What is Conversion Rate Optimization (CRO)

Today, let’s dive deep into the world of Conversion Rate Optimization (CRO), a powerful methodology designed to boost your sales. Understanding CRO can be complex, so let’s learn together how to start your CRO strategy, and some hacks to increase your platform’s conversion rate.

What is CRO

CRO is a methodology aimed at improving the profitability of any digital platform through continuous improvements identified in each process of the conversion funnel. In other words, CRO consists of a set of procedures used to make the digital platform increasingly profitable, whether by removing barriers or optimizing processes, which can range from analyzing the technology used to the usability of the platform.

Basic concepts of CRO

First thing you need to know before implementing a CRO strategy is what is your digital business goal. Every digital platform, from an online hotel finder to a dentist’s website, must have a clear objective. What do you want to achieve? How will you achieve it, and most importantly… how will you generate revenue?

It is crucial to understand that to meet your goal, users must perform macro-conversions, which might seem obvious but involve several micro-conversions.

For instance, if you run an eCommerce, your goal is to sell a product (macro-conversion), but several actions must take place first (micro-conversions). What if you sell offline services? Understanding your goal is key to identifying your macro-conversion, and from there, you can start working on the micro-conversions.

What are conversions

One of Spain’s foremost experts on CRO, Ricardo Tayar, in his book “CRO. Design and Development of Digital Businesses,” defines conversion as:

“Conversion is the act of successfully completing an important action or task aimed at achieving a business goal on our digital asset, whether it’s a website or an app.”

Conversions come in two types:

• Macro-conversions: These are directly linked to the business goal. For Begoña’s jam eCommerce, macro-conversions would be the sales made through her online store.
• Micro-conversions: These are all the actions taken before achieving a macro-conversion. For Sarah, these could include the number of unique visitors viewing a product, adding a product to the cart, filling in details in the cart, and the number of visitors who complete the payment process.

As explained by Raúl Yañez, CEO of Comunicare, “micro-conversions are fundamental in understanding how our business model works. The most successful companies are those that understand in detail all the stages a customer must complete before reaching the final goal we have set: the sale.”

How to calculate Conversion Rate

The Conversion Rate is the percentage of visitors who do what we want them to do on our website. It measures the ratio of conversions to total visitors.

The formula for the Conversion Rate is:

Conversion Rate = (Conversions / Total Visits) X 100

Important: Do not fall into the trap of measuring only the Conversion Rate of your macro-conversion. The conversion rate will help you measure micro-conversions such as product viewing, adding to cart, downloading whitepapers, or subscribing to newsletters.