What is Conversion Marketing?

Conversion marketing is when a marketing tactic or technique convinces a prospect or customer to take a specific action, such as making a purchase. This term is most commonly used when discussing Internet marketing. Conversion marketing describes the action of converting a visitor to a business website into a customer by making a purchase directly from the site.

For example, assume a visitor to the website places some items into the online shopping cart. Before completing the checkout, however, the visitor abandons the website by trying to exit the site. A conversion tactic may be to have a pop-up box show up on the screen that confirms the visitor really wants to abandon the order. The pop-up box may make a special offer to the visitor to try to entice him or her to stay on the website and either continue shopping or complete the checkout. This special offer may include a percentage off the order, free shipping, or a bonus gift with the order.

Conversion marketing is a measurable concept. In order to calculate the conversion rate, the website owner determines the percentage of visitors to the site that make a purchase or convert into a customer. If 100,000 visitors go to the website in one month and 30,000 make a purchase, then the conversion rate is about 33 percent. While conversion marketing is primarily used to describe online marketing conversions, it can be used for offline marketing methods as well.

In an offline example, a company mails 100,000 postcards to prospects and past customers offering a coupon if the recipients place an order online or by calling customer service. The company can track how many phone calls or online orders come in by asking the customers for the special promotional code it prints on the postcards. Again, if about 30,000 orders come in from this marketing effort, then the conversion rate is about 33 percent. This is a form of marketing testing that allows companies to maximize conversion rates, improve their marketing efforts, and boost sales.

Businesses can use conversion marketing rates to determine how effective or ineffective a marketing piece is. For successful marketing conversion rates, the company can mimic the piece again to try to invoke similar results. For unsuccessful conversions or to try to increase the conversion rates, businesses can tweak the offer or one item in the marketing piece to see if the rate changes.