Once you’ve filled the top of your marketing funnel with prospects and encouraged them toward making a purchase, conversions become a key area of focus. Tracking this process will help you understand how users are finding your brand, content, and ultimately your product, and what you can do to improve these journeys.
What Is Conversion Tracking?
Conversion tracking involves monitoring user actions along the path to a goal you’ve set. Depending on your industry, the action might be a user adding a product to their cart or buying an item. Other desired conversions include a user clicking a link on a targeted landing page, subscribing to a particular newsletter, or downloading gated content.
Conversion tracking lets you see how well your marketing efforts are working in the crucial mid- and lower-funnel stages. Conversion tracking is most often used in advertising and email marketing, but modern digital marketers can apply it to any campaign where you’re directing your audience toward a goal. If a behavior is valuable to reaching your marketing goals and is measurable, then you can identify it as a conversion that you can track. It’s a way to view and measure your user acquisition efforts and use those insights for better decision-making and budget allocation.
How Does Conversion Tracking Work?
Conversion tracking varies by channel and action — for example, you can see in your analytics tool how many people downloaded a piece of content. For web activity, though, conversion tracking requires the installation of a pixel on all websites where you want to record specific user actions. Third-party cookies used to be a primary method to track conversions, but their deprecation means that pixels are now more common.
For conversion tracking on mobile apps, you can choose from various mobile measurement partners (MMPs) using Apple’s SKAN framework, or using a software development kit (SDK) in your company’s app. MMPs offer performance tracking and measurement, so you’ll want to investigate how many mobile users you have and which MMP best suits your business needs. Mobile app user behavior and conversions can vary widely from desktop activity, so consider AppsFlyer for a full-service platform, Kochava for both mobile and web, or Branch to include influencer efforts and a full-funnel approach.
Conversion rate is expressed as a percentage, measuring the amount of visitors who completed the goal you set. Once you’ve gathered the right conversion data, use this formula to calculate the conversion rate:
Conversion rate = Conversions ÷ Clicks x 100
Divide the action you’ve chosen as the conversion by the total number of people who took that action, then multiply by 100 to express as a percentage.
The next step in conversion tracking is conversion rate optimization, or CRO. This method includes the steps you take to improve your site and other channels to increase the number of conversions, whether generating leads, making purchases, or something else. CRO can improve the quality of leads, increase revenue, and reduce your acquisition costs.
How Do You Set Up Conversion Tracking?
The first step in conversion tracking is to examine the marketing funnel you’ve established and determine where conversions take place along the way to a purchase (which may itself be a conversion). Then you’ll choose how to implement conversion tracking.
You might use popular conversion tracking tools like Google Analytics and Google Ads, or whatever CRM (customer relationship management) or other platform you have already established. Here’s what to keep in mind as you’re setting up conversion tracking:
Match Goals and Data
There’s overhead of time and resources involved in setting up conversion tracking, so make sure you’ve already mapped out what goals you want to achieve, why they are important to your strategy, and how conversion tracking will help you reach them.
Map Out All the Paths
While the traditional marketing funnel still provides value to modern digital marketers, the user journey these days is often circuitous. A user might complete several conversion actions on their way to a purchase or subscription — or none at all. Make sure to anticipate various conversion flow possibilities, then adapt as you gather more information about how users are navigating and responding to your offers.
Chat With IT
Adding pixels to your website will likely require consultation with an in-house or outside IT team to ensure you aren’t slowing down page-load times or causing other disruption. Make sure to get this right from the start to ensure a great user experience across all your site pages.
Why Is Conversion Tracking Important?
Conversion tracking is an essential way to see how users are responding to your marketing tactics. Without third-party cookies and with a crowded marketplace, marketers need conversion tracking to give them feedback on their user assumptions and overall strategy. Without conversion tracking, you’re spending money without understanding whether it brought your business any results.
Using conversion tracking means you can optimize ad spend, test and improve copy and creative, and generally increase the ROI of your marketing efforts. In addition, mobile conversion tracking can provide insights into key app events, like purchases or upgrades, to help marketers optimize and increase traffic sources, in-app copy, and more.
