conversion rate optimization

Questions a Prospective Client Should Be Prepared to Answer

 

When I am talking to a prospective client regarding their online marketing strategy, the interview process is as important to me as it is to them.

 

While I can give them an overview of online marketing tactics, it takes a deeper understanding of their business, resources, and goals before we can mutually determine if working together would be a good fit and how we would approach their strategy.

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Split Testing

What is Split Testing?

Split Testing Overview

Split testing (also referred to as A/B testing or multivariate testing) is a method of conducting automated and random experiments with the goal of improving a predetermined website metric, such as number of clicks on a specific element (I.E. add to cart button, register button, play a video, click for more info), form completions (I.E. registrations, opt-ins, contact requests), or purchases. Incoming traffic to the website is distributed between the original (control) and one or more variations. This is transparent to the visitor, who does not know they are part of an experiment. You, the tester, waits for a statistically significant difference in behavior to emerge. The more traffic the page gets, the faster you can obtain statistically relevant results. The results from each variation are then compared to determine which version showed the greatest improvement. If it is determined that there is a clear winner, you would likely update your site to incorporate the elements from your winning experiment. (And then start a new experiment to improve it further!)

What Types of Elements Can Be Split Tested?

Nearly any element can be varied for a split test. For example:

  • Visual elements: pictures, videos, and colors (Does a photo of a smiling man help convert better than a serious man? Does an orange button convert better than a green one?)
  • Text: headlines, calls to action, and page copy (Does “Get Your Free Quote” convert better than “Receive an Instant Quote?” Do bullet points convert better than a paragraph? Does adding a customer testimonial help increase conversions?)
  • Layout: arrangement and size of buttons, menus, and forms (Does a form with 3 fields convert better than one with 5? Does a register button on the left convert better than having it on the right?)
  • Traffic flow: how a user gets from point A to B (Does a 2 page checkout convert better than a 3 page checkout? Do more people sign up for a free trial on page 3 after visiting page 1, then 2, then 3? Or Page 1, then 4, then 3?)

ab split testing

Split Testing Email

Split testing isn’t only used for testing webpages. It can be very useful for testing your emails as well. You can answer questions such as, What’s the best day to send your email marketing campaign?  What time? What kind of subject line works best? Something promotional? (Save 10% on Widgets Today Only!) Or something more subtle and informative? (Find Out How Our New Widget Can Save You Time.) You can set goals such as opens, clicks, or ROI for each email variation. First, make sure you integrated analytics into your emails. Many email service providers such as Mailchimp and Aweber can do this for you automatically and also offer certain reporting capabilities such as the number of opens and clicks directly in their system. You can then set up segments of your email list, perhaps sending one version of an email to 10% of your list and then 10% to another version (or the same version, but at a different time.) You can then see which performed better and send the remaining 80% out using the winning version, or at the winning time.

A/B Split Testing

(Courtesy: Mailchimp.com)

Some Split Testing Best Practices

  • Simplify: generally, fewer page elements create less distractions from the conversion goal.
  • Don’t forget about the overall business goals: test with the overarching goal of the website in mind, not just the goals of individual pages. For example, one page might generate more clicks, but fewer checkout completions. Or, one version of an email might generate more opens, but less sales.
  • Test one element at a time: Testing one element at a time is called A/B testing, while testing multiple elements on a single page is called multivariate testing. Unless you have a testing tool capable of interpreting more complex multivariate results, it’s important to test one element at a time (although you can have multiple variations of this one element.) For example, just change the call to action, or an image on the page, or the position of your testimonials. Otherwise you can’t be sure which element had an impact, and by how much. If you test two elements and one results in an increase on performance of 10%, while the other results in a decrease of 10%, you might assume that the net benefit of your changes is zero; that there was no difference in page performance. In reality, if you only added the positive performing element, you would have seen a 10% increase which could be a big win.
  • It’s not all about drastic changes: Don’t be seduced by the idea that all variations in an A/B test have to be huge, obvious transformations. Even subtle changes can have a demonstrable effect, such as slightly editing a list of product features to persuade users to request more information, or phrasing a call to action differently to drive user engagement. It’s a gradual, granular process. Keep iterating until your conversion rate for that page is maxed out.
  • Don’t make assumptions: Just like a scientist tests a hypothesis, that should be your approach to split testing. Use hard A/B test data to make informed business decisions – no matter how much it surprises you.
  • Resist the temptation to jump to a conclusion: Even if you’re getting strong initial results, let the test run it’s course.  Economists and data scientists rely on a principle known as statistical significance to ensure that the data has a high probability of accuracy and this relies on a large data sample. Without it, you run the risk of making business decisions based on bad data.

Split testing doesn’t have to be complicated. Services such as Visual Website Optimizer, AB Tasty and Optimizely offer interfaces that allow you to create page variations without touching your website code. Conversion Rate Experts has a great breakdownof the numerous split testing tools and platforms that are available. With easy ways to do split testing of your website and emails, there is no excuse for settling for the status quo. There is always room for improvement throughout your site. So once you find improvements, don’t stop there. Keep testing!

What is Conversion Rate?

conversion rate

Conversion rate is simply the percentage of visitors to your website that achieve a certain goal that you set as your objective.

Your objective might be making a purchase of a product, filling out a contact form, signing up for a mailing list, registering for your site, or whatever else you are trying to achieve.

