A conversion rate is the average number of conversions per ad interaction as a percentage. Remember that a conversion is a desired goal of an ad, often a website visit or sale. Conversion rate can be found by dividing the number of conversions by the total number of ad visitors and multiplying by 100 to get a percentage.
While desirable conversion rates vary greatly by industry and business model (the average conversion rate in Google Ads is 4.40% on the search network), a high conversion rate can be indicative of a successful ad campaign.
Example: Mikaela was calculating the conversion rate of her ad campaign. There were 1100 conversions out of 35,600 total ad interactions, yielding a conversion rate of 3.09%.
Channel sales, also known as indirect sales or partner sales, are sales facilitated through third parties instead of directly through a company’s sales team. These third parties may be agencies, influencers, or distributors. This is a common go-to-market strategy amongst B2B (business-to-business) software companies.
Channel sales is often a far more efficient system for driving revenue than direct sales, since the company doesn’t have to hire a sales team. Rather, the company only pays if and when partners make sales. Typically, partners are paid a cut of the sale, so it doesn’t require the same degree of overhead investment or risk as hiring and training an inside sales team.
That being said, to unlock maximum growth potential, many companies opt to use both direct and channel sales. Since partners will likely have access to different audiences than your sales team, it’s often worth investing in both. The programs are usually complementary as opposed to cannibalistic.
Example: Lavender Ltd. drove 30% of their revenue last year via channel sales, up from 20% the year before.