Kobe Bryant and Magic Johnson are both all-time great guards who played for the Los Angeles Lakers. Bryant is one of the highest-scoring players in league history with 25 points per game, and Johnson averaged 19.5 points per game. While Johnson may not have scored as many points, he averaged 11.2 assists per game.
The lesson? Only by analyzing a more complete set of game statistics could Johnson’s overall contribution to Lakers' scoring be revealed to be just as great as Bryant’s — if not greater.
Track KPIs for Every Digital Channel
The parallel for today’s organizations is that they, too, must develop more advanced and nuanced key performance indicators (KPIs) if they want to measure the performance of their digital channels as insightfully and accurately as possible.
So if you’re tracking digital sales and conversion rates without knowing how much your web and mobile channels are contributing to your overall business, it’s like keeping track of points but ignoring assists: You’ll be making judgments and decisions based on an incomplete picture of your various digital channels’ performance and potential.
And you’ll have no way of assessing the role each of your channels is playing in influencing sales and building loyalty throughout your customers’ journeys.
Think Beyond Conversion Rates
There are three key reasons why focusing on conversion rates unnecessarily limits your understanding of the overall influence digital channels can have on your business as a whole:
1. Conversion provides an incomplete view of the customer journey
The customer journey is complex, and the role each digital channel plays within that journey has become increasingly hard to pin down and quantify.
One key reason is because today’s consumers use a variety of platforms, channels and touchpoints to interact with brands. An interaction that starts on a mobile phone may end in-store at the cash register, while one that starts on a website can just as easily end in a doctor’s office as a banking call center. And increasingly, websites themselves are final destinations, but even then, multiple visits often occur before conversions take place.
Just as limiting basketball stats only to points scored yields only a one-dimensional view of a player’s value, focusing on sales and conversion rates to evaluate the performance of your digital channels reveals only part of their importance and leaves you working with incomplete information.
At least 90 to 97 percent of visitors leave digital channels without making a purchase. What do they do next? If they leave your website and sign up with a competitor, your website has failed. If they leave your website but convert through another channel — that’s a win for your brand and your website — if you can track and quantify that result.
2. Conversion rates are too broad and unspecific
One way to make conversion rates more specific is to calculate a metric known as true conversion. When someone comes to your website or mobile app, ask them at the beginning of their visit if they plan to convert — or whatever the equivalent may be for your organization — or if they’re only doing research. The answers to those questions let you calculate true conversion based on how many people came planning to buy, rather than how many people came to your website overall.
Conversion rates that don’t take intent into account are too broad to be useful. For example, if 3 percent of your visitors originally came to do research but ended up converting, that’s amazing! But if only 3 percent of your visitors who came wanting to make a purchase or at least sign up for your newsletter ended up converting, then you have a big problem.
3. Conversion rates don’t help you prioritize changes
Conversion rates show what percentage of your visitors are converting, but give you no insights into what improvement efforts you should make first or where you should direct your resources. Why did someone leave? What actions can you take to encourage that customer to buy, return or recommend?
Being able to prioritize the changes you make is a crucial factor in executing a strong digital strategy. Not knowing what issues or improvements to tackle first puts you at a huge disadvantage, and you’re almost certain to waste time and money with guesswork.
How to Measure Each Channel’s Contribution
What should you do instead of — or in addition to — measuring conversion rates? Measure the contribution each digital channel makes to your business overall. To recycle the basketball analogy, you need to track your players’ points and assists to fully understand the contribution that each player is making to your team.
Here’s how to measure digital’s contribution:
- Capture email addresses using an existing customer experience (CX) survey
- Send digital visitors a short email survey asking what they did next after leaving your site
- Analyze what CX factors drive digital visitors who never convert, or who converted with a competitor
- Report on digital’s contribution to the customer journey
- Gain enough certainty to prioritize strategic and tactical improvements
Become a Digital Measurement MVP
Once you’re measuring digital contribution, you’ll be able to accurately represent the impact of web and mobile across all areas of your business and obtain appropriate resources and funding.
Or in other words, if you want to win the game — and maybe get an MVP award while you’re at it — don’t ignore Magic and focus only on Kobe.