Mastering Online Conversion | Reklama w internecie

01-1-70

Defining Online Conversion: The Multi-Channel Component

Posted by admin

Online conversion is not only the result of online activities. Rather, the conversion process can be initiated by an offline channel, such as direct mail, catalog, flyer, TV advertising, mobile, print advertising and even radio advertising … or even prompted by brand or retail.

On the other hand, the conversion doesn’t really need to happen online, but it could happen in a physical retail store, over the phone or even using a mobile phone.

Consequently, measuring and optimizing conversion for multi-channel merchants, as well as for B2B marketers, where conversion is most often achieved in a live meeting, is a complex issue.

What Initializes Conversion?

Why do we even care which channel initiated the conversion?

Optimizing for the Source Consumer
Different sources of conversion always generate different results. A TV customer will convert at a different rate than a catalog customer, and an SEM customer will convert at a different rate than a print customer. The point is, each source of traffic delivers a different type of prospect. Being able to tailor the on-site experience to these different types of customers impacts our sales success.
Optimizing the Source
By measuring the conversion, and naturally sales, per source of conversion we are able to directly attribute revenues to that source. That allows us to optimize both the source (advertising) and the conversion touch-point (website). It allows us to evaluate each source, decide whether that source is performing according to our standards, and in the end helps us optimize our ad spend by channel.

So far so good. But it gets even more complex.

Imagine this scenario:

TV advertising generated demand for our product.
But instead of going to our website, the consumer goes to Google and does a search for a phrase he remembers from the TV ad.
Google delivers him to our website, where he does not make a purchase, but rather subscribes to our e-mail e-zine.
Our new subscriber then receives 5 more e-mail e-zine issues, before deciding to make a purchase.
But instead of coming directly to our website from the e-zine issue to make the purchase, he again uses Google to visit the website.
He finally ads the product to his shopping cart, but then changes his mind.
Because we already have his e-mail address and have identified an abandoned shopping cart, we initiate an abandoned shopping cart e-mail program.
After 3 follow-up e-mail messages from the abandoned shopping cart e-mail program, the consumer finally completes his purchase and converts.

Or in graphic terms …

This isn’t a sci-fi scenario, but rather a reality we’re seeing in our webstores every day.

For example, in my own experience I’m finding that in our case e-mail e-zines don’t convert the majority of subscribers directly, but rather facilitate the conversion indirectly. Subscribers receive the e-zine, which builds their trust, builds demand and gets them ready for the purchase. But when making the purchase, that same subscriber still enters the website through a Search Engine.

While looking at the conversion from this complex viewpoint does present difficulties, it simply needs to be done.

Just take a look at the number of steps outlined above. Each of these steps represents an optimization opportunity, enabling you to further increase sales. And every step also represents a threat that decreases conversion.

But in addition to the question of how to measure this process, the next logical problem is how you actually attribute conversion to the appropriate channel. It is clear in this scenario that TV started the process. So while each of the following steps assisted in achieving the conversion, the TV advertising needs to be attributed for starting the sales process.

The problem here is that the above scenario is really a simple one. In a multi-channel environment, the paths are much more complicated and can shift from channel to channel, including offline channels, before the purchase is concluded.

Also in many cases it will be difficult to establish the initial channel that started the sales process. If for example you’re conducting a full-scale offline campaign through TV, print, outdoor and radio, all at the same time, all of these media will generate online search, consequently making it impossible to determine from which media exactly the prospect came.

Furthermore, we must not forget that an offline media cannot be taken out of the equation once the sales process has already started. Even while the consumer is receiving our e-mail campaigns, he may be exposed to our offline advertising, further facilitating the purchase decision.

Where Conversion is Achieved?

As if measuring the impact of various sources of traffic and conversion were not enough of a challenge, we also need to take into account that the conversion can be completed using an offline channel.

Many website visitors will make the purchase through your call center, using the phone number on your website.
Multi-channel merchants with their own retail stores or even with retail partners will often see the conversion happening in the physical store.
A website visitor may order a print catalog from your website, and then make the purchase using the phone number in the catalog … or go back to the website and make the purchase there.
In B2B, online will often generate the lead, which will then be processed in-person by live sales reps.

