What’s a Good Conversion Rate?

(It’s
Higher Than You Think)
Author: Larry Kim
Last Updated: November 13, 2023 | Conversion Rates

Conversion is a key element in your paid search strategy; after all, if you’re not
actually turning lookers into buyers at a high rate, what are you advertising for?
Conversion rate optimization enables you to maximize every cent of your PPC spend
by finding that sweet spot that convinces the maximum percentage of your prospects
to take action.

But what is a good conversion rate? If you’re already achieving 3%, 5% or

even 10% conversion rates, is that as high as you’re going to go? But what is a good
conversion rate? Across industries, the average landing page conversion rate was
2.35%, yet the top 25% are converting at 5.31% or higher. Ideally, you want to break
into the top 10% — these are the landing pages with conversion rates of 11.45% or
higher.
We recently analyzed thousands of Google Ads (formerly known as AdWords)
accounts with a combined $3 billion in annual spend and discovered that some
advertisers are converting at rates two or three times the average. Do you want to be
average, or do you want your account to perform exponentially better than others in
your industry?

Through our analysis of this massive amount of data on landing pages and conversion
rates, we were able to identify some common traits of the top converting landing
pages. What do they have that you don’t? Believe it or not, there isn’t much standing
between you and conversion rates double or triple what you’re seeing today. But the
 way you’re going to get there is totally counter to typical conversion rate optimization
wisdom.

 Why Conventional Wisdom Around Conversion Rate Optimization is Silly

 What Is a Good Conversion Rate?

 How You Can Replicate the Success of Top Landing Pages

Are you ready to find out why everything you thought you know about CRO is
wrong?

Let’s get started, but first: Is your conversion rate higher or lower than average in your
industry?

Find out with our conversion rate benchmarks

Conversion Rate Optimization: The Conventional Wisdom

Learning that the experts you’ve been listening to all along are wrong is a bit like
learning for the first time as a kid that mascots aren’t real. Underneath that fluffy suit
there was just a sweaty unshaven guy. Everything you’ve learned about conversion
rate optimization is a bit like that: shiny and pretty on the surface, but seriously
lacking in substance.

How is everyone getting it so wrong? Primarily, if you’re singing the same song as
everyone else, you can really never be anything more than average. When all of the
gurus are all preaching the same optimizations, and all of your competitors are
listening to them, how are you supposed to stand out?

The Classic Conversion Rate Optimization Test is Silly

Ladies and gentlemen, this is the Great Conversion Rate Optimization Fairy Tale.
Once upon a time, a self-professed marketing guru told you it’s really important that
you optimize your site. They shared one example where the author changed the button
color, or the font spacing, or the image. Lo and behold, the advertiser’s conversion
rate jumped by 2-7%.
Amazing, right?! Um, no, not really. These are really basic, run-of-the-mill A/B
testing best practices. Yes, you should be doing these optimizations on an ongoing
basis, and you’re probably going to see small, single-digit increases in your
conversion rate – but it’s not likely to shoot you into the 10% or greater conversion
bucket.
Let me show you what happens with those gains generated by these small tweaks on
your page. Here’s an example of a landing page split test; the gray line on the bottom
is the first page version we were running. The blue line is the second version we ran
against it. In the beginning, the new page far outperformed the old. Awesome, right?
Except as you can see, the gains were not long lasting. In fact, the “better” page would
eventually plateau. We began running 20 to 30 tests at a time and saw this pattern
across our tests. We call this a premature testing dilemma. You see an early lead
but shortly down the line, the early lead disappears.
This isn’t true all of the time, of course. However, we found that in the majority of
cases, small changes like line spacing, font colors, etc. = small gains. If you want big,
serious, long-lasting conversion gains, you need to move past these spikes that last
only a couple of days or weeks.

Why does this happen? Often, it’s because the total volume of conversions you’re
measuring against are low to start with (not seeing any conversions at all?). If you’re
looking at 50, 100 or even 200 conversions across your entire test, small changes can
seem more impactful than they really are. A couple of conversions might mean a 4%
conversion increase if there are only 50 conversions total, because your sample size
really isn’t big enough to start with.
Not happy with your conversion rate? Get our
(free!) guide to hacking Google Ads

It’s Time to Stop Moving the Chairs Around

When it comes to landing page optimization, you can stay really busy doing small
things that have little impact. It’s like rearranging deck chairs on the Titanic. We need
to move past this mentality to the big tactics and optimizations that will dramatically
change your performance and fortune.
First, we need to know:

What is a Good Conversion Rate?

Hint: it’s a lot higher than you may think.

