Let’s be honest….
Let’s wipe away all the distractions & buzz words that surround making a business work online.
What do you get when you boil it down to the basics?
That is all there is1. It’s true for offline businesses too (just that traffic is people in the store rather than on the website).
And you need all three to be strong.
A stool with one leg shorter & weaker than the others will not stand
Similarly, a business where one of those three key elements is broken will struggle to survive in the long run.
If you get 100,000 visitors a month but none of them convert into subscribers, buyers, clients, etc – – then you may as well have gotten 0 visitors.
If you convert 100% of your traffic but can’t get anyone to come to your site, then you’re not getting anywhere.
And even if you got 100,000 visitors and converted each and every single one of them into a customer, if each conversion only produces a profit of $0.01 – – then you’re making $1,000 a month….likely not enough to support yourself.
You need to be strong in all three areas to have a thriving business.
In terms of time & money invested into improving these three areas, I’d say most online businesses break down like this:
Traffic – 80%
Conversion – 10%
Economics – 10%
Splits like that will lead to a lot of wobbly & broken stools.
I don’t think it should be an even split between the three but I think the investment into increasing conversions should be at least 30%.
Let’s look at a hypothetical pay per click campaign where you have $10,000 to spend. See the total number of new customers & the cost per acquisition (CPA) with different levels of investment into traffic vs. conversion:
|Campaign Budget||Spend On Boosting Conversions||Spend On PPC Traffic||CPC||Visitors||Conversion Rate||New Customers||Cost Per Acquisition|
Splitting the budget 70/30 between traffic and conversion got the best results in this example. Of course, the numbers are made up but I hope it illustrates the point.
On top of that, when you’re paying per click – – the traffic comes and then it goes. You pay for it and your investment lasts as long as that visitor is on your site (and if you’re converting 1% of traffic then you’re paying for 99 out of 100 visitors to just up and leave).
When you’re paying for conversion optimization and get a lift in your conversion rate, that lift will have positive impacts for the life your website or for that webpage.
Take the long term view. Take some money from Paid Search, Display, SEO, or whatever other traffic budget you have & put it towards increasing your conversion rates.
You’ll get the best results that way. You’ll get lasting results that way. You’ll truly grow your business that way.
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