Unfortunately we can never expect to be able to measure the multi-channel environment with 100% precision, but we certainly can get close enough.

What we have to understand though is that measuring multi-channel conversion is not a one-time deal, but rather a long-term process that will slowly enable you to increase measurement precision.

We will return to these issues in more detail in many of the future posts on this blog.

How Can RSS Power Your Internet Marketing and Publishing?
Find out more in the most comprehensive and best guide on RSS for marketers, as acclaimed by leading RSS experts, developers, marketers and publishers.
Click here and get the step-by-step guide to taking full marketing advantage of RSS.

Mastering Online Conversion

Comments (0)

01-1-70

Defining Online Conversion: The Conversion Time Component

Posted by admin

Conversion rate measurement and optimization must also take the time component into consideration.

A conversion can happen instantly or over a longer period of time. If you’re measuring your purchase/visitor conversion rate, the purchase might happen on the first visit, after a few visits or even months after someone has visited your website, subscribed to your e-zine and received weekly communications from you.

I usually define the time component as

immediate conversion (1st visit),
short-term conversion (2-5 visits),
middle-term conversion (first subscribes to e-zine and purchases within a month) and
long-term conversion (purchases after more than one month).

There is no rule of how you define the time component … as long as you understand it, adjust it to your internet marketing processes and use it.

The time component is one of the more important aspects of measuring the conversion rate.

Delayed Conversion
The conversion most often does not happen at the first visit, or often even doesn’t happen after months of visits. Consequently, a specific website element you might be measuring or a specific campaign might not show their real results even months after you’ve implemented them. Judging too quickly and without knowing all the aspects, such as the conversion purchase time scale after the first visit,
will often provide the wrong answer.
Comparing Different Website Elements
In a website test scenario, perhaps doing a simple A/B test, you might be interested in seeing how different modifications increase your e-zine subscribe/visitor conversion rate.
However, changing one element, such as the e-zine subscription box, might also reduce your immediate purchase/visitor conversion, because a strong e-zine subscription box might focus the visitor’s attention to first subscribing to the e-zine.
The question now would be whether the additional number of e-zine subscribers on the long-term generate a higher long-term purchase/visitor conversion rate and if the long-term conversion rate makes up for the loss in the immediate conversion rate?

The Conversion Time Component Example: E-zine Subscription Box

To better understand this, let’s take a look at a quick example of the largest Slovenian webstore, Enaa.com.

The owner wanted to increase their e-zine subscriber/visitor conversion rate. Their first test was to move the e-zine subscription box from below the left-hand detailed navigation box to the top position in the left-hand column, putting it above the search box and above the left-hand detailed navigation box.

Now consider what this modification can cause:

The e-zine subscription box is now highly exposed, thus increasing the e-zine subscribe/visitor potential.
The search box and the left-hand navigation are now hidden deep on the left, with the left-hand navigation actually being below-the-fold, thus decreasing both the search potential and the ease of use with which users can navigate to all the product categories offered in the webstore. Hence, this modification might decrease the instant purchase/visitor and the short-term purchase/visitor conversion rates. Simply put, this modification means that we just decreased our short-term sales to non-subscribers.

Have you noticed that we mentioned three different conversion rates?

e-zine subscribe/visitor conversion rate
instant purchase/visitor conversion rate
short-term purchase/visitor conversion rate

One simple website modification (moving the e-zine subscription box to the left-hand column top) caused a change in three macro-action conversions!

While increasing the e-zine subscribe/visitor conversion rate was our goal, we also need to understand that this simple modification also changed our sales conversion rates.

This is where the time component comes in.

Increasing the e-zine subscribe/visitor conversion rate caused a higher influx of new e-zine subscribers.
These e-zine subscribers will now receive our weekly sales communications via e-mail, thus increasing the number of contact touch-points.
Since the increase in communications also increases our sales potential, it might be safe to assume that our long-term purchase/visitor conversion rate will increase, thus increasing our long-term sales volume.
However, it is also possible that our e-mail communications are so ineffective that the gains in long-term purchase/visitor conversion gains might not make-up for the loss in the instant and short-term sales conversions, for example by generating a lower average purchase value than that of short-term conversions.

