Almost every organization can benefit from conversion rate optimization (CRO). But if you’re not already convinced of its value, this strategy may seem like a questionable use of time or money. Why is CRO so important? Can you do it yourself? And how do you make sure your organization strictly benefits from it?
What Is CRO?
Let’s start with the basics. What exactly is CRO?
CRO is a set of strategies and practices that allow you to optimize specific pages of your website, or specific elements of your overall online presence, for increased conversions. In case you aren’t familiar, conversions are meaningful actions taken by your customers and visitors; most commonly, companies consider product purchases, email newsletter signups, form completions, and similar goals to be conversions.
For example, after setting up a new landing page and beginning to drive traffic to it, you might notice a conversion rate of 2 percent; in other words, approximately 2 percent of people who visit the landing page eventually convert.
Through the process of CRO, you would perform optimizations to your landing page, and potentially other elements of the customer journey, to increase that number. If you’re successful, you might be able to push that number to 3 percent, 5 percent, or even higher. This depends on your industry, your audience, and other factors.
Why Is CRO So Important?
CRO is vital for your online success. It has the potential to increase the value of any page of your website. Because it increases the number of people who meaningfully take action with your brand. And, in turn, increases your return on investment (ROI) for any page to which it is applied.
“In terms of pure ROI, CRO is the best sales and marketing investment a company can make. With even a minimal investment of time and money, you can instantly multiply the value of all traffic going to your site. It’s hard to beat that.” Jeff Loquist, SiteTuners.com
Imagine you estimate the value of a conversion to be $10 and your website is currently seeing 100,000 monthly visitors. With the conversion rate of just 1 percent, you’ll make about $10,000 a month. With a conversion rate of 5 percent, you’ll instantly increase that to $50,000 a month – without even increasing your traffic figures. If you manage to triple your traffic, the 1 percent conversion rate would lead to revenue of only $30,000 a month, while the 5 percent conversion rate leads to $150,000 a month.
There are a few other reasons why CRO is so important:
- Traffic isn’t inherently valuable. Too many entrepreneurs and business leaders disproportionately focus on generating traffic. Increasing traffic isn’t necessarily a bad thing, but you need to realize that traffic isn’t inherently valuable. It’s only valuable if it leads to meaningful engagements with your brand.
- Active CRO pays off indefinitely. As we’ve seen from our example, CRO pays off indefinitely. If you continue running your website and increasing your traffic, your higher conversion rate will keep paying dividends.
- CRO is a wise use of resources. CRO is an ongoing process that’s going to demand continued investments of time and money. However, it’s affordable, productive, and capable of incredible returns.
- Most people fail at initial CRO efforts. People can attempt conversion rate optimization entirely on their own, but without much knowledge or experience, these efforts typically fall flat. Default landing pages don’t convert nearly as well as ones that have been formally optimized.
CRO vs. Traffic Generation
Before we go any further, think about the potential payoff of investments in CRO compared to investments in traffic generation. Let’s say you have 100,000 monthly visitors and a conversion rate of 1 percent, with the value of a conversion being $100. That results in revenue of $100,000 per month.
Investing in SEO might be able to help you achieve rank one for a popular keyword term, which could increase your monthly visitors by 20,000 a month. Under the current circumstances, this would help you generate $20,000 of extra monthly revenue, pushing you to $120,000.
But what if you invest in CRO and manage to double your conversion rate? This would push your revenue to $200,000 per month – and make the value of your future SEO efforts even more lucrative. Plus, investing in CRO is typically cheaper than investing in SEO or other, bigger marketing strategies.
Keep in mind that CRO is an excellent tactic, but it’s still only part of the equation. Greatly increasing your conversion rate is valuable only if you have a stream of traffic to capitalize on it; accordingly, CRO works best in conjunction with other marketing strategies like SEO, PPC advertising, and social media marketing.
How to Make Sure CRO Pays Off
These are some of the ways that you can make sure Conversion Rate Optimization pays off for your organization:
- Start with the right philosophy. To make CRO work, you need to have the right philosophy. For starters, you should make most of your decisions from the perspective of optimizing for ROI. That means squeezing the most value out of every dollar you spend and making your calculations based on bottom line returns.
- Work with better partners. Working with an organization that specializes in conversion optimization can help you see much better results than you’d get on your own.
- Designate leaders within your organization. Choose someone savvy on your own team to lead the conversion optimization initiative. They can help coordinate with your CRO experts to make sure all optimization efforts are in line with your strategic vision – and positioned for measurable improvements.
- Cater to your target demographics. Different people respond to different types of incentives and motivations. There’s no such thing as a perfect CRO strategy, generically, since your approach should depend on who you’re targeting. Keep your target demographics in mind and use market research to better understand them as you attempt to appeal to them.
- Experiment aggressively. AB testing allows you to figure out what’s working and what isn’t on a given page. The more aggressively you experiment, the more you’ll learn, and the better you’ll be able to push your results.
Conversion Rate Optimization is a strategy that almost any conceivable organization can benefit from. If you’re willing to make the investment and continue optimizing indefinitely, it can lead you to an enormous return.