Conversion Rates
How to Get Buy-in for Conversion Rate Optimization
I just arrived home from San Francisco where I attended the eMetrics Marketing Optimization Summit. As always, it’s great to catch up with friends and participate in enlightening conversations. A key theme of my presentation: how to get organizational buy-in to testing and conversion optimization.
Marketers often get so worked up about the prospect of optimization and persuading more customers that we forget something. Before we can pursue optimization, we must convince those in our own company about optimization’s value.
Here, then, are some tips for convincing executives, coworkers, teammates, and anyone else in your company of the importance of investing in marketing optimization, analytics, and conversion improvement efforts.
Get the Math Right
When you present your numbers, don’t assume your listeners are getting the math right:
- 100,000 people visit your Web site
- 3 percent of people convert into a desired outcome
- Your site gets 3,000 total conversions
What happens when you increase conversion rate by 1 percent? How many total conversions does your organization hear?
- 3,030
- 4,000
Translate All Numbers Into Dollars
Another dangerous assumption to make is that your listeners can translate numbers into dollars. Always show impact in terms of dollars. Use average order value (AOV) or average lead value (for lead-generation or registration sites).
Let’s say your AOV is $50 and your company spends $200 for every 1,000 visits. For those 1,000 visits, your conversion rate is 2 percent, which equals 20 actions. For every 1,000 visits, you gross $1,000 in sales (calculate: $50 AOV x 20 actions = $1,000 in gross sales). If you increase your conversion rate modestly to 3 percent, your gross sales increase is 50 percent, or $500 per 1,000 visits (calculate: 3 percent x 1,000 visits = 30 actions; 30 actions x $50 AOV = $1,500 in sales).
It’s also helpful to show the dollar impact over an entire quarter or a fiscal year.
Oftentimes companies have a hard time determining AOV or average lead value with any degree of accuracy; that’s OK. Of course, the cleaner your data, the easier it will be to have organizational buy-in. The key is to show some sort of monetary value. We often encourage our clients to make a conservative estimate that most in the company will agree on.
Leverage Your Reach
Show your team the advantage of taking control of the visitor instead of existing solely at the mercy of visitor traffic.
With an AOV of $50 and a modest conversion rate increase from 2 percent to 3 percent (50 percent), the sales increase is impressive, but that’s only one part of the story. In the table below, you can see the impact of increasing both conversion and traffic:
In the “good” column, you get more from the traffic and spend. Your CPA (define) goes down, and you generate more profit from your advertising. You won’t grow faster, but you make more.
Let’s say you reinvest some of those dollars into acquisition spend to drive more traffic. You can grow exponentially and outspend your competition, you can even afford for the conversion rate to go down a bit. Your conversion and traffic increase rockets your growth dramatically.
This advantage of conversion rate optimization is often missed or overlooked by many companies.
With a conversion rate increase, you now have a choice:
- Use incremental profits to expand reach: 133,000 visits x 4% conversion rate = 5,320 orders
- Lower your marketing acquisition costs. If your acquisition cost was $100 per action, with this efficiency it would now be $66 per action.
Again, even with modest increases in conversion companies can begin to wean themselves off addictive traffic or make their traffic work harder for them instead of working harder for traffic.
Is There a Catch?
While there are many tools to aid marketers in their quest, there’s still no conversion rate black box. Conversion optimization always require resources and effort, trial and error, and sometimes sweat and tears. And it never ends. Optimization is a continual process of gaining customer insight, implementing changes, testing, then starting the whole process over.
The Bottom Line
You can’t always control the amount of visits, but you can control what you present to visitors. Why not optimize it?
Still have doubts? Ask yourself: what would it cost you to double traffic (if this is even possible) versus doubling conversion rate?
*Article cross-posted on ClickZ
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Editor’s Note: Want an even easier way to get buy-in for conversion optimization? Join Bryan on June 3rd in Manhattan at the Call to Action seminar. Today (May 9th) is the last day to take advantage of the early registration discount for the Call to Action and Persuasive Online Copywriting seminars, so hurry up and make your business case for the trip. It’s a lot easier to convince management when you can save up to $300 off the price of admission.
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Written by:Bryan Eisenberg
Top 10 Online Retailers by Conversion Rate: March 2008
Here they are, the top 10 converting retail sites for March 2008*…
1. Office Depot - 20.9%
2. QVC - 19.0%
3. Vistaprint - 18.3%
4. Roamans - 18.1%
5. Lands End - 16.2%
6. eBay - 15.7%
7. 1800flowers.com - 15.5%
8. Ebags.com - 15.3%
9. L.L. Bean - 14.6%
10. Pottery Barn Kids - 14.2%
Last month, when Snapfish and Vistaprint found their way to February’s list (at the #1 and #2 spots respectively), Bryan wondered whether they were being tracked for the first time or if they had done something specific to move the needle. Although Vistaprint has slipped to #3 on this month’s list, their conversion rate has actually gone up. Snapfish, meanwhile, has dropped off entirely.
