There are many companies who are worried that their CVR (CV rate) is low and they are not able to connect with inquiries as expected. If the conversion rate is low, the cost of attracting customers will be high, so many people would like to know how to improve it.
This time, we will explain the importance of understanding the conversion rate, the factors that reduce the conversion rate, and ways to take countermeasures.
Please refer to it if you are a company looking for ways to increase conversion rates with listing ads.
What is conversion (CV)?
(CV) literally means “conversion,” “conversion,” or “conversion.” In the field of marketing, it refers to the final result of a website.
For marketers, the mission is to acquire and maximize conversions more efficiently. To achieve this, you need to consider the flow of users visiting your website and optimize the content.
Additionally, in some cases, it may be necessary to use paid measures such as Internet advertising to attract a large number of highly prospective users to your website.
“Number of unique conversions” and “Number of total conversions”
There are two types of conversions: unique conversions and total conversions, and the numbers differ depending on which one you use. If this difference is not shared among all involved parties, the results of data analysis and understanding may be completely different. The definition of each conversion is as follows:
▼Unique conversion Conversion by user who accessed the site
▼Total conversion Conversion by action of users who accessed the site
For example, if a user buys products A and B, the total conversion will be counted as “2” if we consider the action unit “purchase”. On the other hand, when considering each user, even if the user purchases twice, it is the same user, so a unique conversion is counted as “one time.”
Unique conversions, which do not count subsequent actions by the same user, are a good metric to evaluate from a customer acquisition perspective. On the other hand, total conversions, which also count the second and subsequent actions of the same user, are a suitable metric to evaluate from a sales perspective.
Therefore, which conversion metrics to use will depend on whether you value customer acquisition or sales as your website’s goal.
How to calculate “conversion rate”
Managing your website requires calculating not only the number of conversions, but also the conversion rate. Conversion rate is calculated using the following formula.
[Conversion rate] = [Number of conversions] ÷ [Number of visitors] x 100%
Furthermore, as mentioned above, conversions include unique conversions per user and total conversions per action.
▼User unit [Conversion rate] = [Number of unique conversions] ÷ [Number of users] x 100%
▼Action unit [Conversion rate] = [Total number of conversions] ÷ [Number of visitors or page views] x 100%
Calculating the conversion rate reveals what percentage of the number of visitors and users to your website convert.
How to calculate “cost per conversion”
Cost per conversion is the advertising cost spent to obtain a single conversion. The cost per conversion is calculated using the formula below.
[Conversion cost] = [Advertising cost] ÷ [Number of conversions]
Cost per conversion uses the same formula for unique conversions and total conversions.
For example, if you spend 100,000 yen on advertising to get one user to take an action, the cost per conversion will be 100,000 yen when calculated using the number of unique conversions. On the other hand, if you have the same user take an action twice, the cost per conversion will be 50,000 yen when calculated using the total number of conversions.
By improving advertising based on the cost per conversion, you can further increase the number of visitors and purchases and improve cost efficiency.
Types of conversion measurement methods for listing ads
Although it is generally referred to as conversion, the definition of conversion varies depending on the effectiveness measurement method of the medium and measurement tool. Here we will introduce the main types of conversion measurement methods for listing ads.
“Unique conversion” and “Total conversion”
With unique conversions, no matter how many conversions occur for one click on an ad, the number of conversions will be counted as one. Total conversions, on the other hand, count all the conversions that occur for each click on an ad.
Your website may not only generate one conversion per user. For example, purchases made on online shopping sites or charges made through apps may lead to repeat purchases.
For online shopping sites where sales increase through repeat sales, conversions themselves become sales and profits, so total conversions are measured.
On the other hand, for mail-order sites whose KPI is regular purchases or new trial purchases to lead to subsequent repeat purchases, the number of users who convert is more important than the number of conversions themselves. Therefore, you can consider using them differently, such as measuring the effect using unique conversions.
