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I constantly counsel people to make their Web site more than just an online brochure--they must measure their conversions online and offline so they know what it's worth to bring that extra visitor to their Web site. Only then do you know what to spend on marketing. Simple, right? Not always. What do you do when you have multiple ways of measuring conversions?
First things first. If you don't know what a conversion is, or how to measure conversions, you need to start there. Whether you sell online or offline, you want to engineer your customer experience so that each sale can be tracked back to your Web site. That way, you can do the math backwards to know what it's worth for each new visitor to come to your site because you know how many visitors completed the last step the Web site offers.
For example, if you sell online, the last step is completing the checkout--simple. But if you sell offline, you might need customers to call a special phone number or bring a coupon to the store or fill out an e-mail contact form--anything that helps you identify them as coming from your Web site. By counting how many visitors come to your site, knowing how many of them fill out the e-mail form, for example, tells you your Web conversion rate. If you know how many of those e-mail leads turn into sales, then you can calculate your overall conversion rate, and what it's worth for each visitor who comes to your site.
So, you might know that 10% of all people that fill out the e-mail form eventually sign a $50,000 consulting agreement with you. So, getting someone to fill out that form (your Web conversion) is worth 10% of $50,000 in revenue, or $5,000. If only 1% of the visits to your site fill out the contact form, then each of those visits is worth 1% of $5,000, or $50 in revenue. Your marketing budget should reflect spending considerably less than $50 a person to get someone new to your site--if your profit margin is 50%, then you're making $25 in profit for each visitor, so every dollar you spend on bringing people to your site cuts into your profit.
But what if you know all this already and you are concerned that different analytics programs seem to tell you a different story each time you try one? Suppose you try Google Analytics and it tells you you had 29 conversions based on 3,011 visits last month but that you also have WebTrends installed and it says that you had 31 conversions based on 2,831 visits?
Well, probably neither one. None of these analytics programs are totally accurate. They each have errors in the way they collect the data. But you shouldn't care which one is correct. Nor should you worry about this level of accuracy. What you should embrace is the trends they show you.
You only need one analytics program. Yes, it won't be accurate, but that's OK. What you want to examine is whether the things you are changing are improving conversions or not. Whatever inaccuracies are inherent in the analytics are stable from month to month, so just pay attention to whether your site's metrics are improving, based on the actions you are taking, or getting worse.
So, rather than being concerned about a standard way of measuring conversions, pick a way that works for you and start making decisions on what the data tells you. The secret isn't accuracy, it's action.
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.
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