A few weeks ago ROI Revolution’s Meredith Smith wrote about the importance of monetizing your non-ecommerce goals (i.e. lead generation or brand awareness goals) in order to get the fullest value from Google Analytics.
Meredith ‘did the math’ for you in her entry:
Assume that an average successful sale is worth $500 to you, and you know that about 1 in 10 submitted leads become a paying customer. Just divide the average sale by the total submitted leads, and you get the goal value: $50.
But what if there are multiple conversion opportunities on your website which are leading indicators of an eventual offline transaction?
Check out this excellent article written by Robbin Steif entitled computing the value of your lead gen conversions. From Robbin’s posting:
This gets a little more interesting when there are multiple ways to convert (they can sign up for an e-newsletter, download a demo, attend a webinar.) If everyone only did one of those conversion methods, you could just follow the instructions above and compute the value of an e-newsletter sign-up, the value of a webinar registration, etc. But the truth is probably muddier and most visitors who convert probably sign-up for more than one option, especially if the end result is a $50K purchase. There are many ways you could do this, but I always like to keep things really, really simple when you are guesstimating anyway. So I recommend that for starters, you consider each conversion to be an equivalent event, and then count by the events.
For example, let’s assume that the customer who made the $75K purchase signed up for all three events (e-newsletter, webinar and download.) The first $50K purchaser only signed up for the download, and the second $50K purchaser signed up for both the e-newsletter and the download. So that’s six events spread over $175,000 of transactions, or $175,000/6= $29K per conversion event that turned into a customer. Now you can spread that over all the 1000 individuals who took action on your site (whether they bought the software or not, since our real goal is to put a value on each software download, each webinar registration, etc.) Let’s assume that the 1000 “action-takers” actually completed two events, for 2000 total events. That makes each event worth $29K/2000 = $14 and change. So each of the three events (webinar, e-mail, download) is worth between $14 and $15.
Next, what if you want to ‘weight’ the events? No worries! Robbin explains how to do this in the second part of her post about computing the value of your lead gen goals. She also provides an even deeper example which shows how to know how folks who sign up for two conversion events affect the value of each event.
If you’re not reading Robbin’s blog you’re missing out on some great conversion education. Robbin even had a chance to chat with Paul Muret, one of the founders of Urchin/Google Analytics at the last eMetrics Summit in April, and get her Google Analytics invitation code.