What are conversion rates, and how are they calculated?

Conversion rates are a key performance metric in digital marketing, specifically in advertising campaigns. They quantify how effectively a campaign persuades users to complete a desired action, such as making a purchase, signing up for a newsletter, or downloading an app. The conversion rate is calculated by taking the number of conversions—those desired actions completed—and dividing it by the total number of visitors or interactions, then multiplying by 100 to express it as a percentage.

Choosing the correct answer ties directly to this definition. By focusing on the percentage of users who take these specific desired actions, conversion rates provide insights into the effectiveness of ad campaigns in engaging target audiences and driving actions that support business goals. This metric allows marketers to evaluate and optimize their strategies, ensuring resources are utilized effectively to enhance user engagement and maximize returns on investment.

In contrast, the other options do not accurately represent what conversion rates measure or how they are calculated, as they pertain to different aspects of performance metrics like brand awareness, audience interest, or ad visibility, rather than the specific actions users take in response to an ad.