According to the consulting Agency Econsultancy, 78% of companies are dissatisfied with how many of their potential customers become actual.
This is not surprising: a rare businessman does not want to improve his sales conversion. What is this indicator and what does it affect? How and why it is considered? Let’s see.
Sales conversion: how to count and why is it necessary? Your business can work better and make more money. You already know that.
But! He can do it right now. No additional investment in advertising. Without the introduction of additional, more expensive products.
That is, with the original data that is now. All you need is to raise the sales conversion. What is it and how to get the most out of it, we will analyze in this article without lyrics and complex words.
But first, as marketers say, a small teaser. What will interest you to read further.
It is the conversion of sales and its increase that affects the fact that more buyers turn from potential to real.
This figure is in the TOP 5 required for the calculation. And how to do it in the store, sales office, showroom or even online store, read on.
OH, THESE CONCEPTS
There is such a thing as a lead in marketing. In short, leads are customers who call/write/come / contact Your company. In short, people who are interested in Your products.
This word I propose to use because it is universal and we Will not be confused in the “store buyers”, “calling the office” and “applications in the online store.”
Now, we have:
1. potential client,
2. existing customers.
So, in order for a person to move from the first state to the second, he needs to go through certain stages.
Each business has these stages and their number. In the transition from one stage to another, we see a conversion in sales.
Sales conversion is an indicator of conversion of leads into real buyers. That is, potential customers in real. Although there is no, a bit not so.
Sales conversion is the ratio of real buyers (those who used the goods/services) to potential buyers (those who DID not use for any reason).
The sales conversion rate is calculated as a percentage over a certain period of time. This is done very simply, even the Humanities will understand. Below are the formulas for the calculation, but for now let’s define the remaining concepts.
CV, conversion rate, CTR, close rate — these symbols by and large, denote the same thing — conversion.
Since I don’t really like the theory, I suggest to call it a day with her. The only thing I want to tell you about is that there are currently many types of conversions.
However, I will highlight three main types that are most common.
And that you need to know how to pray to any businessman:
- Conversion in advertising. This is the ratio of hits/clicks on an ad to impressions of that ad.
- Offline conversion. This is the ratio of the number of buyers to the number of people who entered the trading zone.
- The conversion on the website. This is the ratio of people who have made a targeted action on the site to the number of all visitors.
Based on this, we can draw the main conclusion. If Your company uses several sites (shop, online store and office).
And conversion of the sales will be few and the data for them will be different. Also, how will the conversion in the section differ:
2. target audience,
3. region, etc.
But first start to consider the minimum and simple steps, and then delve.
In business, when it comes to conversion, it is usually referred to as part of the sales funnel.
Therefore, be sure to read our article “stages of the sales funnel: open your eyes to your business.”
Believe me, all this will change the view of your business.
Believe and forget
In our materials, we constantly insist that business is primarily about numbers, not feelings. There is a small part of luck, but everything else is based on very real facts.
And the more indicators you own, the easier it is to manage, control and develop
Knowing how to calculate the conversion of sales in the business, you will see very interesting moments in Your company.
For example, how much target customers come To your advertising company or how well your sellers work.
But! I’ll be honest with You. Conversion rate is not the main indicator in marketing. He’s important, but not important.
The most important thing is profit.
And if you buy every second, but the average check is a few cents. That from conversion calculation in this case there is no sense.
The same applies to advertising and call-to-action on the site, these elements can click dozens of people, but it will not buy anything.
Therefore, as I said, it is necessary to calculate the conversion of sales, so you will see a lot of useful information. But conversion can be deceptive.
Always check the purity of the analysis with such additional indicators as:
THE CLEAR FORMULA
Sometimes, when we do marketing analysis for our clients, we use different formulas and therefore search the Internet for how to calculate them.
Often I find it extremely funny when a formula is written in the article, the calculations for which do not converge. Because the author simply does not recheck them.
In case with this article (as in principle and with all our articles) you can be calm. The conversion calculation formula is correct and tested for viability on dozens of our customers.
Sales conversion = (N1 (number of buyers) / N0 (number of leads)) * 100%
For example, You have a company that provides services for the installation of plastic Windows (difficult you have a sphere, we know).
