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The True Definition of Website Traffic
By Fred Tyre
I have been doing quite a bit of research over the last few years. As anyone who has done a small amount of research into analytics will tell you, the formula for sales is such...
Traffic * Conversion Rate = Number of Sales
The conversion rate is a percentage rate that describes the percentage of visitors (Traffic) who buy your product. Many have taken this information and said that all you need to do is increase the amount of traffic (number of visitors) that are sent to your sales page and you will have increased sales. However, this is a very narrow sited approach to the formula. If you get more traffic from the same sources of your current traffic, then yes you will average the same number of sales and generate more sales via the increase. However, if you add a completely new source of traffic that you have never tested before, it will have it's own ratio of buyers. Advertising bridal dresses on ESPN will have a totally different percentage of buyers, then the same advertisement on Oprah's website. Adding a brand new source of traffic to a sales page could unpredictably make the conversion rate better or worse. However, let's say that you have a PPC (Pay Per Click) campaign on Google. If we do the math using the formula listed above for a previous campaign, we could actually have a pretty good idea of how many sales we are going to get from a repeat campaign. In that case you could increase traffic by paying Google more money so that you have more visitors going to your sales page. In most cases you will see a proportionate increase in sales. Even then, things could go wrong. Maybe last week was Mothers Day and no matter how much you pay Google or how much traffic you send to your sales page, you won't see a jump in sales of a mothers day product for this week. Time can also be a factor that you have to pay attention to. I like to compare these sort of discussions to fishing. If I'm a great fisherman, I can still have bad days where I don't understand why the normal techniques aren't working. After enough practice, you start to get the hang of it though. Then you can say that if I advertise on this day on this particular website, I am fairly confident that I will generate this many sales. There might be times that you are wrong, but the difference between a professional fisherman and an amateur is that you figured out a way to have success more often using the exact same tools. Anyway, I hope this gives you a different perspective on website traffic that will give you an edge over your competition. Sincerely,
Fred
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I like your illustration of the fisherman. My fish are always so small that I have to throw them back in. ;)
I DO get what you mean though. Well done!
Having been innundated recently with every guru, every guru's dog and every guru's dog's flea sending me 'free' or 'secret' traffic producing methods and processes that I am quite sick of it. Traffic, of itself, is of little value unless it actually has an interest in buying what you are selling at the price you are charging and at the time you are advertising it. Commerce has been around for thousands of years and just because the 'latest' method of delivering a sales message is 'the internet', don't imagine for one second that the process of making a sale has changed. To make a sale you need a visitor who wants what you are advertising, can find his way round your site to look at the item (some sites have attrocious navigation), has an acceptable method of paying you, has a sufficient need to actually decide to make the payment, is prepared to sit through your publicity to get to the place where the purchase can be made and who will retain the product once it is delivered. Traffic is more than just visitors to your web site to whom you can sell - traffic is visitors to your web site with whom you might set up a sale in the future. It isn't the sale that's important - it's the long term relationship.
So true. I am still figuring out how to be the professional fisherman. The fish seem to change their preferences for bait. LOl
Great comparison and I do like to fish! :)
My Google Adwords campaigns were more like "the one that got away".
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This intel was contributed by Fred Tyre
Fred Tyre
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May, 2012
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