We also noticed on February’s list that LL Bean had dropped from the 23.6% conversion rate they had in January and December to the 14.7% conversion rate they achieved in February. This month, it seems LL Bean has held, but their position has slipped thanks to a higher overall average from the other sites.
Who do you think will make it to next month’s list?
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*Source: Nielsen Online / Marketing Charts
Editor’s Note: Want to know the secrets of top-converting websites? Join Bryan Eisenberg on June 3rd in Manhattan for FutureNow’s Call to Action seminar.
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Written by:Robert Gorell
Conversion Rates, Eat Your Heart Out
Quick question for anyone with a lead-generation or e-commerce site…
Which is easier: Getting people to trust your website and complete its web form or checkout process, or getting them to literally donate their hearts and eyeballs?
Take your time.
Apparently, the answer depends on where they live. While 99.98% of Austrians agree to donate their organs upon death, only 12% of Germans do the same. Virtually all French citizens will donate a kidney to save a life, but the Brits? Only 17% of them seem willing. Meanwhile, your chances of having a heart (transplant) are nearly four times better if you’re having a triple bock in Antwerp than they are if you’ve already had a triple bypass in Amsterdam.
Seems odd, doesn’t it? Take a look at this graph from a recent Freakonomics article:
Here’s how Dan Ariely — Alfred P. Sloan Professor of Behavioral Economics at the M.I.T. Sloan School of Management, principal investigator of the MIT Media Lab’s eRationality group, and author of Predictably Irrational: The Hidden Forces that Shape Our Decisions — explains this bit of research (from colleagues Eric Johnson and Daniel Goldstein) in the Freakonomics post mentioned above:
…It turns out that it is the design of the form at the D.M.V. In countries where the form is set as “opt-in” (check this box if you want to participate in the organ donation program) people do not check the box and as a consequence they do not become a part of the program. In countries where the form is set as “opt-out” (check this box if you don’t want to participate in the organ donation program) people also do not check the box and are automatically enrolled in the program. In both cases large proportions of people simply adopt the default option.
You might think that people do this because they don’t care — that the decision about donating their organs is so trivial that they can’t be bothered to lift up the pencil and check the box. But in fact the opposite is true.
This is a hard emotional decision about what will happen to our bodies after we die and what effect it will have on those close to us. It is because of the difficulty and the emotionality of these decisions that they just don’t know what to do, so they adopt the default option (by the way this also happens to physicians making medical decisions, and also to people making investment and retirement decisions).
[…] The moment you realize that your intuition about your own behavior might be wrong it is clear that you need another, more objective input.
This is what experiments are all about. We could have never intuited the opt-in, opt-out effect, nor could we have intuited the magnitude of this effect, and this is why empiricism is so important.
If you know anyone who’s skeptical about testing content from the visitor’s perspective, please take a moment to share this with them.
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[Image credit: Kistyn E]
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Written by:Robert Gorell
Why Rivets, Not Icebergs, Sink Websites
Yesterday, exactly 96 years after she sank, it was revealed that the people who built the Titanic had used cheap iron rivets where — as fate would have it — the notorious iceberg hit.
The real tragedy is that all of this could have been avoided. (Imagine that, Kate and Leo fans! Your two love birds could have lived happily ever after.)
Harlan and Wolff, the shipbuilder that continues to deny that their choice of rivets was to blame for Titanic, must have known better — and, in fact, it seems they did. While their competitors relied exclusively on steel rivets for a ship’s bow, stern and hull, Harlan and Wolff used low-grade iron rivets for the bow and stern of their ships.
It must have seemed like a good idea at the time. After all, they were building the three largest ships in the world — Britannic, Olympic, and Titanic — at the same time! But when a relatively common iceberg gouged Titanic’s bow, Harlan and Wolff’s riveting scheme proved disastrous.
Jennifer Hooper McCarthy, co-author of a new book on Titanic, exposes the pre-launch jitters:
“The board was in crisis mode … It was constant stress. Every meeting it was, ‘There’s problems with the rivets and we need to hire more people.’ ”
But before we judge Harlan and Wolff for cutting costs, or The White Star Line for apparently financing Titanic on the cheap, we should ask ourselves: Has the conventional wisdom really changed in the past 96 years?
