Conversion Rates Don’t Matter – Heres’ 8 Reasons Why
I came across this article today and two things; 1 their title, Conversion Rates Don’t Matter, was catchy enough to grab my attention in the midst of the myriad of screaming people and 2, the content was great and thought provoking.
To give away the ending at the start I will tell you that they aren’t against conversion rates or tracking the data behind the success of your site. What they argue is that in looking at where conversion rates don’t matter and how we need to remember that the two important facts that require the result. The denominator and the numerator. When these two numbers change it will move the needle up and down. The question is, how much revenue does the conversion percentage represent? Then it might not matter what the conversion rate is.
Here’s an except from the article.
Conversion Rate Defined?
Simply put, a conversion rate is the percentage of visitors or prospects that performs the action that you want them to perform. This action is known as the conversion event and it varies from signing up for a newsletter all the way to purchasing products.
To ensure that you understand better what a conversion rate is, take a look at this equation.
This means that if you get 270 sales or conversions out of ten thousand visitors, your conversion rate will be calculated as shown below:
What is the meaning of all this in practice?