I had a great time delivering the keynote one time at the Wednesday live conference in Stockholm, which featured an all-too-typical show of hands. First, I asked how many of the marketers in attendance had a Web Analytics system installed on their site. Every hand in the room went up. Then I said, "Keep your hands up if you check your results at least once a day." Every hand went down. Why is this so? Having an analytics system and not using it regularly is like having an extra car in your garage that you don't drive. What is stopping us from using these numbers that we generate every minute of every day?

I don't know for sure, but I think there are a few reasons. Some marketers think they can skate through to retirement without really adapting to the Internet. Others might feel like they just don't know how to do it and it's too scary to learn. But every year, I think those groups become more and more of a minority.

I think the real problem is that marketing analytics are still too hard for the average person. Think of all the steps required:

  • Choose an analytics system
  • Get an account or install the software
  • Configure your Web site with JavaScript to start counting visitors
  • Choose your conversions
  • Instrument your site to report the conversions
  • Learn how to analyze the reporting
And after doing all this work, you haven't even learned anything about your customers yet.

No wonder there are books and consultants galore to help you. The average marketer is swimming in details without getting anything back for quite a while. This takes a commitment.

And even after you have done all of these things, you still need to grapple with what you are looking for. Just take one seemingly simple metric: conversion rate. Conversion rate is the number of conversions divided by either the number of visits or the number of visitors. So, marketers need to make a decision before they even can use this metric!

I typically take clients through a very basic set of concepts to get them started:

  • Visit: A single session at a Web site. Every time a person comes to your Web site, it counts as a visit. Visits are not people. They are the online equivalent of a trip to the store. Some people make several trips to the same store before buying something while others make just one, but if you count visits, you are adding up all the trips to the store across all people.
  • Visitors: People who come to your Web site--sometimes called Unique Visitors. If someone comes to your Web site, the person is a visitor and they have made one visit. If that same person returns to your Web site later, you still tally one visitor, because it was the same person, but you count two visits.
Some industries should calculate their conversion rates using visits, while others should use visitors. Because the same person could visit Amazon five times in fives days and conceivably buy something each time, Amazon should divide conversions by visits to calculate its conversion rate.

On the other hand, if a person comes to Honda's Web site five times in five days, it doesn't make sense that they might buy five cars. Instead it makes more sense to figure that they are getting more information in each visit for a single purchase, so Honda should calculate its conversion rate by dividing conversions by visitors.

Now, notwithstanding all of that, for some businesses it might not be that easy to know whether visits or visitors is the right number to divide by. HP sells printer cartridges and laptops--so they don't have a clear-cut argument for using either visits or visitors across their whole site. But you should know that as long as HP makes a decision and sticks with it, they'll always be comparing their metrics consistently, which is the most important thing.

After walking through this entire blog post, I have immense sympathy for all those marketers that put their hands down. Instead of us thinking these poor saps are too dumb to be Internet marketers, maybe this should be a wake-up call to the entire Web analytics industry. If we don't start making it easier, marketers aren't going to do it.

Originally posted on Biznology
July 10, 2015





Mike is an expert in search marketing, search technology, social media, publishing, text analytics, and web metrics, who regularly makes speaking appearances.

Mike's previous appearances include Text Analytics World, Rutgers Business School, SEMRush webinar, ClickZ Live.

Mike also founded and writes for Biznology, is the co-author of Outside-In Marketing (with James Mathewson) and the best-selling Search Engine Marketing, Inc. (now in its 3rd edition, and sole author of Do It Wrong Quickly, named by the Miami Herald as one of the 11 best business books of 2007.






Comments(7)

Good reminder Mike and thanks for sharing the importance to be on top of your stats and being aware what is happening in your business on a daily basis. It doesn't take much to go of course and not realize it before it becomes a major issue.
Thanks,
Alex Z

It takes some time to realy understand your visitors before you can calculate CR. We test CRO right now and it can help, but still takes some time for acurate data. As you say, every business is diferent

Thanks a lot- Very very helpful. Trying to learn web analytics but sometimes it gets very complicated. but this was relatively easy to understand, and made a lot of sence. Thanks again.

I've been involved in web analytics for around 15 years and we still face many of the same problems as we did in the late 90s - it's easier now, but people still expect it to be simple. It isn't, largely done to varied implementations but also chances in basic terminology leasing to significant confusion.

You're absolutely right though that an organisation should focus on their own data and make decisions on that - consistent measurement (even mis-measurement) is vital.

A measurement framework (analyt.co.uk/v1) can help give that consistency and dashboards (analyt.co.uk/v3) make data far more accessible.

Hi mike, I already read your blog about how to calcuate conversion rate.
i just would like to say Thnks a lot. beacuse just for reading your blog i gain knowledge about calculate conversion rate..

thedescent2

Hello Mike, good post again and I will explain my own tactics which I use for counting conversation rates, first of all when I use Facebook add I use their built in conversation API, secondly when I want to count conversation from organic traffic to my website I use JavaScript as its easy to integrate into the website like "counting the clicks on a button" on order now button is the best choice for me. So my vote is for java script.

I used to just concentrate on traffic and what number of visitors every day. But now I began to acknowledge "Conversion" is way more critical than just traffic. Your conversion rate figuring certainly give me more lights on this point. Thank you so much Mike.

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