For example common things to place conversion tracking on are your "contact us" enquiry form, newsletter subscription, online bookings or sales through an online shop. Identify what your goals are ( what action do I want customers to my website to perform ) and place conversion tracking on these goals.
Why Is Conversion Tracking So Important?
Conversion tracking establishes quality!
Lets say you have a Google Adwords campaign which is costing $20 a day and is sending 40 clicks. Thats costing you $600 a month for 1200 clicks. This is a pretty normal scenario for a small business.
Now that all seems really great right? 1200 extra visitors a month, fantastic! But how many of these visitors are actually turning into leads or sales? Are you buying the right visitors?
Take the following example:
Keyword 1: "dog food" costs $200 a month and sends 400 visitors - no conversions
Keyword 2: "buy dog food online" costs $200 a month and sends 40 visitors - 10 conversions
Real Result? Keyword 2 is better... it costs more, and it sends less clicks, but the people it does capture turn into real sales.
Without conversion tracking in place you would immediately identify keyword 1 as better. It's cheaper and it's sending more clicks for the same price. But the truth is, those clicks are not converting.
This is a simple example of how conversion tracking can help your bottom line. Weed out the time wasters and buy clicks that actually make sales.
For more information on how to install and setup conversion tracking you can read the Google Help Centre: Setting up and Using Conversion Tracking
Some basic programming is required and you will need to make sure your website has goals which can be tracked.

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