Generating a high volume of website traffic or brand interest is fantastic.
However, you won’t see a sizeable profit or return on investment (ROI) unless you can turn browsers into buyers.
Sales conversion rate is a critical metric for business, conveying the percentage of visitors or users who performed a desired action.
That could be downloading an asset, purchasing a product, or signing up for your email list. The higher the conversion rate, the more successful your marketing campaign.
But how do you calculate a sales conversion rate? What even is it? And what is a good sales conversion rate to aim for? Find out below.
We’ll cover:
- What is a Sales Conversion Rate?
- How to Calculate a Sales Conversion Rate
- What is a Good Sales Conversion Rate?
- Sales Conversion Rate by Industry
- Strategies to Boost Your Average Sales Conversion Rate
What is a Sales Conversion Rate?
Sales conversion rate measures the number of visitors to a webpage who performed a desired action expressed as a percentage. It’s the cardinal success metric for sales teams.
The more people who complete the desired action, the more successful your campaign, the greater the sales conversion rate.
In the sales world, conversions usually imply a visitor has completed a sale. That could be purchasing a product or signing up for a service.
However, in marketing campaigns, the term conversion rate also applies to everything from opening an email to filling out a registration form to booking a consultation.
How to Calculate a Sales Conversion Rate
Unlike some sales metrics, calculating a sales conversion rate is simple. You only need two pieces of information: (1) total number of visitors and (2) total number of sales. You then divide the total number of sales by the total number of visitors to get the fraction. You can multiply by 100 to convert it into a percentage.
For example, imagine 200 people visited a particular product page, and 10 of them went on to purchase the product. We would divide 10 by 200 to get 0.05. By multiplying by 100, we get a sales conversion rate of 5%.
This calculation reveals only the relative success of a sales campaign. In the example above, we have a website with a 5% conversion rate. However, if a website only had a conversion rate of 2% but had 2,000 visitors, it would be more successful overall.
All online businesses should focus on boosting their conversion rate. But you’ll still want to generate substantial organic traffic in the first place. A 100% conversion rate on 10 visitors is much less desirable than a 5% conversion rate on 1,000 visitors.
What is a Good Sales Conversion Rate?
Your sales conversion rate tells you the effectiveness of a sales campaign or webpage. But what even is a good sales conversion rate?
Here’s a fact: the vast majority of people who interact with your brand never purchase anything. The 5% conversion rate listed above may seem small, but it’s actually at the top end of the average. Businesses can expect a “good” website conversion rate of between 2% and 5% across most industries.
That being said, you should always try to raise your rate. A good conversion rate means a strong return on investment (ROI). Put another way, every time your conversion rate increases, your customer acquisition cost drops.
Let’s say you spend $10,000 building a new eCommerce site. You receive 20,000 visitors per month, from which you get 1,000 purchases. You have an average conversion rate of 5%. That’s pretty good.
It means you spend $10 per purchase. However, if you increase your conversion rate to 6% (or 1,200 purchases), you only spend $8.33 per purchase. You’re getting more for your money.
Sales Conversion Rate by Industry
Average sales conversion rates differ significantly from industry to industry. For example, B2B eCommerce sites (think industrial equipment) have much lower conversion rates than consumer products like electronics or clothing.
According to Shippy Pro and IRP Commerce, the average eCommerce conversion rate by industry is:
- Agriculture: 0.62% – 1.41%
- Arts and Crafts: 3.84% – 4.07%
- Baby and Child: 0.87% – 1.43%
- Cars and Motorcycling: 1.35% – 0.65%
- Electrical and Commercial Equipment: 2.49% – 1.31%
- Fashion, Clothing, and Accessories: 1.01% – 2.20%
- Food and Drink: 1.00% – 2.01%
- Health and Wellbeing: 1.87% – 4.20%
- Home Accessories and Giftware: 1.55% – 2.34%
- Kitchen and Home Appliances: 1.72% – 3.00%
- Pet Care: 2.53% – 2.20%
- Sports and Recreation: 1.18 – 1.62%
However, these figures can vary significantly depending on the source. For example, Statista puts the ‘Food & Beverage’ conversion rate at 3.1%. Always consider what aspects of an industry are included and how the figure is calculated.