“Click-through conversion” and “view-through conversion”
A click-through conversion is when a user clicks on an ad and then converts. On the other hand, a view-through conversion is when a user is shown an ad but does not click on it, but then visits the site via organic search etc. and converts.
In many cases, the initial purpose of web advertising is to get users interested so that they click on the ad and visit your site. Therefore, in most cases, click-through conversion is generally considered as an advertising effect.
However, this does not necessarily mean that ads that are not clicked are ineffective. Have you ever seen a banner ad, but instead of clicking on it, you get curious about it later, search for the service name, visit the site, and convert?
View-through conversion is a metric that can evaluate ads that were not clicked but triggered a conversion.
“Direct (last click) conversion” and “Indirect (assisted) conversion”
Direct (last-click) conversions are measured at the last interaction point where a user converts. Indirect (assisted) conversions, on the other hand, are measured at all points of contact a user has before converting, except for the last ad contact.
Not all users who click on your ad will convert. A certain number of users do not convert at that time after clicking on an ad, but then return to the site or app via organic search, email newsletter, or another ad and convert. Indirect conversion is the evaluation of advertisements that create initial or intermediate points of contact with such converting users.
As you can see, there are various measurement methods depending on the definition of conversion. It is important to choose based on the characteristics of the product or service and how you want to change user behavior and emotions through advertising.
How to increase conversions with listing ads
When operating listing ads, it is important to be able to efficiently obtain a large number of targeted conversions. So how can you increase conversions?
Conversion in listing ads can be calculated by multiplying the number of clicks by the conversion rate. Therefore, if you think about it simply, there are only two ways to increase conversions (assuming the conversion rate is constant): increase the number of clicks or increase the conversion rate.
For example, if the improvement in conversion rate with paid search advertising has reached a plateau, it would be effective to take actions to increase the number of clicks. The number of clicks can be further broken down into the number of impressions and the click rate, so in order to increase the number of clicks, you can see that you need to take action to increase the number of impressions or increase the click rate.
What is CVR (CV rate)?
CVR (CV rate), also called Conversion Rate, is the rate at which users respond to the behavior expected by website administrators.
For example, if a site asks users to request materials, the number of requests that result in that request, and if it is an online shopping site, the number of requests that result in an actual purchase. For corporate sites, inquiries and applications on recruitment sites are also counted as conversions.
The fact that this number is low even though the number of accesses is high means that, in the analogy of an apparel shop, there are many customers who look at the show window but do not make a purchase.
You can see that we are creating a lot of lost opportunities, right?
How to calculate CVR
CVR is calculated by number of conversions/number of sessions.
For example, if there were 10 inquiries and 1000 sessions that month,
[10÷1000×100=1], resulting in a CVR of 1%.
What is the reason for the low CV rate in the first place?
Generally speaking, the average CVR from a website is said to be 1%.
However, for famous brands, the CVR is said to be around 10%, and for advertising, it is said to be around 2%. Please use this as a guideline only, as it varies depending on whether it is BtoC or BtoB and the product.
Of course, there are some things that can’t be generalized as it depends on the purpose and type of the site, but broadly speaking, the reasons for low CV rates often fall into the following three categories.
Due to changes in the environment or market
The number of companies that want to advertise through listings, SEO, etc. is increasing year by year.
As a result, while this is good for users as they have more opportunities to compare and consider, for advertisers, potential customers are dispersed and CVR is lower than before, which increases the risk of losing to competitors. Masu.
In addition, changes in the environment and market may also be a factor, such as price competition due to changes in prices, a decline in demand, and seasonal factors.
When the advertising method is a factor
For example, let’s say there is a man who wants to go on a diet. He will want to look at different books and try them out. Of course, don’t forget to gather information on the Internet.
Then you see an ad that says, “A diet that 99% of men are successful at!” Naturally, I immediately clicked on the ad to see what was inside.
