#What is the conversion rate (CVR)? Your conversion rate is a ratio of prospects to completed transactions (conversions.) How you define a completed transaction will be specific to your offer. Many companies use the internet to generate leads. In this case, the transaction of interest is a completed lead form. In internet marketing, the conversion rate is the proportion of visitors to a website who take action to go beyond a casual content view or website visit, as a result of subtle or direct requests from marketers, advertisers, and content creators.
Successful conversions are defined differently by individual marketers, advertisers, and content creators. To online retailers, for example, a successful conversion may be defined as the sale of a product to a consumer whose interest in the item was initially sparked by clicking a banner advertisement. To content creators, a successful conversion may refer to a membership registration, newsletter subscription, software download, or other activity.
For websites that seek to generate offline responses, for example telephone calls or foot traffic to a store, measuring conversion rates can be difficult because a phone call or personal visit is not automatically traced to its source, such as the Yellow Pages, website, or referral. Possible solutions include asking each caller or shopper how they heard about the business and using a toll-free number on the website that forwards to the existing line. For websites where the response occurs on the site itself, a conversion funnel can be set up in a site's analytics package to track user behavior.
# Methods of increasing in conversion rates in e-commerce:
Among the many actions taken to attempt to increase the conversion rate, these are the most relevant:
Generate user reviews of the product or service
clear distinction[clarification needed] of the website for a certain conversion goal (e.g. "increase signins for newsletter")
Improve and focus the content of the website (which may include text, pictures and video) to target conversion
Increase usability to reduce the barriers to conversion
Improve site navigation structure so that users can find and browse without thinking too much about where to click
Improve credibility and trust by showing third-party trust logos and by good site design
use AIDA (attention, interest, desire, action) to move the user through the conversion funnel.
#Conversion Funnel: Conversion funnel is a technical term used in e-commerce operations to describe the track a consumer takes through an Internet advertising or search system, navigating an e-commerce website and finally converting to a sale. The metaphor of a funnel is used to describe the decrease in numbers that occurs at each step of the process. Typically a large number of visitors register as page view on a referring page which is linked to the e-commerce site by a banner ad, ad network or conventional link. Only a small proportion of those seeing the advert or link actually click the link. The metric used to describe this ratio is the click-through rate (CTR) and represents the top level of the funnel. Typical banner and advertising click-through rates are 0.02% in late 2010 and have decreased over the past three years[citation needed]. Click-through rates are highly sensitive to small changes such as link text, link size, link position and many others and these effects interact cumulatively. The process of understanding which creative material brings the highest click-through rate is known as ad optimization. Once the link is clicked and the visitor to the referring page enters the e-commerce site itself, only a small proportion of visitors typically proceed to the product pages, creating further constriction of the metaphorical funnel. Each step the visitor takes further reduces the number of visitors, typically by 30%–80% per page[citation needed]. Adding the product to the shopping cart, registering or filling in contact details and payment all further reduce the numbers step-by-step cumulatively along the funnel. The more steps, the fewer visitors get through to becoming paying customers. For this reason, sites with similar pricing and products can have hugely different conversion rates of visitors to customers and therefore greatly differing profits
#How do I calculate my conversion rate? Once you have set up your tracking system, and assembled the data, you will need to calculate your rate. This is a simple formula: Total Conversions/Total Views X 100 = Conversion Rate Here are some examples, of how you could compute conversion rates for different scenarios and transaction types: Lead Generation Conversion Rate: Number of Lead forms filled out/Traffic on Landing Page X 100 = Conversion Rate Website Lead Conversion Rate: Number of lead forms filled out/Total Traffic on Home Page X 100 = Conversion Rate Website Sales Conversion Rate:
Number of Sales/Number of Visitors X 100 = Conversion Rate #If you don’t want to shoot in the dark and be concise about your campaign, you should keep minimum
level of idea about average conversion rate about your traffic. Is it really possible? Yes, it does if you consider some parameters as constant. No matter what you promote like CPA, Affiliate products, your own products or even your website, you always need to calculate your project ROI so that you can evaluate by time to time and decide when to scale up or down. In this article, I will show you a list of traffic source in ascending order depending on the traffic quality. Our one and only assumption will be, you have a good converting landing page. Traffic Source: Opt-in List/Email List Traffic Type: Free & Paid Expected Conversion Rate: 40% - 60% --------------------------------------------------------------------------------------------Traffic Source: Niche Forum/Board/Social Networking Traffic Traffic Type: Free & Paid Expected Conversion Rate: 25% - 35% --------------------------------------------------------------------------------------------Traffic Source: Pay Per Click (Search Network Based) Traffic Type: Paid Expected Conversion Rate: 12% - 20% --------------------------------------------------------------------------------------------Traffic Source: SEO Traffic Traffic Type: Free Expected Conversion Rate: Up to 10% --------------------------------------------------------------------------------------------Traffic Source: General Social Media Traffic Traffic Type: Free Expected Conversion Rate: 1% - 3% --------------------------------------------------------------------------------------------Traffic Source: CPM Advertising, General Directory, Press Release, Article Marketing Traffic Type: Free & Paid Expected Conversion Rate: 1% - 2% --------------------------------------------------------------------------------------------Traffic Source: Pop Up, URL Redirector, PTC, Email Spamming Traffic Type: Paid Expected Conversion Rate: Below 0.01% There are some more other traffic sources but these are the 95% of web. The number may vary depending on time or lander but the saturation will be tolerable.
