Really dumb question: How to calculate conversion ratios?

[videosc]

I'm kind of embarrassed to ask this but here it goes:

When I see stats for affiliate conversions/sales like 1:250, 1:500, etc. what exactly does this mean and how do you get those numbers?

Here's what I always thought it meant: the example 1:250 means that for every 250 unique hits to a site I got one sale/join. To get that number you divide the total number of hits by number of sales/joins, so 2500 unique hits in one year with 10 joins is how you get 1:250.

Another example: the ratio for 856 unique hits with 3 sales would be 1:285.33.

Does this all sound about right? Sorry again if this is a super basic question but I recently started to doubt that I'm figuring conversion ratios correctly so I thought this might be a good place to ask. Thanks!

[bigPunk]

Originally Posted by videosc

Here's what I always thought it meant: the example 1:250 means that for every 250 unique hits to a site I got one sale/join. To get that number you divide the total number of hits by number of sales/joins, so 2500 unique hits in one year with 10 joins is how you get 1:250.

Another example: the ratio for 856 unique hits with 3 sales would be 1:285.33.

You are correct sir.

[anthony78]

It is very correct, you are a very good at math!

[j3rkules]

You are correct. I see in the mainstream many people also use this formula:

Conversion Rate = Total Number of Sales / Number of Unique Visitors * 100

Example: If you made 40 sales in a month and you had 4,000 unique visitors to your site, your conversion rate would be 1%.