Often, we concern ourselves with the activities of marketing, but don’t stop to evaluate and measure their effectiveness. If you don’t measure success, how do you know you are achieving it? There are certain formulas you can use to check and see how your marketing is (or isn’t) working for you.
Are you familiar with the term “floundering”? My Dad used to tell me I was floundering. I wasn’t sure what he meant, but now as a fisherman, I understand the analogy. Think of a fish swimming in the water with direction. Now, think of a fish flopping around on the pier. That’s what you’re doing if you don’t have a clear understanding of where you are and where you’re going.
You can only flounder for so long. Soon, you will run out of air. This is what usually happens when people must give up on their dream, or at least put it on hold, while they go back to “work” to support themselves or their family.
Use these formulas to make sure you’re staying on track with your marketing goals.
Website Conversion Rate
Conversions / Visitors = Conversion Rate
Your website receives one hundred visitors. Two of them called or emailed.
Your conversion rate is two percent.
2 conversions / 100 visitors = 2%
Pro Tip: The national average is one to three percent but with good strong calls to action you can reach results of ten to twenty percent.
Cost Per Conversion
Budget / Conversions = Cost Per Conversion
You boosted a post on Facebook for $100 which resulted in one hundred visits to your website. Each visit to your website cost $1.00. Two visitors called or emailed. The cost of each call or email was $50.
$100 / 2 conversions = $50 each
Number of Sales / Number of Prospects = Close Rate
Once in contact, how often does your prospect complete a purchase?
How many attempts does it take to complete a sale? four, ten, twenty? Let us use four in this example.
1 Sale / 4 Prospects = 25% Close Rate
Cost Per Sale Acquisition
Budget / Sale = Cost Per Sale Acquisition
$100 to create two Conversions. Each Conversion costs $50. It took four conversions (4 x $50 = $200) to get one Sale.
$200 / 1 Sale = $200 Cost Per Sale Acquisition