You are doing Conversion Tracking all wrong. Here is why

The first question you may ask after reading the headline is, how it can be possible that my conversions tracking is all wrong?

“Conversions always matter. If my website is getting conversions and I am tracking them then it is impacting the business bottomline. Period.” – you could say that.

Yes conversions always matter, if they are ecommerce transactions.

But if your conversions are goal conversions and not ecommerce transactions then there is always a possibility that they are adding little to no value to your business bottomline.

In fact it could be more likely than you think.

Case Study: Newsletter Signups

Let us suppose that you setup a goal on your website which is triggered every time a person signups for a newsletter.

You set up this goal because you believe that newsletters signup is an excellent way to engage with your target audience and generate repeated visits which could results in more sales and leads.

Say you set up this goal 6 months ago and you are getting like 10 to 20 additional signups each month.

Consequently your website is getting conversions and both the conversion volume and conversion rate are increasing over time.

Everyone is happy.

“we are getting conversions. We are doing something which is impacting the business bottomline”

Hold your horses right here.

How you are so sure that newsletter signups are actually adding value to your business bottomline?

What is the goal value of your newsletter signups?

Is it increasing over time?

If you have not set up any goal value for your newsletters signups, then your conversions are not adding any value to the business bottomline……. Why?

Because you can’t prove it to yourself or to your client/boss.

That’s why.

You are assuming that your marketing efforts are impacting the business bottomline but you don’t have any solid data to backup your claims.

You have no idea up to which extent newsletter signups are adding economic value and whether you should even bother sending out newsletters in the first place.

I know you are very smart and you have added goal value to your goals and your goal value for newsletter signups is $10.

newsletters signup2

You got 150 newsletter signups last month and they added a total economic value of 150 X $10 = $1500 to your business bottomline.

Now my question to you is, from where you got that $10 figure?

Please don’t tell me that you made up this number.

Because if you made up this number than neither I nor anyone else would trust the made up economic value of $1500 and your conversions won’t be adding any value to the business bottomline, as your calculations would be all wrong.

How to compute the true value of your Goals?

So the smart question to ask here is:

How many people who sign up for our newsletter eventually end up buying products from our website?

Or

How many people who sign up for our newsletter eventually end up hiring our services?

If you have a solid answer to this question, only then you can compute the true value of your goal.

Let us suppose that after a deep analysis, you found out that 10 people out of 150 (who signed up for the newsletter) eventually end up buying products from your website and they bought products worth $100

So the average value of a newsletter sign up is $100/150 = $0.67

This is your true goal value for one newsletter signup at present and not the made up $10 figure:

newsletters signup

 

Note: Goal value changes all the time as people may buy more or less products depending upon the season, competition and offers. So you may need to adjust your goal value each month.

So the total economic value added by 150 newsletter signups is $100 (150X$0.67) and not the $1500 as reported earlier.

Now let us suppose that the average cost of creating and sending out a newsletter is $1.

In that case should you even be bothered running a newsletter campaign?

What if the average value of a newsletter sign up turned out to be $0?

Shouldn’t you immediately stop your newsletter campaigns?

Are you optimising for something which really doesn’t matter in the first place?

When the goal value of your conversions is being calculated inaccurately, you get inaccurate data in your multi channel funnel reports.

Any conclusion drawn based on erroneous data can never produce good results.

What other Goal Conversions you should test today?

Some other goals worth testing (if you are currently using them):

1. Session duration – how many people who spent say 3 or more minutes on your website eventually end up buying your product or hiring your service?

2. Pages/Session –  how many people who visited say 3 or more pages on your website eventually end up buying your product or hiring your service?

3. Visit to the contact us page –  how many people who visited ‘contact us’ page on your website eventually end up buying your product or hiring your service?

4. Visit to the about us page –  how many people who visited the ‘about us’  page on your website eventually end up buying your product or hiring your service?

For all of the above goals you need to determine their true goal values.

If the goal value remains $0 month after month then there are only two possibilities:

1. You are not working hard enough to improve your goal conversions.

2. You have picked up wrong goals for your business as they consistently, not adding any value to your business bottomline.

The Brutal ‘So what’ Test

The number 1 way to set up and track meaningful goals, is to ask the ‘so what’ question.

Ask yourself the ‘so what’ question till it starts hurting you (because you no longer have any business bottomline impacting answer) or till you have found an answer which can have a considerable impact on your business bottomline.

If you don’t ask this question you may get ‘stunner’ more often than you think from your marketing efforts.

Let me give you couple of examples:

Example-1:

Marketer: “I will create infographic of Matt Cutts’

Analyst: “so what”

Marketer: “I will let Matt know about it. He will tweet it and we will get publicity”

Analyst: “so what”

 

Example-2:

Marketer: “I will tweet all day long. I will personalize every tweet”

Analyst: “so what”

Marketer: “This will increase the possibility of getting more retweets and attention from other bloggers”

Analyst: “so what”

Marketer: “This will improve our klout score and possibility of getting retweets for our posts in the future”

Analyst: “so what”

Marketer: “This will make us influencer”

Analyst: “so what”

 

Example-3:

Marketer: “We should increase the blog post frequency from 1 to 3 each week”

Analyst: “so what”

Marketer: “This will result in more new and repeated visits to the website. “

Analyst: “so what”

Marketer: “repeated visits leads to user engagement and user engagement leads to brand loyalty “

Analyst: “so what”

Marketer: “brand loyalty leads to more sales and leads “

Analyst: ok. That sounds great. Let us track how blog post frequency improves our business bottomline.

