Measuring Conversions for Lead Generation Sites

Does your company sell a service or a product with a long selling cycle? If so, your web site is likely a lead generation site. To measure the effectiveness of your advertising campaigns, it is imperative that you know the value of each web site lead. Here’s how…

Let’s assume that your web site has a contact form that visitors fill out online. In this instance, a conversion would be a successful completion of your form. Now you need to know the following:

1. Historical count of contact forms filled out (conversions),
2. Number of contact forms that lead to a revenue event,
3. Value of each revenue event.

Let’s look at an example of a real estate agent. She reviews the forms filled out over the past 12 months and counts them all up. [To make it easy, she has kept all of the inquiries in a special folder in her email application.] She then reviews the number of houses she has sold over the past year and identifies which of those clients came through her contact form. Now she knows:

• Her average revenue event (commission) for a home sale was $10,000
• 1 out of 50 people who filled out a form ultimately bought a house from her, for a conversion rate of 2% [1 divided by 50 times 100]
• Therefore, the value of each internet lead is $10,000 x 2% = $200

That means that every contact form that shows up in her inbox is potentially worth $200. Now she can easily see if her PPC campaign is paying off. For example, if her PPC cost-per-conversion is $125, then she’s only paying $125 for a lead worth $200. That’s a 60% return on investment (ROI). It’s clear to see the value.

Using a web site statistics program like Google Analytics, you can do this with your SEO campaign, as well. Let’s say you spent $5,000 on SEO work to get a top 5 ranking for “Raleigh real estate”. How many leads did that new search term ranking bring you? Was it worth $5,000? You don’t have to guess.

So start keeping track of your number of forms filled out and determine the value of a new customer. Then you’ll never have to wonder, “Is my PPC campaign paying off?”

Need help determining the value of your leads? Get a no-obligation quote for SEO Services...

Google AdWords Ad Scheduling

Google AdWords introduced a new interface that allows advertisers to choose when you want your PPC ads to display. With ad scheduling, you can choose the hours and days your ads will run: 9-5 weekdays, Saturday evenings, or whenever business is hottest.

I keep all of the leads from my web site in a special email folder. With a quick scan, I saw that none of the leads that have came in over the weekend have converted into clients. Most are one-person, part-time companies who can't afford the services of a professional SEO firm. I also saw that I received virtually no leads before 8:00 AM or after 7:00 PM (my ads are only showing in the U.S). Based on these pieces of information, I choose to only show my ads M-F during normal business hours.

If you’re consistently hitting your target budget every day, you should strongly consider ad scheduling. When you hit your budget every day, Google only shows your ads sporadically throughout the day. Through ad scheduling, you can specify that you’d prefer to have them show during normal business hours, for example, instead of in the middle of the night.

Of course, depending on your product or service, the middle of the night may be the perfect time for your ad. (Insert your own joke here.)

Need help setting up ad scheduling? Let me know…

Measuring Conversions for Ecommerce Web Sites

In our post entitled Focus on Revenue, Not Rankings, we discussed the importance of measuring conversions on your web site. Today we’re going to look at one type of web site: an ecommerce web site. For our purposes, an ecommerce web site is one that sells products or services directly online through a checkout process.

Understanding conversions for an ecommerce web site is pretty straightforward: a conversion is a successful online sale. The value of the conversion is the value of the transaction. Let’s look at an example of a fictional site that sells bicycles online, Mikey’s Bikeys. Using this information, we can calculate the conversion rate for Mikey’s site:

• In April, Mikey’s site had 5,000 visitors
• In the same month, he had 50 separate sales
• Sales totaled $7,500 (average sale = $150)

The conversion rate is simply the number of sales (conversions) divided by the number of visitors: 50 / 5,000 = .01, or a 1% conversion rate. Put another way, 1 out of 100 visitors to the site make a purchase.

Mikey’s goal is to get his monthly sales up to $15,000 (double his current average). How can he accomplish this?

