4 1/2 Conversion Metrics No One Ever Talks About

Moby Dick is a book about a man and a fish.

True? Yep. But, that’s far from the end of the story. It would be silly to summarize it’s 822 pages of introductions, character development, twists, turns triumphs, disappointment, climax and conclusion in one simple sentence. In a phrase, there’s a lot of meat on that bone.

A lot of parallels can be drawn between a great novel and success online. However, too many e-commerce and marketing professionals focus on the “final act” – a Web site’s overall conversion rate, as the end-all-be-all metric of success. If you’re an online marketer or an e-commerce strategist tasked with increasing the revenues, orders, average order value (AOV), profit margins or the net profitability of an e-commerce Web site, success lies in being able to tell a great story from beginning to end (photo by pandaramic).

So, how do you read the tea leaves in this one metric and derive success? The ultimate goal of many Web sites vary. For some, it may be to sell more products, for others it may be to increase order volumes of physical goods, e-mail sign-up rates, rss subscriptions, Webinar attendance or digital downloads. The desired end result may vary, but in general, the goal is similar. Define the paths of conversion on your site for each conversion goal (an order, a download, a sign-up) and break them down into four distinct categories. By doing this, it’s much easier to tell a great story to the visitors of your site and hand them off to the next step in the conversion funnel process. Plus,  looking at these distinct areas separately allows you to see how minor improvements at each stage in the funnel can dramatically increase the number of visitors moving on to the next phase of the process. Here are the 4 metrics of the funnel that need to be looked at individually:

1. Overall visitors to decision pages / Total number of visitors – How many visitors are getting to decision pages? The pages that have the offer, product or sign-up? Divide this number by the total number of visitors. This gives you the percentage of people coming to the site that are even seeing the desired offer. The first step in the funnel – and quite honestly the most important. By getting your pitch right here, you can increase your goal (orders, sign-ups, etc.) dramatically while reducing the costs of phone calls, emails and other drags on profitability. It’s tough to find what the “average” ratio here should be, but if it’s any lower than 50% to 60% than some big improvements should probably be made. Half or nearly half of your visitors are not getting to decision pages.

A quick tip: Most sites have analytics packages these days. Whether your using Google for free or your paying for your metrics with services from Omniture or Coremetrics, but be careful. Many times organizations peel the bubble wrap off their analytics, install them and don’t make the customization necessary to get the most out of them. A great example is the visit to cart ratio. An out of the box metric that completely overlooks decision pages. If you’re not looking at the specific decision pages that are unique to your business, you’re missing out – and probably not getting your money’s worth out of your analytics package.

2. Shopping cart visits / Decision page visits – Once visitors have seen your pitch, how many are taking action and adding product to the cart or moving on to the sign-up page of that Webinar (or whatever)? That’s what this metric is for. From a percentage standpoint, this is probably where the highest visitor drop-off is going to occur within the funnel. Why? Visitors see this step as the first commitment. The add to the cart, or the first part of a sign-up. Most looky-loos will take off at this point. But if you’ve refined your pitch and reduced the percieved risk in taking this step, serious visitors should have no problem taking the plunge. What should this ratio be for your organization? In a recent pre-holiday season Webinar, Brian Walker of Forrester Research commented that that this metric should be somewhere around 40%, but others cite the metric can be much lower, say 30%, before you should start sweating bullets (photo below by duien).

3. Check-out visits / Cart visits – Okay. So you’ve got potential customers at the cart. How many are taking the plunge and starting the checkout process? This is the metric that will tell you. Honestly, many people get to the cart to see if there is anything special that’s going to happen when they get there. Did the price change? Is there any kind of special offer that happens when the product is placed into the cart? Many times visitors do this out of curiosity. Once that itch is scratched they bail. The committed move on – for the most part. Unless you’ve done something to tick them off. Like added unexpected fees or the load time for these pages are longer than expected. In his Webinar, Walker states that the average cart abandon rate is 59%. But again, be careful of averages. They could be much higher or lower than what you should be shooting for in your business.

4. Confirmation page visits / Check-out visits – The moment of truth. Cha-ching. The ratio of customers who have made the comitment to go through your checkout process and complete the process. The ratio for this metric should be very high. Why? Look at all the hoops your visitors have jumped through and are still willing to complete the process! Look for a 70%-80% completion percentage here. If it’s not up there, look for improvements to forms and other unnecessary questions in this process to streamline the deal. Keep your eye on the prize and not some obscure question that needs to be completed for the boot licking toadies in accounting.

That’s it. Simple eh? Honestly, it is. By disecting the conversion rate funnel into these simple steps, you can begin to make significant improvements to your organization’s Web site, what ever the goals may be.

Oh, and what’s the ½ goal mentioned? Always remember to follow the number of single access pages to your site. This is the number of visitors who took a look at one page of the site, then bolted. This metric is a great determinant of qualified traffic, and will allow you to potentially make the necessary changes to your demand generation tactics (paid advertising, etc.). Don’t look at home page bounce rates alone. This will only tell you part of the story. Your Web site is exactly that. A Web. Visitors are coming from every angle. Don’t miss the whole story – you’ll miss out on tremendous opportunities.

Want to dig into this a little deeper? Read part 2: How to Translate Conversion Ratio Opportunities Into Real Cash. Plus, I’ve built a handy little Conversion Funnel Calculator (.xls) try it out and tell me what you think.