Incremental Conversion Rate

Definition

Incremental conversion rate measures the share of conversions that would not have happened without ads.

Formula

Incremental conversion rate = incremental conversions / total conversions

Example

If 120 conversions are incremental out of 400 total, incremental conversion rate is 30%.

How to use it

• Estimate with holdout or lift tests instead of attribution alone.
• Use the rate to adjust reported ROAS to true incremental ROAS.
• Track it by channel; incrementality varies by intent and audience.
• Track by cohort and audience maturity to avoid overstating new-user impact.
• Recalculate after creative, offer, or bidding changes that alter user mix.
• Report confidence intervals to reflect test uncertainty.
• Use the rate to set scaling thresholds for incremental profit.

Common mistakes

• Assuming last-click conversions are all incremental.
• Ignoring conversion lag when measuring incremental impact.
• Using short windows that miss delayed conversions.
• Comparing incremental rate across channels with different test designs.
• Treating small lift tests as definitive for large budget shifts.
• Ignoring differences in average order value across test groups.

Why this matters

This term matters because it affects how you interpret performance and make budget decisions. If you use inconsistent definitions or windows, ROAS/CPA can look "better" while profit gets worse.

Practical checklist

• Write a 1-line definition for "Incremental Conversion Rate" that your team will use consistently.
• Keep the time window consistent (weekly/monthly/quarterly) when comparing trends.
• Segment results (channel/plan/cohort) before drawing big conclusions from blended averages.
• Use a calculator that references this term (e.g., Incrementality Lift Calculator) to sanity-check assumptions.
• Read the related guide (e.g., Attribution vs incrementality: what to trust, when, and how to test) for context and common pitfalls.

Where to use this on MetricKit