What is your web traffic worth? The iMarketingStrategy.com interactive calculator lets you test numbers and instantly see a "real time" indication of value. The calculator is helpful for planning Internet Marketing campaigns and projecting ROI.
With the growing popularity of Internet Marketing as an alternative or parallel path to Direct Marketing, executives are demanding a measure for the Return on Investment (ROI). In response to these demands, iMarketingStrategy.com developed a simple to use Web Traffic ROI Calculator, built in Flash and 100% interactive.
The variables needed for calculating the value of web traffic are straightforward and they are critical for planning a profitable Internet Marketing strategy. The Web Traffic ROI Calculator found on the iMarketingStrategy.com web site is easy to use. First, enter your estimate of Projected Web Traffic. This can be done on a weekly or monthly basis. Next, enter the following marketing variables;
Conversion Rate – The percent of visitors to a web site that typically make a purchase.
Average Order Value – The average amount the a purchaser is expected to spend.
Average Profit on Sale – The difference between cost and sale price, or percent margin.
Customer Purchase Frequency – The number of times that a customer buys per year.
Customer Life – The number of years that a customer remains loyal and continues to buy.
With these five variables, a cumulative net profit can be calculated for web traffic. This estimate of value can be useful when planning Internet Marketing strategies and determining ROI on targeted marketing campaigns.
Another important indication of value emerges out of this calculation, the value of each web visitor. By dividing the cumulative net profit calculated for web traffic by the number of visitors added per year, the value of each visitor can be estimated.
Here is an example that starts with the projected addition of 500 web visitors per week. The conversion rate is estimated at 2%, or 1 buyer out of every 50 visitors. The average order is $150 and the profit margin is 50% of each sale. The average customer will make a purchase on the web site twice a year and they will remain a loyal customer for three years. With these variables in mind, a net value of $234,000 may be assigned to the 500 web visitors that were added. Furthermore, based on the sales conversion numbers, each visitor to the web site is worth $9.00.
The Web Traffic ROI Calculator can be found on the iMarketingStrategy.com web site and is available for free public use. The web address for the calculator is: http://www.iMarketingStrategy.com/roi-calculator.htm
About the Author
Brent J. Dreyer is an Internet executive with 10 years of online experience and 20 years of marketing, competitive intelligence, product development and consultation experience. His areas of expertise include; Internet Marketing and Integrated Direct Marketing, including email marketing, database hygiene, list segmentation, buyer modeling, business strategy, marketing strategy, plans, budgets, multi-channel and cross channel marketing campaigns.