Conversion (marketing)

Conversion, or even after the English origin Conversion, is a technical term of marketing, especially online marketing. This expression refers to the conversion of the status of a target person to a new state, such as the conversion of prospects into a customer.

Objectives

Targets and their conversion in online marketing can be, for example:

  • Conversion of search results in search engines in page views a web page
  • Conversion of the user of a search engine to a website visitor
  • Conversion of a visitor to a website in a prospective tenant for a download offer
  • Conversion of website visitors into contact requests
  • Conversion of a prospective buyer in a buyer on a website or in an online store
  • Registration for a newsletter on a website
  • Fill out a Request for Quotation in an online store

However, there are also examples of a conversion in the traditional marketing, such as

  • Returning a reply card
  • Requests for information by means of a Coupon Ad
  • The response to a competition ( addresses are generated )
  • Order a catalog for a mailing

In the online sector is referred to as the conversion rate and the conversion tracking, which is one of the essential factors of web analysis.

Conversion rate

The measurement of the conversion is done by the conversion rate ( conversion rate, conversion rate (CR), Prospect Conversion Rate (PCR ) ). This indicates that part of the prospective buyers who visit a particular web page and thereby become buyers.

The conversion rate is calculated as follows:

Using the conversion rate the effectiveness of an advertising measure is determined. Typical values ​​are between one and five percent, which means that out of 100 new visitors won an online store a carry to five a purchase (ie the buyer to convert the visitor / reader ).

General says of the conversion rate, how many of the visitors to a website to perform a desired action; this action can for example also be the dispensing of a comment or click a banner. The increase in the conversion rate associated with the targeted reduction in the rates of discontinuation of a marketing measure, such as leaving a site or to hide an advertisement. For example, since commercial websites visitors generate over costly online advertising, increases a targeted, systematic increase in the conversion rate in addition to the sales and returns.

Measures to increase the conversion in e-commerce

There are numerous policies and practices to increase the conversion rate. The most relevant are:

  • ( " increase newsletter sign-ups " for example ) direct orientation of the site to a clearly defined target conversion
  • Improvement of site content (text, images, videos) to operate the conversion target
  • Improve the shopping experience
  • Improve the user experience, to break down barriers to achieve the conversion goal and thereby reduce the dropout rate
  • Use of online product advisors, and guided selling systems to increase the conversion rate for online shops and manufacturers' websites to improve the product search and product consulting process
  • Use of online labels in order to increase the confidence of the (new ) customer in the shop.
  • Reduction of elements that distract the user from achieving the conversion target. An example is hiding the main menu in your shopping cart.

Increase the conversion rate from an online shop

For a better explanation following example calculation is to be used. It is considered as a change in the conversion rate for new customers on sales of the online shop effect. In the following example calculation a possible customer churn is not taken into account

  • Visits from new customers per year: 50,000
  • Average basket value: 80 EUR
  • Proportion of new customers who are regular customers: 25 %
  • Repeat purchases per customer per year: 2

What happens if the conversion rate for new customers is rising once by 1 percentage point?

  • In addition gained new customers per year: 500
  • Additional sales in the first year: 40.000 EUR
  • Additional sales in the second year: 60.000 EUR
  • Additional sales in the third year: 80.000 EUR

It is clear that even a slight increase in the conversion rate can significantly affect the Company's sales.

Conversion Funnel

While initially mostly only the conversion of a visitor an online store has been measured to a buyer or customer, today called " Conversion Funnel " ( funnel) are formed. These form a series of logically successive conversions, for example, should a visitor to a web site undergo, from a filtering process in the sense of a funnel.

Click-Through-Rate
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