Conversion Rate Optimisation - Achieve More, Spend Less
"Online merchants convert an average of 2%-3% of their site visitors into buyers. That's about the same as last year. And the year before that." - The e-tailing group.
Conversion rate optimisation is the most exciting and valuable form of online marketing you can do.
It is simply the art and science of getting more profit from your customers and potential customers.
It takes all the established practices of direct response marketing and applies them online. It’s not exactly a new practice, although it is new to many online marketers.
At its simplest, it’s about making small changes to your online marketing and business to see what works, how well it works, and then continually improving and building upon that.
Why Does that Matter to You?
Three main reasons:
1: You Make More Money
You get more profit and revenue from your existing customers and prospects.
2: It Costs You Less to Make More
All of your marketing and advertising becomes more effective and efficient. IE: It costs you less to make more.
3: It takes all of the mystery out of your online marketing.
Instead of gambling and hoping that online marketing works, you can build a very accountable marketing process.
If you want to improve your online marketing performance, then call us today on 0411 353 693
Here’s How it Works
The average conversion rate for most sites is between 2-3%.
That is only 2 out of every hundred visitors to your site actually buy something or register or become a lead.
For all the money being spent on online marketing and advertising each year, 98% of it isn’t resulting in a sale or a lead.
That’s why I say people are gambling with their online marketing. They are spending huge amounts and just hoping that they will get a return.
(In fact you’d probably get better odds at the casino.)
I’ve never liked those odds, so when I found out that the best sites converted between 40-80% of their visitors. IE: 20-40 times better than everyone else. I wanted to know how they did it.
This is good news: It means the knowledge already exists to move your conversion rate from 2% 4%, which would be a doubling of your sales.
The benefits for you are many:
- You don’t just get more sales; you get more sales from your existing traffic.
- There’s no need to increase your marketing expenses.
- Your customer acquisition cost goes down.
- Your customer retention rate goes up.
- Your customer lifetime value goes up.
- The effect is permanent. It outlives any particular marketing program.
What is Conversion Rate Optimisation?
Simply put, it’s about getting more results from your online assets at less cost.
More bang for your marketing dollar
Greater profits at less cost
Most websites and online marketing work like knotted up hoses and leaky buckets. Conversion Rate Optimisation unblocks the hose and plugs the leaks.
It works by increasing the results you get from your existing online traffic.
After profit, it is usually the most important KPI of any online activity.
Conversion rate optimisation is a natural extension of copywriting and content marketing. It is simply about continually improving the results of your copy and content via analytics and testing.
Most online businesses only convert about 2% of their traffic into sales or leads. If you're in this majority, then the good news is that just getting to 4% conversion rate would double your results.
Getting a 20 or 30% conversion rate is simply mind boggling, yet that is exactly what a few select online businesses are doing.
It starts by simply recognising that the ROI from an increase in conversion rates outperforms almost every other form of online marketing.
There's more, such as increasing average order value and customer loyalty (repeat business), but it all starts with conversion and optimising your pages.
Other forms of online marketing also certainly have their place, but systematic improvement of your conversion rate is a very different game than what currently passes for most online marketing.
Increased conversion rates mean increased revenues ongoingly.
Once you've made the increase, you get the result every month, month after month, year after year. It's a perpetual increase, a one off investment that gives a permanent, persistent increase in sales.
What's more it starts to work like the miracle of compound interest, as all of your marketing efforts get amplified by the increase.
Increasing conversion rates and optimising your landing pages is a simple concept, but there are thousands of things required to achieve it.
The Difference Conversion Rate Optimisation Makes
How to Make Your Customers Click More
Some businesses make their customers click 4000% more than their competition.
They do this consistently - month after month - year after year
Would you like to be one of them?
All online marketing comes down to one thing; persuading your website visitors to take that next click.
The click that turns them from a browser into a customer.
Tragically most websites only turn 2% of their browsers into customers, leads, members, voters, readers or fans. (And the figures are even worse for online advertising at around 0.001%.)
This is the case for more than 90% of online businesses globally.
What's more, they've been stuck at this low level for over a decade, despite the billions of dollars spent every year on online marketing and advertising.
Something obviously isn't working.
A 65% Conversion Rate
Yet a very few businesses are converting as many as 65% of their visitors into customers.
A staggering 31 times more business than their competition.