Conventional wisdom says that a good conversion rate is somewhere around 2% to
5%. If you’re sitting at 2%, an improvement to 4% seems like a massive jump. You
doubled your conversion rate! Well, congratulations, but you’re still stuck in the
average performance bucket.
In this analysis, we started with all accounts we can analyze and went back a period of
3 months. We removed those that didn’t have conversion tracking set up properly,
those with low conversion volumes (<10 conversions/month), and low volume
accounts (<100 clicks/month), leaving hundreds of accounts for our analysis. We then
plotted where the accounts fit in terms of conversion rate.

So what is a good conversion rate? About 1/4 of all accounts have less than 1%
conversion rates. The median was 2.35%, but the top 25% of accounts have twice that
– 5.31% – or greater. Check out the far right red bar – the top 10% of Google Ads
advertisers have account conversion rates of 11.45%.
Remember, this isn’t for individual landing pages – these advertisers are
accomplishing 11.45% conversion and higher across their entire account.

Clearly, this isn’t some anomaly; this is perfectly attainable. If you’re currently
getting 5% conversion rates, you’re outperforming 75% of advertisers … but you still
have a ton of room to grow!

You should be shooting for 10%, 20%, or even higher, putting your conversion rates
3x to 5x higher than the average conversion rate. Aspire to have these landing page
conversion rate unicorns in your account.

Conversion Rate by Industry

You may be thinking, “But conversion rates are low in my industry.” That’s entirely
possible. We segmented conversion rate data by industry (Legal conversion rate,
Ecommerce conversion rate, etc.) to see whether these insights held true for all
marketers. Here’s what we found in an analysis of four major industries:

There’s a lot of flux there; e-commerce conversion rates are much lower, especially
compared to finance. However, check out the Top 10% Conversion Rates. They’re 3
to 5 times higher than the average for each industry, so we can see that the rule holds
across the board, regardless of industry.
The flip side, of course, is that if you’re in a high-performer industry like finance, 5%
really isn’t a fantastic conversion rate. If you’re comparing yourself to the average
across all industries, you’re really deluding yourself into thinking you’re doing better
than you are. In truth, the top 10% are doing almost five times better.

Even if the average conversion rates are lower in your industry, the top advertisers are
outperforming you by 3-5x or more.
Converting on Display is another animal entirely; typically, conversion rates will be
lower. If you’re advertising on the display network, you can use a tool like our Smart
Ads Creator to create designer-quality that will help you generate clicks and
conversions at a higher rate.

5 Ways to Increase Your Landing Page Conversion Rate

What do these top 10% of landing page unicorns look like and how are they killing
the competition the way they are? We went through 1,000 landing pages and
performed a qualitative analysis, in order to find the common traits among the best
performing advertiser landing pages in the market.

Here are my top five tips to help you increase conversion rates:

1. Change the Offer

Across all of the high-performing landing pages, we saw massively creative and
differentiated offers. Companies often have a default offer, their go-to, which may be
the same or very similar to what all of their competitors are doing. Lawyers, for
example, will offer a free consultation. Software companies will offer a free trial.
They’re unimaginative and not very creative.

How can you get creative with your offer? In our case, we realized that offering
prospects a free trial of WordStream software really wasn’t very imaginative or
compelling. We had to think outside the box (don’t you love that phrase?) and come
up with something different and unique; something more tangible and compelling
than just sending them to a software trial to find their way around.
What we came up with was our free Google Ads Grader, which actually gives
people an account evaluation report, with recommendations to help them improve
their Google Ads strategy. This was a HUGE turning point for us. Prospects loved it
and landing page conversion rates went through the roof.
So how do you know if your offer stinks? If your conversion rate is stuck at 2% or
lower, you’re not there yet. But the real way we figured out how our offer stunk was
by asking our customers. We added one form field on our landing page form to ask
people what they wanted our help with – and it wasn’t a free software trial.

Brainstorm, ask your customers, and come up with more unique offers to test. You’ll
never know which one is the winner until you try some new offers out.

2. Change the Flow

Sometimes, you’re putting up barriers to conversion without even realizing it.

In the above example, you can see the first landing page version and just how much
information people had to provide before they could download the software trial.
Clearly, this was too much for many prospects. It was daunting and discouraging – not
the kind of user experience you want on your landing page.

Here you can see their new landing page iteration, which turned out to be an
exponentially better performer. They’ve changed the flow so that anyone can
download and install the file. At the last step, the user is asked to register the software.
At this point, they’ve already spent 10 or 15 minutes with the software and are far
more likely to invest the time in completing the information form.