If you are spending time and money to draw visitors to your website, increasing your conversion rate may be the single most important metric to focus on to grow your business and improve ROI.

Yet many businesses don’t focus on this and instead just spend more time and money trying to attract new customers, when they aren’t maximizing the customers they already have at their site!

Imagine you own a retail clothing store…

Customers are walking in on their own and browsing the racks. But instead of your sales staff tending to them, making suggestions, trying to convince them that they would look great in that new dress they are eyeing, and helping them check out, they are all standing outside holding up posters asking random strangers on the street to come inside the store. How many of those customers who were just a small step away from becoming a paying customer might instead walk out empty-handed?

It’s easy to see a similar impact in nurturing the customers on your website.

As a website operator, you might spend 5 hours writing a newsletter for your company or you spend $500 on a banner advertisement on a relevant website with the objective of acquiring new customers.  If you double your conversion rate, that very same 5 hours you spent or the same $500 would actually generate twice as many new customers.  And it’s not a one time thing, either. When you improve your overall site conversion rate, every piece of marketing that you do will provide a better ROI, forever! Because every newsletter you send, every advertisement you run, every visitor is now being driven to a better performing website that achieves more of your goals with the exact same amount of effort.

Ok, what else can conversion rate optimization do for me?

Conversion rate optimization doesn’t just help increase the ROI of your existing traffic, it creates great new opportunities for increased marketing to really accelerate your growth.

All businesses should have a target cost per acquisition (CPA) which is the amount it costs you to get a visitor to achieve your goal.

If you get 100 new registrations for your website from an advertisement that costs $1000, your cost per acquisition is $10. If you spend $12 on pay per click search ads to get one new customer, your cost is – you guessed right – $12. Your target cost per acquisition is influenced by your margin, overhead and lifetime customer value.

A simple example would be if you’re selling dresses for $100 and your cost is $50, perhaps you’re willing to pay up to $25 to obtain a new customer, leaving $25 in gross profit to cover your other business expenses and have some profit left over. As your conversion rate increases, your cost per acquisition decreases. Doubling your conversion rate means the $1000 that used to get you 100 new registrations now gets you 200. The PPC ads that used to require $12 to get a new customer now only cost you $6. With PPC bidding getting more and more competitive, conversion rate optimization can be absolutely critical in maintaining profitability.

But wait, there’s more!

Think about how many new keywords you wanted to bid on or other ad campaigns you wanted to run to acquire more customers, but they were just too darn expensive. You’re thinking, “I’d love to be there, but there’s just no way I can justify the cost of that ad if I’m only getting 1% of my site visitors to convert.”  When you increase your conversion rate, all of a sudden ad campaigns that were once unable to produce a sufficient ROI now are affordable, helping you to grow your revenue and scale your business faster.

How do I improve my conversion rate?

Renown Venture Capitalist Bill Gurley, who writes at Abovethecrowd.com, makes an important point: “Unfortunately, conversion improvements typically are the aggregate gain of 100 tiny improvements, not one silver bullet. Rarely will you find one single change that is going to have a 5% lift in conversion (you might if you have never tried, but this type of win will go away quickly). Rather you will find 30 things on a page that all have a tiny impact, and the overall impact, after months of work might be 5%. You have to be willing to toil in the minutia knowing that the impact on the overall system will be the combined result of many tiny little changes.”

Don’t get discouraged. These small incremental changes really start to build over time and have an exponential impact. Stay tuned for new posts on some great ways to test and find ways to perform conversion rate optimization or contact ME to help you with your conversion rate optimization.
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Conversion Rate Optimization Funnel for Healthcare.gov

Healtcare.gov Could Use Massive Conversion Rate Optimization!

According to the latest statistics released yesterday, there is indeed significant interest from users in the new government healthcare exchange portal, Healthcare.gov, with almost 27 million visitors, or 8% of the population. However, here’s where things go south. While there are around 900K users either starting or completing the application for healthcare plans (around 3%), which would be an important “goal” to track on any website, actual “conversions,”  people who selected a plan from the exchange are only just over 100K, or less than .4%. Yikes! That represents only about 1/5 of the Congressional Budget Office was projecting by this point. Another fail.

That is a pretty ugly looking conversion funnel (I posted a graphic showing stats from the first week,) with massive drop-off at every stage of the process. Imagine you just made a huge investment of resources, financial and time (in the case of Healtcare.gov, the most recent reports quote the tab at $174 million), to get people to your ecommerce site and 97% of them never even added a single item to their cart. And of those that did, almost 90% of them never completed checkout. Obviously there is a big disconnect and you’ve got your work cut out for you to bring up those conversion rates. That’s where conversion rate optimization comes in.

Conversion Rate Optimization

Conversion rate optimization is the process of identifying and testing changes to the website by utilizing tactics such as surveys or split/testing changes that increase the amount of users on your site who are actually achieving what you have defined as your goals (I.E. submitting a request, signing up for a service, purchasing a product, etc.) Clearly there are big issues with users likely not finding what they are looking for, confused about how to go through the process, feeling overwhelmed and not getting the reinforcement or answers they need to proceed, and surely more hurdles that they are unable to overcome to convert.

Now that the site appears to at least be more technically stable, I sure hope they have a team of conversion rate optimization specialists analyzing the data and deploying simple, effective tools and testing to improve performance. We’ll talk about these conversion rate tools and tests in more detail in future posts, but you can see how important this is as you start investing time and money to drive traffic to your site.

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