And toy maker Mattel boasts an incredible 80% for some of its sites. See An 80% Conversion Rate? - I'd Like to See That..
Clearly these businesses know something and are doing something that almost no one else does.
This knowledge is helping them produce extraordinary results far above what their competitors are doing.
This is the work we do for you:
- helping you develop the knowledge and skills to move your online business from the ordinary towards an extraordinary high performing site.
How to Calculate Your Conversion Rate
The formula is simple. You just divide the number of completed business goals (EG: sales) by the amount of traffic your website gets and then multiply by 100 for a percentage.
IE: 10 Sales / 500 Visitors x 100 = 2%
Sales are the obvious metric to use, but you can also use the number of bookings, enquiries, leads, newsletter signups, downloads or whatever business objective is the most important for you.
The point is to know what you want to achieve from your online assets and then measure it and keep track of how it improves over time.
Conversion Rate Optimisation Services
How We Improve Your Results
Anything in the online and digital space can be optimized for greater results.
We can audit an entire site, a specific marketing campaign, or individual pages and ads.
The following is a list of some of the areas that can benefit form a conversion rate optimisation process.
- Increase sales
- increased leads
- Improved shopping cart performance (reduced cart abandonment)
- Increased Adwords performance
- Improved landing pages
- Better forms and increased registrations
- Product Pages
- Facebook Pages
- Facebook Ads
- Email Open Rates
- Email Clickthru rates
- Email conversion rates
- Reduced bounce rates
- Increased social media responses
- Higher Clickthrough Rates
For each project we will
Establish the goals (KPIs)
Design a test
Measure the results
Optimise for even higher results
If that sounds too simple, then consider that improving your conversion rate is about doing 100 things 1% better.
The end results work like the miracle of compound interest.
The Truth About Online Marketing and Ecommerce Performance
Global Online Conversion Rates
Average Conversion Rates- February 2009
First Time Visitors 1.90%
Repeat Visitors 2.30%
Cart Abandonment Rate 58.80%
- source Fireclick
In fact it's been the same for the past decade, and it's still at this level. See this recent 2010 survey
I've seen report after report that continually confirms this sorry fact and even today it hasn't changed much. Australian conversion rates aren't much better.
Why This Matters To You
It's hard enough to get potential customers to your site only to lose 98 out of every 100 who walk in your website door.
Turning more of them into actual customers just makes sense. It's a smarter marketing game to play.
Why waste money on expensive online advertising, complicated search engine techniques or other online marketing voodoo when you have interested browsers already on your site?
All you have to do is give them a compelling reason to buy from you.
As we explain elsewhere on this site, just improving your conversion rate can give you a tremendous boost in results.
In the previous example we saw how getting 10 sales from 500 visitors resulted in a 2% conversion rate. Now those 500 people are already on your site (in your store). You don’t have to spend anything extra on online advertising, social media or whatever to get them in front of your products and services.
If you could convert another 10 of them into paying customers that would double your conversion rate to 4% and double your revenue.
Getting another 10 sales from the remaining 490 people doesn’t seem like too big a task. And, most business people would be ecstatic about doubling their revenue.
Yet the vast majority of online businesses and even online marketing consultants totally ignore this opportunity to improve their profits and results.
The average conversion rate for online businesses is around 2-3%.
The very best performers do anywhere from 20 – 80%
Think about that. Some businesses convert 10 to 40 times more of their visitors into customers.
Why is that? What’s their secret?
That’s what this session is about. Conversion rate optimisation is a detailed business practice. Today we are just going to touch briefly on what it is and what you can start to do to increase your online results.
Don’t Do What Everybody Else is Doing
In the chart above we saw the 10 best online retailers by conversion rate.
The companies mentioned consistently achieve these results.
They are obviously doing something that almost nobody else is. So what is it?
Well think about this:
For every $80 spent online to get a prospect to just come to a website, only $1 is spent on actually turning them into a customer once they get there,
According to Omniture, a leading market intelligence company,
$23 billion was spent on online search and display ads
But only $250 million was spent on site optimization
Read that again, that's billions vs millions.
What that looks like in pictures
Obviously, the first thing to do is reassess where you’re spending your marketing budget and investing your time and other resources.
The other thing to understand is that almost the entire online marketing industry is geared towards selling you something in that 99% area. No wonder conversion rates remain low- almost nobody is working on them.