However, the photos on that site are only of women. This is what he would think. “Something’s different…” he said. He doesn’t want to become thinner or prettier or cuter, he just wants to be cool, but the advertisements are all from a woman’s perspective…
This is an extreme example, but in short, if there is a discrepancy between the purpose of the site and the content that users expect, the users who have expectations will not proceed further.
When the site itself is a factor
The third and final factor is when there is a factor in the site itself.
Common examples include sites that have too much information and are cluttered, or conversely, sites that are too empty and lonely, or sites that are clearly suspicious.
Or, if you can’t find the information you want, or if you’re interested but can’t find the inquiry form anywhere, the site could be the cause.
In particular, this is a factor that is closely related to things like bounce rate, so it is necessary to carefully examine the content.
What are the measures to increase CV rate?
Review and optimize user search terms and preferred keywords
When you place an ad, you probably set various keywords.
Of course, if a user searches for the keyword you set, your ad will appear, but some users end up on your homepage using an unexpected phrase.
It would be great if that led to conversions, but even if you direct people who want to go on a diet to a hamburger shop’s website, there’s no chance they’ll get a response.
In this way, check to see if there are any gaps between the keywords you have set and the words users are searching for, and adjust accordingly to reduce access by users outside of your target group.
Clarify the target and pinpoint advertising
Similar to the measures above, this also aims to reduce access by users outside of the target group.
A countermeasure could be to completely clarify the age, gender, hobbies, etc. of the users (targets) you want to visit your site, and then issue advertisements only to those users.
If you have Google Analytics installed, you can check the age and gender of users visiting your site by going to Users > User Attributes, so please use this as a reference. .
Review the homepage structure and reorganize the conductor design
If the site itself is causing a low conversion rate, it’s most likely due to a high bounce rate.
I will not explain the bounce rate here, but in short, if you are not able to make people want to see more the moment they open your homepage, it will be difficult to convert.
Is there an interesting catchphrase placed where it can be seen? Are you giving yourself too many options? Is there a gap between the content and the image of the site? Let’s review whether the design is simple and easy to see and guides the user’s movements.
Lower conversion hurdles
Of course, the conversion rate will also vary depending on cost factors such as whether it is paid or free.
For example, you can imagine that the probability of clicking a button that leads to conversion changes depending on whether you are requesting free information or purchasing immediately with a click.
When a user likes something but is still undecided, they naturally want to compare it with others.
Or, there may be things that are still unclear and you won’t buy it until that is clarified.
Even if there is a purchase button in front of such users, the probability that they will reach that point will decrease.
So, what if there was a button to make inquiries or request information? The mentality at work here is “I still want to think about it, but I just want to listen.”
In this way, even if you’re not at the decision-making stage, lowering the hurdle one step can make it easier for users to respond, which may lead to conversions.
Add impactful content
As I wrote earlier, a high bounce rate is directly linked to a low conversion rate.
In other words, measures to lower the bounce rate can directly be used to increase the conversion rate.
So why not introduce content on your homepage that will interest and catch the attention of users?
For example, “video”.
There is a risk that low-quality videos that can significantly damage a company’s image will have the opposite effect, but a well-crafted video can convey a lot more quickly than reading text.
If you can arouse even the slightest interest in the first few seconds of your posted video, you will increase the amount of time spent on your homepage and increase the possibility of lowering your bounce rate. Also, recently, many sites that publish manga have become popular.
In this way, by showing eye-catching content that is a bit different from what you’ve seen before, you can aim to increase your conversion rate.
summary
When it comes to attracting customers online, we tend to focus only on increasing the number of accesses, but when considering the actual effect, the conversion rate is a very important indicator.
Increasing this number can be said to be a major mission, but if you have a low number of accesses but your CV rate is low, or if you have not done anything but your CV rate is decreasing, start by taking small measures. , let’s be conscious of making even the slightest change.
To increase your conversion rate, you need to repeatedly test and make improvements.
Improving conversion rates from a long-term perspective will lead to more effective results.