Benefits of Conversion Tracking
Budget Correctly
Tracking conversions can have a big positive impact on your budget allocations. If you see a much better ROI for conversions through email vs. social media ads, you can adjust your budget accordingly (and probably fairly quickly, too).
Improve Key Metrics
Conversion tracking can improve ROI of marketing spend generally, and return on ad spend (ROAS) more specifically. If you haven’t tracked conversions before, you may be surprised at the results, and can quickly make adjustments to get the most out of your budget. In addition, you can use conversion tracking to distinguish between click rates and conversion rates, and find out if they’re similar or much different, which can have a huge impact on the bottom line.
See What Resonates With Users
With oversaturated social and search channels, it can be difficult to gauge what’s really reaching readers. Once you identify conversion actions, then track them, you can start digging into various campaign approaches to understand where users are dropping off. This includes any and all tactics and channels you’re using, such as keyword conversion, gated content, or one social media platform versus another. If performance is lower than expected, make changes and review the data again regularly.
Limitations of Conversion Tracking in the Performance Marketing Landscape
Regulatory Compliance
A rise in privacy regulations has complicated the work of tracking user actions across apps and websites. GDPR, Apple’s App Tracking Transparency feature, and others allow users to opt out of tracking, and ensure that companies are using data correctly. Marketers may now be using aggregated data rather than user-level data, so it’s important to understand how your data was collected and how to see trends from it as you stay compliant.
Conversion Definitions
While marketers can often easily define what a conversion is, there’s plenty of nuance in what a conversion really is in each business and industry. A purchase is an easy one to name as a conversion, but with the options available to users and the channels available to marketers, defining and tracking the right conversions can take some effort. Get creative in considering how you can best identify the most appropriate conversions for your audience, then make them easier by optimizing the user experience on your website or app.
Changing Trends
Marketers interested in tracking user conversions should keep an eye on regulatory trends as well as new and emerging conversion tracking methodologies. The use of ML (machine learning) and AI (artificial intelligence) will likely continue to grow in all areas of technology, and cross-device conversion measurement is still an area of exploration.
Types of Conversions to Track
I’ve mentioned a few common conversion types already, but there’s a wide range of conversions you can track. Here are some more types to consider:
- Ad clicked.
- Search term used.
- Physical store visited.
- Site visitors.
- Call or message received/engaged with.
- Item added to cart.
- Purchase made.
- Newsletter signup.
- Content downloaded.
- Video or audio played.
- Contact form submission.
- Increase in pages visited on site.
- Increase in session duration on site.
- Pages per visit increase.
- Cost per acquisition reduction.
Conversion Tracking Optimization
Once you’ve established which conversions to track and gathered enough data to understand user conversions, you can start optimizing for more conversions in more channels. Here are some tips to get you started.
Tailor Optimizations Carefully
When you’re deciding what to change or test, start with your intended goal. If you want more users to download a piece of content as a conversion action, make sure to only count those clicks divided by the number of people who had the opportunity to click. Getting as specific as possible on what’s working and what isn’t can help you decide what to change, whether it’s the page title or the actual content offer itself.
Create Conversion-based Actions
While conversion tracking can offer many options for you to optimize the user journey, you can also create new actions based on what you learn from conversion tracking. A common example is sending an automated email to a user who’s added something to their shopping cart, but hasn’t completed the purchase. This is a type of conversion-based retargeting, where you use the data you’re gathering to nudge a user into converting.
Use the Right KPIs
If you’ve established the right conversions, the other piece of the puzzle is to establish the matching KPIs. Make sure you’re capturing data that can show you what is and isn’t working for your particular situation. These are some common options:
- Number of conversions.
- Conversion rate.
- Cost per conversion or acquisition.
- Bounce rate.
- Pages per visit.
- Hits on destination page.
- Events (played videos, downloaded content, etc.).
- Session duration.
Key Takeaways
Conversion tracking continues to evolve in the face of crowded marketplaces and channels and increased regulations. Marketers can incorporate conversion tracking for their business and users in various ways, and should consider their overall marketing goals, desired user journeys and behavior, and best KPIs to improve CRO.
