Table of Contents
The Shopify Partner system has created great value for developers and shop owners alike. It has been integral to Shopify’s success in developing the best online ecommerce platform.
This great potential has led to huge competition in the Shopify Partner Apps Store. This makes it hard for new Shopify Partners to break into the market and established ones to maintain their market share.
The lead conversion rate and the related sales KPIs are key metrics to track your market share progress. In this article, we are going to look at how you can improve your lead conversion rate for Shopify Partner Apps.
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What is the lead conversion rate for Shopify Partner Apps?
The lead conversion rate can mean two different things. First, it can mean the total number of leads who become paying customers. In this article, we are dealing with the second, more common definition.
Here, the lead conversion rate is simply the number of visitors to your site who eventually become leads written as a percentage. For example, if you have 1000 visitors and 100 become leads, then your lead conversion rate is 10%.
Let’s look at the formula:
Lead Conversion Rate = (Number of Leads/Total Number of Visitors) x 100%
But, what is a lead?
What is a lead?
A lead is a visitor to your page who expresses interest in your product. This means they have taken some positive action to express their desire to be contacted about your product. The most common example of expressing interest is filling out some form with their personal contact information.
What are the different types of leads?
Finding the leads from visitors is only the first step in this process. The entire process can be broken down as follows:
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Some visitors become leads.
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Some leads become marketing qualified leads (MQLs). This is a lead who meets the general profile of your customers.
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Some MQLs become sales qualified leads (SQLs). These are the MQLs who have been vetted in some way. They not only meet the general framework of your ideal customer profile (ICP) but also are individually likely to convert to a paying customer.
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Some SQLs become customers. These are the wins.
Each part of this process has its pitfalls. While in business generally “more is better”, in this case often it is how well you winnow down the different categories of leads that matters.
If you can properly vet your SQLs, then you won’t waste your time dealing with leads who do not seem likely to convert to paying customers.
If you properly select SQLs, then your sales team can spend three, four, or five times longer trying to convert each SQL and end up with more paid subscribers.
What is conversion rate optimization?
Conversion rate optimization (CRO) is the act of modifying your funnel to push traffic towards sales and paid sign ups.
Let’s look at potential issues for visitors, leads, and wins.
Visitors
The two major issues that you can experience with visitors are: too few visitors and not the right visitors.
If you aren’t getting enough visitors, then it is likely that your Shopify Partner App isn’t getting the notoriety it deserves. This can be solved with content marketing.
Just like in the Field of Dreams, “if you build it, they will come”. Content marketing just requires effort and time. You need to be producing a high quantity of content as well as a high quality of content.
Doing this will eventually lead to more visitors. Keep in mind though that high quality includes picking the right keywords that are getting searches but not too difficult for you to rank on.
If you are getting the wrong visitors, then you need to reevaluate your ideal customer profile (ICP). The ICP is your best description of your target market, and it will guide you to produce the content that they need and in the format they want.
For example, customers on mobile devices might not want to read and therefore you may need to think about podcasting or releasing videos.
These problems can be solved by more, and better targeted, inbound marketing.
Leads
Lead issues come in two main flavors: too many and not enough.
If you aren’t getting enough leads, that’s probably an issue with your content marketing not getting enough visitors or attracting visitors who aren’t matching the profile of your customer base.
One other issue can be with how you present information and what that signals to potential users. While requiring a visitor to provide their information to see pricing details might seem like a good idea, many people find this dishonest.
If you are confident that your prices are fair and competitive, then giving more details to potential users might entice them to give you real information.
If you are getting too many leads, then it probably indicates a problem with your vetting process. In this case, “too many” means that you are not converting on enough leads as they do not match your ICP.
Focusing your marketing and sales team on reducing the lead pool more when reporting their MQLs and SQLs can help the salespeople give more attention to the leads most likely to be customers.
Conversions are more likely to happen the faster you can respond to inquiries and the more time you can dedicate to each prospective user while walking through your Shopify Partner App. Reducing wasted time on poor leads gives the sales team the time they need to nurture those best leads.
Wins
If you are getting ample, good leads, and you are confident that your vetting process is giving the sales team the right leads, then why aren’t you getting more customers?
If the problem is at the bottom of the funnel, where qualified opportunities become wins, then you need to look at your whole sales process:
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Do you have a free tier competing with the paid tiers?
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Is your free trial paired with good communication explaining the value added by your app?
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Is your sales team properly trained?
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Do your prices match the market?
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Why should you calculate KPIs such as the lead conversion rate for Shopify Partner Apps?
KPIs are great ways to take all of your data and distill it into a single number. Each KPI can then answer a question about the health of your business.
The lead conversion rate and related sales KPIs answer the following questions:
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Lead conversion rate: How well targeted is your content marketing?
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Lead-to-opportunity ratio: What is your lead quality?
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Opportunity-to-win ratio: What percentage of your quality leads become sales?
Lead conversion rate: How well targeted is your content marketing?
The lead conversion rate will change over time. Ideally, you want your lead conversion rate to increase slowly over time.
This is an indication that your content marketing is becoming better focused on your customer base.
If your visitor count is also increasing, then a rising lead conversion rate will mean more and more leads for your marketing and sales teams to qualify.
Lead-to-opportunity ratio: What is your lead quality?
Every potential lead starts out as unqualified. A qualified lead is one that has been vetted in some way.
Depending on your organization, you’ll consider your MQLs and/or SQLs as opportunities. If these opportunities are not turning into paid customers at a high rate, then you need a stricter vetting process.
Opportunity-to-win ratio: What percentage of your quality leads become sales?
Assuming your qualified leads are actually of high quality, then you should be closing a reasonably high portion of them (about 15% of opportunities should become wins).
If this isn’t the case, either your vetting process for leads is wrong or your sales approach needs work.
Summary
The lead conversion rate is fundamental to evaluating the top of your sales funnel. If you aren’t getting enough visitors or not enough visitors are interested in your product, then you have marketing issues.
If the leads are not turning into customers, then you have sales issues. This can mean you aren’t correctly vetting your leads, or your sales process needs to be reworked.
While many industries are still using the same sales KPIs as they did 50 years ago, this won’t cut it in SaaS. The industry is too competitive, and the best companies are evolving rapidly.
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