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.
The key criterion for defining conversion actions is that they must be measurable and have a clear value. Here are some examples of conversion actions and how you might measure them:
Only a few parts of your website are mission critical. A click-through can measure the effectiveness with which you funnel visitors to the desired actionable pages, and through the conversion process. Click-throughs can serve as intermediate gauges of progress. The click-through rate (CTR) is the percentage of visitors who click through to a desired page.
Some websites have ultimate conversion steps that require a lot of up-front education. They provide resources and online guides to fully explain their products and services. If education of visitors is your primary goal, key metrics may include the time spent on your educational pages and the number of page views.
Downloads and printouts
Many websites want visitors to take away free content without having to leave behind any personal information. Visitors may be able to download and print (where applicable) any number of items from your site: whitepapers, coupons for offline redemption, samples, or computer software. The download or printout rate of the desired content is the best measure of efficiency.
Often the conversion goal involves gathering data about the visitor. This can range from a minimum of data (e.g., asking for an e-mail address to which to send future e-newsletters), to full disclosure involving a lot of personal information (e.g., a lengthy online application for a mortgage loan). Regardless of the length or complexity of the form, the form-fill rate is used to measure the efficiency of this process.
Many companies measure sales efficiency by looking at their sales conversion rate (the percentage of unique visitors who complete a purchase), or their shopping cart abandonment rate (the percentage of people who start the checkout process but never finish it). In many circumstances, the revenue per visitor and profit per visitor are more useful metrics.
If the products that you sell have different profit margins, the revenue per visitor metric can be deceiving. This can happen when you boost your revenues by selling very low margin or even unprofitable loss-leader items. It is possible to boost your revenues while at the same time actually lowering your overall profits. A more sophisticated metric for such situations is the profit per visitor. Instead of assigning the full revenue value to the sale conversion action, you use only the profit margin on the sale.
The situation is more complicated when multiple conversion actions are involved. For example, your site may sell a service, offer a free trial, and have a sign-up form for a free newsletter (which may eventually lead to future sales). These three conversion actions are all appropriate and roughly correspond to a visitor’s position in the buying cycle. It is important to track and measure each of them. By assigning a dollar value to each action, you can see if your overall profit per visitor increases.
Take a look at your site and your business model, and determine for yourself what conversion actions are important for your success. Then come up with a consistent series of metrics that you will use to track your effectiveness over time. You’ll be amazed at how this insight will help you form better business decisions in the future.
Tim Ash is the CEO of SiteTuners.com, a landing page optimization firm that offers consulting and conversion improvement tools. He is the chairperson of ConversionConference.com and a speaker at events worldwide. Tim is a contributing columnist at many publications and author of Landing Page Optimization.