Definition
The expected results are divided by the ratio of possible actions (e.g. SQL/MQL), which measures the quality and validity of the material or clues.
In detail
Conversion rate is a key metric for measuring the effectiveness of marketing or sales activities, defined as the number of desired outcomes divided by the number of possible actions, such as the proportion of sales leads that become opportunities. It helps evaluate the quality of materials, lead quality, and sales process efficiency. Unlike process metrics such as click-through rate or impressions, conversion rate focuses more on outcomes; compared to lagging indicators like customer satisfaction, it more directly reflects the current health of the funnel. Typical output is a conversion rate report for each stage, used to optimize sales strategy.
Example in practice
The marketing department ran two ad creatives. Creative A generated 100 clicks, of which 10 converted to sales leads; Creative B generated 80 clicks, of which 20 converted to leads. By calculating conversion rates, it is found that Creative B has higher quality, so the budget is shifted toward B, improving overall lead quality.