Using Event-driven Analytics to Boost Conversion ValueBy Kobe Ben Itamar on January 19, 2016
Reading Time: 12 minutes
These days it seems as though everyone has a website. It can be hard to get people to visit yours. Most people turn to pay per click (PPC) advertising to drive traffic to their landing pages. But getting someone to click on your ad is only the beginning.
You have to turn that click into a sale or a purchase. This is called a conversion, but you probably already knew that. The question is: how do you turn website visits into conversions?
The answer is to have an inviting landing page. A landing page can be the homepage of your website or a designated page displaying a specific offer, sale, or item on your website. A landing page is how you make your first impression on potential customers.
People see your ads when they search for a specific keyword or visit a website that is of a related vein, and the best way to increase your ad’s visibility is to use event-driven analytics.
The Importance of Calculating ROI on PPC Campaigns
A PPC Campaign is not successful without return on investment. If there is no return – it’s ineffective. Consider using another marketing strategy, or switch the company that carries your ad. PPC is about lead generation and the conversion from a click to a sale. ROI helps to make processes accountable. The simplest way to calculate ROI is to use this formula:
(Profit – Cost/Cost)
Cost does not only refer to the cost of your bid. The cost has to incorporate other factors such as the money spent to make the product or provide services, credit card processing fees, website maintenance, etc.
Impressions vs. Clicks
ROI helps you to determine your campaign’s overall reach by looking at the profit per impression versus the profit per click. An impression is the number of people who have seen your ad. It is great when the profit-per-impression and the profit per click is close. That means that people see your ad and click on it. A big difference between the two means that people see your ad, but they are not tempted to click. Your return on investment is very low if the difference is high.
The easiest way to calculate profit per impression is to divide the profit by impressions. You can calculate profit per click by dividing the profit by the number of clicks. These numbers can help you assess what keywords are working. Most PPC campaigns will divide the impressions by the keyword. Figure out the profit per impression for all keywords to determine which ones work and which ones are not giving you a return on investment.
Estimating the Conversion Value of PPC Visitors
The best way to determine if you are getting ROI is to calculate your conversion value. How many clicks are converted to new clients or customers? You will also need to account for repeat customers, word of mouth advertisement and lifetime customer value.
Types of Conversions
You can estimate a conversion value by multiplying the average deal revenue by the percentage of profit margin and the percentage of leads convert to a deal. The answer to this calculation is called value per conversion. It is a short term value.
Word of Mouth Conversions
In addition to other types of conversions made throughout your campaigns, there should also be data showing what’s the percentage gained from each customer, through word-of-mouth.
If you want to factor in an estimation for the value of word of mouth, take the value per conversion number and multiply it by the gain from word-of-mouth percentage. For example, if you find your gain from word-of-mouth is 18%, and you know your value per conversion is $59, make your calculation as follows:
- Value-per-conversion (short term value): $59
- Gain from word-of-mouth: 18%
- Value-per-conversion (+word-of-mouth): $59 * 118% = $69.62
Your goal as a business owner is to turn new customers into repeat customers – the ones who come back for more, whenever they require whatever it is you offer.
Lifetime profit per customer is determined by an initial estimation of how much the average customer will spend over their lifetime. You find this number by multiplying the average deal revenue x Repeat business over lifetime x percentage of profit margin.
What Are Event Driven Analytics?
Event-driven analytics look for ways to capitalize on buying trigger events. For example, if people are buying more homes, a marketing plan can be designed to target those people.
Such a strategy operated by certain companies, on very specific situations may lead to unpleasant domestic occurrences, but nonetheless, the goal of event-driven analytics is to try and up-sell products to people who fit a current trend or are impacted by a certain event in their lives.
Event-driven analytics use the following three categories to anticipate people’s demands:
Product-driven triggers – There are many factors that can affect a product. A maintenance contract expires, or the availability of a product upgrades. Replacement products can create a trigger, as well.
Tracking these triggers should be quite easy for a company, because they are based on the product’s life-cycle. That sort of data is probably there for the grabs on your servers, and all a company needs to do is keep the records organized and track them systematically.
Organic triggers – These are natural changes occurring in a business like:
- An expanding business’s need for new vendors
- Revenue growth in new areas
- A high rate of revenue growth
- Acquisitions and merges can also create organic triggers.
These sort of triggers can be tracked correctly by first defining what are the kind of businesses you wish to keep under tracking for such organic changes, and by assigning personal to identify them.
