mThink

Many people are familiar with the well-known concept of the sales funnel. Conceived over a hundred years ago, it still serves as a useful framework for understanding the decision-making process. The sales funnel is known by the acronym “AIDA” which stands for the stages that a person must pass through before buying something: attention, interest, desire and action.

Here’s a data-point for you: in 2002 you could buy clicks on AdWords for 5 cents that now cost 50 cents. A price increase of ten times in just eight years.

A related question: if you can currently buy highly targeted Facebook ads for 40 cents or less CPM, what will they cost in eight year’s time? Will they have gone up 10x to $4 cpm? Why won’t they cost $4, when non-targeted CPMs of $2.50 are common these days?

There’s so much hype around Facebook right now that it would be easy to think that they are an immediate threat to Google’s business model, but the reality is that they’re not even close. Not only does Google still make at least six times more revenue per user than does Facebook, but Facebook’s advertising model is still very much a work in progress.

Conversion actions are measurable events that move a website visitor toward the mission critical activities that you have identified. Many people view conversions as large-scale or “macro” events, such as product sales or sign-ups for a service. In fact, most conversion actions are incremental micro-events that reduce friction and allow a visitor to continue moving toward your ultimate desired outcome.