Does this sound familiar? You need more sales, so you try to generate more visitors to your website. You increase your AdWords, fiddle with your SEO, hold more events, offer specials, add outbound telemarketers, hire salespeople, develop fancier collateral – and the list goes on.
But what if you’re just throwing money away? Often, it’s not about the number of visitors, but the percentage of visitors converting into leads. There’s no point attracting more traffic to a website that doesn’t convert.
Rather than investing more time, effort and money into attracting even more website visitors, it may be time to analyse conversion rates. That is, how many web visitors take an action on your website, and ultimately become customers.
Let’s look at the data.
Say your current acquisition activities are driving 100 people per day to your website. Of these, let’s say 10 are becoming leads and one of those leads is becoming a customer. And let’s say your AdWords spend is $100 per day, so each customer is costing you $100.
If you followed the common school of thought and doubled your advertising to $200 per day (with everything else remaining constant), you could assume you would attract 200 people per day to your website. Of these, 20 would become leads and 2 become customers. Acquisition cost per customer would remain at $100 per day and you would still have only 2 customers.
There is a better way.
How a small increase in conversion rates can result in a 300% increase in customers. Let’s start by analysing conversion rates.
Current conversion rates are:
• 100 visitors become 10 leads: This is a 10% visitor to lead conversion rate.
• 10 leads become 1 customer: This is a 10% lead to customer conversion rate
What if we could increase our visitor-to-lead conversion rate from 10% to 20% and our lead-to-customer conversion rate from 10% to just 15%?
The situation would then look something like this:
• 100 website visitors becomes 20 leads
• Of these 20 leads, 3 become customers
A relatively small increase in visitor to lead and lead to customer conversions has resulted in a 300% increase in customer numbers. And the customer acquisition cost has reduced from $100 to just $33 per customer.
Addressing the conversion rates has delivered a significantly better result than simply increasing top of line advertising and promotion activity.
Depending on your industry and market dynamics, increasing conversion rates could be easier than you think. For more on how to increase conversion rates, download the free eBook “The Small Business Guide to Capturing Leads” below.