How to Increase Your Conversion Rate
– What You Really Need to Know
Most businesses make thousands of mistakes when building a website and this is reflected in the poor results they get, they are in effect leaking money everywhere.
The reality is most of us are no better at doing online business than we were 12 years ago.
To be even more brutal, if you’re operating online there’s a very real chance that most of you will burn a lot of money for little or no result.
First, you must understand that online success is not a technology issue. This is a big trap.
Too many companies focus on the technology and forget the fundamentals: Any success online is a human communications and behaviour issue.
And human communication hasn’t really changed in millennia. Only the mediums have changed, but what motivates people to do things, to do business with you has not.
Before you build or rebuild your website, or start an online marketing campaign, you need to get specific about who the project is for and what will motivate those people to do business with you.
What You Need to Know
The best performing companies spend more money on improving conversion rates.
A recent research report from Adobe revealed that those companies with high conversion rates allocated half or more of their budgets to increasing it.
While those with low conversion rates, on average allocated less than 5% of their budget to it.
So have a think about that. Where is the bulk of your online marketing budget going?
Or to put it another way: Those companies that are doing 10 times more business than everybody else are allocating 10 times more of their budget to conversion rate optimisation.
Concept is Easy, Implementation is Often Hard
Like most forms of online marketing conversion rate optimisation can get very complicated very quickly. That’s why those that do it well invest in professional services.
The purpose of today’s webinar is to get you used to the idea that you can improve your online business results systematically and logically.
That is, avoid the voodoo and silver bullets that are so prevalent in the online space.
As the chart demonstrates plenty of companies have figured out how to increase their results via CRO.
So how should you go about doing conversion rate optimisation?
Hire a professional.
Seriously, mastering CRO is a full time profession; it’s a highly specialised area. If you come across someone who says they do SEO and CRO, or they do web development and CRO, then it’s a dead giveaway that they don’t really know all the important stuff.
They may know parts of it, but just knowing parts is dangerous as the rest of this webinar will show.
You could do it yourself, but you’ll need to understand the tools needed such as analytics and optimisation testing platforms.
You’ll also need to be a very good direct response copywriter, understand how design influences action and the technical aspects of how websites work.
And these are just some of the skills and knowledge CRO practitioners need to have.
Why amateurs are dangerous
If you start exploring some of the conversion rate optimisation blogs, you are bound to come across all sorts of best practices recommendations, guides, infographics, ebooks etc.
While the information is valuable, if you’re not familiar with the practice of CRO, then much of this information can actually be detrimental.
Couple of examples.
Three of the things you will see quite frequently are:
what text to put on your “Buy Now” buttons
what colour to make them
Longer copy converts better than shorter copy
Usually they say “Add to Cart”: works better than “Buy Now” and that green buttons work better than red ones.
The problem is that there is also other research out there which proves completely the opposite.
It’s not that either piece of research is wrong; it’s just that they were both right in their own context or situations.
Any competent graphic designer will tell you, that you can’t make an arbitrary statement that this colour button worked better than this other colour without knowing what the rest of the design looked like.
The same is true for what text you put on your buttons, so you just can’t take these recommendations and apply them to your own website.
Likewise for copy length: In general longer copy works better, but sometimes shorter copy is better. Again it depends on the context and the product. Low value low commitment purchases usually only need shorter copy. High value high commitment products usually need longer copy.
Any professional CRO consultant will always tell you need to do your own testing to see what works best for your website.
Why CRO Sometimes Doesn’t Work
Why Your Site Isn’t Working Like You Were Promised
The other thing about all these best practice suggestions is that many simply won’t make any difference to your website, or seem to make much of a difference.
When you take sites with very high conversion rates, you need to realise that they have been carrying out testing for many years.
For example Amazon has been running optimisation tests now for three decades. They started in the early 1990’s, went all through the noughties and are still testing now in the noughty teens.
At any one moment they are carrying out 200 tests.
Capitol One, a US bank, carries out 80,000 tests a year.
Over a 20 year period that means the company knows 1.6 million more ways to convert a customer than any competitor that doesn’t test.
How many tests have you run?
In other words, these sites are highly optimised, so when they make any small change it may make a major improvement because it’s riding on the back of all the millions of other improvements already made.
That is why you can’t just copy what they do and expect to see big improvements. However, that still doesn’t mean you shouldn’t be testing yourself.
