What is Conversion Rate, and how do you calculate it?
In short – The percentage of visitors who complete a desired action, such as making a purchase.. A key marketplace metrics you should track.
Conversion Rate Formula
Conversion Rate = (Conversions / Total Visitors) × 100
Conversion Rate represents the percentage of users who take a desired action, such as making a purchase or signing up. It is a fundamental metric for measuring the effectiveness of marketing campaigns, user experience, and sales funnel efficiency. This metric provides deep insights into business performance, helping to identify trends, optimize strategies, and improve overall marketplace efficiency. This metric provides deep insights into business performance, helping to identify trends, optimize strategies, and improve overall marketplace efficiency.
How can you find your Conversion Rate?
You should generally be able to calculate your Conversion Rate with tools you already posess. If that's not the case, signing up for an analytics tool may make sense.
Among others, twosided is one of the tools you could consider. Out-of-the-box, you'll get over two dozens marketplace KPIs and detailed tracking for your supply, demand and other factors that determine marketplace health.
Explore other metrics
Net Promoter Score (NPS)
A measure of customer loyalty and satisfaction based on user feedback.
Average Order Value (AOV)
The average value of orders placed on the platform.
Supplier Lifetime Value (SLV)
The projected revenue generated by a supplier over their tenure on the platform.
Repeat Purchase Ratio
The proportion of customers who make repeat purchases over a given period.
Customer Lifetime Value (CLV)
The projected revenue a customer will generate during their relationship with the business.