Conversion Marketing- An Introduction
The ultimate goal, of most internet marketing strategies, is to make conversions (sales). So what is conversion rate? Let’s break it down:
- In simple terms it is the percentage of visitors to your site that perform a desired action. This action could mean a number of different things have taken place. Product sales, software downloads, newsletter signups and membership signups are all examples of a conversion. To explain conversion marketing let’s take a look at an example:
-A web browser arrives on your travel website through a search engine query (this would be the case if your website is optimized). The term they have searched for is, “Accommodation in Cape Town”. They then browse around different accommodation pages on your site and find accommodation that suits them best. On the information page they find that the price is too expensive and click escape. When clicking escape, a pop-up window shows up displaying an amazing “25% special on accommodation” for two people if they book in the next 24 hours. Enticed by the offer the prospective customer makes a purchase. This is successful conversion marketing!
Breaking it up
Conversion marketing has a number of aspects to it. Let’s break it up:
- Conversion rate: the number of website visitors divided by the number of customers who actually make a purchase.
- Website design: when landing on a page, it needs to be visually enticing to keep a customer there and guide them along the conversion funnel.
- Website architecture: most people don’t have the time or patience to navigate through tricky websites. From wherever they land on the site, there must be a clear CTA (call-to-action). In other words you need to make it easy for website browsers to turn into paying customers or conversions.
- Traffic: on average, less than 2% of all website visitors complete a transaction. This means that it will take a lot of targeted traffic (link SEO) to increase conversions.
- Cost: bringing new visitors to a website usually has various costs involved. These costs could be for advertising, design costs, your time, promotions, PPC advertising or any other aspect that involves a price-tag to bring visitors to your site.
Maximize The Visitor Experience
Looking at the above aspects, we can see how important it is to convert as many of your visitors to minimize costs and maximise revenue. That’s where conversion marketing comes in. The final outcome is all about generating the most out of your leads. Let’s take a look at an example of this conversion funnel:
- You own a travel website that sells safari tours and 4×4 adventures in Namibia. Your website is generating a good amount of unique visitors every month and you average around 10 000 unique visitors every month. At an average of a 2% conversion rate, this means you will be converting around 200 of those visitors. If an average sale is bringing in $2000 (from safari packages) and you are receiving a 20% commission on those sales, you are generating an income of $200 per conversion. From this we can deduce:
$200 x 200 conversions= $40 000 revenue
Applying Conversion Marketing
When we apply the correct conversion marketing tactic that tracks and optimises conversions, we might see the following happen:
- Conversion marketing tactics are applied to the website with the users experience in mind.
- The final outcome results in an increase in 1% in conversion rate. Bear in mind that this is not instantaneous, but rather a final average outcome. Remember Conversion rate equals:
By successfully increasing overall conversions in the previous example from 2% to 3% overall, we see an increase of 100 converting customers. Times this number by our average commission in sales ($200) and we get $20 000 more revenue! So just a 1% increase in conversions has resulted in an additional $20 000 p/m in revenue! Still doubting the power of conversion marketing? Contact us today to show you how you can apply conversion marketing to your online business.