The lesson here is that certain modifications might show their true results only after a certain period of time, and may be linked to many of the other activities we are doing.

How Can RSS Power Your Internet Marketing and Publishing?
Find out more in the most comprehensive and best guide on RSS for marketers, as acclaimed by leading RSS experts, developers, marketers and publishers.
Click here and get the step-by-step guide to taking full marketing advantage of RSS.

Mastering Online Conversion

Comments (0)

01-1-70

Defining Online Conversion: The Process Component

Posted by admin

As far back as 2001, Bryan Eisenberg of GrokDotCom broke down conversion rate measurement and optimization by action type:
[BTW - check out Bryan’s optimization e-books, which are an amazing resource for online optimization]

Macro-actions
The macro-action constitutes a complete action performed by the subject, such as finish a purchase, download a whitepaper, subscribe to an e-zine, register at the website, become an affiliate, recommend the website to a friend and so on. This is the big action you want your subjects to take.
Micro-actions
Micro-actions are a series of smaller actions or steps that need to be taken by the subject to complete the macro-action. For example, the complete a purchase macro-action might constitute of the visitor viewing the product page, adding the product to the shopping cart, entering his shipping details, entering his credit card and confirming the purchase. 5 small steps needed to complete the big step.

Bryan argued that each micro-action is a potential leak, where you might be losing macro-actions. By measuring the conversion only at the macro-level marketers are missing the real optimization potential of the website, since in order to optimize the macro-action conversion, you first need to optimize the micro-level conversions.

Consequently it should be clear that measuring just the macro-action conversion rate won’t take you far enough. You need to start measuring and optimizing on the micro-level.

Now, to better understand this concept and to add a third dimension, let’s take a quick look at a model I’ve been presenting at seminars in Europe for a few years now: Internet Processing.

This is also the model I’ve tried to implement in any company I worked with, with varying success, since fully working under this model requires alot of measurement and optimization. But not to worry, you can also implement very basic variations of the model, which don’t take that many resources.

Quick Internet Processing Overview

Internet marketing is a process, not an activity. Hence, measurement and optimization cannot take place only on a single activity level, but should be done for your entire internet marketing process.

I’d need alot more space and time to really explain all the aspects of this, so we’ll just take a look at the simple version right now.

Internet Processing consists of five distinct elements:

The Macro-Process
The macro-process is your complete internet marketing process that takes an uninterested internet user (who still needs to belong to your target audience, of course) through a series of steps (micro-processes), which on the long-term aim to convert that internet user into an evangelist for your company … or any other status you wish to ultimately achieve with that user.
Micro-Processes
Micro-processes are the smaller steps needed for the user to reach your desired status. Each micro-process step changes the status of the user to a higher level. A micro-process can also be understood as a macro-action, but I’m using the term micro-process because each micro-process consists of a series of smaller steps needed to complete the process cycle.
Micro-Actions
Micro-actions are the smallest steps needed for the user to complete the micro-process. These micro-actions are the same micro-actions as discussed above.
Macro Elements
Macro elements are the various campaign types you are executing to get the user from one status to another. These are your input activities that influence the user. Examples include e-zine publishing, e-mail sales campaigns, advertising campaigns, search engine marketing and so on. E-zine publishing in this case would be a macro element.
Micro Elements
Micro elements are individual campaigns that you’re executing. For example, if e-zine publishing is one of your macro elements, an individual e-zine issue would be a micro element.

Consequently, Internet Processing demands that you measure your conversion and optimize it on each of these five levels. Today we’ll just take a look at the 3 parts that are most important for conversion rate measurement, and leave the details of the model for a later time.

Macro-Process

Imagine the macro-process as a sequence of all of the big steps you need to complete with a user to reach your ultimate goal, converting him from one user status to another.

The macro-process will be different for every company, based on your internet marketing strategy. The macro-process needs to support the strategy.

Let’s take a look at a quick example:

The image represents an overall macro-process, with the boxes representing the micro-processes within the macro-process, and the lines showing the current status of the user.

