The Problem with Conversion Rate
What’s the number 1 metric Digital Marketers talk about? Conversion rate.
It’s calculated as the number of sales over the number of visits
But have you ever thought about what conversion rate is really telling you?
Because of the way its calculated, a Higher Conversion Rate Doesn’t Always Mean Higher Performance!
Consider these 2 examples:
Week 1: 4% conversion rate. (50,000 visits, 2,000 sales)
Week 2: 10% conversion rate. (10,000 visits, 1,000 sales)
So what’s the problem? The problem is that week 2 is telling us that we have a better engagement rate. But in reality, it has half the number of sales. It’s misleading us into thinking that conversion rate accurately reflects performance.
So the lesson is – be careful when using conversion rate – look at how it’s been calculated, and don’t blindly use it as your main metric of success.
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