Can retailers link a single purchase to the local search that precipitated it? The short answer is, “Not yet, but we’re working on it.”
The local industry as a whole is working to accurately tie searches to sales, so it won’t be long before you’ll be able to connect a specific consumer to a specific purchase, originating from a specific channel. But until that level of attribution is a reality there are a few tactics you can implement today to understand what’s driving in-store sales. It all starts with building your O2O (Online-to-Offline) funnel.
What’s the O2O Funnel exactly?
Your O2O funnel measures your conversions from local search impressions to in-store sales. By measuring the number of online actions customers made (things like clicks to your site, clicks to call and clicks for store directions) you can determine the number of in-store visits and sales generated by local search.
We’re using Google+ as the base example for this article, but you can use the same models to build your funnel anywhere your customers are converting, including Facebook, Foursquare and Yelp.
How are consumers searching?
Are consumers finding you when they search for the products or services you’re selling in their area? Consumers are entirely self-absorbed – myself included. We put ourselves at the center of every search – asking Google (or Bing, or Yahoo) to find me what I want near where I am. Consumers only search for brands about 25% of the time, so you have to optimize your local search for what you are selling (see Brad Shorr’s guest post here.) Google calls these searches “Micro Moments,” and they are a potential goldmine of new customers.
Standard searches look something like this:
- “Coffee shop San Francisco”
- “Plumber around 10012”
- “Cell phone store near me”
These search queries generate billions of impressions every month, and 18% of them will lead to a purchase within 24 hours. That’s a lot of potential dollars that could be spent at your store.
OK, gotcha, now show me how you do it
The key to tying online search activity to in-store visitors is applying the available online metrics to a workable model. There’s as much art here as there is science, but by capturing the right data and understanding the conversion numbers for each online action you can get a clear sense of how many customers you are driving from searches to your store.
Step 1: Measure the online performance of your brick-and-mortar locations
First things first: you need to set your benchmarks. We’re going to measure performance, so we have to know where we’re starting from. Some of the KPIs to record and measure:
- Listings coverage and accuracy
- Keyword ranking for local search terms
- Growth in online reviews and overall sentiment generated
- Amount of impressions generated on local search channels
By creating new listings, suppressing duplicates, working on your keywords and otherwise becoming a local search all-star, your metrics will start to tick upwards.
Step 2: Track online actions
Your online listings are effectively extensions of your website. They come preloaded with thousands if not millions of monthly impressions waiting for you to activate. Every time someone interacts and clicks on your online listing, you get the opportunity to track the action. You just need to be set-up to capture those clicks so you can see how they move down your O2O funnel. Here are examples of track-able clicks on your listings:
- Clicks to your website or online store
- Clicks to your store’s phone number
- Clicks to driving directions to your store
- Clicks to leave a review
- Clicks to download an online coupon*
- Clicks to make an appointment at your store*
You can track these online actions directly from your Google My Business dashboard by clicking on “Insights,” or if you’d like to get more creative, you can use third-party providers for things like call tracking. Unfortunately, Google does not provide a mechanism to aggregate third-party information.
Step 3: Track offline in-store conversions
Now that you are tracking online actions, the next step is measuring in-store conversion rates. This can be done in two ways:
- Store visits: deploy an in-store analytics platform that measures things like store visitors and POS transaction counts, and use the benchmarked data as a basis of capturing the lift you will get through your local search marketing strategies
- Proxy-measure visitors: Tally up the number of in-store conversions you’re getting from reviews, coupons & in-store visitors, and make certain assumptions around the number of in-store visitors who originated from a phone call or a driving direction request. More on how to do that here.
Using either or both of these methods will give you a sense of your effective in-store conversion rate.
Step 4: Track your campaign performance
The last step in the process is to tie a dollar amount to the visitors by tying your ATV (average transaction value) to your in-store conversion rate (the percentage of in-store visitors who will actually make a purchase). Using these numbers you will be able to model your conversion metrics, and gain a much clearer sense of how much of the local search opportunity you’re actually capturing. Here’s an example of an actual O2O funnel for one of our clients, a major beverages chain across the U.S.:
Many marketers know the famous John Wanamaker saying, “I know that half of my advertising dollars are wasted … I just don’t know which half.” With an O2O funnel, you’ll gain more clarity on the performance of your local marketing, and more importantly, you’ll be ready to further integrate online to offline tracking technologies such as beacons into your omnichannel strategies.
[FOOTNOTE *Coupons and in-store reservations are some of the most direct ways to track online-to-offline attribution. If you are not currently doing this, I strongly recommend you start. It’s a cheap and effective way to get some base metrics for your funnel, and something we do with a majority of our clients.]
As CEO and co-founder of SweetIQ, Mohannad helps brick-and-mortar store brands leverage the power of online local search to drive and measure in-store foot traffic. Follow him on LinkedIn and Twitter.
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