If you don’t read the Occam’s Razor blog by Avinash Kaushik, you don’t know what you’re missing. He had another great post last week, to help people identify how to measure more than Web sales as the conversion on their Web sites. He calls them micro conversions, to contrast with the macro conversion that a Web sale represents. I think he has a number of great points in the post, but I want to contrast his thinking with my own, in case my perspective feels a bit more comfortable to you. Whichever way you want to work, we both agree that you should focus on lots more than Web sales to judge your Web site’s value.
Avinash is correctly pointing out that too many sites measure nothing more than Web sales, page views, and visitors—giving you a woefully incomplete view of your Web site. He goes on to suggest that we distinguish between micro and macro conversions, where macro conversions are sales and micro conversions are other important events that might or might not lead directly to a sale.
I think this has a lot of power, but might be overly complicated. I’ve advocated that we think about the best thing someone can do on our site to lead to a sale as our Web conversion. It might be a Web sale, if you have an e-Commerce site, but it could also be filling out a contact form, or calling a phone number found only on the Web site, or walking into a dealer showroom with a coupon printed from the Web. It depends on your business whether your Web site is designed to sell online, sell offline, or just pass a lead to your sales force, for example.
Whatever your Web site is designed to do, that is your Web conversion. And it has a revenue (and profit) value that can be calculated. Sticking with revenue, to keep it simple, if your Web conversion is an actual online sale, then the revenue value is equal to the amount of the sale. If your Web conversion is for the Web visitor to call a special phone number to order by phone, then you know every call to that number is a Web conversion, and if 70% of the callers buy something, then the revenue value of your Web conversion is 70% of whatever the average sale amount is. So, if the average phone sale is $100, each Web conversion is worth $70.
You can do the same thing for contact forms. If, for every e-mail contact lead you get, your sales force follows up to close 20% at an average sale of $10,000, then every time someone submits an e-mail contact form on the list, you can consider the revenue value of this act to be $2,000 (20% of $10,000).
I would consider all of these Web conversions to be macro conversions, in Avinash’s terms. But, as he points out, you can do more than that. You can also track the smaller conversions that lead to these macro conversions—he called them micro conversions and I have been calling them mini-conversions all these years, but the point is the same.
In the diagram above of the Web Conversion Cycle, the mini-conversions are Learn and Shop, which lead to Buy. You can count how often people land on your Learn pages (the ones that explain the problem and different ways to solve it) and the Shop pages (the ones that compare one solution or one product model against another). For products that demand technical support, you can think of the Use step as a mini-conversion, too, in that sometimes the right way to solve a problem is to bring the customer back to the Learn stage. (“I’m so sorry that your laptop is booting so slowly. Because it is five years old, you might want to consider upgrading to a newer model if that is in your budget. Or maybe you could try adding more memory.”)
Where Avinash’s post really shines is looking at registrations, social media, and other types of what he calls micro conversions. They don’t have any clear lead-up to a sale (online or offline). I think it’s very instructive to see some ideas of how companies are treating these hard-to-measure interactions and I applaud his thinking here.
Bottom line is that you need to measure the bottom line. Whether you call them micro conversions or mini-conversions is a lot less important than the fact that you are measuring events with real business value. No matter what system appeals to you, it’s critical that you measure more than page views and visitors—pick something better and start measuring it today.
