Usually the advice of online marketing is to measure and measure and measure and seek to increase conversions or decrease cost per conversion.
In theory this is 100% correct. If we know what we need to measure then this is 100% correct. If we can measure everything we want this is 100% correct. But in practise things are very different.
Firstly we do not know exactly what to measure; in time we can improve this, but initially we do not know what exactly is a conversion. This is explained more below. But secondly we cannot measure everything and we have a bias towards being able to measure contact forms and sales from the online shop. We are less able to measure phone calls, recommendations, referrals and multi-stage processes.
Why is it difficult to decide what to measure? There are several reasons:
- Sales are relatively easy, and ideally you record the sales value. A sophisticated analysis would record revenue – cost of sales, or net profit. But what about loss leaders or products which have many repeat purchases? Errors in the analysis are greatest if your product range has a variety of different types of product.
- What value do you attribute to a brochure request? Especially if large orders tend to come only via phone or fax from brochure. It is easy to ignore this, but you could be optimising the PPC for lots of little Internet orders and not the large brochure based orders.
- What value do you give to a contact form? Many businesses (including our own) have contact forms which we encourage people to fill in to get a quote or enquire about our marketing or design services. But we get a lot of completed forms from offshore developers offering their services, or ‘guaranteed top places on Google’. These are not useful at all, but there is a danger that a PPC campaign could be optimised to generate lots of rubbish forms
- Do you record phone calls? Many B2B companies state they make more sales from incoming phone calls than from contact forms. The incoming calls are the most important, but these are often not tracked. This in fact need not be the case, and you can adapt your website so show dynamic phone numbers according to source of enquiry. Combined with a whisper number this allows phone calls to be tracked and lead source recorded. This is not often done.
Potential errors are greatest when multiple types of conversion are possible; take a hotel website with room booking and event management as an example. Hotels rooms might often be booked online, generating useful small revenue for the hotel. But large weddings and events do not get ‘purchased’ online, they are the result of a phone call or brochure request and result in very high value business.