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5 Reasons Website Traffic Is the Lifeblood of Small Business

02/09/2015 10:53 am ET | Updated Apr 11, 2015

Investment in websites and online marketing by small businesses has increased rapidly over the last five years. Business owners are coming to realize that with the growth of consumers relying on search engines, online marketing can provide low risk, low cost and high returns.

The single aim of all marketing efforts is to increase sales and in order to achieve this online, your website needs to have traffic to convert into a sale or a lead. Therefore it could be said that the initial focus of your online marketing efforts should be to acquire qualified traffic and lots of it.

Below are five points that demonstrate why traffic is so important to your business, the best ways to source it and finally how to calculate a return on investment.

1. The Basis of Online Marketing Is a Website's Traffic and Its Conversion

Website conversion measures the rate at which website visitors complete a certain desire outcome, for example -- submit an enquiry or buy a product. However to have a real effect on your bottom line you need to understand that traffic and conversion rates go hand in hand. You can't convert anything without traffic, and without conversion your traffic is pointless.

2. Where Does Traffic Come From and Which is the Best?

Here is a breakdown of the four main types of traffic:

  • Paid Traffic -- Ad Words, Facebook, Remarketing

Paid traffic offers businesses access to some of the most prime positioning on the internet and is geared towards being highly relevant for audiences. Paid traffic includes Google Adwords, Social ads and various remarketing providers. Because there is a cost for every visitor there is a strong emphasis on generating an effective conversion rate that delivers an economical return on investment. And the great thing with paid traffic is that you can get very accurate data to measure its success. With some paid campaigns the cost per click (CPC) can be quite high, so it's worth calculating the ROI to assess if it is a viable option for your business.

  • Organic Search Results and SEO

The goal of SEO is to improve the organic positioning and ranking of a websites listing on the search engine results page. With any SEO campaign there is an initial investment of time and money to get results. But if done effectively, organic traffic and SEO is often a more rewarding and effective solution in the long term. Rather than competing directly with PPC, SEO can be used in conjunction with PPC, as SEO Image explains 'Gaining a presence in both the natural and paid sectors will often double the effectiveness of your online marketing campaign'.

  • Referral (Content Marketing)

Even though content marketing is often used to improve organic SEO rankings, if done effectively this content can be an abundant source of links and referral traffic. A blog is a great place to start with content marketing and according to Hubspot -- businesses that blog have 55 percent more website visitors and 97 percent more inbound links. By providing high value content you're likely to be referenced by others or even have the opportunity to guest blog and also build up your link profile.

  • Social Media

Not to be confused with paid social media advertisements, social media as a source of traffic is referring to having a social media presence that encourages a community to visit your website. Unlike search engines, social media allows you to build relationships within a targeted network of users, resulting often in more qualified traffic. One of the great things about social media is that the bigger your audience gets, the bigger your audience can get. For example if your social media marketing efforts for the month generate a 10% increase to your audience and your audience is 1000, that's an increase of another 100 viewers, but if your audience was 100,000 that's an increase of 10,000 viewers for the same effort.

3. Qualified Traffic vs. Random Masses

According to Incapsula "bots accounted for 56 percent of all website traffic in 2014 and for smaller websites, bots can make up 80 percent of all website traffic." There are multiple ways to quantitatively increase traffic to your website, but without this traffic being qualified it's likely you'll see a sharp drop in conversion rates and little effect on your bottom line.

It's therefore vital that you attract qualified traffic using an online marketing strategy that is aligned with your consumer's intent.

4. Traffic Results in Conversions

Despite businesses being able to monitor their traffic, they often can't analyse this in relation to their conversion rate. According to a recent study from Infotrust "34 percent of businesses that collect data on their website traffic, don't know what to do with it."

Successful online marketing strategies are centred on one simple proposition - to acquire qualified traffic and then convert this into sales. Therefore, it's important that once traffic is acquired that it also converts; otherwise your return on investment will be non-existent.

5. Strike a Balance and Calculate Your ROI From There.

The fine balance that conversion rate optimisation and traffic have on the success of an online marketing campaign is irrefutable.

Once you understand how acquisition and conversion work on your website and how to project their effect on your ROI, you'll be able to assess the channels used to acquire traffic in a much more effective way.

The key to generating large amounts of quality traffic that converts is to focus on relevancy, and diversifying the channels used. Multichannel marketing is used to describe leveraging multiple sources in one overall strategy to complement each other. By focusing on attracting qualified traffic initially, you can then gear multiple channels to reach a larger quantity of customers - setting yourself up for a steady increase in sales for the long term.

For more information and tips on online marketing check out the Magicdust website, we are a Sydney web design company specialising in small business.