Last month, 217 people visited your office, 32 of them bought from you and became happy owners of new Windows. Consider the numbers according to the formula above.
Cv = (32/217)*100% = 14.75%
Thus, the conversion of your office, that is, all sales managers working in it, is 14.75%.
You won’t believe it, but this whole formula. One and it works flawlessly, as the machine Ferfrans HVLAR.
It is used, and small firms, and large chain stores by H&M. the Only thing the bigger the company, the greater the breakdown is the conversion. But the essence and formula does not change.
Conversion is calculated for a certain period of time. This can be a conversion of sales per day, per month, per year.
We recommend that you monitor your conversion daily, and then group them in different time intervals.
The average conversion
Looking ahead to answer Your question. There is no specific conversion rate. The average temperature in the hospital is very approximate.
There are General statistics, but periodically we see it shattered on the concrete floor of reality.
The offline guitar store (narrow business) conversion to sale can be 60%. But the conversion of the clothing store, located in a popular shopping center, rarely exceeds 10% (clothing store Mango considers a very steep conversion of 7-8%).
On the website the situation is the same. Everything can be comical. Two identical sites with the same products, pricing and design. Can give radically different results.
The result may depend on the quality of traffic and the city where the company is located.
Therefore, there is no ideal conversion value in the market. Everyone will have their own. And to define it.
You remove the first metrics from your business for a month, then make it a minimum plan and look for ways to develop.
Introduce innovations and then look at the result. If everything went up, then You have a new minimum bar. And so in a cycle.
METHODS TO IMPROVE
Recently, we write a lot of thanks that in our articles a lot of sensible material. Thanks to practical information that people can take and apply here and now.
Traditionally, this article will not be an exception. And I will give you some universal advice on all kinds of contacts.
They will not reveal the theme fully, but will be a nice addition:
1. Count the number of people.
Both came, and bought.
2. Do it daily.
3. This can be done manually or using special systems and services
(head count, web Analytics, end-to-end Analytics, call tracking, CRM-systems).
4. For beginners.
You can use the online table in Google.Docs, which Your fighters will lead. And you daily to see and inspect.
5. Simplify sales.
Make navigation, good merchandising, selling price tags and Pos materials.
For someone it will sound banal and perhaps even a mockery, but most businesses still do not.
And these recommendations are not only for retail stores. This can be applied to both services and wholesale. And all this will work to increase sales conversion.
6. Simplify your purchase.
Add the ability to purchase with a card, credit or installment. It will be especially important if it is installment from the store.
One of our clients introduced a similar installment plan for 4 months. The results exceeded all expectations.
The non-return of money barely exceeds 10%, but the conversion rate in the sale (especially expensive products) increased by 20%.
7. Have a contest.
If you have 2-3 shifts or 2-3 sales managers, arrange a contest for the highest conversion between them.
The meaning of the contest-the one who will have a higher conversion for a certain period of time, will receive a prize.
The only thing, make sure that between these comrades did not happen collusion, otherwise your whole idea will go to pieces.
8. Add more contacts.
You should have not only the phone number of the region in which the office/warehouse is located, but also a free call, e-mail.
As well as an online consultant, which can be written through various social networks or messengers. At the time when the company is not working, you can set up a chatbot.
9. Remove the difficulty.
Every customer has a way from the first contact to the purchase. In marketing, it’s called the Ustomer journey. You need to simplify this way at every step.
On the site to remove a huge number of fields in the application form. Or make a call to Your company without unnecessary actions with the answering machine.
10. Implement sales scripts.
The conversion of the sales personnel easily increased with the help of teaching techniques effective communication with customers.
If you don’t already have it. The for good reason. When an employee works on the structure of the ideal seller, the conversion increases.
When we talk about a new blog article, we choose what to write for a long time. In the case of sales conversion, we did not think for a long time.
It is necessary to count conversion. Without any talk, objections and other things. Whatever the staff says, no matter how much you hate this innovation.
Implement, track and constantly work to increase sales conversion, it is necessary.
But remember the text, reading the above, and is part of the “conversion can be deceiving”. This figure is gorgeous and if You do not believed that the results will surprise
And if you already think, rather go deeper, and see this indicator in the context of people, products, advertising channels, time, place, etc.