Strategies to Boost Your Average Sales Conversion Rate
1. Optimise Your Sales Funnel
Your sales funnel is the fundamental framework for turning prospects into customers. To enhance it, start by mapping out each stage – awareness, interest, decision, and action – to identify where prospects are dropping off.
As a rule, you’ll want to simplify the funnel to reduce any impediments to the final sales. Another popular option is personalisation – tailoring the message and sales strategy to the individuals can significantly increase your sales conversion rate.
Successful strategies include targeted content marketing for awareness, engaging email campaigns for interest, persuasive sales presentations for decision-making, and seamless purchasing options for action.
However, combine all these strategies in a digital sales room. In this virtual space, you can 100% personalise the sales experience, funnelling customers toward the final sale from their first brand interaction.
2. Leverage Social Proof
Trust is the bedrock of every transaction. We buy what we trust. That could be because we’ve bought it before, friends and family have recommended it, or we’ve read the reviews. We call the latter “social proof.”
According to Chatter Matters, 83% of consumers say recommendations increase their likelihood of purchasing a product or service. In fact, 88% of people trust user reviews the same as personal recommendations.
Expand beyond basic testimonials by incorporating user-generated content using your product or platform, such as customer photos or videos. Engage influencers or industry experts to endorse your product, adding credibility. Highlight media mentions or awards your business has received.
Include this social proof on product pages, landing pages, and in your marketing materials. Don’t overdo it – but always ensure it’s visible.
3. Implement A/B Testing
A/B testing is a foolproof hack to improve your sales conversion rate. But it’s not just about making random changes. It’s about tweaking your sales materials strategically to nudge consumers toward the desired outcome.
Start by identifying key elements in your sales and marketing funnel that could impact conversion rates, like headline copy, page layout, CTA buttons, or email subject lines. Use analytics to establish a baseline performance metric for comparison.
You can then start making minor alterations to see which variation performs better. Remember, for A/B testing to be successful, you need a significant sample size. If there are too few people in the sample, the results won’t give a clear indication of which option is better.
4. Utilise Data Analytics
The big question is, why aren’t customers converting? What’s happening? How are they behaving? Once you can identify the step(s) that are causing significant drop-off, you can take the appropriate actions to remedy the problem.
That’s where a host of other metrics come in. These data points let you know how customers behave throughout your sales funnel. There are dozens of different metrics you can analyse. However, the best five are:
- Bounce Rate: The proportion of visitors who leave the site after viewing only one page, indicating potential disinterest or confusion.
- Cart Abandonment Rate: The percentage of shopping carts that are not converted into a purchase, highlighting issues in the checkout process.
- Page Views per Visit: Indicates how engaging your content is and how effectively it moves visitors through the sales funnel.
- Average Time on Site: The average amount of time visitors spend on your site.
- Heat Maps: Visual tools that show where visitors click, move, and scroll on your website, offering insights into user behaviour and preferences.
5. Streamline the Checkout Process
Don’t stumble at the final hurdle. Too often, businesses get everything right, funnelling the customer toward the sale only to make the checkout process needlessly complex.
Here’s the thing: every unnecessary step you add results in lost sales.
Simplify the process by minimising the number of steps and asking only for essential information. Offer guest checkout options to further speed up the process for new customers. Progress indicators also show customers how far they are from completion, reducing the risk of an abandoned cart.
For B2B deals, integrating eSignature services into your digital sales rooms also streamlines the conversion process, ensuring a smooth and efficient final step in the sales journey.
Ready to Boost Your Sales Conversion Rate?
Don’t leave your sales conversion rate to chance. The more visitors you convert, the less you’ll spend on unnecessary marketing and sales campaigns. That’s not just good for your sales team but your overall bottom line.
With trumpet’s digital sales rooms (or “pods”), you can take control of your sales funnel. Personalise the room with relevant content (including social proof), track customer activity to see what works and what doesn’t, and start collaborating early with mutual action plans.
Learn more about our sales tools by booking a free demo today.
