Another really critical metric to track is lead conversion. This is the number of leads who become customers. Lead conversion can be improved by increasing the quality of leads who become prospects or by improving the conversion funnel.
Lead conversion can be improved by increasing quality of leads becoming prospects or improving the conversion funnel
Click to Tweet
A prospective customer might visit the community, ask questions and then be more likely to convert into a customer as a result. As they learn more about the topic, or what they need to measure, their desire to purchase the product might increase.
Measuring lead conversion is complicated. The people who join and participate in an online community may inherently be more likely to convert into customers. This creates a challenge in proving causality. Did the community improve lead conversion, or do the leads most likely to convert join the community anyway? This is the challenge we need to disentangle.
To measure lead conversion, we need to run an experiment and put together a few data points. Specifically, we need:
- Number of people ‘exposed’ to the community (group A).
- Number of people ‘not exposed’ to the community (group B).
- Percentage of leads ‘aware’ of the community.
- Total number of leads.
- Average order value.
- Average purchase frequency.
- Average retention rate.
- Average gross margin.
Community ROI Template
You can drop these numbers into this spreadsheet or follow the process below.