Is it the word “ratio” that brings back ugly memories of grade school arithmetic? Are you trying to avoid being called upon because you don’t know the answer? It’s simple division! Whatever the reason, if you’re going to take your band website and music career more seriously, we need to talk conversions.  So let’s start with some basics;

• If the venue says you need to sell 30 tickets and you sold 10, your conversion ratio was 33%.
• If the venue holds 500 people and only 200 people show up,  simple division tells us that the conversion was 40%.
• If 200 people came to your last show and 10 bought t-shirts, your t-shirt conversion ration was 5%.

Now, if you received 1,000 visitors to your website last month and 10 people bought a CD, your conversion ratio was  1%.

The only question left to answer is that good or bad?  I’ll answer that shortly, but  if you don’t actually know how many unique visitors you had to your website last month;  that would be bad.  You need to learn about website analytics, but I’ll save that topic for another day, maybe.  Email me if you would like to see an introduction to band website analytics.

Now. Take a look at this story by Author Bryan Eisenberg, posted on grokdotcom.com, about the BEST online retailers and their conversion rates.  What you’ll quickly see is that the very BEST online retailers, like Amazon, LL Bean and Office Depot all see conversion ratios which average around the 20% mark – for December 2008 at least.  In plain terms, that means for every 100 visitors who come to those website, 20 visitors will actually make purchases.  While this is very helpful information, I would remind everyone that these companies are the cream of the collective crop, in the midst of prime shopping season, and most have been selling online for over 10 years. There are a lot of other details about average ticket prices, number of items, time online and page views, most of which we’ll ignore to keep this lesson simple.  If nothing else, the story above illustrates that Amazon is perfecting a way to turn visitors into buyers which directly benefits anyone attempting to sell their books, DVDs or MUSIC using that channel!

Image via Wikipedia

One more VERY, VERY, VERY important topic related to selling music on Amazon, or anywhere else for that matter:  This link will show you the top 100 selling mp3 albums for 2008 on Amazon.  Before You Click – care to guess who beat out Coldplay for the number one position?  I’ll give you a hint; It was an album that was also given away for free and it wasn’t Radiohead (they were #11 on the list).  Furthermore, it was a 36 track INSTRUMENTAL album… Congrats to Trent Reznor for continuing to lead by example, that you can do great things to reach your audience and still take home the $$ to keep the lights on at the studio. Nine Inch Nails’ Ghosts I-IV was the number one SELLING digital album for Amazon during 2008. Giving away music is a way to increase your sales, but again, I digress…

So what does that “conversion rate” mean to you as an independent musician/band attempting to sell some of your merchandise, CDs or digital downloads through your website?  What’s a reasonable target for conversion. My straight answer; 10%.

If your website gets 500 unique visitors each month (just 17 visitors a day) and 10% of those 500 people converted  (bought something) and finished the process spending an average of $12 for each transaction, that total ($12 x 50 people) would equate to $600 in monthly revenue.  What did your website score in extra income last month?  Finally, are you pusing all of your social media traffic from Twitter, Facebook and MySpace back to your band website?  Using the same conversion target of 10% a band with a website getting 5,000 visitors per month would be pulling down $6,000 in sales.

I realize that selling music, tickets and merchandise is not everything that music is about. I get that.  But money does provide the fuel for further future creativity.  In other words, if your music isn’t selling now you probably will not have the money to fix the van or promote the shows or afford the postage for media press kits that will get you more airplay and interviews.

SOME money is necessary to keep the wheels going round and round, and that allows you to do what you love.

-pjc

Please contribute to this website by posting your comments, questions and real-world examples below. Comments without links back to your band/music website or social page will not be approved for publishing.  Spammers and sploggers should not waste their time either. “Move along people, nothing to see here.”