Understanding Conversion Rate Optimization

Posted by Corey Smith on May 26, 2017 2:12:00 PM

Conversion Rate

For as long as business owners have had a location to hang their sign, they have tried to find more and more ways to get more and more people to buy from them.

What usually happens is that businesses (even experienced marketers) will simply create a punchlist of tactics that they think are important to do — if they do they’ll get sales.

Same Strategy, New Tactics

In reality, the strategies to market your business have never changed but the tactics must be revised. 

In my book, I break down your marketing into four key components. In parenthesis I’ve indicated how I relate them to web marketing, specifically.

  1. Location (Web presence or website)
  2. Brand Awareness (Search Engine Optimization – SEO)
  3. Visitors (Traffic Generation)
  4. Transactions (Conversion Rate Optimization - CRO)

Even if you have a web presence, there is no guarantee people will find you — this is why you need search engine optimization.

Even if you are high in the search engines, there is no guarantee that people will go to your website — this is why you need traffic generation. (Note that sometimes people call this search engine marketing or SEM but I usually leave SEM to be one of the possible tactics of traffic generation.)

Even if you are getting a lot of traffic, there is no guarantee that people will buy from you — this is why you need conversion rate optimization.

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Conversion Rate Optimization Defined

  • Conversion – Getting someone to do something you want (e.g. go to another page, fill out a lead form or buy something).
  • Conversion Rate - The percentage of people that do the thing you want versus those that don’t.
  • Conversion Rate Optimization - Making changes on your website that help increase your conversion rate.

One of the biggest misnomers is that CRO is lead or sales generation. CRO is not lead or sales generation. CRO is the process of testing and analyzing your website to hopefully generate more leads or sales.

Think of it this way. We don’t know what people will do on your website until we observe it. We have certain goals and we don’t necessarily know how to get there. CRO allows us to create tests to get a higher percentage of people to do what we want (fill out a lead form, buy a product or even just click on another page).

There is another, bigger part to CRO. That is getting the right kind of people to do what we want them to do. We can develop tactics that allow us to maximize the number of conversions we get. We can also develop tactics that will weed out all but the most serious. CRO allows us to figure that out. It allows us to analyze the results in such a way to know that what we do will produce the best results (however we define it).

Get Started Tracking CRO

From a strategic point-of-view, this requires a shift in your attitude about how things have to look. You must understand that your opinion doesn’t matter. What matters is what your website visitors do. If you get the conversion you want but the website doesn’t exactly match your design preferences, maybe you should look at your design preferences and figure out why you are wrong.

From a tactical point-of-view, there are different ways that you are able to track a conversion when it happens online. The easiest method, and the method that is the least intrusive to the user, is using conversion goals in Google Analytics. You are able to set up specific goals, such as filling out a contact form or completing a sale, and linking that specific conversion to an initial action taken by the consumer. It also allows you to create a custom conversion funnel that will track traffic from a particular landing page all the way through to a completion of a goal.

To set up a conversion goal on Google Analytics, follow the steps below:

  1. Since goals are set at the profile level, start from Admin

  2. Be sure to select the account name, the property name, then view Goals. Click +New Goal.

  3. Choose from a template or create a custom Conversion Goal Type that will allow you to track different actions that you would like your users to perform. These Goal Types differ from URL destination, visit duration, pages per visit, or an event.

  4. If applicable, you are able to assign a monetary value to your goals. An example of this would be if the average user spends a certain amount of money per transaction, you are able to record the amount of money made per transaction or conversion.

  5. From here, the process is quite simple as you are able to follow a step-by-step flow in your account to set up the goal. As you complete each step, click Continue to save and move on. Be sure to click Save to finish.

Google Analytics will start tracking data as soon as you save your new conversion goal. You can even see what your conversion would have been over the past seven days.

Another feature known as the Visitor Flow will allow you to track exactly where customers are jumping out of your conversion funnel, making it easier to adjust your promotion or landing pages accordingly.

In Conclusion

Bringing this concept back to the beginning of this post, it is through CRO that you can identify the marketing tactics that are actually producing the results. If they aren’t producing, get rid of them.

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Corey Smith

Written by Corey Smith

Corey Smith is the founder of Tribute Media and serves as the Digital Marketing Strategist. He is also the author of "Do It Right: A CEO's Guide to Web Strategy" and "Tweet It Right: A CEO's Guide to Twitter."

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