Landing pages are a focused and customized sales pitch, specifically designed to get your visitor to take an action.
As an extension of your upstream advertising (paid search and banners), they have the ability to increase your conversions rates compared to the effectiveness of a campaign that doesn’t use them.
In this article, we’ll share some insight into the simple economics of landing page use and answer the question: “Why Should I use a landing page?”
There are several simple answers to this question, the most obvious of which is that it can increase your conversion rate. But how, and by how much?
Online advertising that uses landing pages typically sees a conversion rate improvement of at least 25% .
Testing can double this number.
The table below illustrates the impact that Landing Pages can have on your Cost Per Acquisition (CPA).
|Campaign Type||Campaign Budget||Landing Page Costs||Media Spend||Traffic||Conversion Rate||New Customers||CPA|
|With LP + Testing & Optimization||$10,000||$2,000||$8,000||8,000||3%3||240||$41.67|
2 Omniture typical 25% increase in conversion
3 50% increase through testing
As you can see, by channeling a portion of your marketing spend on the production and testing of a landing page (and subsequent optimization), you can obtain a significantly lower CPA.
By further optimizing your landing pages you will be able to see this amount drop even more, further magnifying the return on your marketing investment. For further information about how to optimize your landing pages, download our free white paper “101 Landing Page Optimization Tips”.
Testing and optimizing landing pages benefits you in other ways:
66% of online advertising budgets are spent on paid search and banner ads 4, totaling $15.4bn annually. Below is a chart that shows how online advertising spending is broken down.
Clearly, if all of that money saw an enhanced level of return as described above, marketers would be making significantly more from their annual budgets.
4 IAB Internet Advertising Revenue Report – 2008 Full Year Results, Published March 2009
It’s clear that there is a massive amount of advertising spend that’s not being fully realized. The sooner you start building, testing and optimizing landing pages, the sooner you can start getting the correct return on your marketing investment.