#Cost per mile/Cost per thousand impressions (CPM) Calculation: Fill in any two to calculate the third field: Cost of a campaign ($): CPM ($): Ad impressions:
The online CPM Calculator is used to determine your advertising costs, cost per 1,000 impressions (CPM), and the number of exposures (Ad impressions).
#Terminology Ad impressions: An ad impression means the number of times an individual advertisement is displayed. CPM : The CPM stands for cost per thousand impressions is the rate to be charged or
paid for every 1,000 times an advertisement is displayed. It is widely used to set pricing for banner ads or CPM rate is the cost per 1,000 impressions or the amount that you pay every 1,000 times your advertisement is displayed. Cost of a campaign: This is the total cost of your advertising campaign.
#Effective per thousand of impressions(eCPM) Calculator: eCPM is a useful way to compare revenue across different channels and advertising programs. It is calculated by dividing total earnings by the number of impressions, then multiplied by 1000. For example, in our default values, if a publisher earned $350.00 from 90,000 impressions in a particular advertising project, the eCPM would equal $350 divided by 90000 (X 1000), or $3.89 (cost per thousand)
http://www.csgnetwork.com/ecpmcalc.html
#Combined eCPM Calculator: This calculator is a variant of the Standard eCPM calculator. This calculator will combine separate eCPM's into a single eCPM with nonshared pageviews. It is specifically designed for a publisher running ads from multiple ad networks on a single page (but not sharing the same traffic). For instance, If a page is swapping out Google ads and Yahoo ads, the eCPMs will be tracked separately by the respective companies, but the page itself will have an eCPM of the two networks combined. A
common mistake is averaging the two, which will not provide you with the correct eCPM. This will not be an accurate number if the ads are running alongside each other (i.e. sharing pageviews), only if they have separate traffic. This calculator will calculate for 3 ads on the same page. You can also use it to combine eCPMs for whatever purpose you can find.
http://www.csgnetwork.com/combinedecpm.html
#Media Planning & Buying Calculators: http://www.srds.com/frontMatter/sup_serv/calculator/cpm/ Cost per impression (CPI): Cost per impression, often abbreviated to CPI, is a term used in online advertising and marketing related to traffic. It refers to the cost of internet marketing or email advertising campaigns where advertisers pay for every time an ad is displayed. Specifically, it is the cost to offer potential customers one opportunity to see the advertisement.
Cost per impression, along with cost per click and cost per order, is used to assess the cost effectiveness and profitability of online advertising.CPI is the closest online advertising strategy to those offered in other media such as television or print, which sell advertising based on estimated viewership or readership. CPI provides a comparable measure to contrast internet advertising with other media.
#Impression versus Page view: An impression is the display of an ad to a user while viewing a web page. A single web page may contain multiple ads. In such cases, a single page view would result in one impression for each ad displayed. In order to count the impressions served as accurately as possible and prevent fraud, an ad server may exclude certain non-qualifying activities such as page-refreshes or other user actions from counting as impressions. When advertising rates are described as CPM or CPI, this is the amount paid for every thousand qualifying impressions served.
