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More and more people are asking themselves questions about the performance of their websites.

What kind of performance should I expect from our website?

What is a good conversion rate?

What is an average conversion rate?

What is my current conversion rate?

Let us start by defining what a conversion rate is, as different people may measure it in different ways.

A conversion rate is the ratio of the number of successful events divided by the number of visits or visitors (this is the first place that people may get different numbers).

Different business may want to define the denominator of this equation in different ways. They may feel that for their business it is most important to measure conversions based on only how many unique people visit their site verses how many visits are made to the site. My feeling on this is that it should be measured by visits, as there is no way to be sure if someone is a unique visitor. It could be a different person using the same computer at a different time, or the same person visiting your web site from a different computer later. Regardless of how you choose to define your denominator make sure that you are consistent in its application otherwise you won't be able to compare the numbers over time.

The numerator of the equation will also have a large impact on your conversion rate. Depending on what you success event is will impact what a good, average or poor conversion rate would be for your web site. If your success event was someone signing up to get a free MP3 player with no strings attached you would expect that your conversion rate would be 70% or more. On the other hand if your conversion rate was selling a $100,000 car online and having someone pay for it with their credit card you would probably expect your conversion rate to be well under 1%.

For years now people have been talking about the average conversion rate being ~2%. Comparing your conversion rate to the average conversion rate isn't all that useful. You need to compare apples to apples. You need to compare against other web sites that are in the same competing space that you are.

Here are some examples of different verticals conversion rates.

Lead generation 10-70%
Catalog company 5-10%
Specialty stores 3-5%
Fashion/Clothing 2-2.5%
Travel 2-2.5%
Home/Furnishing 1.5-2%
Sports/Outdoors 1.25-1.75%
Electronics 1-1.5%
All industries 2-3%

The first step to improving your conversion rate is to start tracking it. Then you will be able to measure positive or negative impacts that result from changes that you have made to your web site or to your marketing campaigns. Next don't strive to be average, strive to be the best that you can inside your industry, and never be satisfied with the status quo. Managing and optimizing a web site is an ongoing process that is never completed. You must continue to measure, analysis, strategize, design, implement and test new ideas.