Wednesday, October 15, 2008 10/15/2008 03:40:00 PM
This is a guest post from Bryan Eisenberg of FutureNow, which has helped businesses with conversion rate optimization since 1998. Bryan is also the author of Always Be Testing and a Website Optimizer Authorized Consultant.
Having weathered and learned from the dot-com bust, Bryan shares his insights on how your company should approach conversion rate optimization in these economic times.
This economic mess will touch your company. The "how much" and the "when" are yet to be determined. But they're things you can actually do something about. I doubt that you want to throw up your hands and blame everything on the economy.
If your company puts conversion optimization based testing on a budget hold, or calls testing a "luxury," you may be handing a huge advantage to your competitors.
I hope your company doesn’t think that way. Unfortunately, if your company does you wouldn’t be alone; in fact, you’d be in good company. I recently spoke with leaders at two multi-billion dollar online retailers who have told me that they are cutting their optimization budgets. Ironically, one of their competitors recently contacted us to work with them on a very aggressive optimization program.
What are these two very capable leaders thinking? They didn’t offer a lot of insight but I have three guesses as to the reasons:
- They tried but the vendor they used couldn’t make optimization work for them.
- They have been ordered to cut their budgets and something else was a priority.
- They don’t see themselves in control of conversion rates and think that the economy will affect all their competitors equally
I’ve always seen conversion rates as something the company controls.
I’d like to share two encouraging stories with you.
In the late 90’s, we started FutureNow against the popular marketing grain. Back then, everyone was talking about eyeballs while I was screaming two words that were virtually unheard of: ”conversion rate.” My brother and I were saying “the emperor has no close!”, yet companies were focused on traffic, eyeballs, and sock puppets and not on closing the sale. Still many smart folks saw the logic and signed on.
In late 1999, we started working with an struggling online retailer of magazine subscriptions, Magmall.com. Nine years ago there was no off-the-shelf, easy to use, split testing software but we found a way to test and optimize anyway. In a short time, MagMall’s conversion rate improved from 1.21% to 4.93%. This was a game changer for them since they could afford to buy ads their competitors could not afford. Not only did they weather the dot com crash; they flourished and the owner we worked with recently sold the company.
More recently, Jigsaw Health combined our Persuasion Architecture methodology with intelligent testing using Website Optimizer, and the company’s CPA dropped from a volatile $150-$300 to a consistent CPA of way under $50. What CPA would you rather have heading into this economic storm? Highly efficient sales conversion is a competitive advantage.
The lesson is this: now is the worst time to stop optimizing. The buying and selling game has just moved to another, much tougher, playing field where the customer’s are asking more and spending less. The more you focus on them, and optimizing for their needs the easier you will find it to weather the economic storm.
I hope that I’ve inspired you to rethink optimization. Let me leave you with a few testing ideas you might want to consider. Even if you haven’t had success testing these things in the past, right now environment is ripe for the following types of tests:
- Different price points. Price is becoming more relevant.
- Different product copy. The product with the better perceived value wins.
- New offers that highlight value of your service/products.
- "Free shipping" or low-cost shipping promos or offers.
Don’t give your competitors the advantage.
Thanks to Bryan for his insights. If you want additional ideas for testing, you can watch the Always Be Testing webinar series Bryan has done with our own Tom Leung. You can also read more from Bryan on his blog.
Posted by Trevor Claiborne, Website Optimizer Team.