Maintain Healthy Business Conversion Funnel
By means of Google Analytics, online retailers must constantly monitor the ratio of sales to visitors.
It’s called a conversion funnel. Most people have no idea what this means. Visualize a funnel, or triangle, that is wider on the top than the opposite end. The wide end has a large opening, through which something is poured. The narrow end has a small opening that limits how much comes out. Business conversion is similar.
In theory, the narrow opening at the bottom (sales) maintains a 4 percent ratio to the wider top (site visitors). This is most certainly a simplification, as there are generally more bands on the funnel (namely leads, prospects, customers, sales) affecting conversion.
Conversions can also be measured in relation to campaigns. Though 4 percent is a general average, a ratio of 6, 10 or 20 percent is welcomed, and varies by industry. Niche markets have lower conversion when their websites are accessible by the general population.
During the 20 years prior to launching ClinicalPosters, the sales model formed an inverted funnel. A few major corporations were responsible for 90 present of the sales. Eventually those contacts dissipated from attrition (relocation, retirement, mortality, mergers). Thereafter, the funnel was turned right-side-up, forming a more traditional funnel. Now ClinicalPosters serves thousands of customers spending, on average, much less per order.
Online retailers focus on search engine optimization (SEO), advertisements, and social media to drive traffic. Without sufficient conversion, there is a risk of increasing overhead and widening the funnel top (ratio of visitors to sales).
One solution to disproportionately narrow sales is to pry open the narrow end with pop-up banners, ads from other sites, and special offers during checkout. This is sometimes effective, but can backfire if the shopping experience becomes cumbersome or annoying.
Another strategy for widening the descending funnel end is to improve website quality. This can be as simple as rethinking brand colors, it may delve into technical website coding, or upgrading product offerings. If the site design is solid with consistent branding and marketing message, products are top notch and pricing is fair, focus attention on what’s coming into top end of the funnel.
As a filter, login might be required to view specific content (prices, products, articles, etc.). Even if there is no fee for doing so, less serious customers whose intent is to bounce after 20 seconds are dissuaded by the extra requirement. An enormous number of signups without conversions may require a finer sieve: subscription access to premium content.
Building a Sieve
Driving voluminous site traffic that does not match the ideal customer profile worsens conversion rate. It is as effective as giving away steakhouse lunch coupons to vegetarians or chocolate factory visits to diabetics.
Controversially as it sounds, it may be necessary to narrow the diameter of the funnel top. Try more targeted advertising or use a sieve to filter out shoppers who have no intention of purchasing.
With 100,000 monthly visitors you expect to receive 4,000 sales (4%). With too many visits from unqualified buyers, you might see as few as 1,000 sales (1%). Providing fresh content for 100,000 visitors is an enormous task. Imagine having a retail store with this much foot traffic. It is better to either have more sales to cover overhead costs or less visitors in relation to a healthy number of sales.
Controversially… it may be necessary to narrow the diameter of the funnel top.
Learning more about the 1 percent that convert will help to better trim the 99 percent that do not. Ideally, your sales should increase to 4,000 or your visitors should reduce to 25,000 in order to reach with the 4 percent ratio.
A Clinical Study
ClinicalPosters is good at interpreting data. Our primary audience is comprised of medical professionals. Through polls and other metrics, we know 40 percent of visitors do not fit this description; they are divided among students, patients or curious onlookers. The most visited product pages depict female reproduction without a corresponding ratio of poster sales from that category. Evidently most of these visits are recreational.
Changes to the ClinicalPosters website reflect a response to analytics. Content depicting reproductive organs are now obfuscated to the casual visitor. After a couple of weeks, these are no longer the most visited pages.
Access to most articles with considerable research and authorship (A Bit More Healthy blog) is now accessible to customers with subscription. This site also expanded its product line to include items beyond posters.
As we continue maintaining a balance between site traffic and sales, additional features may roll out. This is done to improve the conversion funnel. Then ClinicalPosters can devote more time to servicing core customers.