Every business wants to grow, and to do that you need to find and win more customers. You have to make it easy for buyers to find you and then nurture them through their buying cycle.
But how much website traffic and how many sales leads do you need to generate so that you can achieve your revenue goal? I’m going to show you a calculator that will make it easy to answer this question.
What is your revenue goal?
Your current sales and marketing methods already deliver a stream of revenue. If you are going to start a new program like inbound marketing, first decide on your growth goals. How much additional monthly revenue do you want to generate over your current revenue stream with the new program?
Let’s say your company wants to produce an additional $50,000 a month in sales. Enter this amount into the calculator. Also enter your average revenue per sale. Here we’ll say the average deal size is $10,000.
Now you know the number of additional customers that your inbound marketing program needs to produce each month. In this case it’s five customers per month.
How many sales leads do you need?
Let’s move on to sales leads. What is your current lead-to-customer conversion rate? If most of your business comes from referrals, it may be quite high. If most of your sales leads come from your website, it will be much lower.
Now think about what rate of lead-to-customer conversions you can expect from your inbound marketing program. Enter this value. Here we’re going to use 7%.
You’ll see the number of sales leads you need to produce given your expected conversion rate. In our sample case we need 71 leads.
How much traffic do you need to attract to your website?
And finally, calculate the amount of traffic you need to attract to your website. Estimate what visitor-to-leads conversion rate you foresee. Companies that are new to inbound marketing can expect visitor-to-lead conversion rates in the 1-2% range; companies with more experience can expect something higher. Here we’ll use an optimistic 4% for the visitor-to-lead conversion rate.
At a 4% conversion rate, this company will need to attract 1,786 visitors to meet its goal for leads.
Traffic. Leads. Customers. Revenue.
Now you can see the entire sequence: the number of website visitors you need to attract, the number of visitors who you expect will convert into sales leads, the number of sales leads that you plan will become customers.
With a few simple calculations you now have information that you can act upon. This calculator will help you to your eye on the big picture of the flow of buyers through your funnel.
- It makes it easy to map the flow of the selling cycle (from traffic to leads to customers) to the flow of the buying cycle (from being unaware of a problem to awareness to desire to solve the problem).
- It’s simple. Just three numbers to calculate, only five numbers to enter.
- It tells you where to focus. Visitor-to-lead conversion rate not where you want it to be? Dig into the numbers for that conversion and look for opportunities to increase the rate. The same goes for lead-to-customer conversion and your revenue goals.
- It links the actions and goals of marketing, sales, finance, and the chief executive. You can sit down with any of these groups and have a conversation based on the link between traffic, leads, and new customers.
How many sales leads do you need? Give this calculator a try. If you want a version that’s online, go to Greg Elwell’s page. Or you can download the Excel spreadsheet of the Traffic Lead Calculator I used on this page.
What do you think? Are there changes you would make to the calculator? Let me know what improvements you’d like to see.