Conversion Rate

What is conversion rate? 

A conversion rate is the percentage of users who have completed an action (called a conversion event) such as clicking on an ad. 

Conversion rate equals the total number of users who convert / the total number of the audience.

For example, if a mobile ad campaign on Facebook reaches 10,000 viewers and a total of 400 users click on the ad, the conversion rate is 400 / 10,000= .04, or a 4% conversion rate.

Why are conversion rates important?

Conversion rates allow you to compare and contrast the performance of multiple advertising channels. They can be particularly valuable when running mobile user acquisition campaigns because they can measure the success of each campaign. They can also be used to set ROI expectations when scaling a campaign.

Conversion rates can be clicks or conversion events further down the funnel. For example, you could calculate the percentage of users who installed an app or completed an action in the app, which can help both advertisers and marketers identify valuable users. 

This data can then be used to: 

• Optimize targeting
• Reveal which channels are the most effective for promoting an app
• Determine the effectiveness of ad copy
• Make strategic designs
• Optimize overall campaign performance
• Identify issues in an app’s UX

No single conversion rate can identify success across the entire mobile advertising industry, but researching industry benchmarks and vertical-specific conversion expectations can help you compare these figures against the performance of your in-house advertising campaigns across a selection of channels and advertisers.