The Ultimate Guide to Calculate and Improve your Conversion Rate

Do you own an online business and you’re finding an easy way to calculate your conversion rate?

Conversion rate is important for all types of businesses operating online, be it a small business, a Freelance agency, or an MNC.

The success of a business that is solely performed online has many factors that get into consideration. Conversion rates being one of the important factors as a high conversion rate can benefit a business in so many ways.

What is the Conversion Rate?

Conversion rate is the percentage of the actions taken by the user after the total clicks on a site that has completed a specific goal. It is when your reader or your user responds to the CTA (call to action) on your website.

The CTA could be a pop-up box, an email sent by you, a form on your website, or a purchase of a product through a link.

The more people respond to your site’s link, the higher is the chances of the increased conversion rate of your business. Each conversion or action to CTA can convert your potential audience into a potential customer.

Why it is important to know How to Calculate Conversion Rate?

The term conversion rate is used by several professional marketers as they need to keep a check on the conversion rate of a site.

There are several things you can achieve by knowing how to calculate the conversion rate of your website.

If you know how to calculate and monitor your conversion rate, you can get benefited by:

  • Determining your Visitors
  • Hire a professional marketing team
  • Better determining profitability
  • Better Allocation of resources
  • Know your potential customers

Not knowing how to calculate your conversion rate can lead you to miss out on so many beneficial opportunities and you’d be one step away from knowing your potential audience.

Marketing your online business and not knowing how to calculate the conversion rate will end up overspending on marketing. Knowing how to calculate the conversion rate and to improve it is the key skill every marketer must have.

What are Conversion Goals?

The conversion goal of a business depends on the type of industry you’re dealing in and what is the scope of your product or service offerings. Choosing a specific goal that best suits your business will help you improve the conversion rate.
Some of the Common Conversion Goals are:

  • Contacting the business
  • Signing up for a newsletter
  • Creating an account
  • Downloading an asset from your site (eBook, Product, guide, or another type of content)

There are mainly two types of conversion goals such as:

  • Micro Conversion- It is a primary goal where a visitor makes a purchase from your site.
  • Macro Conversion– It helps your customer to the path of making a purchase such as adding an item to a cart or wishlist.

How to Calculate Conversion Rate?

It’s the right time when you can learn how to calculate conversion rate as we have discussed some of the common goals and why it is important for you to know how to calculate conversion rate.

There are 3 different formulas to calculate conversion rate:

  • Conversion Rate = The total number of conversions/ The total number of sessions *100
  • Conversion Rate = The total number of conversions/ The total number of unique visitors *100
  • Conversion Rate = The total number of conversions/ The total number of leads *100

All the 3 formulas work great for all types of businesses and to calculate the conversion rate for your site, you need to define the conversion events you’re considering. The numerator of the formula remains the same in every case but the denominator depends on the total pool of traffic. The denominator is commonly unique leads, visitors, and session count.


An online business of e-commerce site that sells graphic T-shirts and the conversion goal of this site is to convert the audience into a customer. The conversion goal is to have a visitor go through the site’s funnel and make the purchase of a T-shirt.

Suppose the site gets 1,00,000 visitors in a month and purchase of 2,000 T-shirts is made, Let’s insert both the values in the conversion formula.

Visitors = 1,00,000
Conversions = 2,000
Conversion Rate = Visitors/ Conversions *100
Conversion Rate = 1,00,000/ 2,000 *100
Conversion Rate = 2%

What Constitutes to a Good Conversion Rate?

Every entrepreneur aspires to build a profitable business with a high conversion rate but what constitutes to good conversion rate?

A business operating online, the conversion rate says a lot about your business and most importantly it tells you how well your business is performing. If 6% of your site visitors have joined your mailing list or they have gone through your funnel and made a purchase then your website is effective by 6%. As per a study, a good conversion rate for an online business is between 2% to 5%.

The conversion rate of a business depends on the type of industry. Many industries like clothing, food, and electronics have higher demand and have average conversion rates while some industries may have low-performing websites.

Why is Conversion Rate Important?

Determining how effective your marketing campaigns are performing, you need to know how to calculate it and know how people are responding to your marketing campaigns. Conversion rates directly reflect the number of responses by your customers and it implies one of the most accurate metrics of our online business.

