Experienced online marketers often use in their work such a notion as website conversion. In particular, conversion rate optimization is one of their key tasks. In this article, you will learn why do they care so much about conversion and how it affects sales.
First of all, this post is for those who in addition to understanding the nuances of the notion and role of conversion also want to learn how to set, optimize, and assess it, or get useful tools to do this. Our article will come in handy to both newbies and experienced online marketers.
So let’s imagine a situation. An online store owner hires an irresponsible manager who does many mistakes processing requests, skips some messages, and is rude to customers. The business owner has no time to monitor other’s work since he is busy with the launch of a new advertising campaign worth $3000 per month. Here is the result: before the launch of the ads, monthly income was $20,000, and after that – $22,000. If to subtract from this sum the advertising cost, you’ll get the net monthly income of $19,000. Thus, after the launch of the ads and engaging new customers, the entrepreneur lost $1,000. Unfortunately, this is a common scenario for many commercial websites.
The Negative scenario of website development
And now let’s suppose that before the launch of the advertising campaign, the business owner had decided to optimize business processes, checked the work of his employees, and substituted the irresponsible manager. Here what we get: before the optimization, the monthly income reached $20,000, and after the optimization – $22,000. In this case, the net monthly income increased by $2000. It is reasonable to launch ads, attract customers, and increase sales only when the business processes are fine-tuned. This is the scenario of competent entrepreneurs who know how to optimize conversion rates and want to get maximum income from the existing resources.
The Correct scenario of website development
Conversion rate optimization is a basis inevitable to create a stable sales funnel. Below we will talk about this in more detail. You will find out what is conversion and why you should monitor it. Also, we will take a look at the best tools for conversion rate optimization and give useful tips on how to improve conversion rates.
What is conversion?
Conversion is the main indicator of the effectiveness of a launched website. It shows the connection between the number of website visitors and the number of completed target actions. Target actions are any processes that can be tracked with available metrics. For example, you can calculate a sales conversion rate. At the same time, you won’t be able to count the number of visitors who went to competitors after visiting your website and for some reason purchased on their pages.
There are numerous types of conversion. All of them differ depending on the target action to be measured. To calculate conversion, a conversion rate is used. This is an imputed value calculated by dividing a certain target action by the number of people who could do it. To give you a better insight, we will provide a table of popular types of conversion, indicate their purpose, define conversion rate formula, and complement all calculations with examples.
|Sales Conversion||Calculates website profitability||The number of purchases is divided by the number of website visitors and multiplied by 100%||During a month, a website had 1000 visitors who made 100 purchases. You need to divide 100 purchases by 1000 users and multiply by 100%. The conversion rate is 10%.|
|Request Conversion||Defines the effectiveness of selling elements on all landing pages||The number of requests is divided by the number of website visitors and multiplied by 100%||During a month, a website had 1000 visitors who left 200 requests. You need to divide 200 requests by 1000 users and multiply by 100%. The conversion rate is 20%.|
|Registration Conversion||Defines the effectiveness of a registration form||The number of registered users is divided by the total number of website visitors and multiplied by 100%||During a month, a website had 1000 visitors. 500 of them completed the registration. You need to divide 500 registrations by 1000 users and multiply by 100%. The conversion rate is 50%.|
|Page Visit Conversion||Defines the effectiveness of the settings that forward visitors to a certain page||The number of visitors of a certain page is divided by the total number of website visitors and multiplied by 100%||During a month, a website had 1000 visitors, and 800 of them opened the pricing page. You need to divide 800 visits by 1000 users and multiply by 100%. The conversion rate is 80%.|
|Subscriber Conversion||Defines the effectiveness of a subscription form||The number of subscribers is divided by the number of website visitors and multiplied by 100%||During a month, a website had 1000 visitors, and 350 of them subscribed. You need to divide 350 visits by 1000 users and multiply by 100%. The conversion rate is 35%.|
|Call Conversion||Defines the importance of phone support provided by website managers||The number of callers is divided by the number of website visitors and multiplied by 100%||During a month, a website had 1000 visitors, and 50 of them used phone support. You need to divide 50 callers by 1000 users and multiply by 100%. The conversion rate is 5%.|
|Inquiry Conversion||Defines the frequency of customers’ written requests to support managers||The number of written requests is divided by the number of website visitors and multiplied by 100%||During a month, a website had 1000 visitors, and 5 of them contacted the support through messages. You need to divide 5 requests by 1000 users and multiply by 100%. The conversion rate is 0.5%.|