#Calculation of Cost per impression (CPI): Cost per impression is derived from advertising cost and the number of impressions. Cost per impression ($) = Advertising cost ($) รท Number of Impressions (#)
Cost per impression is often expressed as Cost per Thousand Impressions (CPM) to make the numbers easier to manage.
#Page view: A Web page that has been viewed by one visitor. Page views are often used in online advertising, where advertisers use the number of page views a site receives to determine where and how to advertise. An
individual viewing of a web page by a user, often counted when measuring a web site's popularity.
#Ad serving: Ad serving describes the technology and service that places advertisements on web sites. Ad serving technology companies provide software to web sites and advertisers to serve ads, count them, choose the ads that will make the website or advertiser most money, and monitor progress of different advertising camAn ad server is a computer server, specifically a web server, that stores advertisements used in online marketing and delivers them towebsite visitors. The content of the webserver is constantly updated so that the website or webpage on which the ads are displayed contains new advertisements—e.g., banners (static images/animations) or text—when the site or page is visited or refreshed by a user. The purpose of ad serving is to deliver targeted ads that match the website visitor's interest. Ad serving also performs various other tasks like counting the number of impressions/clicks for an ad campaign and report generation, which helps in determining the ROI for an advertiser on a particular website.[1] Ad servers can be run locally or by third-party or remote ad servers. Local ad servers are typically run by a single publisher and serve ads to that publisher's domains, allowing fine-grained creative, formatting, and content control by that publisher. Remote ad servers can serve ads across domains owned by multiple publishers. They deliver the ads from one central source so that advertisers and publishers can track the distribution of their online advertisements, and have one location for controlling the rotation and distribution of their advertisements across the web.
#PAY PER CLICK (PPC) /COST PER CLICK (CPC) : Pay-per-click (PPC) (also called cost per click) is an internet advertising model used to direct traffic to websites, in which advertisers pay the publisher (typically a website owner) when the ad is clicked. Farris et al. have defined it simply as “the amount spent to get an advertisement clicked. With search engines, advertisers typically bid on keyword phrases relevant to their target market. Content sites commonly charge a fixed price per click rather than use a bidding system. PPC
"display" advertisements, also known as "banner" ads, are shown on web sites or search engine results with related content that have agreed to show ads. In contrast to the generalized portal, which seeks to drive a high volume of traffic to one site, PPC implements the so-called affiliate model, which provides purchase opportunities wherever people may be surfing. It does this by offering financial incentives (in the form of a percentage of revenue) to affiliated partner sites. The affiliates provide purchase-point click-through to the merchant. It is a pay-for-performance model: If an affiliate does not generate sales, it represents no cost to the merchant. Variations include banner exchange, pay-per-click, and revenue sharing programs. Websites that utilize PPC ads will display an advertisement when a keyword query matches an advertiser's keyword list, or when a content site displays relevant content. Such advertisements are called sponsored links or sponsored ads, and appear adjacent to, above, or beneath organic results on search engine results pages, or anywhere a web developer chooses on a content site. The PPC advertising model is open to abuse through click fraud, although Google and others have implemented automated systems to guard against abusive clicks by competitors or corrupt web developers.
Cost per click, along with cost per impression and cost per order, are used to assess the cost effectiveness and profitability of internet marketing. Cost per click has a big advantage over cost per impression in that it tells us something about how effective the advertising was. Clicks are a way to measure attention and interest. Inexpensive ads that few people click on will have a low cost per impression and a high cost per click. If the main purpose of an ad is to generate a click, then cost per click is the preferred metric. Once a certain number of web impressions are achieved, the quality and placement of the advertisement will affect clickthrough rates and the resulting cost per click.
#Calculation of cost per click:
Cost per click is calculated by dividing the advertising cost by the number of clicks generated by an advertisement. The basic formula is: Cost per click ($) = Advertising cost ($) รท Ads clicked (#) There are two primary models for determining cost per click: flat-rate and bid-based. In both cases the advertiser must consider the potential value of a click from a given source. This value is based on the type of individual the advertiser is expecting to receive as a visitor to his or her website, and what the advertiser can gain from that visit, usually revenue, both in the short term as well as in the long term. As with other forms of advertising targeting is key, and factors that often play into PPC campaigns include the target's interest (often defined by a search term they have entered into a search engine, or the content of a page that they are browsing), intent (e.g., to purchase or not), location (for geo targeting), and the day and time that they are browsing.