Each day, CMO’s and small business owners are forced to make decisions that cause dangerous leaks in the websites they manage. Maybe they didn’t have enough time or budget to make sure it was built right. Maybe they compromised. Maybe they decided not to hire a good copywriter. Maybe they paid an agency to plan, build and write the entire website for them, just because a one-stop-shop scenario seemed easier to explain to the board. And when the site launched without sinking, it was considered a success because it was built with cafes, squash courts, a swimming pool, Turkish baths, a barbershop, three libraries and cheap iron rivets.
With that mentality, is it any wonder why — year after year — the average conversion rate is between 2-3%?
It doesn’t have to be this way.
If your web strategy is more focused on bells and whistles than nuts and bolts (or rivets), maybe it’s time to stop shuffling the deck chairs.
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Already launched? FutureNow can help you test the rivets on your site.
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Written by:Robert Gorell
Email Secrets of a Top Converting Website
ProFlowers is a conversion-rate heavyweight. Its top-line conversion rate has been in the double-digits for the past few years, and it consistently appears in the top 10 converting Web sites according to the folks at Nielsen Online.
This is not an accident.
ProFlowers.com is committed to a culture of ongoing optimization. A recent promotional email demonstrates its commitment to go beyond the Web site, extending into other touch points, specifically its email marketing.
Look at this screen shot of a ProFlowers email as it appears in my Entourage email preview:
Contrast that with this email preview from SmartBargains.com:
The ProFlowers email shows evidence of planning and optimization, while the second shows, well, a bunch of Xs.
Notice the top of ProFlowers’s email makes the offer part of the “Can’t view this email” line. Most only say something like, “Having problems reading this email? Please click here.”
Inspired by the ProFlowers example, today I’ll share a few tips so you can optimize your own email messages.
Optimize Your Email Marketing
• Use alt tags. Never place an image in an email (or anywhere else online) without an alt tag. It’s just smart, and there’s no downside. ProFlowers uses the alt tag in the large image on the left to reinforce the overall message, and most of the major images are tagged appropriately. I can easily preview the message and act on it, without even downloading the images.
• Test your subject line. The ProFlowers’s subject line gives me enough information to determine if I’m interested in the offer. While this direct approach won’t work for every situation, your subject line should show respect for the recipient’s time and inbox. At the very least, the subject line and content should be consistent. Don’t hook recipients in with a catchy subject only to let them down in the email body by hiding the offer or by making them scroll down to see it.
• Copy matters. It matters a lot. Make sure your offer is clear and concise.
• Test your offers. What are you offering? Sometimes a seemingly lesser offer performs better. Notice how the ProFlowers offer gives me a clear choice between two decent offers.
Get Into the Inbox
These optimization tips are all well and good — provided your email actually arrives at the intended inbox. So much opt-in email ends up in the junk folder because it’s mistaken for spam. I asked my friend, Yasifur Rahman, VP of Kobemail, to share a few other tips that will help marketers optimize deliverability:
• Images and text. It’s a good idea to work toward a 60:40 image-to-text ratio. Image-only creative is a big no-no. Always have both images and text in creative. Most spam creative is just center-aligned images, so this layout is a spam indicator for various filters. If you have a top header (usually a logo), keep it under 100 pixels and simple, if possible. And always linked to the sender’s landing page.
• Overuse of spam-flagged words. Symbols and words, such as “$,” “FREE,” “$100″ (or any other amount), “cash,” “!,” “Prize,” “!!!,” “click,” and “complimentary” increase your spam score exponentially when used excessively. A few of them used here and there won’t affect the email as much. But when they’re used consistently throughout the message, the email is open season for spam blockers.
• Backgrounds and alignment. Colorful backgrounds raise a spam score greatly. A white background is the lowest scoring color within an email. Also, most spam messages are centered. Left-align your creative to make it look legitimate. The combination of these changes will have a positive effect on your deliverability.
• Subscription date. Add a subscription date to your message, such as: “Thank you for signing up on 07/13/06.” This builds email credibility. The more information about the subscription you put in your email, the easier it is for ISPs to determine that the mailing was a legitimate, subscribed mailing.
• Broken image and text. A smooth transition between image and text makes your creative look professional. Plus, when images are disabled, the HTML won’t break. Combined with the earlier recommendations, it will be easier for email recipients to believe your email isn’t spam. And if reported, it’s easier for the sender to convince the ISPs that the newsletter was legit and not intended as spam.
You can get more of Rahman’s tips on his blog.
