For a lot of business owners, it can be difficult to accurately measure the return of their online spend. With the digital marketplace getting increasingly competitive, it is important to make sure you can accurately measure the return on the money being pumped into any online marketing strategy. But that's easier said than done, right?
In recent times, there has been a shift in online consumer behavior. More and more, your customers will be informed about what they are buying and who they are buying from. This shift in behavior comes from information being more accessible, review sites becoming the first port of call for many consumers, as well as, increased consumer confidence when it comes to purchasing online. As consumer behaviour patterns evolve over time, we need our tracking and measuring capabilities to grow as well.
When considering how best to measure the return on your ad spend, one thing that must be looked into is the buying cycle your customers exhibit and the path to conversion they choose to take. Sounds easy when you say it like that, but what does it actually mean and how do you go about it?
Luckily for us there are a few tools available through Google Analytics which can help in understanding how your customers interact with your website prior to conversion. If we can understand this, we can not only better measure the return on ad spend, but also build a holistic digital strategy which, in the long run, fits in with your customers’ purchase patterns (rather than expecting them to fit in with how you advertise).
The Multi-Channel Funnel is one of the main tools that I like to use when determining what the next step will be for any of my clients. This tool is the reporting function in Google Analytics that tells you how any single user interacted with your website prior to converting. Such a tool allows us to identify trends in the path to conversion as well as determine the time lag to conversion. It actually gives us a really valuable insight into how each step in your digital strategy links with any other step prior to conversion.
In other words, it allows us to measure the success of each aspect of a digital strategy, in the context of the bigger picture! Pretty cool right?
So, enough of the technical stuff…
How can this be applied?
Let’s say, we see trends in the data showing that a large percentage of the people visiting your website are coming through Google AdWords. The data also shows that two weeks later they return organically and then one week after that, they make their purchase after coming to your site directly.
What does this mean in real terms?
This sort of information tells us that for the most part, there is a 4-week time lag before the conversion takes place. Lets say the reason it takes so long for someone to purchase is because the product is either technically complex, or a high-ticket item.
How can we use this information?
There are a number of things we could implement based on this data that would help build the campaign around the consumers buying habits. Ultimately, if you’re running a Cost-Per-Click (CPC) campaign, you want to have the shortest possible time lag with the least amount of interactions via paid advertising. You can do this by either encouraging impulsive purchases, targeting people at the end of the buying cycle or encouraging people to return to the site organically, or, directly so that you only ever pay for one click per customer, per conversion.
With this in mind, there are many things that you could implement with the aim of reducing the time it takes your customers to convert. Two simple solutions to test could be:
- AdWords Remarketing: Through this you could build strong brand or product awareness, consumer trust and keep your website top of the mind for your customers.
- Building trust through website content: Perhaps you might look at including a list of consumer guarantees, shipping or returns information on the product page, reducing the perceived risk of buying the product online from your website.
Either of these options would have the potential to reduce the time between the first interaction and the final conversion.
Multi-Channel Funnels can tell you a lot about how your customers behave around purchasing decisions. If you better understand your customer you can better understand how to target them. Within this whole process, the important thing is being able to identify the behaviour and then implementing a strategy to improve results and measure its impact.
For me, Multi-Channel Funnels are a must-have tool for SME’s operating in the online arena – the benefits are clear.