Marketing · business glossary
What is Conversion rate?
By Shivam Bhandari · Reviewed 31 October 2026 · How we write
definition
The percentage of people who take a desired action (buying, signing up) out of everyone who saw the opportunity to.
Conversion rate explained
Conversion rate is the percentage of people who take a desired action — buying, signing up or enquiring — out of all who had the chance.
formula
Conversion rate % = Conversions ÷ Visitors (or leads) × 100
example
2,000 website visitors and 50 orders gives a 2.5% conversion rate.
why it matters
Improving conversion often grows revenue more cheaply than buying more traffic.
common mistake
Comparing conversion rates across very different traffic sources without context.
Frequently asked questions
What is Conversion rate?
The percentage of people who take a desired action (buying, signing up) out of everyone who saw the opportunity to. Conversion rate is the percentage of people who take a desired action — buying, signing up or enquiring — out of all who had the chance.
How do you calculate Conversion rate?
Conversion rate % = Conversions ÷ Visitors (or leads) × 100. 2,000 website visitors and 50 orders gives a 2.5% conversion rate.
Why does Conversion rate matter?
Improving conversion often grows revenue more cheaply than buying more traffic.
What is a common mistake with Conversion rate?
Comparing conversion rates across very different traffic sources without context.
Related terms
Marketing funnel
The stages a stranger passes through on the way to becoming a customer — typically awareness, interest, consideration, and purchase.
A/B testing
Showing two versions of something (an ad, a page, a price) to different groups at the same time to see which performs better.
CTR (click-through rate)
The percentage of people who saw an ad or link and actually clicked on it.