some of the benefits of a high conversion rate:
- Increased profitability: By converting more visitors into customers, you directly increase your revenue without increasing advertising costs.
- Advertising efficiency: Ads that generate high conversion rates show better ROI.
- Better customer experience: Strategies that increase conversions often focus on improving the user experience.
For example, imagine you are running a paid advertising campaign on Google Ads. If the cost per click is Rp10,000 and you get 100 clicks, your advertising costs Rp1,000,000. If the conversion rate is 2%, you get 2 customers.
However, if the conversion rate increases to 4%, your customers will become 4, doubling the sales at the same cost.
Factors that affect the importance of conversion
To improve conversions, it is important to understand the elements that affect them:
1. Website design and navigation
An attractive yet intuitive website layout is essential. Complicated navigation discourages visitors from taking the action you expect them to take.
2. Website loading speed
Users tend to leave websites that take longer than 3 seconds to load.
3. Clear CTA content
Call-to-action (CTA) buttons such as “Buy Now” or “Sign Up for Free” should be clear, eye-catching, and easy to find.
4. Relevant offers
Ensure the ad or page you promote is appropriate for your target audience. For example, targeting a teenage audience with vintage clothing products will be more effective than formal products.
5. User trust
Factors such as customer testimonials, security certifications, or positive reviews can build a higher level of trust.
6. Mobile-friendly experience
Most users today access websites from mobile devices. A website that is not responsive will miss out on many conversion opportunities.
Conversion-Boosting Strategy Examples
How do you increase sales conversions? Here are strategies that have been proven to work:
- Landing Page Optimization Your landing page is the spearhead of conversions. Focus on simple design, appealing visuals, and messaging that resonates with your target audience.
- Personalize Email Marketing Send emails with messages that are relevant to your audience, such as birthday discounts or product recommendations.
- Leverage Product Videos. Studies show that 64% of customers are more likely to purchase a product after watching a related video. Create videos that highlight your product’s unique features and benefits.
- A/B Testing Continually test your CTA, design, or page content to see what works best.
- Automated Chatbots Chatbots allow you to answer customer questions instantly, even after business hours.
Essential Tools and Metrics to Monitor Conversions
Several digital tools can help you track and improve conversion results:
- Google Analytics: Measures conversion rates, visitor behavior, and traffic sources.
- Hotjar: View heat maps to understand how visitors interact with your site.
- HubSpot or Mailchimp: Track the effectiveness of your email marketing campaigns.
Other important metrics include bounce rate, click-through rate (CTR), and customer lifetime value (CLV).
Conversions are the foundation of any online business. Improving conversions requires a strong understanding of and implementing relevant and continually evaluated strategies. With consistency, your efforts will pay off.
Dreambox offers services that can be tailored to your business needs, such as digital marketing. Contact us and get the right marketing and branding strategy for your business!