The Analyst's Path

Glossary

Conversion rate

M5.05 · M4.02

Also called conversion, purchase conversion.

The proportion of visitors who buy.

A store receiving 80 lakh visits and completing 22 lakh transactions converts at 27.5%.

Together with traffic and basket size it decomposes revenue into three levers that can each be managed separately, which is why retailers and e-commerce businesses track all three rather than only sales.

Improvements in conversion are the cheapest form of growth, since the visitor has already been paid for.