Email and the Big Picture
Email’s only one piece of the conversion rate puzzle.
Double-digit conversion rates don’t happen overnight. They take work and relentless testing, collecting insight after insight into why customers behave the way they do, making the changes, then doing it all over again.
What are you optimizing in your email marketing and landing page experience?
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Also seen on ClickZ.
Looking to improve email and landing page conversion? FutureNow can help.
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Written by:Bryan Eisenberg
3 Steps to Recession-Proof Your Online Marketing
Everyone’s using the “r” word. Just a month or two ago, online marketers were whispering the word for fear of contagion. Now it’s spoken out in the open. We all seem to sense that we’re in a recession or that one’s stalking us and tapping on our shoulder.
Some sites are experiencing slight sales declines; others are prepping for the recession by trimming marketing budgets and tightening their belts in other areas. Online marketers are being asked to do more with less. It seems it’s going to get worse.
It’s interesting to watch how different companies respond to tough times. Traditionally during a recession, most will cut their marketing spend and ask the sales staff to squeeze more from what marketing delivers. In the online world, most decrease ad budgets, but the first cuts are aimed at any sort of marketing optimization (like analytics or testing). This bunker-type approach often leads to stagnation. Optimization is the last line item you can afford to cut.
Others will pour more money into traffic acquisition and flashy advertising or gimmicks. This kitchen-sink approach is highly inefficient and risky.
Effective Optimization Is a Scientific Process
I prefer a more scientific approach.
The “r” word doesn’t mean failure or certain doom. While we don’t control the factors that cause a recession, we can optimize the factors we do have control over and do our best to build and continually improve a recession-proof Web site.
A site that converts better will decrease cost per acquisition and, in turn, will increase ad spend efficiency. A site being continually improved for conversion can withstand the storms of finicky economic times. Optimizing your site should be a scientific process that gives customer insight and is accountable, efficient, and measurable.
In the midst of the dot-com boom, we took on our very first conversion optimization client and helped the company build an internal process to continually optimize its conversion rate. Everyone else was talking about eyeballs and, to their detriment, got spanked by the mother of bursting bubbles. Site after site went into the trash heap, while our client’s continued to grow and thrive through the worst of it. During that time, the client enjoyed an aggregated 400 percent increase in conversion. Its advertising spend was potent, each dollar spent on advertising was worth four times more in top-line sales. Its competitors could spend the same and a lot more on advertising and couldn’t get similar traction. Some went under.
Building a recession-proof online marketing campaign is common sense, but you must work on it. It’s well worth it. It’s not about getting the occasional gain from a test or analytics but about having a continual process for doing so.
The Cost of Not Improving Your Conversion Rate
Let’s suppose your site draws 100,000 unique visitors per month and you have an average conversion rate of 2.5 percent. If you average sale is $50, then you gross about $125,000 a month. Let’s also say that after some optimization work and a couple tests, you increase your overall conversion rate by just 10 percent (a very achievable goal), and your conversion rate is now 2.75 percent. Your monthly gross is now $137,500. The annualized revenue realized by the move of the needle is $150,000. With a minor conversion increase, you’ve earned a baker’s dozen: 13 months of revenue in 12 months’ time.
If you continue to optimize better every month throughout the year, that 13th doughnut gets bigger and bigger. Assuming traffic costs remain static, ad spend becomes stronger and your cost of acquisition goes down. Even in the likely scenario that your traffic costs inch up, you’re riding the curve instead of falling below it.If you don’t become recession-proof, your competitors will. There are simply no more excuses. A decade ago, putting together the resources for optimization was a challenge. Today, analytics and optimization software are much more easily available and affordable when you look at them in this light. Google even offers them both for free.
Steps to Recession-Proof Online Marketing
Here are three steps you can take to make your online marketing recession proof:
1. Turn your analytics into customer insight. It’s not enough to get reports. Each click is an action taken by a real person. Learn why your customers do what they do on your site.
2. Turn your insight into action. If customers leave your site or landing pages, theorize as to why, then test variations to confirm or refute your insight based on step one.
3. Rinse and repeat.
Don’t become a victim of a recession; instead use it as an opportunity to take control of the things you can and jack up your conversion rate. The dot-com bust would have been a blip had many focused more on the fundamentals of increasing conversion online.I don’t know about you, but I don’t want to live through another bust. So I leave you with the wise words of Blackie Sherrod: “The reason history must repeat itself is because we pay so little attention to it the first time.”
What are your plans to recession proof yourself? Let us know if you need help.
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Originally posted on ClickZ.