When measuring the macro-process conversion, you are measuring your conversion of getting the user from one stage to another, as displayed here:

For example, the 10% conversion rate from first-time visitor to e-zine subscriber tells you that 10% of your first time visitors are converting into e-zine subscribers. And then, 10% of your e-zine subscribers are converting into loyal subscribers.

What happens if we add some numbers?

Internet users reached: 100,000,000
(our online advertising campaign)
First-time visitors acquired : 10,000,000 [10%]
(the number of visitors we received from the 100,000,000 users reached at a 10% first-time visitor/internet user conversion)
E-zine subscribers: 1,000,000 [10%]
(the number of e-zine subscribers we converted from the 10,000,000 first-time visitors at a 10% conversion rate)
Loyal subscribers: 100,000 [10%]
(the number of loyal subscribers we generated from the 1,000,000 e-zine subscribers at a 10% conversion rate)
Customers: 11,000 [10% & 0,01%]
(the number of customers we converted from the 100,000 loyal subscribers at a 10% conversion rate, and the 1,000 customers directly generated from first time visitors at a 0.01% conversion rate)
Satisfied customers: 1,100 [10%]
(the number of satisfied customers we generated from the 11,000 customers at a 10% conversion rate)
Loyal customers: 110 [10%]
(the number of loyal customers we generated from the 1,100 customers at a 10% conversion rate)
Affiliate partners: 11 [10%]
(the number of affiliate partners we converted from the 110 loyal customers at a 10% conversion rate)
New first-time visitors from our affiliate partners: 1.1 [10%]
(the number of new first-time visitors we received from our 11 affiliate partners at a 10% conversion rate)

Micro-Process

Now, to understand the power of this model for optimization, consider what happens if you increase your overall conversion from first-time visitors acquired to e-zine subscribers acquired, keeping all the other numbers the same.

Let’s say that you manage to increase this conversion to 30%:

Internet users reached: 100,000,000
First-time visitors acquired : 10,000,000 [10%]
E-zine subscribers: 3,000,000 [30%]
Loyal subscribers: 300,000 [10%]
Customers: 31,000 [10% & 0.01%]
Satisfied customers: 3,100 [10%]
Loyal customers: 310 [10%]
Affiliate partners: 31 [10%]
New first-time visitors from our affiliate partners: 3.1 [10%]

Instead of 1,000,000 e-zine subscribers you now have 3,000,000, and this eventually converts to 30,000 customers as opposed to 10,000 customers … just by optimizing your e-zine subscription process.

It needs to be admitted that this demonstration is taking a much to simplistic view of the conversion process, but it should be enough right now to show you the power of taking an overall look at your internet marketing process.

But, in order to get this kind of increase, you actually need to optimize the lead generation micro-process, which in this case is also 10% when we start with it.

So, we need to take a look at the lead generation micro-process:

What does this process tell us?

50% of first-time visitors clicked on the whitepaper banner, which eventually leads to the e-zine subscription
90% of these entered their e-mail address on the first step
40% of these entered the additional required information to register
56% of these confirmed their subscription
In total, 10% of first-time visitors completed the lead-generation micro-process to convert into an e-zine subscriber

To optimize this micro-process to achieve the increase of the e-zine subscriber/first-time visitor conversion rate to 30%, we have two optimization routes, and one of them takes place on the overall micro-process level.

The simplest thing to do –> remove the confirmation micro-action:

By removing the confirmation micro-action, the total conversion rate for the lead generation micro-processes jumped to 18%. This is optimization on the micro-process level.

Micro-Action

The other optimization route is optimizing the actual micro-actions that form the micro-process, for example optimizing the whitepaper banner in such a way that a higher % of first-time visitors take notice of it and click on it.

At the same time, we optimize the field for entering additional information, perhaps removing some required fields to make things easier for our visitors.

60% of first-time visitors now click on the banner.
80% of these enter their e-mail address. As you will notice, this decreased from 90% from the previous example, since the more attractive banner generated more clickers that really weren’t that interested in going forward once they saw what it’s about.
63% of thee entered the additional information and completed the lead generation micro-process.
The overall conversion rate for the lead generation micro-process jumped to 30%.

This was optimization on the micro-action level.

