To begin, it is important to know what exactly a conversion is, and that conversions can be illustrated in many different formats. A conversion is described as a point in time when a consumer of the marketing action performs the desired response. In simple terms, it’s the point in time when a recipient responds to the call-to-action put in place.
A conversion can be depicted as:
So when considering the average conversion value of your business call-to-actions it is imperative to know how to not only find the rate but what rate is considered “good”.
To calculate the average rate of conversions you simply take the number of conversions divided by the total number of customer interactions with the advertisement.
Many businesses find conversion rates between 2-5% on each individual tactic. This may seem incredibly small but it’s almost impossible to obtain a 100% average conversion rate. This is because a large majority of the impressions gained on the ad may not choose to complete your desired action. So small rates or increases within your conversion value will be incredibly helpful to drawing traffic and purchases to your business.
How is ACV calculated?
ACV is calculated by dividing the total revenue generated from conversions by the total number of conversions.
What are some ways to increase ACV?
Some ways to increase ACV include offering higher-priced products or services, upselling customers on additional items, and improving customer service and satisfaction.
Fun Fact:
According to a study by OptinMonster, "Average conversion value (ACV) is one of the most important metrics for marketers to track. It measures the average amount of money that customers spend when they convert on an offer or purchase a product." (https://optinmonster.com/average-conversion-value/)