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CRO] subster's Conversion Optimization 102

Discussion in 'Copywriting & Sales Persuasion' started by subster, Apr 8, 2013.

  1. subster

    subster Elite Member

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    After the big success and the cheering crowds of the very grateful BHW community I present you part 2 of subster's Conversion Rate Optimization course ( Please find 101 here ):

    subster's Conversion Optimization 102

    Today we will take look deeper into the word "conversion". I decided to make the course a bit smaller and easier to snack for you. Our programm this evening:


    1 - What means a "GOOD Conversion Rate"
    2 - The tells us the conversion rate and what not?
    3 - How to measure the CR correctly.

    1 - What means a "GOOD Conversion Rate"

    For many marketers the CR is the holy grail of online marketing. This is stupid ( but to be honest, much more intelligent then the point of view that backlinks are ).
    There are case studies that compare conversions rates. A US online shop claims a CR by 40% within one of those example. Things like this and other ridiculous things can be found if you dig into the topic called "Conversion Rate".
    I worked with many. I worked with SEM agencies that showed reports with a 10% adwords conversion rate. I 've talked to ecommerce colleagues who used webalizer data to calculate their conversion rate and often, very often I saw business owners faking the numbers just for themselves. Yeah, for the warm and fluffy feeling inside the stomach. There is no general thing like a good conversion rate. Stop searching for it. Keep watchin it. Long term! If it grows while you do changes you are doing something right. There is nothing like a good conversion rate in general - it all depends: Buying very targeted traffic from Adwords as main traffic source? Will most likely result in a good CR. Have big organic traffic from Reddit, StumbleUpon, Instagram and other sites? Most likely trash traffic that lowers your CR. So you understand there is nothing like a general GOOD conversion rate.

    A high conversion rate is the goal. NOT. Sure you want it, but it is not the goal of all of our efforts when we start a Conversion Optimization. Let's see why...

    2 - What tells us the conversion rate and what not?

    UVs * Conversion/100=Conversion Rate

    This is a formular, but nothing more. It is an analytical metric, which tries to make something "invisible" touchable, it is an indicator, something to throw eyeballs continiously on, but not permanent. This metric gives us a number to measure if the amount of actually converting visitors grows or decreases. Period.

    CR shows us just a relation between visitors and their behaviour. A conversion rate does not show you how satisfied your customers are and if they would purchase again from you, if you build a loyal customer base and last but not least it even does not say anything about your revenue - the most important vitality factor of every business.

    3 - How to measure the CR correctly

    My guess is that 80% of all measurements are wrong. And the most of them aren't knowing it.

    Example Amazon:
    How dies Amazon Partnerprogramm calculate the conversion rate?
    Purchased products / Clicks * 100 = Amazon-Conversion-Rate

    This is stupid! Not the amount of purchase products, but unique visitors that have purchased in general are counting. If a visitor purchases 3 products means not that there are 3 conversions like amazon tells its affiliates.

    - Only UVs are counting in bound timeframe (1Day, 1 Week, 1 Month)
    - Only one conversion per UV counts! You can only persuade a visitor once. If the UV purchases a few times more, or like amazon has a few items in the shopping cart are this not all single conversions! This will mess up the validity of your data! We want to measure how often our websites are persuades FRESH visitors to buy something or do a defined action. This is what we want to do with conversion optimization. Counting every article or multiple purchases by the same UV says nothing about the performance of your property.
    - Measure multiple KPIs - conversions are not enough! For example the shopping cart value is a very important KPI Factor. RpV (Revenue per Visitor) has much more meaning about your overal success in terms of money - the goal we are behind actually.

    And in the next part we will take a look at the 55th Rule of Acquisition by the Ferengi

    Always sell at the highest possible profit​
     
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