Make Conversion Rate Meaningful
Everyone loves conversion rates, but without greater context, it's not nearly as important as some marketers think.
Conversion rate is an important metric, but it’s not the be all end all of KPIs. The fact is that growing your site will likely decrease conversion rates – and that’s not necessarily a bad thing.
Despite its limitations, conversion rate is still a powerful metric that works very well for measuring specific tasks – things like building individual landing pages around conversion and email marketing.
Here’s an example, with two alternative tables of numbers for a site bringing in £565k in revenue over a given period:
On its face, the answer seems obvious: invest more in the high-converting channels. But, that misses the point, and is exactly why focusing solely on conversion rate can be detrimental. Channels like search and social certainly support conversion through awareness and visibility, even if users aren’t directly converting through those channels.
For argument’s sake, let’s cut investment in low-conversion channels:
That all looks fantastic at first glance. But, we've turned off most of the growth channels of the site. Look at the second table again and ask, "In a year's time, will we still be able to squeeze out new sales from our same old email list?" Or, "Will we be able to win back the customers our competitors have grabbed from us through their PPC and affiliate campaigns?"
Break your conversion rate down by channel:
- Generally, "acquisition" channels like non-brand PPC will convert at a far lower rate than your site average. Seeking to improve those rates individually will save you money (and make you far more of it) than treating it as part of a bigger overall conversion number.
- Separate out your channels and figure out which you can impact through conversion optimization. Focus on those instead of your headline conversion rate.
Break conversion rate down by visitor type:
- Split out "new visitors" vs "returning visitors" (or better yet, "previous buyers" vs "never bought before").
- Remember that superficial site changes are far more likely to affect new visitors than old visitors. Your existing customers are swayed by brand, service, product quality, delivery, etc. Your new visitors are swayed by perception.
Break it down by task:
- If your site has several key tasks (sales, customer support enquiries, leads, account top ups, etc.), treat those as separate conversion tasks.
- Split tasks out from each other and track work to increase their rates individually.
Focus on microconversions:
- Instead of asking "How can I increase the conversion rate of my site?", and wondering where to look first, break this down into smaller pieces.
- Start with your most important pages and journeys – like what percentage of searches result in a click to a product page.
Of course, the best way to make conversion rate meaningful is to measure it relative to more KPIs and tie it to an overall marketing ROI assessment. For more on exactly how to do that, get in touch.