“What’s a good conversion rate for my lead gen campaign?”
We hear that question a lot at Capterra. Conversion rate – calculated as the percentage of website visitors who fill out a form on your website to become a lead – is a great indicator of a campaign’s success, so it’s no wonder everyone wants to compare theirs to the competition and the mythical universal average.
Of course, like all metrics, comparing conversion rates is not always comparing apples to apples; sometimes it’s like comparing apples to bowling balls! Conversion rate averages can vary across industries, products, ad channels…the list goes on.
That being said, within the business software industry, conversion rates tend to fall in a fairly consistent range. Based on our own numbers, surveys, and external insights, here are some benchmarks you can use to compare to your campaign’s performance.
Average Software Industry Conversion Rates
Since Capterra is an advertising channel for the B2B Software industry, our conversion rate average can provide a pretty accurate picture of the software industry’s lead gen performance.
While conversion rates on Capterra do vary across the 300+ software directories and by ad rank, as a whole, our PPC advertisers see an average conversion rate of 7%.
Of course, like all other ad channels, that rate does vary. 7% is a strong conversion rate, and we typically suggest that advertisers shoot for somewhere in the 5-10% range, but we have seen software marketers reach 20%+ conversion rates on our site.
That 7% average conversion rate is reflected in a MarketingSherpa study on website conversion rates, too:
The Software/SaaS industry average website conversion rate outperforms half of the industries represented in this study.
But as MarketingSherpa points out, a lot depends on the definition of “conversion” in these industries. Perhaps a conversion for the Financial Services industry is just an email address, while for Retail it’s everything from name and address to buying preferences.
Another important part of tracking performance is looking at conversion rates at each stage of the sales process, shown here with data from software lead generation campaigns on Capterra:
Not surprisingly, it’s much harder to convert top-of-funnel visitors compared to those farther along in the sales funnel. That’s evidenced by the fact that just 7% of web traffic was converted into a lead, compared to the 36% of those leads that were then qualified into a sales-ready opportunity.
But put it in perspective: once you get that crucial contact info and you’re able to qualify them, you’re working with someone who wants to hear from you and wants to learn more about your product. So moving a known prospect over to the sales team becomes a lot easier than convincing an unknown visitor to fill out a form.
The important thing to take away from this data is to not just compare your industry against another, as your lead gen goals may differ. As a software company, you may need more or less info than a nonprofit organization. Collecting the information needed to qualify a lead is more important than trying to attain an unreachable conversion rate of a completely different industry.
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Average B2B Conversion Rates Differ By Channel
While 7% is a good benchmark for a software website conversion rate, that number can differ drastically depending on the ad channel. For example, WordStream did an analysis of B2B conversion rates on thousands of Google AdWords accounts.
They found that the average conversion rate for B2B advertisers was just 2.23%, with the top performing accounts reaching 11.7%. Of course, 2% to 12% is a pretty big range in performance! Also, it’s considerably less than the averages I shared above for the software industry. You can account for some of the disparity because WordStream looked at all types of B2B AdWords accounts, not just those in the software industry.
But most of the disparity comes from the difference in ad channel and quality of traffic that comes from an AdWords campaign versus any visitor to a software website.
Does the landing page provide the info they were expecting based on the ad copy and the keyword they searched? Is there a strong offer that they’d be willing to submit their contact info for? If you’re getting lots of clicks, but no conversions, you probably need to make some changes to increase conversions with your landing page.
How Not to Benchmark
Seeing all of these numbers, it’s hard not to compare and judge your campaign’s performance, but make sure you’re considering all of the factors that go into that conversion rate.
For example, Capterra’s average conversion rate can be higher than other channels because we target software buyers, so the web visitors we get are more likely to click through and convert than those from AdWords. That doesn’t mean your AdWords campaigns are performing poorly; the traffic and leads are just different, so your data will reflect that.
Judge the performance of your campaigns based on your success metrics and goals, not the industry averages and benchmarks. I’ve provided this data to help you get an idea of what the landscape is like for similar campaigns, not as a right or wrong answer for how your campaign is performing.
Quick Tips to Improve Your Conversion Rate
If you’re not happy with your campaign’s performance or you think there’s room for improvement, here are a few easy A/B tests to run to increase your conversion rate:
- Form length: Too many fields can discourage leads from submitting their info, which means you lose out on a potential sale. We recommend 3-5 fields, at most, but test what optimizes your conversion and qualification rates.
- Call-to-Action: “Free Demo” or “Free Trial”? “Buy Now” or “Sign Up Now”? Your CTA plays a big role in getting those conversions, since it dictates what your prospects are expecting from that click. Test a few offers to see what drives conversions best. But don’t promise something you can’t follow through on: if you don’t have a free trial, don’t offer one!
- Trust elements: First of all, if you don’t have any trust elements on your page, like testimonials or customer logos, add them NOW! Then, you can test how they affect your conversion rates. Next to the form? At the top or bottom of the page? Only testing will help you learn which kinds of trust elements and their location optimize your conversion rate.
What other research have you seen about average conversion rates? How has your business used this data for your lead gen campaigns? Share your thoughts and experiences in the comments below.