|Social Media Effectiveness Conversion||Defines how many visitors came to a website from social media||Calculate the number of customers who originate from social media. Then divide it by the total number of website visitors and multiply by 100%.||During a month, a website had 1000 visitors. 950 of them came from social media. You need to divide 950 transitions by 1000 users and multiply by 100%. The conversion rate is 95%.|
|Conversion of Third-Party Resources Effectiveness||Defines how many visitors came to a website from third-party online resources||Calculate the number of visitors from third-party resources. Then divide it by the total number of website visitors and multiply by 100%.||During a month, a website had 1000 visitors. 450 of them came from partner resources. You need to divide 450 transitions by 1000 users and multiply by 100%. The conversion rate is 45%.|
|Ads Conversion||Defines the number of visitors who landed on a website through advertising||Calculate the number of visitors who came through the placed ads. Then divide it by the total number of website visitors and multiply by 100%.||During a month, a website had 1000 visitors. 650 of them came from online ads. You need to divide 650 transitions by 1000 users and multiply by 100%. The conversion rate is 65%.|
Conversion is an auxiliary tool that cannot be assessed separately from sales volume and income. Otherwise, you may get a wrong understanding of the quality of website development:
- For example, let’s take two websites with 1000 visitors/month. On the first website, 500 users left purchase inquiries, while the second one got 100 requests. If we show these numbers in the form of a request conversion rate, the first resource will be five times more effective than the second.
- And now let’s take a different look. On the first website, out of 500 requests, only 50 people made a purchase whereas on the second resource all 100 requests were successful. If you calculate these numbers as a sales conversion rate, you will find out that the second website is two times more effective than the first one.
- And what about the income? Let’s assume that 50 users from the first website purchased goods amounting to $10,000 whereas the cost of the products bought on the second website is only $1000. Then the first resource is more effective since it is 10 times more profitable than the second one.
Conversion is a set of useful statistics intended to help companies grow. If you take steps to improve online conversion and at the same time continue monitoring the income, your company will develop in the right direction. If you only worry about the conversion rate growth forgetting about the income, you are very likely to have problems with your business. It will grow statistically, but actually, you will lose a part of income.
An interesting fact: Only 22% of companies are satisfied with their conversion rate..
Why Conversion Rates Matters
Reason #1. The regular checks of conversion rates will help you to get timely information about the problems that lead to a loss of customers. Imagine that your website had some technical issues, and now the Buy button sometimes doesn’t work. If you track the conversion of requests, you will promptly see the anomaly: there are many visitors but the number of orders has sharply decreased. This is the reason to make a comprehensive check and search for flaws. You will gradually fix the found errors and hope that the sales volume will revive. If after troubleshooting, the sales will reach the same level, that means you’ve done everything right. In case the conversion rate remains low, you need to conduct deeper research, dig into the essence of the problem, or look for another reason.
Reason #2. With the help of conversion rates, you can track the visit history and popularity of selected landing pages. This way you can learn which sections interest your visitors most. For example, an entrepreneur has launched an online store of self-defense products with five categories: Firearms, Bows and Crossbows, Clothing and Equipment, Knives, and Self-Defense Accessories. Initially, the entrepreneur focused on the first fours groups of products and invested in them 95% of the budget. After some time he analyzed the page visit conversion and found out that a great part of the audience is interested in the Self-Defense Accessories section. That was the reason to redistribute the budget and allocate additional money for the popular category.
Reason #3. Conversion analytics allows you to track traffic and define the most effective user acquisition channels. For example, an entrepreneur allocated a budget and decided to promote a website through YouTube, social media, contextual advertising, and popular online publishers. 60% of the budget was assigned to YouTube, social media, and contextual advertising.
Example of a YouTube ad:
The remaining 40% is used for two popular online resources that regularly publish articles promoting the website of this entrepreneur. The analysis of the traffic conversion shows that 35% of customers come from YouTube, 25% – from social media, and 40% – from contextual advertising. The promotion on the third-party online resources didn’t generate any customer. This means that the entrepreneur should refuse from such advertising and fully focus on the first three channels of user acquisition.