Black Swan triggers – Unpredictable events over which a company has no control. These sort of events may shift a certain business’s focus, and/or even impact society in a more groundbreaking manner, and cause sudden changes in needs and requirements or capabilities.
A global financial crisis may cause large firms to collapse under an immense pressure of a liquidity crunch.
A natural disaster might affect sales. If, for example a great storm is about to hit – it can drive the demand for supplies such as water and sand up for a short term. If the storm is very destructive to buildings and homes, construction can be on the rise for the long term.
On a smaller scale, tax incentives and subsidies trigger buying activity as well.
Anticipating Buyer Behavior
The second part of event-driven analytics is to anticipate buyer behavior.
First, you should try to anticipate customer behavior by learning habits in a systematic way. Specifically behavior demonstrated by your customers, on which you have the most amount of data. Once you know your customer, be on-top of identifying event triggers. The best way to do this is to establish real-time reporting processes, combined with your CRM database.
That combination can expose some kinds of data which is usually not mined, and may be available solely to your company.
Be careful with your timing though. Event marketing is all about starting an ad campaign at the right time so the trigger is taken advantage of in an effective way. When you pick your timing, be sure to do a test run before expanding. This can help you work out any kinks before committing to the campaign on a much larger scale.
Sending Targeted Traffic from Paid Search Engine Campaigns
Ads are shown to people based on their browser history. This helps to target the traffic. You have to make sure that your landing page reflects the keyword that is searched. In other words, your website should not be a scavenger hunt. It needs to be organized and easy to assess. The person should not have to search for the product that sparks their interest.
One of the best ways to organize your website is to have product categories. This will make navigation easy, while making people less likely to end up frustrated. You should create a PPC campaign for each category. The link should be directed to the category’s page. Think of this as an aisle at a grocery store. If people are looking for juice, you can take them directly to the juice aisle instead of showing them the entry of the store and making them walk down every aisle looking for juice. If you don’t do that, someone else might.
Divide your PPC campaigns up by categories. It’ll make it easier for you to optimize them. Calculate your ROI based on the products or services you offer. When you do this, you can create fantastic landing pages for all your categories. A good, productive website goes a long way to getting lifetime customers.
But just because you are creating and testing more than one landing page option doesn’t mean you’ll have to stress. You can easily track all of your landing pages and PPC campaign categories in the Pagewiz dashboard, easily navigating from client to client, page to page or from campaign to campaign. You can create testing variants for pages, mobile campaigns and multiple campaigns with ease, and manage them all from the same location.
Use Specific Keywords to Increase Traffic
You can maximize the exposure of your high selling products by developing an ad that has the name of the product in it. The search impressions will not be as high, however, the people who click will have a higher intent to purchase. Therefore, you can have a higher conversion rate if you use specific keywords. For example, if you have a high selling fishing fly, use the name of that fly as a keyword, and you are more likely to get more traction from people who are looking to buy.
Specific keywords can affect your landing pages. Your landing page has to reflect those words. If it does not customers will be disappointed and your search-engine optimization would be low. You can test new landing pages, and see which one draws the more conversions from the specific keywords.
Create Dedicated Landing Pages for PPC Campaigns
The first goal of a design for your dedicated landing page is to fully cover the subject of your ad. No one wants to go to a landing page and not see the reason why they click on the link. Your landing page has to be 100% relevant to the banner ad.
The landing page should be relevant and have a strong call to action. The call to action is crucial for the conversion. Use plain English. Make sure your keywords are in your headlines and sub headlines. Convincing details about your products are a great way to motivate people into believing in your products. Details also help to make your landing page more credible. Testimonials or reviews from customers are another way to show credibility on your landing page.
Customers are also more likely to exit out of the website and try another one if yours does not load quickly.
You should use all you know about creating a landing page, calculating your ROI and how to identify an event, to use event-driven analytics to improve your landing page campaign. Landing pages do not have to be static. You can change them to fit your campaign.
Well-tailored ads are a great way to improve your landing page campaign. You do not have to bid high for these. There is less competition on them than on general ads; people intend to buy.
Return on investment is not just a nebulous concept that is hard to pin down. In a strategic campaign, it’s not a chance that might happen if the conditions are right. It’s engineered from the top down and considers buying behavior, event-driven positioning and continued testing and persistence.
Also published on Medium.