Again, all of these examples were fairly simplistic and did not take the entire complexity of the issue into account, but they should be enough to demonstrate the Internet Processing model, which we will cover in greater detail in the weeks and months to come.

How Can RSS Power Your Internet Marketing and Publishing?
Find out more in the most comprehensive and best guide on RSS for marketers, as acclaimed by leading RSS experts, developers, marketers and publishers.
Click here and get the step-by-step guide to taking full marketing advantage of RSS.

Mastering Online Conversion

Comments (0)

01-1-70

Defining Online Conversion: What Is It?

Posted by admin

In previous articles we covered the conversion benchmarking problems and misinterpreting conversion data without understanding the entire picture. But we never really got around to taking a look at what conversion actually is, what it tells us and why it’s important for interactive marketers.

If you’re thinking "Nah, I already know all of this", give me a few more minutes. The conversion isn’t just about knowing what % of your traffic is turning into buyers or comparing test variables against each other. And, if interpreted incorrectly, it leads to many mistakes that make a dent in the bottom line.

But first let’s define the conversion rate …

What is Conversion Rate?

Wikipedia defines the conversion rate as …

"… the percentage of unique visitors who take a desired action upon visiting the website. The desired action may be submitting a sales lead, making a purchase, viewing a key page of the site, downloading a whitepaper, or some other measurable action."

While this definition is a good start, a broader definition is needed:

The conversion rate is a % of unique actions that result from unique exposures.

The keywords here are:

Actions - a clearly defined measurable activity performed by the unique subjects exposed to our call-to-action [CTA]
Exposures - a clearly defined measurable CTA, presented to a number of unique subjects
Subjects - the number of individuals exposed to the CTA
Unique - all single and clearly identified actions and exposures are only counted once for each individual subject
Call-to-Action - an expressed request for the subject to take the required action after viewing our creative

How is this different from the Wikipedia definition (which comes closest to how marketers view conversion)?

The conversion does not necessarily need to be linked to a website or even happen on a website.
For example, in my e-commerce work I measure the conversion for multiple interactive elements, such as conversion per e-mail open-rate, conversion per ad impression or even conversion from e-mail sent to telephone contact.
By applying a broader meaning to the term conversion rate you are able to apply the conversion rate methodology to a larger number of key interactive elements you wish to measure and improve.
Hence, in the definition, we need to get rid of "upon visiting the website" but rather use the term "exposure".
Unique visitors really cannot be measured accurately online, due to several technical issues.
You can never be certain that two people you are counting as two unique users are really two different people. They might be just one person, accessing your website from two different computers.
And the same goes for an e-mail address; you might have multiple e-mail addresses in your database, belonging to just one real person.
Or even better yet, the visitor might not even be a person, but a computer script.
Consequently, the term unique visitor is really a bad choice of word that might lead to misinterpretation.

The Conversion Rate Formula

The conversion rate formula is simple:

Conversion Rate = Unique Actions / Unique Exposures

Two quick examples to make this easier to understand:

Overall Website Sales Conversion Rate = Unique Sales / Unique Visitors
[if your Overall Website Sales Conversion Rate is 5%, it means that 5% of the people that visited your website purchased something]
Overall E-mail Sales Conversion Rate = Unique Sales / Unique E-mail Addresses
[if your Overall E-mail Sales Conversion Rate is 2%, it means that 2% of the people that your e-mail was sent to purchased something]

This is of course a very simplistic conversion rate formula. In most cases you would need to go into much more detail to get any usable numbers.

What You Are Actually Measuring With the Conversion Rate?

The conversion rate is a measure of your efficiency. It tells you approximately with what efficiency you are getting the people that are exposed to your CTA to take the action you want them to take. There are several different types of conversion.
The conversion rate does not tell you the whole story about your efficiency –> it depends on the sources of traffic you are utilizing, the audience you are reaching, your brand, all of the elements of your CTA and so on. Consequently, the conversion rate is an indication of your overall internet marketing efficiency, not just your website efficiency.
The conversion rate is not a measure of your success. It only tells you part of the story. And in some cases, as we already discussed, a lower conversion rate might actually be generating better financial success than a higher conversion rate.

How Precise is the Conversion Rate?

