I have written an article detailing a CPC calculator and the Cost Per Click formula. If you haven’t read it please do. Having read the article you might have found the results of the calculator depressing.
In this article I want to cover how you can increase your CPC and maintain profitability.
Cost Per Click Formula Recap.
The CPC comes down to two key variables, conversion rate and budget.
Budget is the easy one to increase, if you want to reduce profitability.
Having said that you could increase your selling price or you could try lowering your costs to subsidise the increased CPC but that is outside of the scope of this article.
That leaves us with the conversion rate
If we can increase the conversion rate, it will mean clicks are more effective meaning we can pay more for them.
How To Increase Conversion Rate
To make your website convert more visitors into buyers there are a plethora of articles available, about the best I have read is this one, it gets right to the point.
But before you can start making adjustments to your website you need to know where you are now, you need a baseline.
What to measure?
Landing page – You need to know what starts people’s buying journey on your website. It’s fine to know a person bought from your business but you want to know where they started their journey. Are there specific landing pages which are leading to more sales than others? Identify if there are and see if you can recognise any patterns.
Conversion rate – Before you can measure improvements in your website’s conversion rate you need to know where you are now. The conversion rate formula is number of Sales divided by Visits.
Other advertising – When you are establishing your baseline conversion rate for your website, record what other advertising you are doing at the time.
Try to keep the same activities going. It is hard to impossible to know what effect changes have if you do two or more changes at the same time. Sure it slows the process down but the priority has to be to get reliable data.
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