Reason #4. Conversion rates help to test and assess the quality of all updates related to website development. For example, an entrepreneur decided to start a blog and regularly publish informative articles for his visitors:
Simultaneously with the blog launch, he hires a full-time support specialist responsible for the 24/7 customer support. As a result, sales conversion increased by 30%. We can conduct detailed analytics and separately calculate the page visit conversion and then assess the inquiry conversion. The results are the following: 90% of customers visit and read the blog whereas only 3 people used the 24/7 online support since its launch. Thus, the experiment with the blog turned out to be successful but there was no demand for online support. So the business owner should refuse from ineffective options and look for new ways to increase sales.
Why Do You Need To Optimize Conversion?
Conversion rate optimization is necessary to get the maximum benefit from the capabilities of a website. To learn more, take a look at the table below with five key factors that affect sales conversion and check out the advantages of optimization.
|Factors Affecting Conversion||Advantages of Conversion Optimization|
|Website Look||A website design must be appealing, friendly, simple, and understandable to any user. Additionally, it’s better to create an original look which will be easier to remember and will attract more users than a template website. It’s also recommended to use unique photos, customer reviews, add detailed information about your project and online chat. Don’t forget to adapt your design for all types of modern devices. Sales and the frequency of repeat visits depend on the first impression a website creates.|
|Convenience||A website should have a well-thought-out interface and a simple registration procedure (make sure to add the registration via social media). All information must be included on the main page. The navigation menu must be convenient and clearly state all crucial sections, such as Home, About Us, Services, Catalog, Pricing, Contact Into, etc. The easier it is for users to navigate the site, the faster they will complete the necessary target action. For example, buy a product, make a call, leave contact details, register, etc.|
|Content||All content on a website must be useful to users. All articles should be clear, succinct, and informative. It’s recommended to use images, graphs, photos, instructions, and thematic videos. If a resource has high-quality and regularly updated content, this will save it from losing search ranking and customers.|
|Accessibility||A website is a virtual shop-window which, if properly set, can generate income 24/7. To achieve this, you need to check whether all technical resources are working seamlessly and customers can anytime place an order on the selected page. When any website function becomes unavailable, the business owner loses income.|
|High-quality advertising||A website won’t be really popular if you don’t select effective advertising. You can choose among banner, teaser, media, contextual, or any other type of ads. Everything depends on your budget and goals. If ads are properly chosen and set, they will bring new customers and income. If during the setting process technical demands were violated, the ads will be ineffective, and you’ll just end up wasting your money.|
We have identified five factors that affect the conversion of any website. In reality, sales depend on many more parameters which, if properly optimized, can help to sell and attract interested users.
Recommendations for Conversion Rate Optimization
Conversion rate optimization is a set of technical solutions, information materials, and psychological approaches which can help to influence buyers and increase sales on a website. In other words, you just take your website, make some changes, and increase income. Below we will complete a guide on how to increase conversion rate. It includes 10 simple tips suitable for any website owner. Yet before you start using them, remember to keep in mind the portrait of a modern Internet user:
- A buyer cannot find what he needs for a long time. He becomes irritated and instantly feels negative towards all the websites that prevent him from finding the necessary products.
- A buyer constantly faces with frauds. Most often, all websites using stock images instead of the real ones are risky as well as the pages with paid reviews and inaccurate, unclear, or incomplete product descriptions.
- A buyer is tired of browsing and needs some rest. That’s why he doesn’t have free time to check the content and place an order.
- A buyer has a choice. If he doesn’t like something, he will immediately leave your website, and in a few seconds order from competitors.
After summing up everything mentioned above, you’ll get an irritated and impatient user who craves comfort and simplicity. This is the key point for the following recommendations.
