A Conversion Rate is the percentage of people who perform a desired action.
An example of this would be if I had a newsletter on my site that I wanted people to sign up for. I could look at the conversion rate and see what percentage of people who come on my site sign up for the newsletter.
This can be a good way to see whether your goal for your website is being met. It also enables you to notice if things are not working the way you hoped so you can make changes.