Consider also that when compared to 2002, today’s Web sites and landing pages are far better designed and much more usable. Web technology has improved, and more companies use Web analytics and A/B testing technologies. Additionally, customers visit fewer Web sites (yes, less competition for you), and they’re also more confident about buying online now compared to four years ago.
Yet despite the marketer-friendly technologies, better site designs and improved customer confidence in shopping online, conversion rates limp downwards. Too many marketers find the low, single-digit conversion rates acceptable. In offline direct marketing, a 2 percent return certainly is acceptable since the marketing is pushed at customers, but the online channel’s pull marketing is night to direct mail’s day. Of course, the online channel appears better because it doesn’t have to accommodate printing and postage costs, but these cost savings are only temporarily advantageous.
Consider that in the online world, customers are in control. They’re task-oriented, and with every search term they type or hyperlink they click, they reveal more about their intentions. A clickthrough on a search term reveals a certain degree of visitor intent. Assuming your product or service offering is what that prospect needs, you have the recipe for superior conversion rates. This is why most online campaigns should enjoy a conversion rate at least two to three times greater than that of offline direct marketing, based on the nature of the online medium alone.
Why Are We Settling for So Much Less?
Traffic cost inflation will hurt the small to medium-sized online advertisers the most. Today’s deceptively low keyword prices have created a new breed of advertisers. I call them crackvertisers.
Crackvertising (krak-ver-tyzing) n. - The addiction to and/or business dependency on low-cost traffic from Google search and other search advertising. Signs of addiction include needing more and more traffic to convert the same amount of sales and paying more for less traffic. Finally, the advertiser’s life becomes obsessed with the next “fix” of traffic. A lack of, reduction of or fluctuation of paid traffic results in severe withdrawal. The effect usually is a corresponding and parallel fluctuation in top line sales. The potency of the drug (read: traffic) declines in time, and the addict needs greater amounts to satisfy his/her addiction.