Due to multiple internet technology issues, the conversion rate is not a precise measure. It should not be viewed as an absolute metric, but rather used as a trend indicator.

The more focused your conversion rate measurements, the more precise trends you will get.

For example, measuring the overall sales conversion of an entire website with all of its traffic sources gives you a completely useless number.
Measuring the overall sales conversion for a single type of traffic source, such as Google, gives you a number you can start working with.
Measuring the overall sales conversion for a single Google campaign gives you really the first usable piece of information.
Measuring the conversion rate of various sales process elements for a single Google campaign gives you a strong piece of information that you can use to improve your marketing.

How You Can Use the Conversion Rate?

Improve the performance of your campaigns without increasing your ad spend.
Improve the overall performance of your website or other CTAs.
Forecast the sales results of your online advertising campaigns.
Compare different interactive test elements.
And much much more …

OK, enough for the start. If this article seems a little technical in nature, don’t run away. I promise the next one will be more practical, as we start looking at the various types of conversion rate you can measure.

How Can RSS Power Your Internet Marketing and Publishing?
Find out more in the most comprehensive and best guide on RSS for marketers, as acclaimed by leading RSS experts, developers, marketers and publishers.
Click here and get the step-by-step guide to taking full marketing advantage of RSS.

Mastering Online Conversion

Comments (0)

01-1-70

How Traffic Sources Impact Test Element Conversion Rates

Posted by admin

Website conversion rates are some of the most important Key Performance Indicators (KPIs) for measuring how well your internet marketing works. However, measuring conversion is daunting task, since conversion rates themselves do not tell us enough to really asses our performance adequately or benchmark our website against industry averages.

One of such problems, covered in the previous example, is that a higher conversion rate may actually be costing you money. We took a look at a real DVD sales example where 2 price points were tested. The higher price point generated a lower conversion rate (CR), but greater overall profits due to a higher margin.

In this case, looking at the CR, but not looking at overall project profitability, would lead us to making the wrong decision.

Today I want to cover one last example of CR measurement problems, before we move into actually using CR to measure and optimize your performance.

For this example, let’s take a look at a single website that’s testing two different elements to see which one generates a higher conversion rate.

	Element #1	Element #2
CR	5%	7%

With the above numbers, we’re looking at the aggregate CR data for each element, trying to asses the one we should go with to reach the best possible results.

Not looking at any additional data, Element #2 would be the clear winner.

But in this case, the website did the test using two different traffic sources. Today we won’t look at all of the traffic source specifics, such as costs, sales, CPO or profits, but just at the implications of what using different traffic sources means for your CR.

	Element #1	Element #2
Total CR	5%	7%
Traffic Source #1 CR	8%	4%
Traffic Source #2 CR	2%	10%

When evaluating these numbers let’s presume that both the traffic sources:

generated an equal amount of traffic in total,
generated an equal amount of traffic per test element,
cost the same,
generate the same value per converted customer.

This would of course never be the case, but adding additional data would just further complicate things at this point.

So, looking at the data, it’s clearly evident that Traffic Source #1 generates a high conversion rate for Element #1 and a lower conversion rate for Element #2, and vica verca.

When doing your online advertising, this is a very realistic scenario. Each traffic source caters to different audiences, who will react differently to your marketing messages.

In this case, each traffic source’s audience responds better to an individual test element.

Everything else being equal, this means that determining any of the two test elements in the test as a clear winner would be a big mistake, wasting you customers and money.

What’s the solution?

Quite simply, if and when your tests prove that different traffic source audiences respond differently to your different test elements, the only solution is to implement a solution that allows you to display the winning element for that traffic source to the audience that comes through the source.

Essentially, both of the test elements are winners. You need to select both.

How Can RSS Power Your Internet Marketing and Publishing?
Find out more in the most comprehensive and best guide on RSS for marketers, as acclaimed by leading RSS experts, developers, marketers and publishers.
Click here and get the step-by-step guide to taking full marketing advantage of RSS.

Mastering Online Conversion

Comments (0)

01-1-70

I Want a Lower Conversion Rate!