Tip #1. Make sure users understand what you are doing from the very beginning. Tell them who you are, list your services, and indicate what cases you can solve. Focus on simple descriptions understandable to all users.
|Hello! Welcome to YYY website. We are working with the development of advertising concepts and creative solutions in the field of content marketing.||Hello! Welcome to YYY website. We create and edit content for websites.|
Tip #2. If your business is locally-oriented, mention this from the very beginning. This way you will keep the interested audience and promptly exclude the customers who won’t buy anything.
|Hello! Welcome to YYY website. We supply coal at wholesale prices.||Hello! Welcome to YYY website. We supply coal at wholesale prices in NY and NY state.|
Tip #3. Build positive associations and try to create promotional texts that will make your readers feel all the benefits they can get from your product. To achieve such an effect, prove each association and support it with visuals (photos, videos, graphics).
|YYY restaurant – the best place with the best prices and chefs in the best place in NY. Just come and see. We are located near Central station. For more detailed information, call us.||
YYY restaurant is a perfect place for a romantic dinner or rest with your family. You will be greeted by a friendly staff who will help you to enjoy the original and classic French cuisine. All processes are controlled by the team of YYY chef, who for a year worked as a personal chef of A STAR. Now it’s your turn to try his/her culinary masterpieces. We are located near Central station so you can continue your evening enjoying the night city views. Address: YYY. Phone: YYY.
Tip #4. Add easy-to-use website navigation that will help the visitors to complete the required target action. To do that, get rid of all unnecessary fields, buttons, and functions. Create a stylish design that doesn’t distract, keeps customers on the key pages, and helps to sell.
|Product selection → Registration → Finding Out How the Online Store Works → Application Processing → Order Confirmation → Purchase||Product selection → Purchase|
Tip #5. Consider all the possible objections to your product or service.
When you create a list of objections, prepare detailed answers and put them into a separate information block on your website.
|Objection: Why are you so expensive?||Objection: Why are you so expensive?|
|Answer: This is an optimum price since all our products are handmade and manufactured only from natural materials.||Answer: Our price is based on the prime cost, which includes three categories of expenses: development, production, and logistics cost. The development cost covers the services provided by the designers and managers of the product. The production cost includes workers’ salaries (e.g., tailors) and the expenses on materials and processing equipment. The logistics costs consist of the expenses on the transportation of goods to large and small retail outlets. We add up all these expenses and calculate the minimum sum necessary to cover them. After that, we add 10% to this sum for business development and expansion.
If you want to save, get a loyalty card, and buy all products with a 5% discount. Also, we have seasonal sales where you can buy goods from the previous collections half price.
Tip #6. Collect feedback, listen to your customers and, if possible, use their suggestions to improve your service.
|Case: Every day several customers order vegetarian dishes
Solution: Dishes are cooked at customers’ request only when the necessary products are available.
|Case: Every day several customers order vegetarian dishes
Solution: A vegetarian menu is developed and constantly expanded with personal recipes of visitors.
Tip #7. Demonstrate the results of your work and get useful reviews. To do this, ask your customers to share feedback and encourage them to tell other users about your cooperation.
|Case: A customer ordered a robot vacuum cleaner with a 20% discount in an online store, got the order on time, and remained satisfied with the experience.
Feedback: The customer mentioned that the product was delivered on time and everything was ok.
The online store owner did nothing to encourage the customers to leave useful reviews.
|Case: A customer ordered a robot vacuum cleaner with a 20% discount in an online store, got the order on time, and remained satisfied with the experience.
Feedback: The customer made a detailed video review of the product with the information about the discount, shipping time, functionality, and other benefits of the device.
The online store owner offers a 1% discount for any detailed review.
Tip #8. Make sure your prices are relevant and prepare a downloadable price list for your customers. If the price depends on many factors, add to your website an online calculator at least to show an approximate price of the selected product. Additionally, indicate that you provide free consultations during which you can calculate the final price.
|Case: On the website of plastic windows, the Pricing section is empty. This resource offers a complex product, the price of which can only be calculated individually. Instead of the prices, they have the contact info of their consultant.||Case: There is a website of plastic windows with the empty Pricing section. The website owners added the contact info of a personal consultant, developed an online calculator, and prepared price lists with an approximate cost.|
Tip #9. Think over the options that can attract customers to your website and make them stay longer. It can be something like a blog, news, promotions, special offers, bonuses, a loyalty program, etc.
|A computer spare parts website consists of the following sections: About Us, Pricing, Services, and Contacts. It has nothing interesting that could hold customers’ attention.||Initially, a computer spare parts website included such sections as About Us, Pricing, Services, and Contacts. Later the website owners added a blog with useful articles describing how to use different spare parts. This gives their customers a choice: repair a device on their own or ask for professional help.|
Tip #10. Conversion is better optimized if customers can directly address a business owner on the website. This strategy increases trust and allows visitors to complain about any unqualified actions of the staff right to the top management.
|Case: A tech support specialist was rude to a customer.