• Double his traffic.
  Assuming Mikey could maintain his 1% conversion rate, an increase in traffic would translate into an increase in sales. He may try offline advertising to drive people to his website (radio, TV, newspaper), PPC ads, an SEO campaign, adding more informational pages to attract buyers in each phase of the buying cycle, or other methods to drive qualified traffic to his web site.
  
• Increase his conversion rate from 1% to 2%.
  To double his sales, Mikey needs to increase his conversion rate by only 1%. This small increase from 1% to 2% will double Mikey’s revenue. He may try streamlining his checkout process, making his “call to action” (add to cart) more clear, adding testimonials or other items to increase visitor confidence, or adjusting his SEO and PPC campaigns to exclude unqualified visitors.

What else could Mikey do to increase his conversion rate? Post your comments below.

Need to increase your online sales? Get a no-obligation quote for SEO Services...

SEO Training Course Discount

If you're a member of my SEO Tips newsletter, you received an email today with a huge discount on our Search Engine Optimization Training course on June 8 in Raleigh, NC. The bi-weekly newsletter is free and contains summaries of some of our best SEO articles as well as exclusive subscriber discounts. If you haven't signed up already, what are you waiting for?
Sign up now: http://www.ciinc.com/seo/newsletter.htm

Jakob Nielsen's Usability Newsletter

Are you a member of Jakob Nielsen's "Alertbox" Usability Newsletter? If not, head on over to his web site to sign up: http://www.useit.com/alertbox/subscribe.html

Every two weeks you'll get an email outlining one of his recent study findings. This week, Jakob revealed his findings on user experience testing on B2B web sites. He makes some really good points about B2B sites not utilizing a "shopping cart" mentality because they don't sell their products or services directly online. But if your site is a lead generation tool, the concept of a "shopping cart" is very valuable to think about.

• Do you have a form on your web site to collect leads?
• Does every page on your site have a clear "call to action" that guides the user to successfully completing the transaction (giving you their contact information)?
• Can the user find their way back to the "cart" (contact form) from any page on your web site?

These are some good questions to think about. Head on over to Jakob's site to read the article...

SEO Stakeholders

As SEO and PPC campaigns become more competitive and higher priority in organizations, it is imperative that everyone have at least a basic understanding of what is involved and what results are realistic to expect.

Marketers provide the content. Marketing is right in the name: Search Engine Marketing. Search engines rely on quality content, and this content typically comes from your marketing department.

Web Developers implement the changes. The IT team must work together with the marketing team to upload the new content. Some changes require modifications to coding on the page that only the developers can implement. Also, developers need to understand the implication of renaming files, changing directory structures, or moving to a new web site technology (for example, a change from .php to .aspx has the effect of renaming every page on the site).

Managers & Business Owners must have realistic expectations about how soon to see results and what results are realistically obtainable. Simply put, SEO takes patience. Google, in particular, can take months to reward your SEO efforts. A brand new site may take 6-9 months before it starts to rank well for primary keywords in Google. Managers and business owners need to understand the SEO process in order to accurately measure the success of those on the SEO team.

At our SEO Training Classes, we're seeing registrations from not just web developers, but marketing executives, business owners, and managers. They all need to understand what is involved in managing a SEO campaign and what results are realistic to expect.

Find an upcoming SEO Training Class in your Town

Yahoo and eBay vs. Google and Dell

As summer approaches, the search engine wars heated up quite a bit this week. The stock prices for both Yahoo and Ebay rose this week as they announced a joint partnership to provide services to each other's customer base. Of particular interest to PPC advertisers, Yahoo has become the exclusive sponsored search provider to eBay. That potentially means more eyeballs for Yahoo Search Marketing ads.

Not to be outdone, Google countered with the announcment of a partnership with Dell computers. Of particular interest to organic search marketers, Dell computers will ship with the Google Toolbar and a co-branded Internet homepage. This will likely lead to even more searches on Google, who already control 50% of all Internet searches.

Neither of this is good news for MSN, who maintain a distant third in the search engine race. And Ask.com? Hopefully they won't go the way of Jeeves...

Read more on Cnn.com:
Yahoo, eBay announce partnership
Google chief: We're getting a Dell