# Flat-rate
PPC:
In the flat-rate model, the advertiser and publisher agree upon a fixed amount that will be paid for each click. In many cases the publisher has a rate card that lists the cost per click (CPC) within different areas of their website or network. These various amounts are often related to the content on pages, with content that generally attracts more valuable visitors having a higher CPC than content that attracts less valuable visitors. However, in many cases advertisers can negotiate lower rates, especially when committing to a long-term or high-value contract. The flat-rate model is particularly common to comparison shopping engines, which typically publish rate cards.However, these rates are sometimes minimal, and advertisers can pay more for greater visibility. These sites are usually neatly compartmentalized into product or service categories, allowing a high degree of targeting by advertisers. In many cases, the entire core content of these sites is paid ads.
#Bid-based PPC: The advertiser signs a contract that allows them to compete against other advertisers in a private auction hosted by a publisher or, more commonly, an advertising network. Each advertiser informs the host of the maximum amount that he or she is willing to pay for a given ad spot (often based on a keyword), usually using online tools to do so. The auction plays out in an automated fashion every time a visitor triggers the ad spot. When the ad spot is part of a search engine results page (SERP), the automated auction takes place whenever a search for the keyword that is being bid upon occurs. All bids for the keyword that target the searcher's geo-location, the day and time of the search, etc. are then compared and the winner determined. In situations where there are multiple ad spots, a common occurrence on SERPs, there can be multiple winners whose positions on the page are influenced by the amount each has bid. The ad with the highest bid generally shows up first, though additional factors such as ad quality and relevance can sometimes come into play (see Quality Score).The predominant three match types for both Google and Bing are broad, exact and phrase. Google also offers the broad modifier match type. In addition to ad spots on SERPs, the major advertising networks allow for contextual ads to be placed on the properties of 3rd-parties with whom they have partnered. These publishers sign up to host ads on behalf of the network. In return, they receive a portion of the ad revenue that the network generates, which can be anywhere from 50% to over 80% of the gross revenue paid by advertisers. These properties are often referred to as a content network and the ads on them as contextual ads because the ad spots are associated with keywords based on the context of the page on which they are found. In general, ads on content networks have a much lower clickthrough rate (CTR) and conversion rate (CR) than ads found on SERPs and consequently are less highly valued. Content network properties can include websites, newsletters, and e-mails.
Advertisers pay for each click they receive, with the actual amount paid based on the amount bid. It is common practice amongst auction hosts to charge a winning bidder just slightly more (e.g. one penny) than the next highest bidder or the actual amount bid, whichever is lower. This avoids situations where bidders are constantly adjusting their bids by very small amounts to see if they can still win the auction while paying just a little bit less per click. To maximize success and achieve scale, automated bid management systems can be deployed. These systems can be used directly by the advertiser, though they are more commonly used by advertising agencies that offer PPC bid management as a service. These tools generally allow for bid management at scale, with thousands or even millions of PPC bids controlled by a highly automated system. The system generally sets each bid based on the goal that has been set for it, such as maximize profit, maximize traffic at breakeven, and so forth. The system is usually tied into the advertiser's website and fed the results of each click, which then allows it to set bids. The effectiveness of these systems is directly related to the quality and quantity of the performance data that they have to work with — low-traffic ads can lead to a scarcity of data problem that renders many bid management tools useless at worst, or inefficient at best.
#Cost Per Order: Cost per order, also called cost per purchase, is the cost of internet advertising divided by the number of orders. Cost per order, along with cost per impression and cost per click, is the starting point for assessing the effectiveness of a company's internet advertising and can be used for comparison across advertising media and vehicles and as an indicator of the profitability of a firm's internet marketing.
#Example: An internet retailer spent $24,000 on online advertising and generated 1.2 million impressions, which led to 20,000 clicks, with 1 in 10 clicks resulting in purchase.
Cost per impression = $24,000 ÷ 1,200,000 impressions = $0.02
Cost per click = $24,000 ÷ 20,000 clicks = $1.20
Cost per order = $24,000 ÷ 2,000 purchases = $12.00
This is the cost to generate an order. The precise form of this cost depends on the industry and is complicated by product returns and multiple sales channels. The basic formula is: Cost per order ($) = Advertising cost ($) / Orders placed (#)
#CLICK THROUGH RATE (CTR):
CTR measures the effectiveness of an advertisement. It is calculated using the following formula that involves the number of clicks and impressions: CTR = (Clicks/Impressions) x 100 A high CTR means that it attracts attention and get clicks often. A low CTR means the ad is under-performing and should be evaluated further. Other similar terms include: response rate, click-thru ratio.
