How much is each visitor to your site worth to you?

It is very important that you learn how much each visitor to your site is worth to you.

By knowing this, you can determine how much you are willing to spend in order to gain a new visitor. This becomes a critical part of buying advertising and using pay per click search engines.

Once you know your site is converting enough visitors into customers, you can do well with these strategies as long as you know how much to spend.

You can figure out your visitors worth by looking at your web site's statistics. If you don't have access to your statistics, you need to! Ask your web site designer to get you access to them. If there are none built into your site, considering putting an inexpensive one on your site.

Here's a basic example of how to figure out the value of every visitor

After looking at your web site statistics, let's say you discover the following average occurs.

Let's say that on average, your site is getting 1000 unique visitors a day. On average, that generates 10 sales with any average combined value of $199.50.

To keep this example simple, we will assume that your sales are 100% profit to you.

Divide your profits ($199.50) by the total number of visitors (1000). You will learn that on average, every visitor to your site is worth .199995 cents (rounded up to .20). As long as you spend under .20 to get each visitor, you will make money.

You now know you can create a pay per click ad campaign and bid anywhere under .20 cents for each click to make money.

Very simple, yet powerful information.

As you get more advanced with your stats, you will learn how to track which ads are worth spending more money on. This can be influenced by having a more targeted audience. You may find that with the right targeted ad, you are converting 3 customers in 100 instead of 1 out of 100.

Knowing the basic conversion rate of visitors to customers can help your profits. It makes it very clear how much money can be spent to get each new visitor.