Understanding CRO: Defining Conversion Rate Optimization [Part 1 of 4]
October 4, 2017 | Posted in Lead Generation|
What is conversion rate optimization (CRO)? If websites are the marketing wheel that can help a visitor down through the sales funnel – CRO is the grease that keeps the wheel turning efficiently. It’s the strategy behind converting passive website visitors into clients. Great CRO = a high performing website. In this 4-part series we’ll be covering:
1) The conversion rate definition & why it’s vital to your digital marketing strategy.
2) How to properly create a CRO strategy tailored to your needs & what that process looks like.
3) The common barriers to high-performing conversion funnels and CRO best practices.
4) Which resources industry experts recommend to help you test CRO.
Part One: What is Conversion Rate Optimization
CRO is a proven method for using analytics to improve the key performance indicators (KPIs) on your website. What are visitors searching for when they land on your website? How are you delivering that to them? What action do you want them to take and how are your pushing them through that avenue?
While some sales experts argue that it’s just a numbers game, we think that just increasing your website traffic with the hope that more visitors equal more customers is too passive. CRO makes your website work harder with the traffic it already has. It’s an investment in the internal flow of the website to double your results without having to double the traffic.
The actual rate is the result of this equation.
The number of completed funnels ÷ The number of visitors who entered the funnel = The percentage of successful conversions
This equation can change based on your unique KPIs and funnel options. And make sure your numbers are based on the same time frame, whether that’s daily, weekly or monthly. For example, let’s say your designated funnel is when a person visits your website and fills out a contact form. Your specific equation would look like this.
Completed contact forms [per month] ÷ Total website traffic [per month] = Conversion Rate
If you’re getting 6,000 visitors to your website each month and 60 completed contact forms, your conversion rate is currently 1%.
Why Utilize Conversion Rate Optimization?
CRO is all about making your current website meet and exceed your KPIs. Work smarter – not harder, right? It’s about using factual statistics rather than guesses to increase your return on investment. Here are our top reasons we think everyone should be optimizing their visitor conversion rate.
- Optimizing the sales funnel on your website also means improving the user experience. The visitor can clearly see the correct path to take to get what they want. Great user experience also translates to higher search rankings.
- CRO ensures that only the right clients for your business are completing the sales funnel. It’s about the quality of the leads over quantity.
- You can maximize your profit by paying less per customer acquisition. Increasing conversion rates means decreasing the cost per acquisition. That extra money can be put back into the marketing budget.
- You’ll gain an edge on your competitors. If your website helps a visitor move along the sales funnel easier than a competitor’s website – the visitor is more likely to become your customer.
- The process is a continuing cycle based on results. Improving your website and KPIs is a continuing cycle. Engaging in CRO helps you keep track of what’s working and the ability to quickly change things that are not.
With the average return-on-investment on CRO tools being 223% and only 22% of businesses currently happy with their conversion rates [Source], it makes perfect sense to investigate how you can incorporate CRO into your digital marketing strategy.
Stay Tuned for Part 2 of our CRO Series
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