If you have been in the marketing industry, there is certainly one demand you have come across – increasing the traffic to a website as the primary goal. Most businesses focus on activities that help them drive a decent amount of traffic to their website, which is then expected to explore the products and services they offer, and maybe, turn into leads if not customers.
Let’s be honest, the goal isn’t entirely wrong. You do need to bring people to your business and make them understand what you’re about, before trying to sell anything to them.
But what most businesses and marketers confuse while driving traffic to their website, is the core difference between leads and conversions.
Yes, there is a difference and not everyone understands it.
Understanding what leads are
Leads are people from your target audience that are interested in what your business does and has to offer to them. They are what you’d call prospects in the digital world.
The prospects can then be nurtured based on their interests or inquiry into products or services that the business has to offer. In simpler words, these are people who have given your business the permission to contact them with what you have to offer.
Now you might think that the traffic on your website are then all leads. Because if they won’t be interested in what you have to offer, they won’t be on your website.
All the traffic to your website doesn’t necessarily fall under the category of your ideal customers. The main difference between leads and your traffic is that the former has the potential of becoming a customer of your business, while the latter might have just chanced upon your website while looking for something.
How do you know the difference? By effective market segmentation.
You know who your target audience is, but think about how you can further narrow this audience down into well defined segments that actually depict an individual customer or a prospect. Digging deeper into data points like where they come from, what they are looking for, their previous purchase triggers and more, create customer personas.
While going through your analytics, keep the demographics of these customer personas in mind. This way you’ll be able to sought through the endless traffic based on different filters that you have narrowed down. Making it amply clear how much of the traffic to your website are actually quality leads and how much is the noise you’re generating.
Defining lead tracking
Lead tracking refers to a process that helps marketers to forecast the ROI on a marketing campaign for their business. It is measuring how many leads in your sales pipeline essentially make it from signing up or first interacting with your business, to actually agreeing to pay for using your product.
Most companies don’t have effective lead tracking systems in place. This often results in them not being able to determine the status of their leads or set up proper follow-up systems that will help nurture those leads for a conversion.
Here are 4 tips for effective lead tracking:
- Find an easy to use tool like HubSpot that makes it simpler to track the status of your leads for each campaign.
- Align your marketing and sales team, by agreeing to measure specific metrics each and quantify the number of leads you want to generate with every campaign.
- Clearly define what hot, warm and cold leads mean to you, and how you would like to incorporate converting them each in your campaigns.
- Define the timeline for campaign evaluation, to understand what actually works and how long it takes to be effective.
What are conversions?
Most businesses define a conversion as a sale. Basically when a website visitor purchases one of your products and services before leaving. But that’s not it.
A conversion can be defined in a number of ways based on the campaign you’re running and your business goals. This could include giving a successful demo of your product over a call, getting the visitor to subscribe to your newsletters or any action that in the end adds up to the macro conversion.
While an ideal conversion would be one that adds to the revenue your business generates over time, it is important to also monitor your micro conversions closely. After all, not every visitor to your website is ready to make the purchase – a slight nudge though, might do the trick.
For instance, we offer a demo of our exit intent technology to our website visitors before they leave. The reason being that it is highly possible they have heard of the technology, but aren’t really sure how it would help them. We take the opportunity to target a micro conversion wherein they are willing to share their contact information with us.
Yes, this gives us the opportunity to speak to the website visitors – the quality traffic that converts on this exit intent campaign, put forward our value proposition, send them a proposal and even follow up on the same to drive them towards a macro conversion.
But here’s what you need to observe from the micro conversion we’re targeting – we’re not looking at a purchase or winning a subscription right away. Our aim is to make the visitors understand what we do, how we’re different from the others in the market and at the same time ‘show’ him the value he would gain from our product.
Defining conversion tracking
It is very important for businesses to know the total number of conversions it is generating over the period of the campaign, based on the marketing budgets being aligned for it. For instance, if you’re setting aside $100 for Facebook advertisements, you should know how many conversions – customers, you’re going to get out of it by the end of this campaign.
Conversion tracking is as simple as analysing the number of people who have converted into paying customers of your business. If the revenue your campaign generates is more than what you invested in it, well – you have a winner!
What’s better for you?
Well, we don’t tip towards any. Based on what your business goal is, it could be leads you’re looking at or simply getting more customers.
For instance, maybe your product is in its beta stages and is looking for the initial set of people who would be willing to try it for free. In this case, you’re looking at leads – possible people who will turn into your customers after their free trial or when your product launches.
Now if your product is ready and has been tried by customers before, what you’re now looking at are conversions – people who are willing to continue using the product beyond the trial period and maybe even pay for it.
So start by setting specific goals for your business and marketing campaigns. That’s the only way you will be able to effectively measure the results and optimize your campaigns for higher performance.
A lot of businesses and marketers don’t understand the difference between conversions and leads, and this often leads to them not being able to optimize their campaigns for better results.
Know the difference and never make this conversion tracking mistake again!