05/15/2012 05:08 pm ET Updated Jul 15, 2012

"Conversion Rate" Marketing: The Whole Point Behind Driving Traffic to Your Website

The purpose of driving traffic to your online business is to get customers. Once a prospect lands on your site, you still have to convert that prospect into a buyer. You might be able to drive 100,000 visitors to your site, but your efforts aren't worth much if your site can't monetize their clicks. This is where conversion rate marketing steps in.

The conversion rate experts are my good friends Bryan and Jeffrey Eisenberg. They are the undisputed gurus on search engine optimization for conversion and wrote the following:

Conversion rate is the number of folks who visit your site within a specified time period divided by the number of folks who actually do something productive on your site (like buy or register or subscribe).These days, a conversion rate of 2-4 percent is considered average, below 2 percent is shabby and 5 percent or more is really quite amazing.

Let's assume you spend $10,000 in advertising to drive 5,000 people to your site, and your conversion rate is 2 percent. This means that 100 transactions cost you $10,000, or $100 per transaction. Now let's assume your conversion rate rises to 4 percent. The same $10,000 buys you 200 transactions at a cost of $50 per transaction. An 8 percent rate gives you 400 transactions at a cost of $25 per transaction.

It all seems so simple. Higher conversion rates mean more money coming in and less money spent to attract a customer.

If you can get twice the number of visitors for the same amount of money and maintain the same conversion rate, you get twice the number of sales at one-half of the cost per sale. Of course, the final objective, regardless of which variable you change, is to get the lowest possible cost per sale.

When you consider that even small improvements in your conversion rate translate into dramatic increases in income, you begin to understand that investing time in trying to convert the traffic you drive is well worth your effort. Conversion rate marketing has a big effect on your profitability. Search on "conversion rate marketing" to start incorporating this practice in your marketing strategies. If your firm closes 2 percent and makes $100,000 in profit, and you want to get to $200,000, you would have to ask yourself - do we spend more on marketing or spend more money on research to learn a better way to convert those leads and shoot for a 4 percent closing rate? The beauty here is that the 4 percent closing rate continues while the marketing dollars must be spent month after month.

Good website practice and optimizing for conversion usually makes for good search engine optimization. These work together to ensure you drive quality traffic and can persuade that traffic to help you meet your business goals.

Marc Ostrofsky is a New York Times bestselling author of "Get Rich Click" and owns 300+ websites including, and He's been seen on ABC's "The View," the "Today Show," and 20/20, as well as in the "Wall Street Journal," "New York Times" and "USA Today." His sale of the URL "" landed in the "Guinness Book of World Records." He can be reached at, where you can also read more of his business insights and review his schedule of speaking engagements.