SEOmoz user chenry posted some i8nteresting data showing captcha’s effect on conversion rates vs. reduction in spam. Chenry was given the task of eliminating spam that was being submitted through a web form. Disliking the captcha solution, he decided run a test to compare the data after adding captcha for a period of time, with data captured after turning captcha off. He made the following observation:

From the data you can see that with CAPTCHA on, there was an 88% reduction in SPAM but there were 159 failed conversions. Those failed conversions could be SPAM, but they could also be people who couldn’t figure out the CAPTCHA and finally just gave up. With CAPTCHA’s on, SPAM and failed conversions accounted for 7.3% of all the conversions for the 3 month period. With CAPTCHA’s off, SPAM conversions accounted for 4.1% of all the conversions for the 3 month period. That possibly means when CAPTCHA’s are on, the company could lose out on 3.2% of all their conversions!

The important data point seemed to be this: “159 total failed conversions while the CAPTCHA was on”. There were no failed conversions when captcha was off, but they also got the spam. Interesting observation, and a number that’s pretty significant if we’re talking missed sales or signups I suppose.

Read the article for a look at the data and comments.