Basic Web site Conversion Theory

There are three types of Web site conversions:

Informational conversions occur when visitors find the information they are seeking. They stop looking because they are satisfied with what they have found. The very real danger for the visitor, of course, is that they may have found something completely bogus and simply don’t realize it. The challenge for the Web site operator is determining if the informational conversion occurred. You may attempt to measure time spent on site (not easily done, as you have no record of when the visitor leaves your site) or you may attempt to measure how much content your visitor examines (not easily done if you’re using AJAX or a similar unpaginated format).

Web sites designed for informational conversions include (unmonetized): Wiki-sites, FAQ archives, article archives, news sites, blogs, and anything with content meant to be read, played with (like online games), used (like mortgage calculators), etc.

Non-profit organizations, business associations, research sites, government Web sites, and similar resources are also built for informational conversions.

If you need to measure return on investment for these types of sites, you have to define metrics that make sense, such as (for example) an ROI based on cost-versus-distribution (or reach). That is, if it costs $1,000 to make information available to 1,000 visitors, your return on investment is poor if that $1,000 could make the same information available to 2,000 people offline. Your best metric may simply be to improve reach until you hit a performance ceiling (where it becomes too expensive to continue providing information in the same manner).

Transformational conversions occur when visitors sign up for a free service (such as a newsletter), perform a specific action (such as take a survey), or otherwise interact with a Web site without any money changing hands. Some people would classify game-playing as a transformational conversion, however, I tend to view game-playing and widget-use as informational conversion unless the visitor is required to share information with the Web site as part of the conversion process.

For example, if you require free registration for people to view your private forum, their first visit produces a transformational conversion if they register, but subsequent visits only produce informational conversions (if they log in and browse the forum).

The key difference between a transformational conversion and an informational conversion is that in the transformational conversion information passes both ways (from visitor to site, from site to visitor), whereas in an informational conversion information only passes one way (from site to visitor).

It’s easier to measure return on investment for many types of transformational conversions because you can often monetize them in other ways. For example, you may sell advertising based on how many people sign up for your newsletter or forum. Some social media sites (including blogs and forums) measure return on investment by comparing registrations with other sites.

Transactional conversions occur when visitors to your site directly provide you with revenue, either by purchasing something or by engaging with content on your site that produces revenue, such as clicking on advertisements. If you’re only making money just by displaying ads visits are not transactional regardless of whether people click on the ads. For an advertisement to produce a transactional conversion, it must only pay you when people click on it.

Paid registrations, product sales, paid subscriptions, and other ecommerce transactions are all transactional conversions. You measure return on investment in several ways for transactional conversions, but the simplest method is to subtract the (cost of sales + cost of goods/services sold) from your total revenue. If the difference is positive, you have a good ROI. If the difference is negative, you have a bad ROI.

Blending and refining conversion type definitions

A few years ago most Web sites were seeking either informational or transformational conversions. Now with the proliferation of pay-per-click advertising networks and affiliate programs, it’s difficult to measure how many sites are seeking any specific type of conversions. Even Web spam seeks a mixed bag of conversions (in fact, it could be argued that some link spam sites seek a fourth type of conversion, an indexing conversion).

All of these conversion types can be sub-divided into targeted conversions and untargeted conversions. You must use a specific demographic model to develop targeted conversions. You want a specific type of visitor to read your content, sign up for your newsletter, or buy your merchandise. Believe it or not, many sites do receive untargeted conversions in all three areas.

SEO and Web site conversions

Search engine optimization certainly influences types of conversions and return on investment. However, in a robust marketing campaign you may have to track multiple conversions to determine where your most efficient ROI occurs. For example, you may get better conversions from PPC campaigns than from organic search results, or perhaps your banner advertising works better (or maybe your billboard advertising works best).

You can test conversion type ROIs by developing specific Web sites for each type of conversion and then executing different promotional campaigns. Print and broadcast advertising might drive more converting traffic than huge PPC and organic SEO campaigns.

Understanding how these different conversion methods scale and peak helps you plan more efficient marketing campaigns. Your organic search engine optimization might work better up front if you’re building a query space, but maybe you’ll want to leave it for later if you’re building brand value through advertising channels. Telling people what to search for virtually eliminates competition, thus rendering organic SEO unnecessary.

This is pretty advanced search engine optimization theory. The average SEO technician is not in a position to weigh the pros and cons of different marketing strategies, but a good SEO technician should understand what types of conversions of being sought and where they are most likely to come from. Just because you’re only concerned with optimizing for search doesn’t mean you should milk the cash cow for all it’s worth.

There are campaigns where you can and should only do minimal SEO and then let nature take its course because brand value will drive more traffic to the site than targeted search referrals. In such campaigns, it is better to look at the long-term role that search engine optimization should play in improving ROI rather than simply achieving it. When the client understands that SEO complements a powerful marketing campaign, their expectations can be set to a more reasonable standard.

That said, this article at best serves as an introduction to the topic of Web site conversion. There is a great deal more to be said.