Outcome: The customer couldn’t find the contact information of a business owner to file a complaint, and went to competitors.
Possible consequences: The customer will create the adverse publicity of the company, leave a negative review, and repel many customers.
|Case: A tech support specialist was rude to a customer.
Outcome: The customer found the contact information of a business owner and addressed him with a complaint. The business owner personally solved the issue, penalized the responsible person, and offered a discount to the customer.
Possible consequences: The customer will appreciate the actions of the business owner, use the discount, and forget about his negative experience without leaving negative feedback.
How To Test Conversion?
Conversion testing is a research process used to check the effectiveness of the actions taken to increase website conversion.
- First, think of possible ways to increase your website conversion rates.
- Develop options for conversion rate optimization.
- Start implementing and testing all the options.
- Leave the most effective conversion optimization measures.
- Remove all the ineffective options.
After the testing, you will see whether the changes have been really useful or it’s better to get everything back and try something else. Here is a universal algorithm for conversion testing.
STEP #1. IDENTIFY THE TARGET ACTION
A target action is a procedure taken to improve a website. For example, considerable customer acquisition, sales growth, increased number of calls, and other user-related methods that can be assessed. A website owner defines the target action based on the set strategic tasks.
STEP#2. FORMULATE A HYPOTHESIS
A hypothesis is your assumptions about which conversion rates will generate the maximum result and help to implement the selected target action. Think of the actions that can increase website conversion, and rank the formulated hypotheses. Put the most effective methods to the top. Narrow the hypotheses to one main option and prepare to test it.
STEP#3. CONDUCT TESTING
To conduct the testing you need to connect any conversion tracking tool and select the type of testing. We will tell about the best conversion tracking tools in one of the following sections of this article. As to the type of testing, everything depends on the target action you test. In most cases, for conversion the A/B model is used. It allows you to test one hypothesis at a time. The multidimensional testing model, which can simultaneously test several hypotheses, is less popular.
A/B testing model
All website traffic is divided into two equal parts: the first half is directed to the original page and the second goes to a new page where the implemented hypothesis is tested. At the end of the test period, the two pages are compared. If the second page is more effective than the first one, the hypothesis is confirmed.
Multidimensional testing model “3 to 3”
In this example, users are offered three buttons and three content options. Thus, there are 9 versions of a landing page with about 11% of users evaluating each of them. At the end of the test period, you’ll have to compare the results and leave the option with the best conversion.
STEP#4. EVALUATE THE RESULT
To confirm or refute any hypothesis, you need to know initial indicators and conduct testing during a considerable time span. For example, initially, the sales conversion of your online store was 10%, which means that out of 100 visitors 10 people bought something. After the content was changed, a one-month test showed that the updated page increased the conversion to 12%. Now out of 100 users 12 people buy something. So if the income has also grown, the test is successful. Yet if the conversion improved but the income didn’t change or decreased, something must be wrong with the hypothesis or testing procedure.
8 Tools to Increase Website Conversion
In this section, we will discuss eight tools that can help to increase website conversion rates. You can use our recommendations, choose similar services, or find something new. Just make sure to stay technologically updated and use modern software for conversion optimization.
Plerdy is a service with a whole set of useful functions for comprehensive conversion growth. It helps to analyze different elements of design and see what is easy-to-use and what needs improvement. Also, you can generate a heatmap and find out which sections are popular and which deserve to be deleted.
Mention is a special tool that helps to increase website conversion with the monitoring of all related online publications users leave on different resources, such as social media, forums, and news websites. After you connect Mention, you can influence the public image of your website in real-time. If everything is ok and users praise your page, you can thank them and offer additional services. In case someone leaves a negative comment, you will be able to find out the problem and try to change the customer’s opinion.
Conversion Voodoo is a multifunctional service you can use to perfect the design of your landing page, conduct an A/B testing, track the productivity of pages, and find out what users think about your website.
