You want it quick and straight. You pull up to the window at the fast food place. My voice crackles over the intercom, "May I help you?"
"Hey, Grok! Two burgers, large fries, a medium diet soda, and what's the most important statistic I should pay attention to in my e-business?"
"Conversion rate. That'll be $4.59 at the second window, please."
You can get as fanatical about your website metrics as baseball fans do about player stats if you want1, but the number one measure that is going to give you the best indication of your success online is your conversion rate. "Any serious company on the Internet should have an absolute awareness of conversion rate. Small gains on low conversion rates can have unbelievably powerful effects on a company's performance," says J. William Gurley.2
"So what is a conversion rate, really?" you ask. Conversion rate the number of folks who visit your site within a specified time period divided by the number of folks who actually do something productive on your site (like buy or register or subscribe). These days, a conversion rate of 2-4% is considered average, below 2% is shabby and 10% or more is spectacular. (Notice, though, if you compare these percentages to the bricks and mortar world, they are all pretty tragic. Offline, the average conversion rate is around 50%. So, your site can do better than 2% or even 10%, and isnt that great to know?)
Gurley has done the math for you:
Let's assume you spend $10,000 [in advertising] to drive 5,000 people to your site, and your conversion rate is 2 percent. This means that 100 transactions cost you $10,000, or $100 per transaction. Now let's assume your conversion rate rises to 4 percent. The same $10,000 buys you 200 transactions at a cost of $50 per transaction. An 8 percent rate gives you 400 transactions at a cost of $25 per transaction.
It all seems so simple. Higher conversion rates mean more money coming in and less money spent to attract a customer. Heres a flash: it IS simple; dont make it complicated.
So how do you get those higher conversion rates? Heres a recap of a lot of the stuff Ive talked about. For more details, check out the archives.
· Get your site to your visitor fast! Minimize download times and don't bother with slow-loading graphics. If you can get your site to download in under 10 seconds, your visitor is far less likely to bail and up goes your conversion rate.
· Make your value proposition, or unique selling proposition really, really clear.
· Give your visitor immediate and powerful confirmation that theyre in the right place, that you have what theyre looking for.
· Make sure your home page makes a crisp and professional impression.
· Design a site with super navigation that reflects an intuitive buying process, superior content and delightfully clear and simple checkout (with all the options, ma'am). Easy-to-use sites have much higher conversion rates.
· No bugs. Test, test and then test again to make sure your site is error-free. Folks simply won't tolerate your inability to get it right. They'll vote by leaving and never coming back. Watch that conversion rate drop.
· Cater to the visitor who knows what she wants right now. Give your customers fewer clicks to complete a purchase and your conversion rate will rise. The power of a one-click purchase is sublime.
· Evaluate how folks buy on your site and then tailor your offers to their preferences. You might find that people want bundled products rather than individual offerings, or vice versa. Listen to your customers, and be willing to get creative.
· Make sure, before you go spending your advertising dollars, that you invest in an excellent site. Don't do it halfway, and don't design to please the designers or programmers. Your customers reign. Keep 'em happy, and they'll have you jumping up and down with higher conversion rates.
Better conversion rates dont just mean more sales, they mean more sales without additional marketing expenses. Plus, conversion rates not only determine how much youre selling, but also tell you a lot about whether you are tuned in to the things that matter to your customers: performance, convenience, quality, value and customer service.
So follow the list above, and watch that wonderful conversion rate climb!
1 Paco Underhill, "Conversion rate is to retail what batting average is to baseball." Why We Buy, Simon and Schuster, 1999, p. 36.
2 "The most powerful Internet metric of all." J. William Gurley, Above the Crowd, 21 February 2000. <http://www.news.com/Perspectives/Column/Textonly/0,197,403,00.html?st.ne.per.col.pfv>