2 minute read
As a business leader, you focus on the long term vision of your organization and important metrics such as revenue and profitability. You have a lot on your plate, but lets not forget about marketing and sales conversion rates and why they are so critical to your organization's growth strategy.
In order to increase sales, you need to know how your marketing and sales conversion rates are performing. Let's learn more about these key conversion points and how to maximize for growth.
Understanding Conversion Rates
Conversion rates can be measured across several different stages in the buyer's journey. A CEO should be aware of the two most important conversion rates: traffic to lead conversion rate and lead to customer conversion rate. Below is a simple example of how to calculate your conversion rates.
- A landing page receives 1,000 visitors per month.
- Out of 1,000 visitors, 80 convert to leads.
- This is a traffic to lead conversion rate of 8%.
- Of those 80 leads, 10 convert to sales/customers.
- This is a lead to customer conversion rate of 12.5%.
If your website traffic stays at 1000 visitors per month, but your marketing team optimizes your landing page, you should see your traffic to lead conversion rate increase. If your number of leads grows to 200 per month, your marketing team just increased your traffic to lead conversion by 20%. Assuming your lead to customer conversion stays at 12.5%, you can expect a lead to customer conversion of 25 new clients from the same amount of traffic.
Diagnosing Conversion and Making Improvements
If your website is receiving a good amount of traffic, but you aren't converting many leads, it could be that your landing pages or calls-to-action are in need of an adjustment. Attracting visitors is only one third of the equation. The second part of the equation is convincing a visitor to convert into a known lead. The third step is to then convert that lead into a a paying customer.
You can maximize your sales growth by isolating the various choke points in the conversion process. If you have a large number of leads, but aren't closing the deal, your sales team might need additional training or updated sales collateral. Targeted strategies need to be put in place to convert new business. It's critical to understand the full funnel flow, key conversion points, and optimize for maximum results.
Customers usually make decisions based on emotion. Think about the last time you bought something online. You may have done some research, read some reviews, looked through the photos and product descriptions. But I'm betting you didn't create a spreadsheet to quantify any of that research before you bought the product. You buy from a company because they make you feel confident and secure in your decision.
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