More traffic does not always mean more sales

On the gap between growth in site visits and growth in revenue, and what to check before increasing budget.

The site visits graph goes up, and revenue stays where it was. This is one of the most common situations in e-commerce stores, and it almost always leads to the same wrong conclusion: more traffic is needed.

Traffic is not a single metric

A thousand visitors who searched for the product name are not equal to a thousand visitors who clicked a video in the feed. The conversion rate of the former can be several times higher. When the budget grows, the new traffic usually comes from the second kind, so the average conversion rate drops even if nothing on the site has changed.

Three checks before scaling

• Conversion rate by traffic source and by device. An overall average hides the picture.
• Where the traffic lands. The home page usually converts less than a product or category page.
• What happens in the cart. If visitors add products and do not complete the purchase, the problem is in checkout and not in advertising.

When to scale after all

When the conversion rate of cold traffic is stable, when the acquisition cost is below the allowable cost, and when stock and service can handle the growth. Without these three conditions, extra budget mainly buys visitors.

Traffic is a means. The metric that needs to rise is revenue, and ultimately profit.