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| Nov 12, 2005 2:27 pm |
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re: re: Internet Advertising Success Pyramid |
Simon Payn
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Hi there
I know Denise's question isn't directed at me...but I couldn't help jumping in anyway. Too much coffee this morning, maybe.
I think conversion rate and number of clickthroughs are not the most relevant questions.
Instead, it's all about profitability and ROI.
If you're selling enough product to cover the costs of your clickthroughs and product costs, you're in profit. Period.
Of course, you can go on to further improve your conversion rate, but that's a relative number.
Conversion rates for low-priced products are likely to be higher than for high-priced products. And conversion rates can also be affected by how well targeted your internet advertising is. (PPC advertising that matches keyword well to ad will covert better than less well targeted advertising).
If you are selling a $5,000 seminar, for example, you can spend a lot of money on marketing (and afford a lot of PPC clickthroughs) for each sale. Your conversion rate might be .001% and you might have thousands of clickthroughs but still be happily profitable.
On the other hand, if you're selling a $19 ebook, you've got to get a much higher conversion rate (or pay a lot less for clickthroughs).
Conversion rates are a useful yardstick by which to measure current performance relative to previous performance. But what matters at the end of the day is ROI.
SimonPrivate Reply to Simon Payn (new win) |
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