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The Average Conversion Rate



By Kevin Gold
Expert Author
Article Date: 2007-08-06

A question I am asked frequently is what is the average conversion rate for an e-commerce website or for any website for that matter.

There is a basic answer and a more complicated yet more practical one.

For the basic answer I reference a recent study conducted by Forrester as presented in an article from the August 2007 edition of Target Marketing Magazine. The article stated, "Forrester research indicates that the average conversion rate - that is the ratio of orders to overall site visits - is 2.9 percent."

About three-fourths of the e-commerce companies I have worked with to improve their conversion rate (defined the same way as indicated above) initially reported to me a conversion rate of less than 1.0 percent. Therefore, from my experience the average conversion rate among small to mid-size businesses (ones probably not well represented in Forrester's study) is maybe closer to 1.5 percent.

NOTE: If anyone has expereince with a larger number of samll to mid-size e-comemrce sites, please send me your thougths on the average conversion rate! It would be a great information for everyone to know.

For lead generation and other non e-commerce sites, the conversion rate fluctuates drastically. I have not found reliable average conversion rate figures yet for non e-commerce sites but I assume that subscription sites could expereince similar to slightly higher rates (around 2.9 to 6 percent) while lead forms could reach even higher levels around 8% to over 20%. Certainly variables like B2B versus B2C, the type of offer,the type of attracted visitors (advertising methods), incentivizied vs. not incentivized, quality/relevance of creative and so on will influence the conversion rates.

The paragraph above and its obscure assumptions lead perfectly into the "more complicated yet more practical" response.

Comparing conversion rates within markets or worse across industries is difficult if not almost impossible. There are so many variables affecting conversion rates. More importantly a conversion rate metric provides no indication of profitablility - the number that really matters. Knowing an "average conversion rate" is nice but you should really be concerned with what conversion rate you need to achieve to drive profitable leads, subscriptions, sales or other business value associated with your objectives.

Set your own conversion rate goal based on a financial analysis focused on greater sales volume and/or higher profits and compete against this internal benchmark. At the end of the day, its not a matter of whether you are above or below the "industry average" - instead it's about the financial success of your web business.

By the way, if you want to easily calculate your conversion rate use this free conversion rate calculator. It might help.

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About the Author:
Kevin Gold is a regular contributor to Search Marketing Standard Magazine blog and is the Managing Partner of Enhanced Concepts. Kevin has extensive experience and knowledge working with companies of all sizes from Fortune 1000, entrepreneurial start-ups, franchises and home-based businesses. He has worked with hundreds of companies in diverse markets to increase their website sales and generate more qualified sales leads.

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