Lead Conversion Rate: Formula, Examples and How to Improve It

The lead conversion rate formula

Lead conversion rate = customers won from a group of leads ÷ total leads in that group × 100.

Example: you received 120 enquiries in July, and 18 of them became customers. Your July lead conversion rate is 18 ÷ 120 × 100 = 15%.

Count the customers who came from that group of leads, even if they signed in August. Dividing August’s sales by July’s enquiries mixes two groups and gives a number that rises and falls for no real reason.

Win rate: the number that ignores leads still open

Conversion rate counts every lead, including the ones still being worked on, so it looks low for recent months. Win rate looks only at leads that have reached a decision.

Win rate = leads won ÷ (leads won + leads lost) × 100.

Example: of those 120 July enquiries, 18 were won, 62 were lost and 40 are still open. The win rate is 18 ÷ (18 + 62) × 100 = 22.5%. Use win rate to compare sources and salespeople, and conversion rate to plan how many leads you need.

Practical tipMark leads Lost when they are truly lost, with a reason. A pipeline full of leads nobody closed makes both numbers unreliable.

Conversion by stage: find where leads stop

One overall number hides where the problem is. Count how many leads reach each stage and the rate between each pair of stages.

• New → Contacted: low here means slow or missed first calls.
• Contacted → Qualified: low here means the wrong leads, or questions that are not being asked.
• Qualified → Proposal: low here means the quotation takes too long to go out.
• Proposal → Won: low here means price, scope or follow-up after the quotation.

Conversion by source: which leads are worth paying for

Ad leads, marketplace enquiries, referrals and website forms convert very differently. A source that sends many leads but few customers can cost more per customer than a smaller one.

Example: Meta ads sent 80 leads and 4 customers (5%), referrals sent 15 leads and 6 customers (40%). Divide what you spent on each source by its customers, not its leads, to see what a customer really costs.

What is a good lead conversion rate?

There is no single good number. It depends on the source, the price of what you sell and how qualified the enquiry is when it arrives. Published averages mix industries and definitions, so they are a poor target.

Compare yourself with your own last quarter instead, source by source. A rising win rate on the same sources is real progress; a rising conversion rate from cutting junk leads out of the count is not.

How to improve lead conversion

Most small businesses lose more leads to process than to price. These changes usually matter most:

• Reply faster. A first call within minutes reaches people while they still remember enquiring.
• Give every lead one owner, so nobody assumes someone else called.
• Book a next step with a date on every lead, every time.
• Send the quotation within a day of the meeting or site visit, and follow up on a schedule.
• Record why leads are lost, and fix the most common reason first.

Practical tipSee how quickly you should respond to a new lead and the quotation follow-up templates for the two stages where most leads are lost.

Tracking it without a spreadsheet

In a sheet, these numbers need a stage column, a source column, a lost reason and a pivot table that someone keeps up to date. In WTS CRM, owners and admins get an Analytics page with the lead funnel by stage, each source’s leads, wins and win rate, the reasons leads were lost and the call results per person. Stage, source and lost reason are recorded as part of working the lead, so nobody has to fill in a report.