A number of businesses are missing out on increased online conversion rates by failing to implement basic changes to their procedures. This is according to new research from Econsultancy and RedEye, which found that 39 per cent of firms using digital marketing are unhappy with the amount of customers or traffic they are getting from their current strategies.

Weak performance is largely due to firms failing to carry out regular website tests or divide their customers into segments, the survey found, with the majority of companies that do employ segmentation opting to use demographics over geography and behaviour.

However, the results also indicated that 70 per cent of companies using the web for marketing have seen their conversion rates improve over the last year, suggesting that firms are beginning to learn how to use the internet effectively.

"Companies' lack of resources is cited in the report as the biggest barrier to improving conversion," chief executive officer of RedEye Mark Patron commented, while research director at Econsultancy Linus Gregoriadis added that not having an individual "directly responsible" for conversion is hindering businesses.

One area of digital marketing that is set to grow is online video, as the Internet Advertising Bureau has predicted its popularity will increase sharply in 2010.