Do You Know Your WordPress Product Conversion Rate

Now that I have some historical data on my plugin business I have been going back and looking at the trends. I have a spreadsheet I created the first month after I launched to record sales. When I first started I was so green that’s the only thing I recorded. I had no idea my traffic much less my conversion rate. Now I know that conversion rate is one of the most important key performance indicators (KPI) when you sell your WordPress theme or plugin. Let me tell you why.

How Is Your Conversion Rate Calculated

Conversion rate measures the number of people who come to your site vs the number of people who purchase your product.

Number of Sales / Number of Visitors x 100 = Conversion Rate

This number is important because you can use it to measure and calculate lots of different interesting things. For example: As you make changes to your website you can use this number to see if those changes improved or hurt your sales. Hopefully you are A/B testing these changes but that’s for a different blog post. You can use it to tell whether that blog post or email blast had any effect on your sales.

I See The Future and It’s Bright

You can also predict the future with it 🙂 So say you have a product that sales for $50 and you currently make $1000 per month in sales with 1000 visitors per month. You current conversion rate would be 20(number of sales) / 1000(visitors) = (0.02 * 100)  2%

So just work the formula backwards to figure our how much more traffic you need to generate or how much more you need to convert your current traffic. So if I want to make $10,000 per month you would need to generate 200 sales at the current conversion rate and to get those 200 sales you need 10000 visitors.

200/10000 = 2%

But just what if you could optimize your site and increase your conversion rate to 4% then you’d only need 5000 visitors.

200/5000 = 4%

So as you can see conversion rate should be a key factor in your decision-making process. It’s a great indicator as to how your product is doing.

My Experience

I started tracking my conversion rate about 4 months after I launched my WordPress plugin for coming soon pages and I was converting around 3% of my traffic. I’ve manage to increase that number by 1.25% over that last year and a half by A/B testing my site and making other optimizations.

I use the Unique Visitors metric in Google Analytics to calculate my conversion rate because this try to measure people. You can also setup Google e-commerce Tracking and it will do it for you. Plus you get lots of other juicy metrics in relation to your e-commerce in all you other reports.

Gotchas

If your site has more than just your product like a blog then you need to account for those times when a post becomes popular or some other artificial spike in traffic. I ran a MightDeals campaign once it drove lots of people to my site but they were going back to MightDeals to purchase. You can use Google Analytics to segment out that traffic and find your true visitors that you’ve acquired through your marketing. Segmenting is another post as well but I recommend this course if you use Google Analytics and run a business. Understanding the numbers should be key factor for your decision-making and running your business.

The course is called Google Analytics Academy and it was one of my goals to take it this year. It was definitely worth my time.

What are some other key performance indicators you use?

 

Just Because You Can Do a Job Does Not Mean You Should

When you are a one person company you are kind of use to doing everything yourself. You wouldn’t have gotten to where you are at unless you could wear many hats. When you are first starting out this is fine but once you start to experience success this can be a downfall because you waste your time doing remedial task.

For example, I’m quite capable of running my own server and hosting WordPress, yet spending my time being a system admin does not help my business. If your business is making money and the cost of you using a service is less than what your time is worth than hire it out.

Another less obvious example is house work. I calculated how much time I spend doing things like cleaning bathrooms, kitchens etc… This valuable time adds up. Why not hire it out and use that extra time to spend with your family or work on your business.

You cannot and should not do everything yourself or you’ll quickly get overwhelmed. I’m still learning to let go of some task and hire it out but there’s a part of me that want to just do it myself. It’s the perfectionist in me I guess. I know though that ultimately to continue to grow I need to start delegating and learn to let go or else I’ll always be a one person company.

What are some things you do to save time and become more efficient?

 

 

Goals for 2014 and a Look Back at 2013

2013 was an incredibly busy and awesome year in my personal and professional life. I accomplished most of what I set out to do this year but I have a few goals that will carry over.

Personal Life

We sold our house in April and lived in my father-in-laws river house for 8 month while my family and I searched for a new house. Did I mention I had no internet for 8 months. I used my cell connection the entire time to run my business. To say that was challenging is an understatement. We finally found a house in late September, remodeled it in late October  and November and moved in December. We got settled in just in time for Christmas. The whole process of moving was extremely time consuming and really dominated most of my time and thoughts in 2013. I ‘m super glad to finally be settled and don’t plan to move again for a long time!

Other notable moments include: My daughter turned 3 and is really becoming quite the princess 🙂 We made 2 trips to Disney World this summer. My wife and I  celebrated our 5th wedding anniversary.  Overall we have been extremely fortunate in 2013 and I am so grateful for that.

Professional Life

One of my goals for 2013 was to quite my day  job. While my business has enough income to do this I needed to have my day job to get a loan and make the process of buying a house go smoothly. So I worked a day job and on my business at night this year. For 2014 I do plan to accomplish this goal once I get my reserves built back up.

I 2x my business, SeedProd, income from 5 figures in 2012 to 6 figures in 2013. I attended Pressnomics in Arizona. And I started the planning of a WordCamp in Charleston for 2014. I didn’t get to grow my business as much as I’d like in 2013 since I was working a day job and moving but I have some high expectation for myself in 2014.

Goals for 2014

I really want to focus on my business this year and quit my day job.

In no particular order here are my goals:

  • Blog more – I’ve signed up for Chris Brogan’s Blogging Masters Class and hope to learn to write better. It will boost my credibility and have SEO benefits.
  • Launch SellWP.com – This is a platform for selling WordPress products that I originally built for myself. I rebuilt over the last year so other could use it.
  • Market more and hire a VA and eventually a developer for SeedProd. – I want to start delegating out more of the day-to-day task of the business so I can focus on growing it.
  • Take the Google Analytics University class. – A key part of growing your business is to be able to measure what you do and make decisions based on that info.
  • Release 2 more major plugins and try a plugin that uses the add-on revenue model.
  • Release smaller plugins that generate at least $3000 per month in rev with little to no support.
  • Over I’d like to generate an average of $1000 dollars a day in revenue.
  • On a personal note I need to become healthier.  I need to eat better and exercise more, just like everyone else right 🙂 I plan to start slow by just taking a walk every night with the family to build the habit. The goal is at least 30 minutes per day.
  • Finally quit the day job. I have a few things left to pay off and settle up on but I plan to quit my day job by September if every thing goes as planned.
  • Start a podcast to discuss bootstrapping a business and help other do the same.

So that’s it! 2013 in a nutshell and my goals for 2014.

Here’s to an awesome New Year and I  hope this is the best for you so far as well!