In part 1, we talked about GA in general. How you configure it, how you set things up, and obviously, how Benne makes the whole process extremely smooth. ;-) In part 2, we looked at some of these reports and how they can help you understand your traffic better. Today, we look at conversion goals, and how setting up conversions and goals aids you in makig smarter marketing decisions.
Now we are getting to the good stuff.
I always say, businesses are in the business of making money.
As crass and crude as that may sound, it is a fact. Businesses are supposed to be profit centres. If you run a business in loss, no amount of cash infusion is going to help you make it big. So, naturally businesses are always concerned about conversions. No matter what marketing channel you look at, conversion is always the benchmark on which things get measured. Revenue for sure is the ultimate indicator, but it is actually conversion that decides how hard you can step on the gas pedal.
Every analytics tool and platform helps you track conversion. And businesses need to keep a close eye on the conversion trends to enable themselves into making better marketing and sales decisions.
Conversions aren’t just about revenue. Your conversion goals could be different for different activities that your business engages in. You could look at percentage of users who initiate a live chat with your sales team as a conversion indicator of how good a job you are doing in generating intrigue about your product features and capabilities. You could look at percentage of visitors who subscribe to your blog as a conversion indicator of the quality of your content, and its relatability and value to your target audience. Conversion is the single source of truth on which all your marketing efforts are evaluated.
All conversions start with a well defined goal.
In your GA dashboard, if you set up your conversion goals as we discussed earlier, you can look at conversion numbers and trends for your websites. You can look at the number of conversions you have received (in Goals Overview), you can look at the URLs these conversions happened on (in Goal URLs), or you can have a look at the route your users took on their way to converting (in Reverse Goal Path).
All of this helps you understand your consumers’ browsing behavior to a reasonable extent, and get a better understanding of the driving factors and triggers that enable and facilitate these conversions.
GA does a good job of making sure you don’t miss out on your conversion numbers by embedding it in almost every report you will look at. Whether you are looking at geographical traffic breakup or looking at the traffic source report, there is a dollar figure flashing for you in every report.
How can you measure conversion value for anything?
As we mentioned earlier, everything you do has a conversion factor associated to it. But not everything you do translates to sales. After all, just initiating a live chat, or subscribing to your blog doesn’t bring revenue to your business. So how can there be a dollar figure associated with everything?
This has got to do with how you set up your goals.
When you are setting up a goal in GA, it gives you the option to assign a value to your goal completion.
This way, irrespective of whether the goal has a monetary transaction attached to it or not, you are always able to measure it in terms of the dollar value impact it has for your business.
So, should you assign any arbitrary number to the goal value?
Theoretically you can, but obviously you shouldn’t.
Your goal value should be an indicator of how much that particular action is worth to your business. Let me explain using an example.
Say out of every 100 live chat sessions that get initiated, 20 of them result in free trial activations, and out of those 3 convert to a paying customer within 30 days. If my ARPU is $50, then that means these 100 chat sessions ultimately added $150 to the business. So, a rough calculation tells us that each chat session is worth dollar fifty to the business.
Same logic can be applied for any goal that you have. Measure how those goal completions ultimately translate to revenue and calculate backwards from there to arrive at a dollar value for your goal.
Keep these calculations simple and don’t overcomplicate it. It may be tempting to slice down this data further to look at the engagement level of these chats and calculating the value of engaged chat sessions vs shorter chats. But the more complexity you add to this analysis, the more work it would be for you to arrive at a number you can depend on. Keeping things simpler would easen things up quite significantly.
There are a couple of things you should note while arriving at these goal values.
First, do not overestimate the conversion percentage at each stage. It is natural to assume that since chat sessions indicate interest of the user in your product, and trials are inherently free and without risk, you would witness a much higher conversion. But it rarely works that way. Whenever in doubt, always err on the conservative side of the spectrum.
Second, if your computation gives the calculated value of your goal as a dollar, you should assign it a lower figure in your analytics dashboard. Maybe 70 or 80 cents. You have to remember that even though it is a well computed indicator, it is still just an indicator. Be conservative in your estimates and you won’t be face to face with false growth indicators. This becomes exceedingly meaningful when you have actual transactions facilitated on your website, but at the same time have goals. If your goal values are higher and they convert at a much faster rate, then you may be witnessing an unprecedented business growth indicator while in reality the revenue isn’t growing as much, if at all. Always have a clear view of your actual revenue indicators when working with virtual revenue associated with intangible goals.
So. How to get the most out of your conversion reports?
By measuring it all, and formulating your marketing strategy based on an analysis of the data.
Assume the following very real and very possible scenarios.
A landing page converts far better with a particular audience segment as compared to your entire audience base (or target audience).
Another landing page performs far better with returning visitors as compared to people visiting your website for the first time.
Scenarios like this happen all the time. Take the returning visitor case, for example. This essentially indicates a few touchpoints happening prior to conversion, so it makes more sense to (a) expose and guide your visitors to experiencing more touchpoints on their cold approach, and (b) exposing this particular landing page to your returning customers and email list as compared to brand new, cold traffic.
The more you measure the conversion numbers and indicators, the better your decision making would get. That is the value conversion reports add to your business.
With Benne Analytics, all this data analysis happens continuously behind the scene and only the insights relevant to taking actions is displayed to you. This saves you a ton of time and number crunching, enabling you in making faster decisions and executing on your decisions faster.
While you would still be able to look at numbers just as you would have with any analytics platform, our focus will always be on bringing actionable insights to you faster so that you can act on them instead of spending invaluable time digging through reports and charts/tables.
Faster execution means less opportunity loss, and more revenue for your business.
The downside of almost all analytics tools is the fact that no matter how invaluable these insights are, spending time on the dashboards doesn’t add revenue to your business. Every single analytics tool gives you the option to add custom reports and data views, and each of them would enable you to look at data in a slightly different way. But the more custom reports you have, the more data views you add, the more time you are spending just looking at data, and the less time you will have to take actions. Which is why Benne Analytics dashboard is simple, and constantly designed and redesigned to help you gain as much valuable insight as possible in the shortest time. We want to empower you into absorbing more critical insights every minute so that you spend as less time on the dashboard as possible and more time and bandwidth into acting on our insights. Give it a spin, you’ll be pleasantly surprised.
That’s it for today, see you tomorrow.
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