Having a website and not knowing how to use the traffic intelligence to grow one’s business is a fatal mistake. However, it is not an uncommon one. Several small and medium-sized business (SMB) owners fail to make the most of the insights that website data can provide.
One of the most important metrics to track is conversion rate. Only by doing this can you embark on conversion rate optimisation (CRO). In this first article of a two-part series, we explain how CRO can make a difference to your SMB.
Gain 'free' revenue
It is easy to see the attraction of CRO once you know how it results in 'free' profits. But first, you need to understand what a conversation rate is. It is the percentage of the total visitors to your website who take an action that you (the business owner) deem desirable. Examples of such actions could be making a purchase or signing up for a newsletter.
Businesses use CRO to increase conversation rates, so they have more customers purchasing products or signing up for newsletters. And this can be achieved without spending a dime on advertising.
Increase customer spending
CRO involves improving your website so it’s easier and more enjoyable for visitors to use. Providing a better user experience on the website can not only attract more shoppers, but also increase the amount each individual spends and entice them to return for more.
In this sense, CRO is a powerful tool for boosting the average order value and number of return customers, while lowering the cost per customer.
Enjoy substantial ROI
The value of CRO is obvious when you consider the return on investment (ROI). The return from increased conversions goes straight to your bottom line. This means a 50 per cent increase in conversion rate can result in as much as a 500 per cent jump in profits.
This is why more businesses are turning to CRO – 90 per cent of marketers rated it as important or crucial in the Conversion Rate Optimization Report 2015 by Econsultancy. Even the savviest startups use CRO to boost their bottom line. Zalora, one of Asia’s fastest-growing online fashion retailers, for instance, grew its checkout size by 12.3 percent with CRO.
Since no two businesses are alike, find out your potential ROI gains through CRO by using ROI calculators.
Strengthen your business
Finally, CRO can make SMBs more robust, as it enables a ‘circle of benefits’. An increased conversion rate means more profits to set aside funds for marketing, both online and offline. On top of this, you get a bigger bang for your existing marketing buck – 87 per cent of businesses surveyed in the Optimizely Benchmark Report found CRO improved the ROI of their marketing.
With more effective marketing, your website is less reliant on search engine traffic, and less vulnerable to algorithm changes that see sites fall in search rankings. Thus, more CRO means higher ROI.
SMB owners looking to grow should seek to unlock the greatest gains from their website. It’s important to remember competition online grows fiercer by the minute. With CRO, you can not only gain more loyal customers and boost your bottom line, but also strengthen your overall business and gain a competitive edge. In the second article of this two-part series, we shall discuss how to undertake CRO.