Conversion Rate and Return on Investment

A good conversion rate of an organization directly results in a strong return on investment.

Let’s take an example to understand this in a better way.

Let’s pretend you are spending $2000 every month on the content of your website and it gets you 20,000 readers and an average of 500 clicks or conversions. Now you have a conversion rate of 2.5%.

Although, if you manage to land 800 clicks in the next month, there will be an increase in your conversion rate by 4%. So in this month, you spend the same $2000 but have managed to get a hike on your conversion rate.

If your conversion rate has decreased, you will also see a decrease in your ROI.

What are the Types of Conversion Rates?

So far, we have addressed how to calculate the conversion by a specific formula but there are other types of conversion rates which you need to have information about

Overall Conversion Rate

This type of conversion rate looks at the site traffic and offers a measurement of your conversion goal. Let’s say Aeroleads, an email finding software, our site conversion rate would look at the percentage of visitors signing up for the paid version of the software.

Channel Conversion Rate

Does your online business rely on multiple channels for traffic and lead generation? The channel conversion rate is a type of conversion that offers a channel-by-channel breakdown of all your conversions. This conversion rate will help you identify the difference in performance on each channel and which channel is performing the best.

Ad Campaign Conversion Rate

Digital ads tend to bring more conversion rates and you’d want to know the type of Ad your audience is liking the most which will result in higher conversion rates. There is a different workflow when it comes to running Ads, which depends on your prospects.

Keyword Conversion Rate

There are keywords that perform great and keywords that under-perform. Keyword conversion rates can help you identify the keywords that doing great and converting your audience into your potential customers.

How to Improve and Optimize your Conversion Rate?

There are various ways that can help a business in improving and optimizing its conversion rates. If you wish to optimize the conversion rate of your site, you need to focus on following a strategy that enhances the traffic of your site organically. Utilizing E-commerce CRO services can significantly aid in this process, ensuring that your strategies are tailored to effectively convert visitors into customers.
To improve and optimize your conversion rate, you’ll need to test your website by:

1. Prioritize your Landing Page

Before you start spending on paid advertisement and marketing campaigns, it’s essential to know which website page you are planning to target. Many businesses use their website homepage as their landing page for ads while some businesses focus on special pages for current sales.

2. Perform an A/B Test

When an online business website is already generating traffic, performing an A/B test is an easy and quick way to do conversion rate optimization. Create two types of landing pages and name them A and B. Send half of your traffic to A and half to B. Online software for conversion rate optimization works well in this case.

Once you have examined and recognized which elements of your website is working well and making a positive impact, try experimenting with several CRO Test (Conversion rate optimizing).

Make sure you’re only changing one element during a test so you can directly change and involve the elements that are doing great. The changes can be made in the call-to-action element of your page, it could be, ‘Shop Now, ‘Buy today’, and even ‘Act fast’.
You can perform this test by switching the picture and videos of your website to see if they are appealing to your audience.

3. Establish Trust

Building a trustworthy website is the first and foremost thing an online business should focus on. The ‘About Us’ and ‘Contact’ information is visible on your website and designates someone who will answer your audience’s queries.

Offer customer reviews, testimonials, and client stories on your website, so your visitors have access to them directly. This will help you build trust among your site visitors and audience.

Wrapping Up!

If you’re unsure about the elements that you’re planning to test for conversion rate optimization, you’d end up through stones in a lake blindly without expecting any result. Instead, try using more dynamic language, highlight solution to pain points, enable limited details of your visitors, add incentives or offers, remove any type of distraction, and make sure that your site has ‘shop now’ or any call-to-action link.

Conversion rate is everything for an online business and making your website’s first impression count can help you gain potential leads, more traffic, and increased conversion rates.

Do you want to generate leads at a low cost? Download our Chrome extensions and start exploring it for free.

Try AeroLeads for Free! Signup Today itself.

For any queries feel free to contact us at or chat with our support team from our homepage.


About Gundeep Singh

Gundeep is the Digital Marketing Manager of Aeroleads. He has experience for 4 years in SEO. He believes in targeting every problem with an out of the box solutions. When he is not working, you can find him socialising on Linkedin and other Social Platforms.

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