Conversation Rate: The New Bar for Marketing Engagement

The explosion of ChatGPT, Generative AI and Conversation Automation across the business landscape is reshaping the way we perceive and evaluate the metrics that truly matter in Marketing and in measuring funnel quality. 

Most funnel-focused Marketing executives have historically needed to rely on industry-standard metrics and proxy indicators to assess campaign impact on the funnel: click-through rate, web traffic, social engagement and the number of marketing-qualified leads (MQLs).

These metrics were revolutionary when they first debuted, offering a level of visibility to the “ingredients” of a campaign that Marketers just didn’t have access to before. For the last 20 years, they’ve been staples but they miss the mark with the modern consumer and are getting a well-deserved downgrade in importance.

The End of Opens & Clicks 

With the rise of new technologies, privacy drivers and the increasing competition for mindshare, the metrics we’ve relied on for so long are starting to fail us. In today’s highly digital world, they run shallow, lacking the fidelity we need to identify and capitalize on true interest and most importantly, true two-way engagement.

Let’s take click-through rate as an example of an antiquated metric that’s becoming increasingly meaningless. In the past, click-through rate served as a valuable measure of campaign success for email marketing. But with the advent of spam filters, privacy blockers and application platforms like Apple’s ecosystem, it has become a world of false positives and positive falsehoods.

New Marketing technologies like Conversational AI enable brands to have powerful two-way conversations with customers and prospects to meet the modern consumer experience expectation. And with these technologies has come the next generation of metrics for Marketing teams.

At Conversica, we have witnessed the immense value these new metrics provide to our customers in managing their company revenue funnels effectively, adding a level of detail that just wasn’t possible in the old world.

In my blog series The Funnel Files, I’m exploring several of these “new” metrics, starting with Conversation Rate.

Defining the Metric

So, what exactly is Conversation Rate? Let’s explain it both verbally and mathematically. 

In essence, Conversation Rate is a method of measuring how many of your prospects or contacts you engage in conversation. It’s the most powerful quality engagement metric because it measures two-way interactions and conversations rather than shallow leading indicators like an open or a click. 

So when you compare click-through to Conversation Rate, you’re looking at two metrics that measure engagement, but on two different levels. It’s not apples to apples—more like apples to apple pie. Think of it as a sliding scale: opens are the baseline of interest. Clicks are a tad bit better. A two-way conversation is towards the high end of the scale, and Conversation Qualified, when the contact actually self-identifies as ready for the next step (e.g., a meeting with a Sales rep), is at the very top.

Now that we understand what we’re talking about, let’s look at the math.

Calculating Conversation Rate is very straightforward, but very difficult to track outside of a Conversational AI platform. Divide the number of leads that respond to your outreach by the total number of leads messaged and multiply by 100 to get the percentage. 

The Value of Conversation Rate

When was the last time a lead responded to your product update asking to set up a meeting with Sales? I’m willing to bet never. But with AI-powered Conversation Automation, these two-way interactions are commonplace and executed at scale. 

You can’t measure that kind of engagement with old-school metrics—it goes way beyond an email open or a click. When you’re leveraging Conversation Automation, the Conversation Rate becomes your method to track the number of genuine two-way conversations taking place. This signifies a deeper level of engagement than a click and opens up a world of opportunities beyond email interactions alone. It delivers a one-to-one, concierge experience to each of your leads via whatever channel the contact prefers, scaling infinitely in a way that no human-only team could replicate.

By leveraging Conversation Rate as a metric, marketers gain true visibility into how their engagement tactics drive real, meaningful interactions.

With these new technologies and more precise metrics, marketers can gauge the effectiveness and impact of their campaigns on the entire business funnel. Conversation automation enables:

1. Improved execution through better signals: By leveraging Conversation Rate, marketers can fine-tune their strategies based on the insights derived from meaningful engagements. This leads to more effective and targeted campaigns.
2. Deeper alignment and productivity of revenue teams: Conversation Automation fosters better collaboration between marketing and sales teams, enabling them to work cohesively toward revenue generation. The insights derived from the Conversation Rate can inform sales strategies and improve overall revenue performance.
3. Enhanced intelligence on lead quality: The two-way conversations facilitated by conversation automation provide valuable insights into the quality of leads. Marketers can assess the level of interest, intent and qualification through meaningful interactions, leading to better lead nurturing and conversion rates. We call this “Conversation Qualified” and believe this will make MQLs a thing of the past.
4. Streamlined and efficient funnel management: By focusing on Conversation Rate, marketers gain a holistic understanding of the entire customer journey, from initial contact to conversion. This allows for more efficient funnel management, as they can identify bottlenecks, optimize touchpoints and create a seamless experience for prospects.

The Bottom Line

Just as digital marketing breakthroughs have introduced new metrics in the past, Conversation Automation brings its own set of metrics to the forefront that are more powerful than anything Marketing has seen before. These metrics offer a much richer perspective due to the inherent two-way interaction, enabling marketers to measure true engagement beyond the limitations of MQL scoring and click-through rates.

Marketers need to embrace these new metrics now to pave the way for a better future of marketing engagement. By leveraging Conversation Rate, businesses can foster deeper connections, drive meaningful conversations with insight into messaging that works, and ultimately, achieve greater success and impact in their marketing efforts.