To fully understand what a conversion rate is, we must first understand what conversion is. A dictionary definition of conversion is the act or an instance of converting or the process of being converted.
In marketing, the act typically applies to a potential prospect or lead and the instance typically applies to the moment they convert from being a prospective lead into an actual customer who has made a purchase.
A conversion rate is a simple calculation resulting in a percentage. Conversion rates are calculated by taking the number of conversions (the marketer's ultimate goal) and dividing that number by the total number of opportunities there were to convert over the same length of time.
For example, an online marketer would calculate their conversion rate by taking the number of users who have taken action to make a purchase and are now their client or customer and dividing that number by the total number of users who have visited their website during any given time frame.