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conversion rate optimization

In online marketing, conversion rate optimization (CRO) is a strategic approach to increasing the percentage of website visitors who follow a desired call to action (CTA). If the website is an e-commerce site, the site's CTA may focus on turning the visitor into a customer. If the website is a business-to-business (B2B) site, the site's CTAs may focus on getting the visitor to share information that could be used for sales leads.

When a website visitor completes a CTA, it is known as a conversion. The goal of CRO is to create as many conversions as possible for a specific CTA, such as making an online purchase or filling out an online form. Mathematically, the conversion rate is calculated by identifying the number of visitors who complete the desired CTA in a given time frame and dividing that number by the total number of website visitors. The quotient is expressed as a percentage.

Through conversion optimization, websites proactively seek to advance their relationship with visitors and create an established path for visitors to contribute revenue directly or indirectly to the website owners. Generally speaking, the higher the conversion rate, the more effective the website's online marketing efforts are. For example, if a webpage had 50 conversions from 1,000 interactions, the conversion rate would be 5% (50/1,000 = .05 = 5%).

Why CRO is important

CRO can maximize the number of conversions that a website's existing traffic generates. Generally speaking, websites can boost conversion rates in two ways: increasing overall site traffic and/or increasing the site's efficiency. When optimization efforts focus on increasing efficiency, initiatives seek to increase the likelihood that the number of site visitors who complete a desired CTA will increase, even when traffic numbers remain flat. To carry out CRO successfully in this scenario, website owners need to understand the following:

  • who the target audience is for their website;
  • which CTAs are currently on the site;
  • which CTAs can be optimized easily; and
  • which optimization efforts should be prioritized to meet business goals.

Examples of customer conversions

In e-commerce, there are two types of customer conversion: macro and micro. Macro-conversions can be thought of as information the visitor provides that could be used to directly nurture sales. When the customer makes a purchase, it is an example of a macro-conversion. Other examples of macro-conversions include the following:

  • The visitor subscribes to a freemium service that the site offers.
  • The visitor opens a chat with the site's virtual assistant to ask questions.
  • The visitor provides detailed personal information in order to skip a registration wall and view the site's content.

When a customer completes a task that indirectly indicates purchasing intent, it is known as a micro-conversion. Micro-conversions can be thought of as information that the visitor shares early in the buying cycle that could be used for lead generation and to nurture sales. Examples of micro-conversions include the following:

  • The visitor adds an item to the shopping cart.
  • The visitor views multiple articles about the same product.
  • The visitor clicks on multiple advertisements for similar products.

Conversion rate optimization strategies

The first phase of CRO involves using data to understand current website visitor behavior. The marketer will look for patterns and attempt to pinpoint what conditions led to the desired result. These conditions can then be prioritized, reimagined and tested with A/B tests. User experience (UX) testing is a fundamental component of CRO. The goal of testing is to ensure that visitors can successfully navigate the site and perform the desired action easily.

UX professionals can improve their site's conversion rate by making changes to the design or content of the site so that it creates less work for visitors and streamlines the customer conversion funnel. For example, marketers may improve CRO by doing the following:

  • Work with the web design team to make CTA buttons stand out.
  • Replace CTAs that users tend to ignore.
  • Make it as easy as possible for the visitor to contact a real person and receive support.
  • Minimize page load times, and decrease bounce rate to keep users on the site for longer.
  • Continually optimize content for search engines.
  • Implement reengagement techniques for users who have visited the site but did not complete the desired CTA.
conversion funnel
A diagram of the conversion funnel

How conversion rate optimization works

Ultimately, the goal of increasing conversion rates is to lower the cost of customer acquisition and nurturing. If the goal of an initiative is to increase subscribers by redesigning the homepage, then the optimization team should do the following:

  1. Test elements of the homepage it plans to change before the changes to measure user engagement with those features.
  2. Make the planned changes to the homepage.
  3. Measure user engagement with those specific elements.
  4. Compare those figures, among other key performance indicators (KPIs), to the figures measured before the change, and determine whether the changes had a positive or negative impact on the company's conversion rate.

It's important that an organization has clearly defined goals going into a CRO project so that the effort and resources spent reoptimizing pay off for the business. Not having a clearly defined goal can cause companies to measure the wrong metrics, which may appear positive on paper but have little actual impact on the business. An example would be driving traffic toward parts of the site that don't help demonstrate purchase intent or measuring micro-conversions that are improving some sort of engagement but do not end up increasing sales because they do not ultimately convert users into marketing-qualified leads (MQLs).

Choosing what to optimize

It's important for marketers to know which website pages are the best candidates for optimization. In A/B testing, the target areas to begin the CRO process are high-traffic, underoptimized webpages. These pages already have the traffic; they simply need to make better use of that traffic. Some common areas of a website or app that can be candidates for CRO are the following:

  • Homepage, which likely receives a lot of traffic and is important to optimize because it is the user's first impression of the site.
  • Article pages, which hold significant conversion opportunities. CTAs can be planted throughout the page to encourage the reader to complete a specific action.
  • Product pages, which should be as user-friendly as possible, with sales contact information readily available on the page.
  • Landing pages, which is where a user lands after clicking a link from an email marketing campaign or social media Landing pages are designed specifically for the purpose of conversion, so they should be streamlined and easy to use.

To set priorities for testing, marketers can use a decision support framework, like the PIE (potential, importance, ease) framework. Before testing begins, stakeholders should know the answers to the following questions.

  • What will a successful optimization effort look like?
  • What metrics will be used to measure success?
  • How difficult will a particular strategy be to implement?
This was last updated in June 2020

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