The BuzzSumo tool is used for analytics and work with content. With the help of this service, you can find ideas for your publications, analyze search requests and competitors’ articles, get different information reports, and follow the latest news in your field.
Google PageSpeed is a useful tool which provides detailed information about technical issues slowing down a website and gives recommendations on solving the problem.
Use Zopim to add a live customer chat to your website. It will help you to stay in touch with users and provide better support. This service has a bunch of settings which can simplify the work of a sales department and allow you to ensure an individual approach to every customer.
Qualaroo is a tool used to conduct different kinds of surveys. This is a great way to get feedback from your visitors and customers. You can ask them about anything related to the work of your website, from the convenience of registration to the quality of the published content. The received replies can serve as a lever to increase conversion and user loyalty.
Eyequant helps to evaluate the effectiveness of your website design for sales promotion. It uses a range of statistical algorithms to define the key attention points (the main spots that attract users). This way website owners can adjust the user focus before the conversion test and make sure the maximum number of visitors completes an intended target action.
Conversion Rates Metrics to Assess Conversion and Increase Sales
The conversion rate of potential customers or leads is a measurable indicator that reflects how every interested user (lead) turns into a buyer. If both the lead conversion rate and sales increase, the website is properly set and you should keep up the good work. If conversion grows but sales decrease or remain at the same level, you should take some measures to optimize your website settings. This process can be monitored with customized tools. To assist you, we have defined seven metrics that can be used to monitor sales and lead conversion. Take into account all the data you’ll collect and make sure to implement timely changes into the work of your website. Only this way you’ll achieve positive results.
METRIC#1. ASSESSMENT OF CONVERSION RATES BY TRAFFIC CHANNEL
With SEO-Reports or Google Analytics you can track visitors and find out which channels generate most customers. For example, choose a reporting period and compare the effectiveness of Facebook ads with an email newsletter. Based on the obtained data, you can define the most effective channel and focus on its development. At the same time, you should close or restrict the use of all expensive or ineffective customer acquisition sources.
METRIC #2. ASSESSMENT OF MULTI-CHANNEL CONVERSIONS
Sometimes to turn an interested user into a customer you need more than one traffic channel. For example, at first, the user gets acquainted with a company through Facebook, then he gets several emails, and only after that becomes a customer. This kind of a customer acquisition scheme is called a multi-channel conversion. If you don’t track this process, you can lose most of the customers who like studying the product before the purchase. The multi-channel conversion can be monitored through Google Analytics or intuitively. Just get rid of a costly channel and pay attention to indicators. If the number of customers or sales decrease, make everything like it was before.
METRIC #3. USER COST
If you take an advertising budget for one traffic source, add all associated costs, and divide this sum by the total number of website visitors, you will get the cost of one visitor. In case the expenses don’t change while the number of visitors increases, user acquisition will become cheaper. This means that the chosen traffic channel becomes more effective. And vice versa: if traffic reduces while expenses remain the same, acquisition becomes more expensive and ineffective. In this case, it’s better to focus on cheaper channels.
METRIC #4 LEAD COST
If a promotion is properly organized, the cost of a lead will be in direct correlation with the cost of a website visitor: a website is well-promoted → the number of visitors grows → visitors make purchases → cost of user and lead acquisition decreases. In reality, it often happens that an agency that provides conversion optimization services doesn’t conduct precise customization and generates cheap untargeted traffic. In this case, the largest part of the advertising budget goes down the drain and the website owner suffers unnecessary loss. To avoid this, it’s necessary to calculate the lead cost separately from the cost of a user:
- Define the advertising budget for one traffic source
- Add all associated costs
- Divide the sum by the total number of buyers
When you find out the average cost of one lead, compare it to the average cost of one visitor. If you notice a direct correlation, the advertising campaign is really working and is worth continuing. If the cost of a visitor decreases whereas the lead cost grows, they are inversely correlated which means that the promotion is ineffective or your calculations are incorrect.
METRIC #5. RATIO OF THE PROFIT FROM NEW AND LOYAL CUSTOMERS
Almost every business model can generate income from attracting new customers and providing services to loyal ones. The only difference is what type of users brings higher profit.
