To start, let’s go over obvious –
Why conversion optimization is crucial?
Well, let’s run the numbers to paint a picture.
In our example, we have 5000$ ad budget what brings about 10 000 leads to our landing and 1% (100) of them converts to paying customers. If CLV is 75$, you will end up with 7500$ in revenue and 2500$ margin.
How to go from there? If we raise ad budget 2x, our new 10 000$ budget will bring us 20 000 leads and 1% (200) of them converts, what leads to 5000$ margin. Makes sense, right?
But what if we manage to improve our landings instead, so it will converts 2% instead of original 1%? Let’s say to make those improvements we invest 5000$ for optimization related development. It should look something like that:
| Ads Cost | Leads | Conversion | Optimization Cost | CLV ($) | 1 Month | 12 Months | |
| A | 5000 | 10000 | 1% | 0 | 75 | 2500 | 30000 |
| B | 5000 | 10000 | 2% | 5000 | 75 | 5000 | 120000 |
| C | 10000 | 20000 | 1% | 0 | 75 | 5000 | 60000 |
| D | 10000 | 20000 | 2% | 5000 | 75 | 15000 | 240000 |
If You run the math, it’s quite clear, why improving Your conversion rate, will make huge difference. It’s crucial to understand the main difference between raising ad budget with current conversion or investing to optimization – first is like a jukebox, you but coins in and it plays, but stops immediately after you are out of coins. With website conversion optimization it’s like a having a tattoo – hurts a bit once, but that butterfly on your lower back will stay.
Start conversion optimization with obvious errors.
You can google up the most common conversion killers, but our usual suspects are:
| Problem | Solution |
| Site is slow | Use lightweight pictures and videos or remove unnecessary fillers. |
| Page does not rank | Keyword analysis and optimizing top pages for top keywords. That also includes pictures (many times not optimized at all). |
| Mobile version sucks | Today about 80% of online traffic is done by phone, therefore you need to develop mobile first funnels as well. |
| Checkout converts poorly | Start with it Remove all distractions from it and lead customer to make preferred decision. That may include even navigation buttons. |
| Contact form converts poorly | Maybe You ask too much or things what potential customer is not ready to give. Ask less and get the lead, then go from there. |
| Bounce rate is high | Prospects does not understand your value proposition, or your ads generate wrong traffic. |
Usually, we can get our first conversion improvements just by fixing obvious stuff. Beyond that it starts getting interesting.
Data – Hypothesis – Tests- Repeat
So, the method to improve Your site conversions is following:
- Mark down prospect ideal route from first ad to paying customer. You will end up with some sort of steps what leads to sale. If You measure traffic in each of those steps, You get visual, what steps will lose the most traffic. Same time You need to understand, that later in the funnel, more valuable prospects are. You should focus on later end first, even though You lose most of the traffic in earlier steps.
- Now You try to come out with possible reasons, why prospects leave the funnel in certain step and figure what changes may lead to bigger conversion to next step.
- You test and measure best of those hypotheses and if the needle moves up, great, if not, You just keep experimenting until it does.
- Sure, after You have couple of rodeos under your belt, it’s easier to come up with ideas, that might work, but still, every case is different.
Yep, this is pretty much how its done.
Until the next time,
Ninjas with L
