Some time ago I changed my lead form from asking for just name and email to asking for name, email and phone number. Conversions fell off a cliff. After about a week and a half of getting almost no leads, I changed it back to just asking for name and email. What I didn’t realize at the time was that my ad budget often runs out near the end of the month and I stop getting leads no matter what.
For most of September I’ve been getting a reasonably steady stream of email addresses coming in, but almost no phone calls or chats for some reason. I’m actually kind of glad that this lull has happened because it made me realize that the email-only leads aren’t very valuable. I had been automatically emailing each lead, but almost no one would respond. (I realize should be sending more than just one email to each person.) But it’s just so much easier to follow up via phone, at least for me.
So about a week ago I changed my lead form back to requiring phone number. Actually, I require a lot more stuff now. The form is now a questionnaire designed to filter out bad leads.
So far I’ve gotten 5 leads over the course of 10 days. I get about 222 visits a month or 222/30 = 7.4 a day, so 10 days is 74 visits. That makes my conversion rate 5/74 ~= 6.8%. That’s a small sample size, of course, but it gives me a rough idea.
I had been thinking earlier that it feels lame to only get one lead every 2 or 3 days, but when I put it in terms of conversion rate it doesn’t sound so bad.
I had also had some ideas around target conversion rates before I even did any number crunching. Here’s what I was thinking.
|Step||Target conversion Rate||Predicted volume/month|
|PPC Click||N/A||222 ($500/$2.25 bid)|
|Fill out lead form||5%||11|
|Do a screenshare demo||50%||5|
|Start 30-day trial||50%||2|
|Become a paying customer||50%||1|
I’d be pretty happy with these percentages, and I don’t know that I can hope for much better. I’m not terribly thrilled with the idea of paying $500 for just one customer each month. In the first two or three months of my PPC campaign (I forget), I got 7 free trials going at once. That means 7/3 = 2.3 trials per month, which is actually pretty close to my prediction here, especially because the real un-rounded percentage would be 2.5. And out of my complete months of PPC so far (June, July, August), 3 of those 7 trials converted to paid. So funnily enough, I’m realizing that the numbers I’ve already seen pretty closely match my targets above. The earliest input ($500/mo for 222 clicks) and latest output (3 paying customers) are easy to measure. I haven’t kept very good track so far of number of demos that I’ve done, although I guess I’ve kept good enough track of how many trials I had started, since I know the exact number (7).
Even though $500/mo for 1 customer isn’t the most desirable ROI in the world, it’s not so out of whack that I wouldn’t be willing to pay it. If somebody asked me if I’d pay $5000 to instantly have 10 more customers right now, I’d probably say okay. At this stage I think I just need better revenue, even if it takes an unscalable initial cash outlay.
Let’s see, if I do spend $5K for an additional 10 customers (over time), that would be roughly $300/mo more in revenue, bringing me to about $720/mo. If I spent $10K that would get me to just over $1000/mo, which is a milestone I’ve been shooting for for a long time.
I’ll be really curious to see how October goes. I’ve gotten roughly jack shit in September so far. I think I’ve done one demo. For this I blame the fact that I haven’t been collecting phone number in my lead form (even though I hadn’t been before), plus the apparent fact that September is a slow salon month. And maybe just a little plain old bad luck. If October goes well then by that time I’ll have a sufficiently large sample size that I think I’ll be comfortable in November spending a little more than the previous $500/mo.