Focus on Traffic, Not Conversion Rates To Boost Digital Ad ROI

It sounds simple enough but it’s easier said than done: If you want to drive optimal conversion results for a digital ad campaign, focus on the factors that will help you deliver those conversion results. In digital advertising, like it or not, the most important factor affecting results couldn’t be simpler.

It’s traffic. Not conversion rate optimization.

Before we dive deeper into this topic, let’s define some terms:Traffic is fairly straightforward as it refers to people visiting your website or mobile app. A conversion event can be any event that occurs AFTER someone clicks on your digital ad or views it. Examples of such conversion events for an ecommerce book retailer could be as follows:

  • Time on site exceeds 2 minutes
  • Email newsletter signup
  • Lead form completion
  • Sale of 1 book
  • Sale of 2 or more books
  • Sales of any quantity of books where the total order value is $20 or more

There are two types of conversion events: 
 “Lead” and “lag” as I am referring to them hear refer to two different types of business performance indicators. A lead indicator is an indicator that has an influence in creating a desired outcome or result. They “lead” the way, so to speak, in having an impact on “lag” indicators. The differences are explained quite well here .

So in the conversion event examples above, lag indicators would be as follows:

  • Sale of 1 book
  • Sale of 2 or more books
  • Sales of any quantity of books where the total order value is $20 or more

Lead indicators could be any of one the following:

  • Time on site exceeds 2 minutes
  • Email newsletter signup
  • Lead form completion

When planning a digital ad campaign, it is vital to focus in priority order on the following:

  1. Traffic
  2. Lead Conversion Events
  3. Lag Conversion Events

My advice is supported by a growing number of digital marketing experts, including Neil Patel who explains the reasons why you should “almost always” focus on increasing traffic, not conversions, in this post which I highly recommend reading.

Neil’s rationale is well-grounded: “Traffic increases your number of conversions across the board, builds brand awareness, raises your long-term business potential, and gives you the information you need to run reliable tests to iterate your current strategy.”

Neil points to research from HubSpot that most businesses are doing just the opposite. According to Hubspot’s research, 74% of companies say converting leads into customers is their top priority.

Before drinking the coolaid that most businesses are following that you should focus on optimizing sales conversions, consider that it may be far less costly to invest your time and money in simply boosting traffic.

Let’s look at an example. Let’s say your current sales conversion rate is 1% meaning that of every 1 visitor to your site, one of them makes a purchase of $20, on average. And let’s say your current traffic levels are 1000 people per day resulting in 1000 x 0.01 = 10 sales per day resulting in total sales value of $200.00 and lifetime sales value from those customers of 5 times that number, or $1000.00. You could either focus, at this juncture, on increasing that conversion rate, through conversion rate optimization tactics or on simply increasing traffic levels.Conversion rate optimization tactics could take the form of:

  • Investing time and money in re-designing your landing pages
  • Adjusting digital ad audience targeting to focus on people who are more likely to make an immediate purchase
  • Adding an exit — intent popup to incentive visitors to make an immediate purchase

Increasing traffic levels could be done through inbound marketing efforts such as

  • Blogging
  • Email newsletters
  • SEO

and through outbound/paid marketing efforts such as

  • Digital display ads
  • Search ads
  • Social media ads

Let’s suppose we focus on increasing traffic levels through search ads keeping in kind that a typical search ad is going to cost somewhere between $0.50 and $2.00. Let’s go with $1.00 for purposes of this example. So we could double traffic levels from 1000 to 2000 by spending $1000 on a search ad campaign. And we could leverage the additional traffic levels we are seeing to move the needle in a positive direction in relation to the sales conversion rate (the “lag” indicator), perhaps moving that rate to 2%, resulting in 2000 x 0.02 = 40 book sales with a total immediate value of $800 and long-term value from repeat purchases from those customers of $4000.00.This is just a simple example but it illustrates an important point:

In digital marketing as with traditional marketing, repeat exposure, not endless tweaking of landing pages and thousands spent on lag conversion optimization, is the key to driving bottom-line results.

Originally published at on January 30, 2018.