#Example A 1.0% CTR means that for every 100 impressions, there is 1 click.
#Monitoring CTR You should measure each ad's CTR regularly and make appropriate changes to improve its CTR. An ad with a low CTR should be modified, or even removed from the rotation. An evaluation should be performed when an advertisement gets at least 1,000 impressions. If this impression threshold is met and it still has a low CTR, less than 0.1%, it should be checked for the use of headings, hot spots, an appropriate call to action and other effectiveness factors.
#Gross CTR Gross CTR = (Gross Clicks / Gross Impressions) x 100
#Unique CTR Unique CTR = (Unique Clicks / Unique Impressions) x 100
#What Is a Good Click-Through Rate for PPC? A commonly asked question in pay-per-click (PPC) advertising is "what is a good click-through rate (CTR)?" There is no easy answer and it can vary greatly depending on channel, targeting, keywords, and more. First, the basics of the CTR: Defined: The number of clicks received divided by the number of impressions generated. For example, an ad that is displayed 1,000 times and receives 10 clicks has a click-through rate of 1 percent.
Channel differentials: Search and display channel results are very different. We tend to see higher CTRs in search because the searcher is looking for specific information, and is therefore more likely to click when they find it. With display ads, the viewer is passive - doing something else when the ad is served to them. Why do people care so much about CTRs? The CTR can be an indicator of how relevant an ad is to the searcher or to the audience targeted. It can demonstrate interest in a product message or show what "resonates" with searchers. I also have a theory that there can be an ego factor with CTRs. The bigger the better, right? Several factors can impact CTR on an ad, which is why there is no definitive answer to the question. A few of the factors to consider include:
Audiences and targeting
B2B or B2C
Brand or non-branded
A keyword's place in the search funnel
Ad copy's creative messaging - CTA
Type of offer
Display URL
Images/design
Industry competitiveness
There are some observed trends in the industry based on PPC managers' experience and the channel's own data. Search: In a healthy account you will see CTRs vary depending on the type of campaign. For example, branding campaigns typically earn a much higher CTR than non-brand. Advertisers may see 1 percent to 7 percent for non-brand with brand ads being 3 percent and up. Consider the differences in each campaign, but focus on optimizing ads with a CTR less than 1 percent. Display: Typically advertisers could see 0.05 percent and above, with retargeting campaigns' CTR as much as double the percentage of site targeting campaigns. Try to optimize any ads with CTRs lower than about 0.03 percent, if clicks are a consideration. Most of the time, display ads are used for branding so impressions are a more important metric. Facebook: Facebook offers two different types of CTR. One is ad CTR, which is the percentage of times the ad or sponsored story is clicked on. The other CTR is the social CTR. This number represents clicks on ads shown with the names of the viewer's friend. Facebook reps have said that CTR is not important and have not shared an average or goal CTR. This seems to be counterintuitive since part of Facebook's algorithm is based on an ad's CTR. Many advertisers will see 0.020 percent to 0.040 percent on average, but I regularly see several CTRs of 0.063 percent and up to 0.5 percent. Focus on optimizing or pausing any ads with less than 0.02 percent.
LinkedIn: According to a LinkedIn rep, the average CTR for ads on LinkedIn is about 0.025 percent. I see that percentage on the low end and then up to 0.06 percent. Focus on optimizing or pausing anything under 0.018 percent. Determining a good CTR is also common-sense marketing. Sometimes to increase awareness or achieve a goal, advertisers have to bid on less relevant or complementary keywords or audience targets. This can result in a lower than expected CTR. This happens. It's OK. The bottom line is if campaigns are achieving their goals in conversions, traffic, or branding, the CTR is only one piece of the data pie. PPC image on home page via Shutterstock.
http://www.csgnetwork.com/ctrcalc.html
#CPM Advertising ROI Calculator Tool SEO: http://www.seochat.com/seo-tools/cpm-calculator/
By Emil Hasibul. Anyone can edit this file for the better improvement. Distributed by http://easybd24.com Thanks to all. Have a nice search engine marketing