When businesses decide to invest time/money/energy into SEO, the focus is on traffic, search result placement, and keywords. I have seen business owners spend tens of thousands of dollars to get more traffic, only to have it not translate into more revenue. My premise for everything I do related to SEO is, “If traffic does not turn into more revenue, I’m doing it wrong.” To that end, in this article I will discuss conversions and how they can help turn traffic into revenue, then I will give you action steps to take immediately to improve your conversion rate.
What is Conversion Rate?
Conversion rate is the percentage of visitors that turn into buyers. Conversions are important because they are the most direct route from traffic to revenue. My specialty is Analytical Marketing, which means that I set up mathematical models to tell the future and make my clients more money. But no one wants to read about mathematical models; people want to read about increasing their revenue! However, money is math, so let’s do some dollar arithmetic.
Conversion Rate = Number of Visits/Number of Sales
First, a rule of thumb: If you have no idea what your conversion rate is, or what it should be, use 1% as a placeholder. This means for every 100 visitors to your website, 1 will buy something.
Do you see that teeny tiny sliver of red at the top of the chart? Those are your buyers, the 1%. A 1% conversion rate is ok. Below 1% and you really need to take a look at how your site is set up and how your copy is written. In this article, we are focused on how to turn that 1% into 2%, or from 2% to 4% or more. But first, let’s talk about why, with more numbers and a math problem.
The Basic Funnel
Your site, widget.com gets 1000 visitors per month, has a 1% conversion rate, and sells widgets for $100 each. How much revenue does widget.com make per month? I’ll give you time to work out the answer…
Ok, here is the answer:
1000 Visitors X 1% Conversion Rate = 10 Buyers
10 Buyers X $100 Average Sale = $1000 Revenue
Conversion can get much more complicated than this picture, but for our purposes, we are talking about a simple 2 step sales funnel that describes the concept.
Why is Conversion Rate Important?
There are a few ways widget.com can get from $1000 per month to $2000 per month in revenue. One way is to double their visitors from 1000 per month to 2000 per month. The math is easy enough. If they double their visitors (and keep the conversion rate the same), they double their revenue. How nice.
A smarter way is to double the conversion rate to 2% because widget.com can squeeze more revenue from the same number of visitors. In other words, the same 1000 visitors creates $2000 in revenue. What it looks like now:
1000 Visitors X 2% Conversion Rate = 20 Buyers
20 Buyers X $100 Average Sale = $2000 Revenue
Improving your conversion rate is a very powerful way to improve your revenue, and it works hand in hand with your traffic traffic to accomplish this goal. Make sure you are keeping an eye on both your traffic and your conversion rate in your SEO activities.
Next Steps: 5 Actions You Can Take to Improve Your Conversion Rate
“Ok,” you say, “I’m sold. How can I use this conversion stuff to make more money?”
I was hoping you would ask that. Here are 4 meaty ways to get started.
1. You can’t improve what you don’t measure. Start by getting your actual conversion rate. You do this by taking your visits from last month and dividing it by your sales from last month. Write that number down somewhere and save it so you can compare months.
Conversion Rate = Visits/Sales
2. Set a goal. If your conversion rate is less than 1%, set 1% as your goal. If its higher than 1%, set the next whole % as your goal.
3. Be obvious. Make sure when a customer lands on your site, it is absolutely crystal clear what you do and how you can help them.
I searched for “chemistry supplies” and got this as a result. When a user lands on the Rex Chemical website, it’s not really clear what Rex is and what the company does. It’s columns of text with a search box. It’s not visual at all, and I don’t know that I would trust this company with my credit card information.
Tag line: “Your Source for Lab Supplies and Equipment,”. Check. Address: check. Phone number: check.
Notice how your eyes travel around the landing page: Lab Supplies, Fun Science, Specimens. These are all things that a person SHOULD find when they search for “chemistry equipment.” I know who this company is. I know what they do. I know how to contact them, and if I am looking for chemistry supplies, I would probably click on the picture of the beaker that says, “Lab Supplies.”
Between Rex and KLM, who do you think has the best conversion rate? Who seems more trustworthy? Who would you give your credit card information? The conversion rate is directly related to helping the user find what he is looking for. The KLM site is much more helpful to me as a user. As an anecdote, KLM is on the first page of search results, and Rex is on the 25th.
4. Create Landing Pages. Landing pages help you make sure the user knows that you supply exactly what they are looking for. If I search for “Air Plant,” I may not know that another name for an air plant is tillandsia. As a business, you need to make sure you have some pages that target the term “Air Plant” and some that target the term “Tillandsia.”
As another example, perform a Google search for “tea bingo cards” and look at the first result. Now search for “almond bingo cards” and look at the first result. You can see how Patrick, the creator of Bingo Card Creator, has landing pages that give the user exactly what they are looking for no matter what kind of bingo card is searched for. He has hundreds of landing pages. His conversion rate is through the roof and he makes a very good living from a very simple website.
5. Make sure your copy is readable and engaging. Copy is king. I could write a book on the importance of excellent web copy, but for the purposes of this post, I’m going to dip my toe in the water. If you are a plumber, instead of “We provide pipe snaking services,” say something like, “Your frustration with that blocked pipe will be erased, guaranteed.”
The difference is that the first sentence concentrates on the vendor and what it offers. The second sentence concentrates on the customer benefit. Take a look at all the copy throughout your website and ensure that every sentence is customer-focused.
When you understand the relationship between conversions and dollars, conversions become very important. Measure, monitor, and track your conversion rates to increase your revenue.