Posted by admin

In parts 1 and 2 of Conversion Benchmarking Hell we discussed why benchmarking your conversion rates against industry figures just doesn’t work, basically saying that conversion benchmarking is the one of the greatest hoaxes in internet marketing.

The key message throughout the two articles was that conversion rates tell only a small part of your internet sucess (or failure) story, but never enough to enable you to come to any concrete conclussions, at least without taking a look at all the other relevant data.

Today, to bring the final point home, we’ll take a look at an example of when the conversion rate missleads you into making the wrong decision.

I Want a Lower Conversion Rate

The following data is from a real example we had a couple of months ago. When selling a DVD package, we split-tested two different price points againts eachother: $54.95 and $77.

Here are the conversion rates (CR) for both of the tests:

Price Point	$54.95	$77
CR	6.8%	4.2%

Price point $54.95 generated 61% more sales quantity than price point $77.

Just by looking at the CR, it would seem that $54.95 is the better way to go, right?

The results stay the same even after we add the sales quantities and other data:

Price Point	$54.95	$77
Reach	1,000	1,000
CR	6.8%	4.2%
Sales Quantity	68	42
Revenues	$3,736	$3,234

Even with a bigger price tag, the $77 price point generated 13.5% less revenues. But is it better?

The CR would certainly indicate so, but not when we also add the margins:

Price Point	$54.95	$77
Margin	$10	$32.05
Reach	1,000	1,000
CR	6.8%	4.2%
Sales Quantity	68	42
Revenues	$3,736	$3,234
Profits	$680	$1,346

Essentially, the $77 price tag generated more profits, even though it generated a smaller CR, smaller sales quantity and smaller revenues.

Clearly, in this case, using the CR, sales and revenues to determine the best price tag would result in lower profitability of the project. Instead it was better to opt for a smaller conversion rate, less revenues and smaller sales quantity, but better profits.

So how important the CR really is?

What do you base your optimization decisions on?

Will be discussed in future posts …

How Can RSS Power Your Internet Marketing and Publishing?
Find out more in the most comprehensive and best guide on RSS for marketers, as acclaimed by leading RSS experts, developers, marketers and publishers.
Click here and get the step-by-step guide to taking full marketing advantage of RSS.

Mastering Online Conversion

Comments (0)

Reklama w internecie

Marketing internetowy

Archive for the ‘Mastering Online Conversion’ Category

Defining Online Conversion: The Multi-Channel Component

What Initializes Conversion?

Where Conversion is Achieved?

Defining Online Conversion: The Conversion Time Component

The Conversion Time Component Example: E-zine Subscription Box

Defining Online Conversion: The Process Component

Quick Internet Processing Overview

Macro-Process

Micro-Process

Micro-Action

Defining Online Conversion: What Is It?

How Traffic Sources Impact Test Element Conversion Rates

I Want a Lower Conversion Rate!

Recent Posts

Ads

Pages

Categories

Archives

Meta

Blogroll

Reklama w internecie

Marketing internetowy

Archive for the ‘Mastering Online Conversion’ Category

Defining Online Conversion: The Multi-Channel Component

W­h­at In­itializ­es­ C­on­ver­s­ion­?

Wh­e­r­e­ Co­n­ve­r­sio­n­ is Ach­ie­ve­d?

Defining Online Conversion: The Conversion Time Component

T­h­e­ C­on­­ve­r­sion­­ T­ime­ C­ompon­­e­n­­t­ E­xample­: E­-zin­­e­ Subsc­r­ipt­ion­­ Box

Defining Online Conversion: The Process Component

Q­u­ic­k In­tern­et Pro­c­essin­g­ O­v­erv­iew

M­ac­r­o­-Pr­o­c­ess

Mic­ro­­-P­ro­­c­e­s­s­

M­icr­o­-Actio­n

Defining Online Conversion: What Is It?

How Traffic Sources Impact Test Element Conversion Rates

I Want a Lower Conversion Rate!

Recent Posts

Ads

Pages

Categories

Archives

Meta

Blogroll

What Initializes Conversion?

Where Conversion is Achieved?

The Conversion Time Component Example: E-zine Subscription Box

Quick Internet Processing Overview

Macro-Process

Micro-Process

Micro-Action