SaaS Conversion Rates – Industry Average

SaaS Conversion Rates – Industry Average

Conversion rate is an important indexing scale used by several marketing analogists to evaluate the effectiveness of marketing strategies for business growth. An advanced website or product with a stable conversion rate can be profitable for any business or company, whether small or multinational. Simply put, the better your conversion rate, the more effective your marketing will be in generating sales and leads.

However, expecting a 100% conversion rate is absurd because it is not possible to achieve even in the wildest dreams. The average SaaS conversion in several fields across multiple substitutes is 4.0 – 5.0%, while the highest can fly up to 7.5%.

Now you must be thinking, what is the impeccable conversion rate for a business? It highly depends on several factors and differentiates in terms of industry. But before diving into it, let’s shed some light on conversion rates and why these are significant for SaaS.

Conversion Rates & Their Influence On SaaS

People have a common misconception that the term “Conversion Rate” is very technical and has many complexities associated with it. However, it is just baseless, and we will convince you otherwise by simplifying it for you.

The conversion rate is a metric that computes the impact and influence of your business by dividing the total number of conversions by the total number of visitors. For every other SaaS business, the conversion rate will vary. However, SaaS organizations, weigh this percentage by calculating the ratio of visitors who turn into customers.

SaaS conversion rate is a standardized indicator that goes on several marketing channels then estimates and evaluates the actions performed there. The desired actions required for conversion rate include:

  • Newsletter subscription
  • Detailed product description
  • Free consultation
  • Several payment methods
  • Renewal of catalog

How Conversion Rate For SaaS Works?

Conversion rate is a very important tactic that evaluates the position of your business in the market. This only works for you if you are a SaaS business a service based business has a completely different criteria. Here is a how simple formula calculates it:

Conversion rate = total number of conversions/total number of visitors

However, this formula might vary depending on your company, vision, objectives, and reputation.

The percentage of visitors that become potential customers and are associated with your services and how companies calculate conversion rates with SaaS. Most businesses relying extensively on SaaS evaluate their conversion and growth based their sales, which is not right.

With the help of their SaaS analytics and several analytical tools, marketers and analysts evaluate the conversion rate of each channel, CTA, and audience subdivision to determine the overall performance of marketing efforts. Marketing strategists can also avail this information to generate more leads and get higher conversion rates.

Higher conversions rates don’t mean your sales would increase too. Given that the freemium models are a hit the SaaS industry. Some consumer will always remain as freemium users, resulting in no sale. But the traffic and conversion both stand high when people use the freemium approach while increasing your reviews and traffic for free. As a result, your Software becomes popular and allows more people to try and buy it. This is why SaaS businesses are more concerned about the optimizing their conversion rates rather than boosting their sales.

Are Conversion Rates Important For SaaS?

For any business or company of any scale, their major target is constant growth. They all want to evolve every step of the way and raise their revenue over time. And all companies are working effortlessly to make a name and capitalize magnificently. Increased conversions help generate more revenue in that compartment, leading to growth in this digital realm.

Conversion is about transformation, from just a site visitor scrolling through the options to be a consumer. Because the amount of conversions is directly related to the money generated by a SaaS business, that’s the main reason why successful SaaS enterprises cling to this approach.

Let’s break it down a little more with some practical examples. Let’s imagine your website receives 50 visitors daily on average. And around four to five of these visitors incline towards your services and buy something from you every day. So your conversion rate will be approximately 9 to 10%.

However, it can be done by various optimization methods if you want to improve your company’s conversion rate. As a SaaS business owner, you need to understand the market and competition when looking for better conversion rate strategies in the service-based industry.

And if you are wondering if these tactics work for SaaS and magnify your conversion rates, it does. Identifying the major factors causing people to close your website and then optimizing your SaaS in a way that caters to these factors can easily increase your conversion rate to 30%. Always remember first impression is the last impression, when you want to increase your conversion rates. Make sure your visitors are impressed as soon as they see your product (service).

What Is A Good Conversion Rate ?

It is a highly competitive era, where every business is trying to get on top by investing thousands in marketing and advertising. Still, in the end, it all depends on the conversion rate. The fate of your company is decided by it if you are a SaaS company.

We can’t define a good SaaS conversion rate because it is never constant and depends upon several factors like the market, competition, services, location, etc. However, a good conversion rate depends upon the industry and the market, but the overall conversion rate between 4-8% is good. It means that you are performing exceptionally well compared to most SaaS industries.

If we look at the current situation, many businesses are doing pretty well and gaining popularity over several platforms. It is only because of the conversion rates; luckily, these companies can achieve a good ranking because of their statistical and creative approach. Some of those SaaS firms with excellent conversion rates are listed below:

  • Slack
  • Dropbox
  • Spotify
  • Google Drive

Did you ever buy any of these? No! In fact, more than 90% of the world’s population used Google for free, but stands as one incredible thing used worldwide. There is no direct sales but the highest conversion rate, more than any other software based service. Currently, there are more than 5 billion Google drive users, and that keeps on increasing.

Primary Industry Standards For SaaS conversion rates

SaaS business models for businesses are majorly classified into two major distinctions. Both of these types completely vary from one another and cater to a different sets of working environments. These two basic types are low-touch and high-touch SaaS models.

Low-touch SaaS Model

This model focus on marketing with little to zero percent engagements. The primary sales approach is to provide a free trial, marketed via email and digital marketing. By enhancing the in-product experience and often inserting CTAs within the product, the prospect is motivated to purchase a subscription.

Examples: Basecamp, Trello, Jira, and Unicorn Train

High-touch SaaS Models

It is more like a high-end model focusing on an advanced traditional marketing and sales approach. To pre-appoint demos and follow-up meetings, the sales staff cold contacts prospects or receives leads from marketing. The emphasis of the high-touch model is on enterprise-level demonstrations and directly influencing sales. However, the packages are customized by sales representatives.

Examples: AppDynamics, Salesforce, and Reachbird

How To Optimize SaaS conversion rates ?

Marketing for you Software as a Service product is one of the preeminent ways to boost your SaaS business. However, when it comes to increasing your SaaS conversion rates, it can be a little tricky, but if you make up your mind and put in all the effort, nothing is difficult. We are listing down some basic tricks that can increase your SaaS conversion rates.

  • Make your landing page simple, brief, and easy to read.
  • Use emotions and anticipation in the text of your landing page.
  • Use concise sign-up forms.
  • Customize the free trials.
  • Frequent testing and tracking.
  • Reassess your product-market fit.
  • Monitor CAC and DAU constantly.
  • Identify unqualified conversions.
  • Focus on easy accessibility.
  • Use empty states to your advantage.
  • Be detail oriented and use a success-driven approach.
  • You can increase your conversion rate by implementing the strategies above and finding the ones that work best for your business.


SaaS conversion rates must be measured and optimized frequently because a greater conversion rate leads to faster growth. The effectiveness of the website and landing page also contribute to it. So, ensure that you are catering to all the critical needs and ensuring that you have a good SaaS conversion rate rather than higher sales. If you need some help regarding it, Rank Top SEO is there to guide you completely.

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SaaS Conversion Rates – Industry Average

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