Sean McCool

Direct Marketing Strategist

Ever heard of something called “conversion rate?” You may have, but are you measuring it all the time or are you just guessing what it might be?

If you don’t know what conversion rate means, you’re missing out on the most cost-effective Profit Funnel™ there is in the world to increase sales, without spending a cent. Plus, by increasing your conversion rate, your net profits always go up!

So what is conversion rate?

Conversion rate is the difference between how many call, walk in or contact your business and then, how many of them end up buying. For example, if you had 10 phone calls to your business and you took their name and phone, over time you simply track how many of them actually spent money with you. So, if you have three people buy from you, your conversion rate would be 30% or 3 out of 10.

This simple measurement is life changing for business owners when they see the power of it. If you don’t know your conversion rate and “guess” it’s about 50%, I guarantee you’re wrong! Almost everyone thinks their conversion rate is higher than it actually is. The reason being is that the people you talk to who say they’ll come back and buy later, or who sound like they are very interested in buying, often don’t. But you don’t know that if you don’t measure all inquiries, because you assume they have bought.
When you measure your conversion rate, be prepared for a shock. I’ve worked with retailers who thought it was 75% and found it was 38%. I’ve worked with service businesses that thought it was 50% and we found it to be 13%.

They get a bit depressed when they realize it’s only 13%, but I get excited! That’s because it’s impossible to double 50% conversion rate, but with 13% you can triple it and still have room for improvement!

Did you know that increasing your conversion rate proportionally increases net profit? That means if you increase your conversion rate by 50% (e.g. from 24% to 36%) you have just increased your turnover by 50% as well! That’s because you get 50% more paying customers than you have right now, but no additional overhead. And you can increase your conversion rate, and therefore profit without spending a cent on advertising or promotion.

So how do you measure it?

First of all, you need two to three bits of information on every person who contacts your business. Things like their name, phone number and what their inquiry was about.

This then gives you information to refer back, to see how many people actually ended up buying who contacted your business. With your business it may take days before you can tally inquiries to customers. For some service businesses you may need to wait a month from the inquiry date to purchase due, to the time it takes people to make a decision.

You’ll notice your conversion rate will be different for each of your staff. Why is that? Simple, some people create a better impression on the customers. Some of your staff will follow up and others won’t. And once you realize the difference, you can do something about it, but until you have measured it, how can you do anything about it?

So now, onto the magic question…

How do you improve your conversion rate?

There are at least 80 ways! Want to know the best ones? Here they are:

1. Learn DISC profiles.
DISC profiling has to be the most unknown method of understanding people there is, yet in business it’s the most powerful tool you can learn and use. DISC is an insight into 4 major differences in people’s behavior: Dominance, Influence, Steadiness, and Conscientiousness.

When you learn DISC profiles, you understand some people want to be friends with the person they buy from, while others find friendly sales people annoying and don’t buy from them. Some people (about 50%) make all sales decisions very quickly, usually on the spot. While the other 50% of people always want to think about it, usually over a day or two. Knowing the difference can increase sales (and profit) by 20%-300% in weeks!

2. Offer guarantees in writing.
Everyone has some level of apprehension about parting with money, so a guarantee helps to overcome that apprehension and helps people to make confident decisions. What can you guarantee in writing that you have not been offering now? What about not to leave a mess if you’re in a service business? Retailers often don’t want to refund, so they scare away dozens of potential customers for the sake of a very few possibly wanting refunds.

3. Make your business appear unique.
This again is a powerful tool as when you “appear” unique or different, you stop losing sales to price shoppers. It’s not hard to do; in fact, when you use guarantees like those above, it makes you very unique!

4. Learn body language.
Body language is responsible for 55% of what you communicate before you open your mouth! Everyone has heard of it but how many people use it? Almost none! Go read a book on it and try it. Body language is a form of flattery and people buy from people they like or relate to.

5. Try different words you use to greet people face to face or on the phone.
Retailers are notorious for saying things that elicit “no thanks, just looking.” It’s the same on the phone. Try saying something like, “Hi, this is XYZ business. What project are you calling about today?”

Are you starting to get the picture there are dozens of ways for you to improve what you’re doing now with your conversion rate? First, you have to measure it before you can improve it. Collate it over a day, then a week, then a month. When you do, you will have a powerful Key Performance Indicator.

Working with business owner’s conversion rates, I have seen fantastic profit improvements in weeks and months. It’s not hard to do, it just needs to be done.

If you don’t increase your conversion rate, your marketing will rarely make you a good profit return, or enough to pay for itself with profit from the sales from the promotion. When you double conversion rates from advertising responses, you increase profit… and in many cases you’ll be able to cut back on advertising.

I’ll leave you with this thought... You can’t improve something if you haven’t measured it. Measuring is the secret to all of your success in business.

Sean McCool is an award-winning copywriter and the author of Marketing Secrets of the Ice Cream Man. He is known as The Profit Funnels Guy™ because Sean shows businesses how to set up multiple Profit Funnels™ throughout their business. Sean can be reached through his website, www.SeanMcCool.com