There are thousands of metrics you can track to understand how effectively your marketing campaigns are performing and whether or not you’re achieving your business goals. However, conversion metrics are arguably the most important.
Conversion metrics measure how well you’re turning your audience into customers by tracking vital parts of their journey with your website. When analyzed, they can provide useful insights into what’s working and what needs adjusting. Here are eight you should be tracking.
1. Click-through rate (CTR)
CTR is an important metric to track to determine the value of paid ad campaigns and organic content. Put simply, this KPI measures the percentage of impressions that lead to a user clicking through to the next step.
You can calculate CTR by dividing the number of clicks by the number of impressions. This can help you gauge how successfully aspects of your campaign like ad copy, headlines, meta descriptions and so on are performing.
The average CTR is below 2%, so by using this as a benchmark you can assess whether your results are falling short or exceeding that of your competition.
2. Cost per acquisition (CPA)
This metric refers to the costs involved when you acquire a new customer, from the initial touch point to their conversion.
It’s calculated by dividing the total marketing cost by the number of customer acquisitions.
Tracking CPA allows you to better understand the profitability of your marketing efforts and can help you to pinpoint areas for improvement if you’re operating at a profitability loss.
3. New visitor conversion rate
This metric focuses on first-time visitors to your website. Typically, new visitor conversion rate tends to be quite low as they need more time to familiarize themselves with your brand before making a purchase. However, conversions can also refer to things like email signups or downloads, depending on your goals for the page in question.
When a user lands on your site, you only have a few seconds to grab and hold their attention. By looking at this metric, you can get a sense of whether or not your website is doing its job. Consider factors like usability, clarity and value and then optimize your website to keep visitors interested.
4. Returning visitor conversion rate
Returning visitor conversion rate looks at the conversion rate among visitors who have already interacted with your website.
This metric is generally much higher than new visitor conversion rates, and if it isn’t there’s likely a problem somewhere on your website. By isolating this metric, you can figure out how to increase conversions on someone’s second or third visit to your website.
5. Return on ad spend (ROAS)
ROAS looks at the return on investment in advertising. By tracking and optimizing this metric you can ensure that your marketing efforts are working and determine whether or not you need to adjust your budget accordingly.
Positive ROAS means you’re making more than you’re spending, whereas a negative score means that something is going wrong. If this is the case, you might consider switching up your advertising strategy or applying your budget elsewhere.
You can calculate ROAS by dividing your total number of conversions by your advertising cost.
6. Time on site
Time on site measures how long a user spends on your website before leaving the page or converting. It should be looked at in conjunction with conversion rate to help you determine if users are taking too long to understand your offering or if your usability isn’t up to scratch.
If you have a low time on site and a low conversion rate, it means people are leaving quickly because you haven’t piqued their interest or they’ve decided your website is too difficult to navigate. Understanding this metric can help you make adjustments to ensure your pages are achieving their intended purpose.
7. Bounce rate
This metric is the rate at which visitors to your website click away from the page without taking any further action or interacting with it at all. This is a clear sign something is wrong and needs to be changed if you want to start converting visitors into customers.
Generally speaking, a bounce rate of 26-40% is considered good, 56-70% is considered high and anything in between is average.
A high bounce rate can indicate several things. For instance, you might be attracting irrelevant sources of traffic, your content and landing pages might not capture their attention or your website is poorly designed.
Measuring bounce rates can help you identify problems and ensure your website is optimized for conversions.
8. Return on investment (ROI)
ROI measures how much money you’re making from your campaigns. Let’s take an email marketing campaign as an example. To measure ROI, look at the revenue that it has generated and subtract the total cost of the campaign.
Having a positive ROI is a good sign, as it means you’re not overspending on marketing. A negative ROI means your campaigns need to be optimized further.