I know the last thing any businesses wants to be told is that they have more work to do, and I’m not trying to overwhelm you with the challenges ahead of you.
What I am trying to get across is to work on the one thing that will make the most difference.
Anyway, here’s the thing: Many of you will waste a lot of money with online marketing and advertising that either doesn’t work or doesn’t bring in a whole heap of business.
And you will keep doing that for several years, always trying the latest shiny ball in the hope that it will magically transform your results.
The online space will always have something new, seo, ppc, social media, video, mobile, tablets, micro data, big data, and on and on it goes.
That time and money could be better spent systematically improving your results via testing and CRO.
That’s how the market leaders have done it.
We know many Australian businesses have been slow to join the digital revolution, but cost and scale of that tardiness needs to be made really clear to you.
If you want to catch up, you have a lot of work to do, but you need to be doing the work that will give you the best return for your efforts.
Death of a Thousand Leaks
As I’ve said countless times most sites only convert 2-4% of their visitors. In other words they are leaking money everywhere. They are suffering the online business equivalent of the death of a thousand cuts/leaks.
To stop all the leaks means you have a lot of work to do. Plugging just a few holes, such as changing a word here and there, won’t make a big difference.
You may need to fix a lot of things before you see major improvement.
All those small movements may not seem like much now, but one day they will add up to incredible results.
So what should you do first?
Perhaps the first thing is to understand that online business is a marathon not a sprint.
I know it’s often portrayed that some companies get fantastic results overnight, but they are the exceptions, not the norm.
As I said earlier, most of the companies that are doing really well have been doing it for 10 or 20 years. They’ve had a long time to figure out what works.
Thankfully we can learn from them.
1: Adopt a mindset of conversion optimisation and testing.
Start to think about your online marketing differently.
Don’t do any marketing unless you can test and measure the results.
Allocate half of your marketing budget to CRO.
2: Get your copy right.
Hire a good copywriter for all your important stuff such as product pages, signup and lead forms. Good copy is one of the few things that can explode your results.
3: Get your website right.
Make sure everything works for everyone all the time. Avoid the fancy stuff first and concentrate on covering off on all the basics and essentials first. (Most of you haven’t done this, despite what your web developer told you.) And make sure it loads fast, 1 second or less.
4: Make it fast
Slow sites cost sales, period.
5: Proper Analytics
Make sure you have analytics properly installed and you know what the data means.
(Google estimates that most sites have incorrectly set up analytics.) You need accurate data and insightful business intelligence in order to make the best decisions.
Analytics is one of the godsends of online marketing and advertising. It means every action is accountable. You can measure to the dollar how effective a particular strategy, tactic, ad or campaign was.
Knowing this you can do more of the stuff that works and less of the stuff that doesn’t.
Unfortunately it also one of the least understood. More than half of all marketers don’t understand how to use it and get the full benefit out of it. Again, hire a professional.
6: Don’t follow the herd.
Don’t do what everybody else is doing. Everybody else is getting lousy results. If you do what they do, you’ll get worse than what they are getting.
This may put you at odds with a lot of online marketing guru’s, but not the good ones.
7: Get a good coach
Some of you know that there’s a lot of snake oil in the online business space. There are also a lot of well meaning providers who will try and sell you solutions you don’t really need, or at a price that can easily be bettered.
Your best bet is to find a coach, someone who’s done it all before and made the mistakes and knows what you should focus on, when you should focus on it and how much it should cost you.
Obviously that’s people like me and Richard etc. But the thing is, 5 minutes with us can save you tens of thousands even hundreds of thousands of dollars.
So we’re a great investment. Again, it’s about becoming smarter with where you spend your marketing dollar.
Questions to Ask Your Online Marketing Consultant or Conversion Rate Optimisation Specialist
- 1: What track record do they have? IE: How much extra revenue did they generate for their previous clients?
- 2: Or, how much did they save their other clients?
- 3: What examples of using Analytics to identify sales improvements can they show you?
- 4: What direct response marketing experience do they have?
Always bring the results back to dollars.
Conversion Rate Optimisation Resources
A list of mostly free resources to help you optimise your conversion rates.
There’s a whole list of resources here for you to explore at your leisure.
Or check out my blog or any of the blogs listed and there will be endless examples for you to see.
Conversion Rate Optimisation Blogs
A/B Split Testing