What Is Your True Conversion Rate?

  |  September 11, 2009   |  Comments

Tips for prioritizing online marketing campaign optimization and improving conversion rates.

Increasingly more people are joining the optimization crowd. Savvy marketers need to do more with less budget. Others just want to beat their competitors. No matter the motivation, optimizing your conversion rate is a no-brainer.

What seems more difficult is deciding where and what to optimize. All of us have our plates full already. Adding optimization to the heap seems uncomfortable, even painful.

It doesn't have to be.

It may not be easy, but very little that is worthwhile ever is.

When no clear starting line exists, most marketers will optimize in an ad hoc manner with no clear plan. Often companies will:

  • Start with their newest campaign

  • Start with their pet campaign

  • Optimize their least favorite campaigns

  • Optimize the easiest campaigns

  • Optimize everything they can just a little, but never develop a method to get maximum results

  • Start with the boss' favorite campaign, least favorite campaign, and so forth

None of these are bad places to start. A little bit of optimization even in a less optimal place is better than no optimization. Still, if you're looking for a more effective means to get rolling toward results sooner rather than later, here are a few tips.

Preface: Understand Your True Conversion Rate

While your average conversion rate is the total number of unique visitors divided by the number of unique visitors that take a conversion action, your true conversion rate is the number of people who take the action you want them to take divided by the total number of potential people who could have taken that action. Your true conversion rate takes into account how qualified the visitor is and gives you a better indication of how well your site is performing.

Look at Your Marketing Efforts

How are you bringing these people who take action to your Web site? Do they all come by directly typing your URL in their browser's address bar? Do some search for your brand? Do some search for your category? Or your products? Do others come from organic search? Paid search? E-mails? Affiliates? Do these people come from different Web sites: Google? Bing? Yahoo? Wikipedia? Twitter? Facebook?

Define Your Prospects

You are likely targeting different audiences based on personas or demographics. You might have different efforts for each segment, maybe several efforts per segment. Each segment that was brought in by an individual marketing effort has different, sometimes intersecting, occasionally opposing scenarios (persuasion paths) based on needs, motivation, knowledge, purchase preferences, or some combination thereof.

For example, you sell Web conferencing and buy the keyword "online web conferencing." You've identified three prospect segments: small office/home office, education, and marketing/sales. They all share a keyword and a landing page that gives them the content each segment needs. You might also buy more targeted keywords that send them to more segment-specific content, but they all share the same sign-up process.

Each one of these is an effort that may need to be optimized. A don't forget your banner ads and offline media efforts, either.

Create Goals and Micro-Funnels

You cannot succeed online unless you plan for it. Specifically, you need to plan conversion goals for each effort. What actions do they want to take based on where they are in the purchase cycle? How are you going to measure them?

Again, if you sold Web conferencing, your early-buying stage goals may be to have visitors sign up for a trial or download a case study. Late-stage buyers would have paid sign up as a goal. Often, optimization means starting by adding efforts for early or middle stage. There are clearly too many businesses that expect to convert you all the way on the first visit. This may be unreasonable, depending on the audience segment and the complexity of the sale.

Each segment brought in by an individual marketing effort that navigates through their scenarios (persuasion paths) is a micro-funnel that needs to be optimized. Prioritize them!

The 80/20 Rule

The Pareto Principle is a good place to start thinking about prioritizing your optimization. It is highly likely that if you have 1,000 different efforts, about 20 percent are pulling their weight. Those 200 efforts need persistent and vigilant optimization.

Here are a few more places to start:

  • Optimize your top-performing efforts, figuring out how to make them better.

  • Optimize your most expensive but low-converting keywords (each one or several related terms in a group in individual marketing efforts).

  • Sort out your top 200 campaigns and optimize those that are within a few percentage points of performing like a top-200 effort, then move on to your next 200.

  • If you have very few efforts that perform respectably (over 10 percent true conversion rate), you may need to look at the potential market and create persuasion paths by paying attention to your market segments' needs or your prospects' needs at different buying stages.

  • Optimize your top 20 exit pages.

  • Optimize the bottom of your registration or checkout funnel and work your way up the funnel.

Your conversion rate is nothing more than the sum of the thousands of efforts and paths that prospects take through your site. Beware of averages. There is no such thing as an average person. That is why your average conversion rate is a rough indicator but virtually worthless as a way to focus your conversion optimization.

You have lots of segments that come to your Web site. They differ by demographics, psychographics, behavior, or marketing effort.

Are you optimizing by effort or by average? Tell me which and I'll tell you what kind of success you're having.

Turn your data into results with true ROI-driven marketing. Join us on Wednesday, September 23, 2009, at 1 p.m., for a free Webinar to learn how to make decisions to improve campaign performance.

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ABOUT THE AUTHOR

Bryan Eisenberg

Bryan Eisenberg is coauthor of the Wall Street Journal, Amazon, BusinessWeek, and New York Times bestselling books "Call to Action," "Waiting For Your Cat to Bark?," and "Always Be Testing." Bryan is a professional marketing speaker and has keynoted conferences globally such as SES, Shop.org, Direct Marketing Association, MarketingSherpa, Econsultancy, Webcom, SEM Konferansen Norway, the Canadian Marketing Association, and others. In 2010, Bryan was named a winner of the Direct Marketing Educational Foundation's Rising Stars Awards, which recognizes the most talented professionals 40 years of age or younger in the field of direct/interactive marketing. He is also cofounder and chairman emeritus of the Web Analytics Association. Bryan serves as an advisory board member of SES Conference & Expo, the eMetrics Marketing Optimization Summit, and several venture capital backed companies. He works with his coauthor and brother Jeffrey Eisenberg. You can find them at BryanEisenberg.com.

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