Among the many interesting findings was the fact that most companies spend less than 5% of their marketing budget on conversion optimization.
Which really means that most companies spend 95% of their marketing budgets trying to find leads and prospects, but don't seem to care very much if they ever become customers!
As the above-noted Econsultancy blog post points out, a small improvement in conversion can translate into millions of dollars in additional revenue for large companies with marketing budgets in the hundreds of millions of dollars.
The report also showed a direct correlation between the relative amount spent on conversion optimization and the average website conversion rates these companies experienced:
- 84% of respondents to their survey spent less than 25% of their budgets on conversion optimization, and these companies maintained a conversion rate of less than 5%.
- On the other hand, a full 39% of respondents who spent more than 25% of their budgets on optimizing for conversion saw conversion rates of 5% to 9% and even higher!
What is conversion optimization?
Conversion optimization refers to any action you take to try to improve the conversion rate on your web pages. This means that you're taking steps to optimize your website so more people become sales leads. It can involve anything from testing various wording variations to changing the design, navigation, graphics, and of course the offer itself. But it always involves an ongoing process of testing and re-testing in a scientific fashion.
Some companies stop there, but there's a second part to conversion optimization which is getting a website visitor through the sales process and to the point of purchasing from you. This may or may not involve your website, but usually involves email and phone calls, or examining the sales process itself.
Why is optimizing for conversion so valuable?
There are at least three very good reasons why website conversion optimization deserves a prominent place in every marketing budget:
1. More leads and more sales: Better conversion means more leads and more sales from your existing website visitors. Basically, every dollar you spend is working toward earning you more going forward.
2. Less time and less effort: Conversion optimization generally takes less time and effort than traffic generation or SEO. Which is not to say that these disciplines are unimportant, but since you can get more out of your current traffic by concentrating on conversion optimization, they only enhance each other.
3. More bang for your buck: For the reasons listed above, conversion optimization makes your marketing spend more worthwhile (because you're converting more visitors to sales leads, and you're doing so efficiently). In an unpredictable economy, every businessperson should be looking for ways to streamline.
If your business relies on your website for lead generation and you're not currently spending a reasonable amount of your marketing budget on conversion optimization, you may want to seriously consider an adjustment. Let's talk.