You must know about the conversion rate which has become the most important web metric in a website. A good conversion rate is important for your long term business success as conversions lead to sales and sales leads to profits.
Conversion rate is measured in % which is equal to the (Number of Successes/ Total number of website unique visitors).
But do you know about how much conversion is OK or enough for your business?
Your conversion rate should be high enough to stay profitable for your venture. It can only be 1%, 2% or 3% or you may require a 20% conversion rate to be profitable because the higher the rate you actually achieve, the more will be good but yes, a zero conversion rate is really not good.
Just take an example:
Total profit in 1 year = Total sales in 1 year – Total operating cost
Total sales in 1 year = Total unique visitors x Conversion rate x Average dollars per sale
If you think that a low conversion rate causes a low profit every month/ year then it might not be the real problem. It doesn’t matter how high your conversion rate:
1. If your total number of visitors is very low, you might not get a profitable number of conversions. You might need to review your targeted keywords, or your website. Update the content on a periodic basis.
2. If the prices of your goods are very low compared to what is considered profitable and competitive then you will have a problem to have a profit. So, consider looking at how your competitors price the item and decide on the most competitive pricing.
3. If you have an extremely high operating cost then you will have a problem to have a profit. So, look at your expenses and double checking the real value before you spend money on something for your business.
So, consider all these points to make you more and more profits.