Conversion rate
Conversion rate, more commonly known as CVR in PPC marketing circles, is a critical metric.
It may not have escaped you that I said PPC marketing circles. I did not say PPC author circles.
More on the difference, and why it’s important, later.
Conversion rate, simply put, is how many clicks it takes on average to get a sale.
There’s no such thing as a good or bad conversion rate. Not on its own. You can only measure CVR against the advertising strategy that you’ve adopted. The same CVR might be bad if you’re aiming for small-scale profit but brilliant if you’re aiming for breaking even at a high scale.
So, always keep your strategy in mind when evaluating results. And always keep in mind that when people share ideas on an internet forum of what a good or bad CVR (or any metric) is, they may be basing that on a different strategy from what you’re using.
In fact, this is a warning sign. If someone lays down specific benchmark figures about what good CTR and CVR must be, it’s quite possible that they don’t even realize there are different strategies. This places a big question mark over the depth of their knowledge of PPC in general.
But there are benchmarks that you can use as general indicators. Especially when you filter those figures through your own chosen strategy. For instance, it’s relevant that the average conversion rate across all products on Amazon via PPC advertising is 10%.
As with CTR, I’ve found this to be spot on for books too.
To put Amazon’s 10% CVR into perspective, the average for ecommerce in general is 1.33%.
That’s an astounding difference.
Why do Amazon customers convert so much better?
Because Amazon customers have buying intent for the products they’re looking at. This is a key difference to other PPC platforms such as Facebook and Google. It ties in, as you would expect, with the earlier comments in this book about targeting. Targeting is critical to success, and it will make or break you as a PPC advertiser.
CVR has value over and above whether or not it’s playing its part in helping you meet your advertising strategy.
I don’t think I’ve ever seen a keyword that has a low CTR and a high CVR. This is because a low CTR is a predictor of a poor keyword. But I have seen keywords with a high CTR that didn’t convert.
This is a gold-standard learning opportunity when it happens. So long as you figure out why.
A high CTR indicates your ad is working well. It’s generating high interest. The cover, blurbsnippet, reviews and price are doing their job.
So the problem is in one of two places. Poor targeting, or expectations generated by the ad are not being met when the prospect reaches the product page.
By poor targeting, I don’t mean the spaghetti-on-the-wall approach this time. I mean that your targeting is fairly close, but not close enough. For instance, you might be targeting an epic fantasy book with a coming of age hero. Your book may be epic fantasy with a coming of age hero. People click your ad, but they find your book is noblebright while the book they came from was grimdark.
Sometimes the difference is not as obvious as this. Sometimes you can’t even tell what the difference is. Don’t give up. Keep looking and you’ll spot it. This is the best way to learn your subgenre and the micro-niches within it.
This is where most advertisers fail. They don’t do the work to figure out what went wrong. They may switch off a keyword because it’s not working for them, only to start up a new keyword with the same mistake the next day. If you’re doing PPC advertising, you will make mistakes. Those who succeed at PPC advertising learn from their mistakes. Those who fail keep repeating them.
Do the work. I can’t say it simpler than that.
The other reason for a high CTR but a low CVR is that something is wrong with the product. Maybe the blurb is bad. Or your preview. Or you have bad reviews. Whatever the case, dig deep and find the answers.
If you have a high CVR off some keywords, but not others, it indicates a targeting issue. If you have a low CVR off all keywords, it indicates a product issue.
One last point. Just as with CTR, but even more so, conversions are influenced by price. For example a boxed set at 99 cents might convert as high as 1 in 5. Book 1 of a series at full price without the follow up books will often struggle to do 1 in 10.