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Written by:Bryan Eisenberg
Top 10 Online Retailers by Conversion Rate: February 2008
Here it is, the list of February’s top 10 converting retail sites*…
1. Snapfish - 17.4%
2. Vistaprint - 16.8%
3. Lands End - 15.2%
4. ProFlowers - 15.2%
5. Lane Bryant Catalog - 14.7%
6. LL Bean - 14.7%
7. HSN.com - 14.6%
8. 1800flowers.com - 14.2%
9. ebay - 14.0%
10. Blair.com - 13.8%
Last month, I wondered if we would see any Valentine’s day influence to this month’s list. What do you think?
This is the first time we are seeing Snapfish and Vistaprint. I wonder if they are being tracked for the first time ever or did they do something to move the needle. LL Bean dropped from a 23.6% conversion rate that they had in January and December.
Which one of our readers will make it to the list next?
*Source: Nielsen Online / Marketing Charts
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Written by:Bryan Eisenberg
Top 10 Online Retailers by Conversion Rate: January 2008
Here it is, the list of January’s top 10 converting retail sites*…
1. LL Bean.com - 23.6%
2. J Jill - 19.8%
3. Proflowers - 17.8%
4. Office Depot - 17.8%
5. Drugstore.com - 17.3%
6. Coldwater Creek- 15.6%
7. CDW - 15.0%
8. Chadwicks.com - 15.0%
9. Bose.com - 14.9%
10. eBay - 14.9%
Several new sites made the list that we didn’t see in December, November, or October.
LL Bean tops the charts with an impressive 23.6% conversion rate. They had the same conversion rate during the holiday season. They must have had some great campaigns this month. (If you have screen shots, please let me know.)
I can’t wait to see those February results. I imagine we’ll see some influence from Valentine’s Day on retailers’ conversion rates.
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*Source: Nielsen Online / Marketing Charts
[Editor’s Note: Our original report on the top-converting sites for January 2007 mistakenly credited a previous year’s data. It seems a fellow blogger cited outdated numbers and we overlooked the error during fact check. Bryan stands by his analysis, however, as it was not intended to be time sensitive or bound to any particular retailers’ performance.]
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Written by:Bryan Eisenberg
Is Something Wrong With Your Design?
I’m still settling in from my trip last week to the Internet Retailer Design conference. If you didn’t attend, you missed a great first-time show, so you’ll have to check it out next year.
Over 800 people showed up to hear the speakers and meet with consultants (like me) to evaluate their current websites — and some even discussed mock-ups and prototypes of new versions of their sites. My back-of-the-napkin calculation is that Internet Retailer gave away around $150,000 worth of consultations, but I’ll ask you the one common question I asked several of the companies I met with just for the price of spending a few minutes reading.
What makes you think the new design you’re working on is going to work any better than the one you have today?
I recall sitting with one of the most recognized brands on the Web and him pulling out his mock-ups. They felt that they had issues around how products were presented and how their navigation worked. They offered a complex menu with way too many options in their current navigation, and were hoping to improve it by using a top level menu with a javascript rollover.
“What research do you have that indicates that new navigation will work better than the current one?” I asked. He was honest and said, “None.”
So why don’t you test it?
Internet Retailer did a pre-conference survey and asked the top 500 retailers if they’re doing multivariate or A/B testing, and included the results in their Website Design & Usability Guide.
Amazingly, 76.7% of retailers surveyed don’t test!
Huh? Now that you can get A/B and Multivariate testing tools for free from Google, why aren’t you testing?
We’ve also found that it’s safer to roll out a redesign in stages, in order to avoid the initial drop in conversion that often results from a redesign. Why not roll this out as a series of tests?
If you need help, call us at 877-643-7244 (ext. 3316). We’d be happy to help you make more money before and after your redesign.
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Written by:Bryan Eisenberg
Top 10 Online Retailers by Conversion Rate: 12/2007
Some very interesting results for the top converting websites from the holiday season. Last month, I wondered who you thought would be the top 10 converting online retailers in December. One of our readers guessed Amazon would make an appearance on this list, and sure enough, here they are:
The Popcorn Factory - 29.50%
L.L. Bean - 23.60%
Abebooks - 20.60%
Amazon - 17.60%
Hollister Co. - 17.60%
Lands End - 17.20%
QVC - 17.10%
Coldwater Creek - 17.10%
Cabela’s - 16.80%
Gymboree - 16.00%
[Source: Nielsen Online / Marketing Charts]
From a quick review of this list, I sure hope the clothes were ordered one size larger with all that popcorn people have been eating. 
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Written by:Bryan Eisenberg