This was actually so effective that they were overwhelmed with conversions. They
ended up backing off slightly and using the registration to find more qualified leads,
by asking for the information one week after the download, once their prospects had
time to sit and get to know their software. Changing the flow helped them boost
conversions, but also manage lead quality in a far more effective way.
Here’s another great example, where the advertiser realized their landing page offer
didn’t necessarily speak to the person who would be performing a search. In their
case, a loved one or friend might be seeking help.

This advertiser decided they would let the visitor choose their own flow. This was
incredibly effective not only for conversion, but also in segmentation for their
remarketing and lead nurturing efforts.

So what’s the takeaway here? Find the flow that works best for your prospects and use
it to boost conversion rate and qualify your leads.

3. Use Remarketing as a CRO Tool

On average, 96% of the people who visit a website will leave without ever converting
to a lead or sale. Remarketing helps you get in front of these people with targeted,
relevant messaging as they take part in other activities around the web, like email,
watching YouTube videos, using social networks or searching for information.
Check out my post at Moz for a deep dive into this incredibly effective tactic.

4. Try Out 10 Landing Pages to Find 1 Unicorn

Let’s talk about effort for a minute. What do you need to put into CRO to find your
own unicorn landing pages? To understand this, let’s look at the relative abundance of
these top performers:

Sometimes you get lucky, but if you want to achieve these top 10% landing pages
across your account, you need to replicate the above steps multiple times and perform
testing on an ongoing basis.

On average, you should be testing four unique landing pages – with varying offers,
flow and messaging – to find that one awesome landing page. If you want to find a
unicorn landing page – that top 10% page that sees your conversions reaching 3-5x
the average – you need to test at least ten landing pages.
Here, we’ve analyzed an e-commerce account with 1000 unique landing pages. About
a third of traffic goes to the top most-trafficked landing page in their account. When
we dig deeper, we see that about 80% of traffic goes to just the top 10% of landing
pages.

You don’t need to make thousands and thousands of landing pages. You need to find
the top performers you already have and focus your efforts there. How can you
improve their performance? Cut the fat, stop wasting time on the low performers – in
fact, just get rid of them. If you have just one great landing page, it’s smarter to focus
your efforts there.

Here’s more proof that burning the midnight oil creating dozens or hundreds of
landing page variations isn’t the best use of your time:

Here, we’ve plotted out tens of thousands of accounts by conversion rate vs unique
landing pages. We don’t see a strong correlation between increased number of landing
pages and increased conversion.

If you’re after the top performers, quantity does not necessarily equal quality.

Before worrying about conversions, you’ll need to get prospects to your landing page
in the first place. Try our free keyword tool to find niche-specific keywords to
implement in your search ads and landing pages.
 5. F%@# Conversion Rates

Wait, what??

Stay with me here. Higher conversion rates, on their face, seem awesome. However, if
you’re converting less qualified leads, you’re actually throwing MORE money away,
because those leads cost you money.

I want you to focus on landing page optimizations like the above that move you in the
direction of higher quality, more qualified lead generation, not just more conversions.

Key Takeaways

So what have you taken away from this? I hope you can get the following to stick and
use these tips to guide a more holistic, effective conversion rate optimization strategy
– the kind that will boost your conversions, but bring better lead quality, as well.

1. Most landing page optimizations are like moving around the deck chairs on the
Titanic. Small changes = small gains.
2. Insanely focused and strategic landing page optimization brings 3-5x the conversions
AND improves lead quality.

3. In some industries, even 5% conversion rates aren’t that impressive. If you’re stuck in
the 2-5% conversion rate bucket, you have a ton of room to grow.
4. Get creative with your offers and test multiple different offers to find the one that
resonates best with your audience. If you want to get really crazy (you know you do),
find different offers that can help you qualify leads in the process.

5. Identify the obstacles keeping prospects from converting and get those roadblocks out
of the way by changing the flow. Test different variations to find out exactly which
path to conversion works best for your audience.

6. Use remarketing to recapture people who showed intent but didn’t convert.

7. Test smarter, not more often. You need to test 10 unique landing page variations to
find 1 top performer, but this goes far beyond changing a font color and calling it a
landing page variation.

8. Trim the fat in your account and ditch your lowest performers. Focus your energies on
the top 10% of landing pages that earn 80% of traffic.

9. Always, always keep your eye on the prize, which is making more sales or generating
leads most likely to convert to sales. Don’t let high conversion rates take precedence
over lead quality or you’re going to spend more qualifying leads. You need to find the
sweet spot where everything works like a well-oiled machine.
Now go forth confidently, young marketer, to slay competitors and wow prospects
with your newfound conversion optimization knowledge. Give our free Google Ads
Grader a spin to see exactly where you’re at with your current landing page strategy,
then start making smarter changes that will rocket you past your competition.
And as always, if you have any questions about our data, strategy or the tips outlined
above, fire away in the comments!