Definition
The percentage of people who click or receive a referral link that go on to become active customers.
Formula
New active users from referral / Total referral link clicks x 100
How to measure
Track referral link clicks and tie them to downstream signup and activation events using the referral code or link parameter.
Why track it
This shows whether the referral channel is producing genuinely engaged customers or just low-quality signups drawn by an incentive.
Example
A referral program with 2,000 link clicks converting 300 into activated users reports a 15% referral conversion rate.
FAQ
- What is Referral Conversion Rate?
- The percentage of people who click or receive a referral link that go on to become active customers.
- How do you calculate Referral Conversion Rate?
- New active users from referral / Total referral link clicks x 100
- Why track Referral Conversion Rate?
- This shows whether the referral channel is producing genuinely engaged customers or just low-quality signups drawn by an incentive.