Holiday spends and conversion rates dropping while costs rise but higher sales volumes.

Ok, here is a constant complaint Marketing Managers get from their higher ups, mainly when the higher ups pay attention to their numbers or actually want to know what is going on and why.

It usually starts with the VP of Marketing asking why your costs are up and conversions are down, why aren’t we getting as many sales as we should, our search volume is higher, fix our conversion rates now!  The Director of Marketing then gets caught off guard because normally the Director is so far out of the loop because of their role (even though they think they have a grasp on everything), that they call the Marketing Manager into their office for a quick response and need information to back it up.

The thing though is the reasons are usually not acceptable if your higher ups don’t want to listen, and because the Director knows that the VP wants a reason that is not the obvious, it is going to seem to the Manager that the Director is unreasonable, but the Manager hasn’t had to be in an executive position yet or had to understand why the obvious answers aren’t good enough.

This lets the Marketing Manager use their staff and their talents to come up with some creative answers and solutions to their problems, as well as also give the obvious answer which is normally what will solidify the deal and make everyone happy in the end.  You just need to have alternates to why sales although sales have increased, your conversion rate has dropped and why are we ok with loosing sales since the conversion rate is lower with a higher search volume on the same keywords and traffic.  If the traffic is the same, which it is, we should be getting more sales.  That does sound like it makes sense, but at the same time, when you actually think about Q4 in most industries, this is one of the exceptions to the rule.

In Search Marketing we know that positions in PPC play a huge role in how well you convert.  Some products will barely even convert in the 1 to 3 spots and others will never convert in the 3 to 5.  You have to know what will work where and then explain and show data to back it up. The same goes for better rankings in the SERPs.

Your traffic volume will go up, your sales will probably also increase, but you can definitely expect to see a decrease in the actual conversion rate.

In the top spots, you get more people that are looking around for the products, they are comparing them to other sites, looking to do research or for parts or returns, etc…  Down lower you miss out on some and could be getting the people just looking for pricing and are ready to shop which is why your conversion rates increase since they find info, or data or whatever they were looking for in the top few results.

You also have to remember that in Q4, more people are shopping, but they are also doing more research online and then looking in stores for better deals and if they cannot find the better deals in the stores, then they come back to the site later on and finally make the purchase.

You get a lot more people browsing then just clicking and buying from your site and because there is a much larger search volume for products and gifts during the holiday season, but not everyone is ready to buy online, your traffic goes much higher on the same terms, you have to spend more because there is more advertising competition and your conversion rates do decrease, but that is because the traffic is not the ordinary traffic that was looking to shop randomly and not research where to buy gifts.

If you explain this without all of my rambling, the Director can go back to the VP and explain this which will make sense to the VP that you are actually not missing out on sales due to the traffic increase, the spend per sale increase and the decrease in conversions, since although the traffic is actually coming in off of the same terms, you have a lot more people researching online and looking for deals in stores, then sometimes coming back to shop if they cannot find them.  Plus, you may be the lowest price or more competitive normally, but during the holidays, stores and competitors offer coupons and discounts that they normally don’t have which could also make your price points higher, so it is important for your VP and Director to also monitor or have you monitor what your competitors are doing and then create deals for you and your team so that you can be just as competitive and keep your sales increasing.

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