Selling online is an art that has evolved beyond mere buying and selling. Every action nowadays contributes to the statistical data needed to understand consumer behavior. For online business, this is commonly referred to as conversions.
Metrics: Conversion and Conversion Rate
Conversions are the actions made by visitors and customers on your online store, or website. These can be the actual purchase of a product, download of an app, or signing up for your email list. On the other hand, less important actions can also be measured. These actions that are not directly related to sales are called micro-conversions.
Conversion rates refer to the frequency of conversions achieved among those who visit the website or online store. This metric focuses on analyzing the effectiveness of the sales funnel by predicting the number of sales based on the number of visitors.
Ideally, each website visitor would become a customer and leave only after they have bought something. This is how a 100% conversion rate can be illustrated; however, in reality, these numbers are almost impossible to achieve because of high competition in online business.
Conversion Rate Optimization
The solution against stiff competition is to maximize each opportunity granted and convert these into actual sales. This is called Conversion Rate Optimization (CRO). Over time, these optimizations allow for long-lasting and sustainable sales through improved conversion rates. As the conversion rate increases then it generally means that more actual sales are being earned.
How does CRO work for your sales funnel? Optimization begins with the analysis of your customer’s behavior and spending patterns. The increased web traffic is refined by CRO to convince as much visitors to purchase something before leaving the site. Overall, the optimization starts from increasing overall engagements with potential customers up to the increased number of repeat customers.
9 Reasons Why You Need To Optimize The Conversion Rate Of Your Sales Funnel
Gone are the days when people click the shopping cart and go straight to the checkout. Instead, customers go “window shopping” first through your website and then look into your competition’s sites that offer bargains. When they leave your site, that lessens your chances for gaining a conversion.
As a result, the sales funnel develops issues such as the following:
- Awareness and interest no longer directly convert into sales.
- Competition makes it tougher to be considered by consumers.
- Customers take a longer time to decide before purchasing.
In short, optimizing conversion rates secures customer conversion and improves overall profits. Websites, online stores, and ads don’t always come cheap and can actually cost you to lose more money than expected
Now, let’s look at the nine reasons why conversion rate optimization is an important part of your online business.
1. Increasing Fees for Pay-Per-Click (PPC)
Using PPC ads has taken a toll on most online businesses. High demand has caused inflation in the price which most budgets can’t afford to risk. Gone are the days when businesses can alternatively use PPC ads to improve their search engine optimization (SEO) to gain attention. Prices for these ads now require high amounts of conversions or sales for the money spent to be worth it.
Here’s where conversion rate optimization comes in. It helps balance the risk and reward of PPC ads for your business by ensuring that clicks paid for turn into actual sales.
2. Increase in competition
There is a growing trend towards online businesses and eCommerce stores, which includes bigger brands shifting their promotion towards the digital space.
Competing head-on against these established companies would require a sizeable and expendable budget. That would be too much for most small online businesses. What is recommended is to instead build an advantage through easy-to-use websites that guide buyers towards completing purchases. Shifting resources towards conversion optimization can help smaller businesses compete without the need for a large budget.
3. Increasing costs of digital marketing
Digital marketing has continuously increased its cost over the past few years. Since traditional marketing mediums such as print and television ads are either too costly or nowhere near the effectiveness of digital marketing, there isn’t much cheaper option left to advertise a business.
Regardless, the need for advertising the business remains important in improving the sales funnel. Maximizing the results, therefore, should be the focus when dealing with digital marketing. The increased sales arising from improved conversion rate can help sustain the costs needed for digital marketing.
4. Maximizing social media as a marketing platform
Social media offers the benefit of engaging potential and current customers through several free platforms such as Instagram, Facebook, and Twitter. The established connection makes it easy for customers to patronize and love the business, and at the same time this also organizes a recognizable customer base through so-called “followers”.
However, due to the numerous platforms available, customers are experiencing shorter attention span. For that reason, once you have their attentions, you need to be able to quickly turn it into sales before something else takes their attentions away from you. Having a unique and differentiated business with a compelling story and offer is what needed to compete in the market.
5. Managing the consumer’s shortened attention span
Consumers nowadays have relatively less attention span than previous generations of consumers. This lack of attention span translates into shorter patience in searching for what to buy. Customers would not patiently browse several pages of listings to find it, and instead, they prefer to get things instantly through searches. It doesn’t matter if prices are higher as long as they can find what they want to buy in a single click.
CRO helps the business adapt to this growing customer behavior and mentality. It can be as simple as having an interface and layout that funnel the customer through the sales process.
6. Streamlining the business to produce sales
It takes legitimacy and a streamlined process to reduce the time it takes for customers to consider buying from the store. Building credibility and reducing all the hassle makes an online business run as smooth as possible.
After finding what they need, customers can easily check out and pay for what they put in the cart. By reducing objections, actual conversion rates can increase over time. These may eventually include optimizations such as a frequently asked questions (FAQ) portion to help buyers decide, or testimonials from previous customers.
7. Investing in long-term solutions
Spending for conversion optimization saves money over time and provides returns in the long run. The reduced costs on marketing and an increase in sales bring in a net profit that doesn’t require maintenance costs. It takes time to reap rewards, but overall the gains earned are able to pay for themselves afterward.
8. Synergizes with marketing efforts such as affiliate marketing
CRO adds great value to affiliate partners that seek to promote your products and drive traffic to your site. When a high number of visitors convert into buyers, your affiliates make more money thus incentivize them to promote your products even harder.
As a result, you make more money! You see, it’s a win-win situation by optimizing your conversion rate.
9. Optimization results in immediate results
Conversion rate optimization brings in immediate and lasting results compared to search engine optimization which takes months or years to kick in.
When changes are made, the results are immediately seen. Your sales funnel directly shows actual changes through increased sales, and lowered customer acquisition cost.
Conversion rate optimization helps move the business towards becoming more competitive. Its effects are instant and it provides lasting results. You can acquire more customers in a shorter amount of time and lower cost. It is the foundation for a successful online business, and you should not overlook it.
You can be profitable with just a small amount of traffic, which allows you to reinvest the profit to get even more traffic. The benefits are undeniable. So, if you haven’t yet optimized your funnel to increase sales then there is no better time than today to get started!
Check out this exclusive FREE 90 minutes training by Russell Brunson (click here) on how you can optimize your conversion and boost sales by an extra 540% with his secret funnel strategy.