Tuesday, April 28, 2009

Your True Conversion Rate: A better way to look at goal conversion

If you ran a telemarketing company booking attendees for a conference, would your success rate depend on the people on your list, or every person in the world with a phone?

If you were a car dealership, would your close rate be based on people who came into the dealership, or everyone in town with a driver’s license?

Fairly easy answers. Let’s start applying the same principles to your web business.

When you open up your web analytics tool, one of the first number you look at (or should look at) is your conversion rate. Your site has a defined goal, regardless of whether you sell something direct; generate leads, names or donations.

This goal conversion number most likely is generated by answering this question:

What percentage of all the people that came to my website completed a defined objective.

This doesn’t take into consideration the fact that many of these visitors are unable to complete this objective at all…and frankly you don’t want them to.

Quick example: Let’s say that the car dealership mentioned above had a website, whose goal was to generate names and requests for contact from a sales person. This dealership really only wants to generate names in the defined geographic region in which they can sell cars. When then does their goal conversion rate include visitors from Asia? They won’t be buying a Passat in Texas any time soon.

eCommerce conversion numbers suffer from the same issue. If you don’t ship outside the continental United States, why does your conversion rate include every visitor in the world? Not only does this make your numbers inaccurate, in many cases it makes the goal conversion numbers lower than they should be.

I was doing some work last week for a new client whose primary goal is signing up for trials of their software online. While anyone can sign up, their exclusive sales focus is on the North American Market. After creating a quick custom segment in Google Analytics, it was easy to see how they were really performing at achieving this goal.

Once you know what the purpose of your online presence is, think about who you want to achieve it. The associated reports might surprise you, and delight your boss.



This week’s takeaway: Try building a filter in your analytics tool around your primary conversion segment. If you need some assistance, drop us a line.

Monday, April 20, 2009

Feelings – Nothing more than feelings…

Welcome to the Napkyn blog. It has been an exciting month, with new clients coming on board, a brand new website coming out within the week and fantastic feedback and results on our unique approach to understanding your digital business.

All the work we have been doing at Napkyn during this recent period has been executed alongside a clearly defined plan. To some extent, we know (give or take a little) where Napkyn is based on our 2-year plan, and what we need to be doing to meet and exceed our targets.

I know, that’s “business 101” stuff.

The reason I mention all this is because this level of planning, reporting and analysis is still sorely lacking for most companies at the digital level.

Every day I talk to business owners and executives who are still focusing on traffic generation and website uptime, and making all other decisions based on gut-checks and guesses.

One company I am in talks with is a fast growing pure play retailer in the apparel industry. They have had substantial year over year growth in sales because of their quality product and attention to customer service. However in a discussion a few weeks ago, their CEO asked me if I thought they should terminate the agreement with their search marketing company because he ‘felt’ that their results had been slipping.

From a seasoned executive who knows his inventory to the product and calls customers personally, this is a pretty odd question to ask. The reason was because they had no historical understanding of what this vendor had accomplished and no baselines set when they came on board. Is this simply because the economy is poor right now? Would you be in worse shape if this vendor hadn’t been driving qualified traffic? Are they a wasteful spend?

A holistic approach to digital analysis is vital for any business that spends more than a dollar a month online. Otherwise you don’t know where you came from, and you sure won’t know where you’re going. Thousands of dollars will continue to get spent on nothing more than feelings.


The Napkyn Team

This week’s takeaway: When you make a major change to your business, like adding a new vendor, establish some firm baselines for metrics they are supposed to influence. It will help you ‘feel’ a lot better once you have to start justifying the bills.