What's a Good Funnel Conversion Rate? [Video]
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- Today, Matt answers a question from a reader about what type of conversion rate you should expect from a good sales funnel.
- One key takeaway? Conversion rates fluctuate, and that’s ok.
Hey, how’s it going? Matt Ackerson here, the founder of Growbo.com, as you may already know. I'm broadcasting to you live, as I have been for the last 5 or 6 months, from Medellin, Colombia.
So, in the next few weeks, I'll actually be heading back to New York for a little while. I'm gonna see family, maybe get an apartment there, maybe keep traveling. You know, we'll see.
A big part of the reason why I've been able to travel, and even take some time off, while making these videos and working is because we have a great sales funnel– the subject matter that Growbo is perhaps best known for right now.
And today, on that subject, I'm taking a question from Dylan Spitz. Dylan is a member of our audience, and he wrote to us once before with another question about upsells. Today, Dylan is writing in reply to a video we sent out advertising our Six Figure Sales Funnel.
THE QUESTION
Dylan says:
"Hey Matt, good video. Thanks for that. I'm sure this answer varies but maybe you can give me a ballpark number. A well-designed funnel will convert what percentage of an email list, 1%, 3%? I have a nurture funnel that's converting 0.7% of my total email list. I'm a little disappointed with that number even though I'm making money."
MATT’S ANSWER
This is a fantastic question, Dylan. I'm happy that you asked it. I may not have thought of it on my own, and that’s why I encourage everyone in the audience to leave a comment or write us an email if there’s something you’re curious about.
To answer your question, I wanted to use the most up-to-date data that we have for this. I looked at our figures for last month, which at the time of this video was May 1st to May 31st, and we converted 114 customers. And then I compared that to the total number of email subscribers we added to our list in that same period of time, which was 1,224 contacts.
If we break out a calculator, 114 divided by 1,224 comes out to about 9%.
(For more information, read our May Growth Report)
In the past, as you'll see from another Matt-Hack video coming up, we were actually converting between 10% to 12% of our email list.
Our conversion has dropped a bit in part because of how we're advertising. We've gone with an upsell that actually brings this number down, but brings the overall amount of revenue that we generate up.
So we were brought down to about 9.3% as you can see, which is still a pretty solid conversion rate.
There is no “Right” Number
I think that if you're just starting out, and you just have one product, our funnel is a bit more developed and a bit more sophisticated in certain ways. That’s only because we've been working on it longer.
But if you have just one product, say in the range of about $99, you should be looking to convert about 5%. From my experience working on dozens of different funnels and in various different markets, you should convert at least 5% of email subscribers on that product.
As noted in this article from Ladder.io, conversion rates vary across industries and channels. It’s based on your market, your audience’s price sensitivity, and on the price that you're actually charging people. So those are all factors to take into account, but I feel that 5% is a good baseline number to aim for.
Photo Credit: Marketo
Now, another entrepreneur buddy of mine, Brennan Dunn, has a very sophisticated sales funnel. Last time I spoke to him, Brennan gave us a walkthrough of his seven-figure sales funnel where he is converting on average something like 20%. (I included his interview as part of our Six-Figure Sales Funnel Training, which is the most premium product that we currently offer.)
His funnel converts in part because he's been working on it and optimizing it for so long, and he also has a nice range of products to offer.
Again, it all depends on price sensitivity, how well your offer is aligned with your market, how affordable your products are in relation to their budget, and the spread of the overall number of products that you can offer to solve different problems for people.
What if You’re Not Hitting Your Baseline Number?
As I already stated, if you're just starting out and you have a limited range of products, or even just one–you want to aim for 5%. And if you're not hitting that, you want to think about it and look at where the biggest bottlenecks are occurring.
Specifically, you want to maybe consider coming up with some new products, perhaps like a tripwire for example. You can charge anywhere from $7 up to $49 for that and you can upsell the more expensive product/products that you may have in your funnel.
Of course, one of the best and easiest things you can do is build brand awareness. No one is going to buy from you if they don’t know who you are.
“Whether you are a new startup or existing business, when you advertise on a new platform you have to inform your audience that you are there.
Instead of going for the straight sale right from the start, introduce your business and touch your audience with an overall brand/business awareness video or image.”
That will help you to get those numbers up and get to that 5% plus number that you want to be aiming for.
Check out our article 40+ Mind-Blowing Stats About Sales Funnels for more ideas on how to up your conversion rate.
THOUGHTS?
So that's my tip for today and if you would like to learn more about how to build a sales funnel that converts from scratch, I encourage you to go to our products page growbo.com/products.
We’re making the Six-Figure Sales Funnel Training an exclusive offer, so we're only opening the doors on it once per month. If you'd like to get in on that, I encourage you to go and sign up for the waiting list.
If you're more of a newbie and perhaps you're on a bit of a tighter budget right now, I encourage you to check out the Sales Funnel Blueprint, which is a bit more affordable and is designed for beginners.
Further, if you're looking for inspiration, I encourage you to check out our newest product, which is the Sales Funnel Diagram Pack.
The Sales Funnel Diagram Pack are 28 custom built-from-scratch funnel diagrams. The pack includes flowcharts that I’ve made and a video that I’ve paired with each one, walking you through the strategy and the thought process behind each.
It's a compilation of a lot of what I have been observing over the years that works for these multimillion-dollar, and in some case, billion-dollar companies, answering questions like: How do they fill all the gaps in their funnels? What does the flow look like step-by-step?
This is so valuable to you, regardless of what type of business you have. It can work if you're looking to generate more leads for your service business, if you're from a SaaS company, eCommerce, selling physical products, membership affiliate, and the list goes on.
Even if the examples in here are for different types of businesses, the point is that it can inspire you. It can help you to communicate with your team in terms of your developer, your designer, or your copywriter. This is the big picture.
Even if you have your own clients that you're looking to setup a funnel for, or just to eliminate guesswork in general, it really lays it all out for you in these flowcharts and videos.
I encourage you to check that out and if you have a question, once again, be sure to not be shy about it. Give me your feedback in the comments, leave your thoughts. I'll be happy to consider answering it in an upcoming video.
And as always, my name is Matt Ack in the Mat hat, delivering you your daily dose of Matt-Hacks. So keep hustling, stay focused. I will see you in the next video. Want more sales? Download my