Keep asking these ‘so what question’ till you get a business bottomline impacting answer.

In majority of cases I have noticed that replies started to become more and more vague and they keep getting away from the core business goals.

In some cases I do get replies which can have a considerable impact on the business bottomline.

These are the goals that really matter and you need to track and validate such goals.

The ‘so what’ analysis is so powerful that I can guarantee you that it will change not only your business priorities but even your life goals for good.

 Takeaways

newsletters signup3

  1. Never track goal conversions without setting up goal value.
  2. Compute true value of your goals.
  3. Your total goal value must increase over time.
  4. Goals which consistently (month after month) add $0 to your business bottomline  are not your goals. Abandon them and set up new goals.
  5. Carry out the ‘so what’ test on your ideas before you even think of tracking them as goal conversions and don’t stop until you get the business bottomline impacting answer which is worth testing.

Other article you will find usefulMeasuring Content Marketing Success in Google Analytics

 

What is the difference between Digital Analytics and Google Analytics?


99.99% of course creators themselves don’t know the difference between Digital analytics, Google Analytics (GA) and Google Tag Manager (GTM).

So they are teaching GA and GTM in the name of teaching Digital analytics.

They just copy each other. Monkey see, monkey do.

But Digital analytics is not about GA, GTM.

It is about analyzing and interpreting data, setting up goals, strategies and KPIs.

It’s about creating strategic roadmap for your business.


Digital Analytics is the core skill. Google Analytics is just a tool used to implement ‘Digital Analytics’.

You can also implement ‘Digital analytics’ via other tools like ‘adobe analytics’, ‘kissmetrics’ etc.

Using Google Analytics without the good understanding of ‘Digital analytics’ is like driving around in a car, in a big city without understanding the traffic rules and road signs.

You are either likely to end up somewhere other than your destination or you get involved in an accident.


You learn data analysis and interpretation from Digital analytics and not from Google Analytics.

The direction in which your analysis will move, will determine the direction in which your marketing campaigns and eventually your company will move to get the highest possible return on investment.

You get that direction from ‘Digital analytics’ and not from ‘Google Analytics’.


You learn to set up KPIs, strategies and measurement framework for your business from ‘Digital analytics’ and not from ‘Google Analytics’.

So if you are taking a course only on 'Digital Analytics’, you are learning to use one of the tools of ‘Digital analytics’. You are not learning the ‘Digital analytics’ itself.

Since any person can learn to use Google Analytics in couple of weeks, you do no get any competitive advantage in the marketplace just by knowing GA.

You need to know lot more than GA in order to work in digital analytics and marketing field.


So what I have done, if you are interested, is I have put together a completely free training that will teach you exactly how I have been able to leverage digital analytics to generate floods of news sales and customers and how you can literally copy what I have done to get similar results.

You can sign up for the free training here: https://learn.optimizesmart.com/registration-web-class

I truly hope you find it helpful.  

My best selling books on Digital Analytics and Conversion Optimization

Maths and Stats for Web Analytics and Conversion Optimization
This expert guide will teach you how to leverage the knowledge of maths and statistics in order to accurately interpret data and take actions, which can quickly improve the bottom-line of your online business.

Master the Essentials of Email Marketing Analytics
This book focuses solely on the ‘analytics’ that power your email marketing optimization program and will help you dramatically reduce your cost per acquisition and increase marketing ROI by tracking the performance of the various KPIs and metrics used for email marketing.

Attribution Modelling in Google Analytics and Beyond
Attribution modelling is the process of determining the most effective marketing channels for investment. This book has been written to help you implement attribution modelling. It will teach you how to leverage the knowledge of attribution modelling in order to allocate marketing budget and understand buying behaviour.

Attribution Modelling in Google Ads and Facebook
This book has been written to help you implement attribution modelling in Google Ads (Google AdWords) and Facebook. It will teach you, how to leverage the knowledge of attribution modelling in order to understand the customer purchasing journey and determine the most effective marketing channels for investment.

Himanshu Sharma

Digital Marketing Consultant and Founder of Optimizesmart.com

Himanshu helps business owners and marketing professionals in generating more sales and ROI by fixing their website tracking issues, helping them understand their true customers purchase journey and helping them determine the most effective marketing channels for investment.

He has over 12 years experience in digital analytics and digital marketing.

He was nominated for the Digital Analytics Association's Awards for Excellence.

The Digital Analytics Association is a world renowned not-for-profit association which helps organisations overcome the challenges of data acquisition and application.

He is the author of four best-selling books on analytics and conversion optimization:

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