- If the main income comes from new customers, make sure to spend a large part of the advertising budget on the development of the traffic channels that can generate new interested visitors.
- If the main income comes from existing customers, use a part of the advertising budget to develop a service that will keep loyal customers active.
- If the sources of income are equal, the budget must be allocated evenly.
To know the profit ratio of new to loyal customers, you must regularly monitor the conversion of new leads and compare it with the data on repeat sales. Also, it’s better if the report is prepared jointly by three departments: analytics, sales, and marketing. This way it will be more accurate.
METRIC #6. ROI OF EACH CHANNEL
Return on investment or ROI is a statistical value calculated in percentages which shows the effectiveness of a particular traffic channel.To find out the ROI, you need to make several calculations:
- First, assess the income generated by the chosen traffic channel. Suppose it’s $10,000.
- After that calculate all the expenses related to the development of this channel. For example, $5,000.
- Deduct the calculated total expenses from the total income. In this case, we deduct $5,000 from $10,000 and get $5,000.
- Divide the received sum by the expenses and multiply by 100%. Hence, $5,000 are divided by $5,000 and multiplied by 100%. Here the ROI is 100%, which means that the channel is profitable, so you should continue using and developing it.
If after calculating the ROI, you’ll see that the channel is financially self-sufficient, you should optimize it and try to customize for generating some profit. In case you lose money because of a particular channel, you should delete or reset it to make sure that a great part of the allocated budget isn’t wasted.
METRIC #7. TOTAL ROI
This is a monetary indicator which helps to evaluate the effectiveness of a launched advertising campaign. To know the total ROI, you must calculate the profitability of every separate channel, and then add these rates. Let’s assume there are three traffic channels. The first channel generates $3000, the second $5000, whereas the third leads to $1000 loss. If you add all these rates, you’ll get $7000 income. A positive ROI is the main indicator that a website develops as intended. A zero or negative ROI means that the advertising is ineffective and needs optimization or complete reconfiguration.
Best Ways to Increase Conversion with the Help of a Sales Funnel
The Algorithm of Sales Funnel FormationA sales funnel is a marketing tool for turning random users into the customers of a company. A properly set sales funnel works independently and doesn’t need any customization. Nevertheless, there are methods that can help to raise sales to an unbelievable level. Below, we’ll discuss ten ways to increase sales conversion with the help of a sales funnel. You can use our tips when you get back to work or offer your own methods of conversion growth in the comments.
The publication of thematic articles is the simplest way to fine-tune the sales conversion process in the marketing funnel:
- Select useful materials related to your product.
- Create a post and add it to the blog.
- A part of visitors will open your blog, check out the recommendations and want to make a purchase.
The main secret of a good blog is that every article must have some practical use. For example, if you sell pre-owned Apple devices, don’t add to your blog the articles comparing old and new gadgets. The customers have already decided what they want. You’d better tell them how to choose and maintain a used device. This would be the benefit we are talking about. It can really help to increase sales conversion.
A newsletter is another way to increase sales conversion rate with the help of useful content. The only difference between a blog and a newsletter is the type of content. Whereas the blog interacts with users directly through website articles, the newsletter relies on emails. An extra benefit of newsletters is the chance to collect contact info and directly contact the customers. Hence, in addition to selling through the text, you can also sell by phone.
3. POSTS IN SOCIAL MEDIA
These are short informational or entertaining messages you can use to tell your audience all news related to your company. Here is how it works: create a useful article for a blog → write a few words about it → add graphics to this preview → add a link to the main content → publish the preview in the social media → receive potential customers.
4. PRODUCT DEMO VERSION
A great example is a solution offered by Photoshop CC developers: the first 30 days most functions are available for free. If users decide to continue using the tool, they must subscribe for a paid plan. In case you cannot adapt your product for a demo mode, it can be substituted with any useful and free service. For example, if you offer legal services, write for your customers a PDF book on how to purchase problematic secondary real estate.
5. FAQ SECTION
Another way to increase a sales conversion rate is related to the FAQ section. Make this section noticeable and frequently updated. It’s very easy to create. Just ask your team to record all the questions that website visitors have asked at least twice. After that, develop text or graphic instructions that will explain all unclear things.
