Take the Quiz: Is Your Business Teeming with Prospects, or Are You in a Prospect Desert?

More than 50% of purchases, regardless of the transaction channel, begin with a web visit. They show up on your site as non-buyers. It’s not necessarily a bad thing. They may be checking you out for a purchase at a later date.

Measuring your engaged shoppers, the ones “checking you out,” can tell you a lot about the health of your business. A high score in the quiz below indicates you’re primed to grow. You are “rich” in potential customers…now you just have to convert them. A low score means that you’re not attracting “fresh blood” to your brand.

New customer acquisition is at the heart of any healthy business. Engaged web shoppers fuel new customer acquisition, no matter what channel the transaction actually takes place in. Without engaged shoppers checking you out, growth is a significant challenge.

Take this quiz to find out how your business stacks up:

1) How many unique visitors did you have on your site in the last 12 months? Note: this is not the number of total visits. It’s the number of people who actually showed up on your website, which will be substantially smaller than your total number of visits. You can use the Audience Overview report in Google analytics to find your number (Google calls them “users”).

2) What is your website “bounce” rate? These are shoppers who viewed only one page on your site before leaving. Most are NOT engaged shoppers, and aren’t likely to buy from you. For the purpose of this quiz, we’ll leave them out of the conversation. The Audience Overview report will also show you this number as well.

3) How many people placed an order on your website last year? Similar to unique visitors, this is not the total number of orders you took online, but the number of unique people who ordered. If you don’t have this number handy, you can use the Ecommerce Overview report under Conversions in Google Analytics, and divide by the average number of overall orders a shopper places with you during a year. For most ecommerce/catalog businesses, the number is between 1.2 and 2.5. It is, of course, higher for some businesses, particularly if they have retail stores.

4) Multiply your bounce rate by the number of unique visitors.

5) Subtract the result in number 4 from your total number of unique visitors.

6) Multiply the number of people who placed an order online by 2 if you have a significant catalog business, and by 3 if you have both a significant retail and web business.

7) Your score: Divide number 5 by number 6.

Here’s a sample quiz to help you:

  1. Number of unique visitors:  1,000,000
  2. Bounce rate:  40%
  3. Total customers ordering on your website:  40,000
  4. Total “bounced” unique visitors:  1,000,000*.4 = 400,000
  5. Total “engaged” unique visitors:  1,000,000 – 400,000 = 600,000
  6. Adjusted customers ordering on your website:  40,000 * 2 = 80,000 (assumes this is a cataloger without a significant retail presence)
  7. Your score:  600,000/80,000 = 7.5

If you scored:

Above 10: Congratulations! Your website teems with prospects. You should be able to grow nicely by focusing on converting these folks, regardless of transaction channel. Note: if you have a good score and are not growing, check out Allen Abbott’s recent article in Multichannel Merchant for new conversion strategies.

Between 5 and 10: Warning! To grow you’re going to have to be very good at conversion. Again, see Allen’s article. You can still grow. Life will get easier for your business if you can attract more prospects. Consider freshening your merchandise and/or developing proprietary products.

Below 5: You’re in a prospect desert. While there are a few cases where you can make this work, most likely it means that your business is quite mature. It could be that your target market is shrinking. It’s time to either reinvent the business or consider exit strategies.

Feel free to contact me (lkavanagh@cohereone.com) if you need help calculating your score.

Larry Kavanagh is CEO of CohereOne.

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