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Landing Page Library » Paying for Traffic vs. Paying for Conversion Optimization

Paying for Traffic vs. Paying for Conversion Optimization

This is a very common question in marketing teams everywhere. The answer all comes down to return on investment (ROI). Paid traffic (e.g. Google Adwords) is an attractive proposition for most marketers as it holds predictable and budgetable outcomes. However, this predictability comes with a level of sameness that leaves money on the table.

If your landing page has a conversion rate of 10%, it won’t get any better by throwing more traffic at it. It’ll always convert at 10%.

If you invest in conversion optimization and increase your conversion rate to 12%, the cost involved was incurred only once. The benefits will continue forever.

Consider the following example (note: all numbers are simplified for easier math).

Paying for traffic

PPC Budget: $1,000/month
Visitors: 1,000
Value of a conversion: $20
Conversion rate: 10%

In this scenario, you will get 100 conversions @ $20 = $2,000 ($1,000 profit).

Paying for traffic + optimization

Now consider spending an additional amount on conversion optimization (and thus increasing your conversion rate).

PPC Budget: $1,000/month
Conversion optimization budget: $400
Visitors: 1,000
Value of a conversion: $20
Conversion rate: 12%

In this scenario, you will get 120 conversions @ $20 = $2,400 ($1,000 profit).

Isn’t that the same thing?

No. Well, yes it’s the same for the first month as the additional profit is swallowed by the outlay of cash for optimization expenses. But consider what happens in the second month when your landing page will still be converting at 12% without having to re-spend the optimization budget:

PPC Budget: $1,000/month
Conversion optimization budget: $0
Visitors: 1,000
Value of a conversion: $20
Conversion rate: 12%

In this scenario, you will get 120 conversions @ $20 = $2,400 ($1,400 profit). A 40% increase in ROI.


For a more detailed analysis of how landing pages and optimization can reduce your cost per acquisition (CPA) – read the following two posts on conversion economics:

Optimization is about continuous improvement

You will of course want to keep investing in optimization to push that 12% even higher. Optimization is an iterative process, but the simplicity of the example above shows how effective it can be.