6. CUMULATIVE LOYALTY PROGRAM
A cumulative system is a business life hack that stimulates visitors to choose your website among many others for making a purchase. For instance, there is a publishing house that offers a 5% discount for registration, a 7% discount for a purchase over $50, and 15% – for $250+. The key hook of such a program is that the sum of purchases accumulates gradually and the discount is time-unlimited. Customers don’t have to buy everything at once and can increase their discount step-by-step, which is a great advantage. The store also benefits from this, since it gets customers who aren’t interested in buying from someone else.
People like spending money before some important events or big days. Use this, give a discount, and earn from the volume of sales. Suppose you have an online store of luxury jewelry. You cannot sell such goods in huge packs at a too low price. Use a holiday as the reason to give a discount on an old collection that you couldn’t sell for several years. In case you cannot cut the price of the old collection, launch a free packaging promo.
8. SPECIAL OFFERS
Here is a case: You have a website for selling different informational products on public speaking. The primary audience is private customers who buy the courses to improve their communication skills. In this case, you can increase sales conversion by creating a special offer for corporate customers. For instance, offer a 20% discount on training for over 100 people. If a business owner accepts this special offer, they will get a chance to train their staff at a bargain price. On the other hand, you’ll get a large customer and a quick profit.
9. SALES SCRIPTS
A sales conversion rate is greatly influenced by the work of technical support specialists. If the pattern of communication is chaotic and crude, many interested users will leave without making a purchase. To avoid this, develop and share with your managers a step-by-step text guide detailing all possible points of interaction with customers. When the instructions are ready, make sure to appoint someone who will monitor how the scripts are used.
To use this marketing trick, you just have to make some technical adjustments on your website. Ask your developer to change the settings to offer customers several additional products when they are placing the main order. For example, if somebody orders a bed set, you can offer pillows or blankets. Actually, there are no limits here. The only rule is don’t be too pushy or offer useless things. Otherwise, the offer of additional products will be counterproductive, and your visitors will go to competitors.
Now you know what is website conversion, why you need to monitor it, and how it can be optimized. In the end, we want to outline the main moments and key ideas of the article. To get the maximum benefit from this information, read it again and think what can be implemented right away.
- Conversion rate optimization is the first step, you must take before you launch an advertising campaign and attract a new audience. If you don’t do this, a sales funnel will be unstable and you will lose lots of customers. As the result, an advertising budget will fall flat, and the major part of the money will go down the drain.
- Conversion is a calculated value created to measure all the technical parameters related to the operation of a launched website. For example, it allows you to track the changes in the ratio of total website visitors to the number of users who left a purchase request. This is an auxiliary tool that helps businesses grow and increase income.
- With the analysis of conversion rates, you can promptly detect problems, define best traffic channels, and find out which target pages are most popular among website visitors. In addition, conversion helps to conduct tests and find effective sales tools.
- Conversion rate optimization helps to increase sales without an additional budget. A website with an appealing design, convenient navigation, fine-tuned ads, useful content, and helpful tech support will always generate more profit than a similar resource with unconfigured conversion rates.
- Before you start conversion rate optimization, make sure to remember how a modern Internet user looks like: they are irritable, crave simplicity and quick results. You must design your website relying on these criteria since if something goes wrong, the customer will immediately go to competitors.
- Without tests, you won’t be able to evaluate the effectiveness of the measures taken for conversion optimization. The tests are conducted on the basis of hypotheses which in the process of the research are either confirmed and implemented or refuted and no longer used.
- For proper operation, a website needs constant improvement and development. There is a special conversion optimization software for this. Remember to use modern tools and achieve optimum results.
- There are special metrics used to monitor the quality of conversion and the volume of sales on a website. We can define seven main indicators: traffic channel assessment, assessment of multi-channel conversions, user cost, lead cost, ratio of the profit from new and loyal customers, ROI of each channel, and total ROI.
- There is a complex of measures that can be used to develop a marketing sales funnel, including blogging, newsletter, posts in social media, demo versions of a product, FAQ section, cumulative loyalty program, promotions, special offers, sales scripts, and cross-selling to existing customers.
Finally, if your conversion rate achieved a pretty good level, this is not a reason to stop optimization. Don’t forget about your competitors who are constantly developing and implementing new technologies. If you let them take the lead, you may quickly lose your market share.