Improving Conversions: Difference Between Larger and Smaller Companies

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Based on all of the buzz about “conversion” it seems that it has become the metric of the year for online marketing. A few years ago, although marketers were certainly aware of “conversion” very few companies talked about it. More so, very few companies ever cared to measured it. Now about every website design and search marketing company suddenly offers “conversion” services. Nevertheless, as the buzz surrounding conversion increases it’s important to remain grounded on the performance fundamentals regarding pay-per-click marketing (or any marketing for that matter).

I bring up this topic because of recent and repeated conversations I have had with prospective customers. Both were seriously focused on increasing their sales conversion rates. I have to admit that I appreciated them recognizing the value of conversion improvement for their web business. But I was concerned with how well they understood the dynamics of conversion rate optimization and how it would unfold for their web businesses.

In my opinion, I find that Fortune 1000 companies have different conversion challenges than smaller or mid-size ones. For example, many of these enterprises have internal marketing staff or deep budgets for large outsourced providers to focus on identifying and attracting qualified visitors whether from online or offline sources. In addition, many of these large companies have powerful brand names and multi-channel structures that also help attract qualified visitors to their websites. For these enterprises, the conversion challenge is one of managing scale with delivering a powerful customer experience. Meaning how do they serve a satisfactory experience to hundreds of thousands to millions of visitors per month that influences them to buy and remain brand loyal. In this example, most of the “conversion” process unfolds on their website.

On the other hand, smaller businesses don’t possess the same range of internal resources or the large budgets to outsource advertising to focus on attracting qualified visitors. After speaking with hundreds of them over the years, they simply want to get “traffic” to their websites. They work effortlessly generating traffic from every means possible and many achieve success generating upwards of 100,000 visitors a month. In addition, many of these businesses do not possess recognizable brand names or other channels like brick and mortar stores (at least not vast footprints) to rely on attracting qualified visitors. Smaller businesses must rely fully on organic, home-grown visitor volume growth.

Due to these challenges, I believe visitor quality becomes secondary to visitor quantity. Companies spend time on ramping up traffic, they reach 50,000 and “BAM” they realize their conversion is at .001% – ask “why” and “how do I improve it?”.

Here is where major changes occur in applying conversion improvement to smaller businesses than larger enterprises. For smaller businesses improving conversion involves not only altering their website to improve the customer experience but also analyzing and optimizing their advertising channels to improve visitor quality. Because if visitor quality is improved (“quality” being defined as a higher relevance between the visitor’s intentions and the business’ offer, product or service) then conversion typically increases as a result.

Therefore, if you own or operate a smaller business or any size business that hasn’t focused on attracting and optimizing quality visitors, it is a good place to start to improve conversion. Here’s a case study example:

I had a client that was experiencing a low conversion rate and they engaged us to help improve it. On average they were generating about 120,000 visitors a month from multiple online sources including PPC (including contextual advertising), SEO, affiliates, micro-sites, and email marketing. It was great volume, a huge target for increasing conversion but it was a hodge-podge of quality.

After spending countless hours upon hours analyzing current data and processes, we discovered some immediate concerns. First we discovered that a few of their PPC campaigns including their contextual advertising were generating zero return. In essence, these campaigns were adding numbers to one side of the conversion equation (visitors) but adding nothing to the other side (sales). We made recommendations to shut these campaigns down for the time being (since they weren’t being managed properly) and to re-focus their limited resources on managing their larger and higher potential advertising channels.

We also discovered that their affiliates were not being tracked and managed effectively so a good percentage of the visitors being sent though the affiliate channel were of poor quality. Therefore, we recommended that the affiliate program be assigned a manager and that the program be re-organized.

We also assessed the keywords attracting the visitors, their behaviors and the search channels’ financial/performance metrics. Additional recommendations came forth from our assessment as well as suggestions for their email marketing.

Concurrent to re-organizing their advertising to focus on generating higher quality visitors, we also implemented some missing conversion best practices and installed a more robust analytics program.

A few things resulted from this initial (first few weeks) of analysis and recommendations: (1) the client’s average cost per sale dropped because they reduced the advertising spends from the PPC and contextual ad programs that were not performing (2) their conversion rate increased because the total number of unqualified visitors dropped while the qualified (those who were ordering) remained equal and even increased after implementing the best practices. The next step was to carefully manage the remaining advertising channels to improve quality (keyword selection, ad copy, landing page optimization, etc.) while assessing their new analytics to identify other conversion barriers for future changes.

The point is – if you want to increase conversion don’t focus solely on your website but also on the quality of the visitors you are attracting from your current advertising channels. Both play an equal role in calculating conversion and both can attribute to an outstanding or poor conversion rate.

About the Author

Kevin Gold is Director of Internet Marketing at iNET Interactive, a social media company operating prominent online communities for technology professionals and technology enthusiasts. Kevin is a frequent contributing author to multiple publications including Search Marketing Standard, Practical eCommerce, DIRECT, Entrepreneur.com, ConversionChronicles.com, About.com, and On Target (Yahoo! Search Marketing newsletter).

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3 Comments

  1. good points and a great reminder to see your online venture as a whole and not just each bit individually.

  2. mislyd

    Thanks Kevin for your insightful article! How did you know which channel (PPC/ email/ offline etc) brought in the sales when you first spoke with the client? I assume they were not tracking it.

  3. Hi Mislyd, Initially the client provided financial data from their shopping cart (they were using Volusion) and we gained some information from their basic web analytics program. We also installed Google Analytics right away (our normal first step for many clients when they are using a basic analytics program or if they don't have one.) The client had some affiliate and high-level PPC tracking setup in Volusion but no one paid attention to it. What I find frequently is that clients don't have the time or skilled resources to commit to studying their analytics or if they do, the analytics they are using paints a different picture than actual reality. After a few weeks we found a number of errors in the client's initial tracking as well which complicated the process but we re-worked it and added additional tracking of their site's merchandising strategy (e.g. home page banners.) That led to a lot of new insights and supported a number of conversion strategy decisions. It's very time consuming work but it develops the foundation for future improvement. Many times, increasing a site's conversion involves so much more than just simple design or placement changes - instead it requires market startegy, advertising and analytical changes as well.