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StrategyJan 04, 2013

3 Steps to Increase Your On-line Conversion Rates

Deana Self

What are you doing to drive customer conversion through your digital channels? With eCommerce of all stripes experiencing explosive growth, do you ever wish you could look into a crystal ball and know exactly what could be done to enhance and experience stronger conversion rates?  There are three straightforward steps that can help any business turn potential on-line customers into actual ones, but strangely enough, these steps are little understood and little utilized.

1. Observe the behavior of your CURRENT on-line customers

Merriam-Webster defines observe as “to watch carefully especially with attention to details or behavior for the purpose of arriving at a judgment” or “to come to realize or know…through consideration of noted facts.” Fortunately, the digital channel is one area where it is extremely easy to “watch carefully.” Analytic tools abound, and Google Analytics, a free resource, is an excellent place to start if you don’t already have a resource.

If you are reviewing actual customer behavior rather than trying to intuit what customers are doing, you are far more likely to be able to identify what needs to change to drive conversion, and, as importantly, what needs to stay the same.  Too often people ignore this critical step and instead drive to the answer before they’ve even identified the cause of the problem.

For example, I worked with a client in the past that decided they knew the answer to their problems and thus did no observation of on-line customer behavior.  Unsurprisingly, their suggested improvements revolved around making their customers do more—answer more questions, provide more search inputs, etc.—in order to produce a better search result, which would, in theory, increase sales.  However, if the client had been reviewing the metrics before defining conversion enhancement requirements, they would have seen their bounce rates were extremely high throughout their search and checkout process—the process was ALREADY too laborious; there were ALREADY too many questions asked.  Unsurprisingly, adding more questions achieved the opposite of what they were hoping to accomplish.

Before you jump to define the right answer to increase online conversion, take an opportunity to observe customer behavior throughout the digital purchase cycle. Bounce rates and fallout reports are a great place to start. By observing what customers are actually doing in each stage of the cycle, you have a much greater chance of correctly diagnosing the actual problems and bottlenecks.

2. A/B Test Potential Solutions

Once you know the problem, arriving at a solution becomes much easier. You now know what is broken, so you can begin working on how to fix it. We recommend using a technique called A/B testing to identify the best ideas for how to change and improve specific areas. In this process, as the name implies, two versions of improvements (A and B) are compared, which are identical except for one specific variation that might impact a user’s behavior. Version A might be the currently used version, while Version B is modified in some respect.  A/B testing allows you to place potential solutions in front of your digital customers and then measure the results– increased conversion or decreased bounce rates.  Thus, you are able to track how the actual behavior of visitors changes based on your proposed improvements (e.g., whether the visitor immediately leaves the page, stays and reads text, makes a purchase based on the look and feel of the page, etc.) and identify the right option going forward.

For more information on A/B testing, check out “A Beginner’s Guide to A/B testing” from KISSMetrics.  Then, do a little web searching to find out more eCommerce best practices. As Linda Bustos (Director of eCommerce Research at Elastic Path –one of the top 10 Canadian marketing blogs—who has been named as one of the “Top 30 under 30” in direct marketing by DMNews) practices states, though, One Company’s ‘best practice’ is another’s conversion killer … take ‘best practice’ advice under advisement, and put it to the (A/B) test on your site to see if it’s best practice for your industry, geography, customers, product and site context.”

The cycle between solution identification and testing is a great one … you get to decide a few variables, test those against a constant and arrive at a solution that is an actual answer to an issue that you now already know will improve your conversion rates … no need to guess!  Need more information on A/B testing?  See “8 Rules of A/B testing …” by Uri Bar-Joseph.

3. React

Testing provides you the opportunity to react to user preferences.  So how do you know what to react with?  As mentioned in step 2, track the reaction of visitors and identify the best solution going forward.  Identifying the best solution does not mean looking at the results and saying, this one seemed to do better … identify your success metrics prior to your testing (e.g., lower bounce rates, increased conversion rates, etc.) and then implement what met your success criteria through your A/B testing. In an ever-changing market with customer demand and influences constantly in flux, when you are able to define success in advance of providing a solution, you are much more likely to meet it!

What’s more, testing is not something you do once, track once, and react to results once … it is an on-going process.  All websites generate different amounts of traffic from different target audiences so test and reaction cycles always vary in duration. Remember this quick process to ensure you maintain effective testing and increased conversion:

  1. Define the area of friction for your online conversion

  2. Define an alternate solution for your area of friction (A/B test control and variable)

  3. Determine the success metric for you’re A/B test

  4. Track all visitor activity

  5. Compare the user preferences (per tracked results) to the success metric(s)

  6. Determine if additional A/B testing is required due to outcome of preferences

    (You may have learned something new from your initial A/B test which spawns additional testing before implementing a change)

  7. Push all successful changes to your site

  8. Monitor your success metric against the new constant to ensure continued success

Your ability (i.e., via good data from tests) to track your customer preferences allows you to react to their needs with great success.  This third step is the easiest step in the process if you have defined your success metrics appropriately and gathered data well.  When you are able to impact the bottom line, increase your sales and push directly to the top of your summit or sales goal, why not do it right?

Your strategy to conversion is an asset. Treating it as an asset and ensuring it is built on a rock solid foundation (fact) rather than sand (opinion of what might make your site better) ensures that your conversion is higher and is generating green backs.  Use your analytics tool–set it up appropriately and take time and resources to manage it well.  It will help guide your success!

Observing conversion friction points through your analytics tool, identifying and testing potential solutions, and then appropriately reacting to the results of those tests presents you with the opportunity to look into a real crystal ball and see what success is for your online business.

Visit credera.com for additional information about Credera’s management and technology consulting services.