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What is conversion value? How to estimate or calculate this?

Visitor ✭ ✭ ✭
# 1
Visitor ✭ ✭ ✭

A sales team converts 10% of leads into deals. For each deal an additional 15% of business is gained from word-of-mouth. Which formula best describes value-per-conversion?

a. (Average deal value)*(10%)/(115%)
b. (Average deal value)*(10%)*(15%)
c. (Average deal value)*(10%)*(115%)
d. (Average deal value)*(0.15)

 

 

Thank you.

2 Expert replyverified_user

Re: What is conversion value? How to estimate or calculate this?

Collaborator ✭ ✭ ✭
# 2
Collaborator ✭ ✭ ✭

(Average deal value)*(10%) = VL = "Value per conversion for a Lead" but because for every VL you get an additional 0.15 x VL , the answer would be 

 

VL + (0.15 x VL) and that translates to which of your answers ?

Re: What is conversion value? How to estimate or calculate this?

Top Contributor
# 3
Top Contributor

This looks like an exam question to me.  Please don't ask exam questions on the Community.

 

Jon

AdWords Top Contributor Google+ Profile | Partner Profile | AdWords Audits

Re: What is conversion value? How to estimate or calculate this?

Visitor ✭ ✭ ✭
# 4
Visitor ✭ ✭ ✭
Hey Cobnut, your arrogance is a reflection on how selfish you are. It looks like you're willing to be a tool rather that answer a valid question! Its because of people like you that the world is the way it currently operates!

Re: What is conversion value? How to estimate or calculate this?

Google Employee
# 5
Google Employee

Hi Paul,

 

Please respect other users and Google employees on this forum. This is a community of users helping each other with AdWords, and we'd like to keep things fun, friendly, and Googley. Treat the Community and other users as you would like to be treated. 

 

Thank you.

Re: What is conversion value? How to estimate or calculate this?

Top Contributor Alumni
# 6
Top Contributor Alumni
Well the forumla should be
=(AV*10%)*115%
But i would recommend you should look at offline conversion tracking https://support.google.com/adwords/answer/2998031?hl=en for more accurate conversion value.
Hope this helps
Regards, Nik
LinkedIn  |   @nikhilparachure | My Blog

Re: What is conversion value? How to estimate or calculate this?

Visitor ✭ ✭ ✭
# 7
Visitor ✭ ✭ ✭

Re: What is conversion value? How to estimate or calculate this?

Explorer ✭ ✭ ☆
# 8
Explorer ✭ ✭ ☆
This is all well and good - but as my economics tutor at uni always concluded "it's never observed in practice".

With Adwords it's incredibly easy to set up a system that allows you to find a profitable market - putting the horse before the cart in other words. Because calculations and imaginary systems are all wonderful - but you rarely find them in your day to day life. Learn a little adwords, have some fun, and most important of all, get some real experience of "conversion value" ;-)

What's more, by the time you've finished your studies, you'll have built yourself a business as well as getting yourself qualified!