Conversion Optimization: The Million Dollar Optimization Strategy

André Morys

The Million DollarOptimization Strategy

Uh Oh.

André Morys @morys

5.8 bn ! Retail / Lead-Volume

2008 2010 2012

CRO Volumen (Mrd. !)

115 Conversion Experts in 15 Offices worldwide

Web Arts is founder of theworldwide alliance of leading

conversion optimizationcompanies

Agenda today

1. Don‘t call it „Conversion Rate Optimization“

2. Optimization is not Testing.

3. Don‘t let the numbers lie to you. (Case Study)

Part I: It‘s about Growth, stupid.

Who has a business plan for CRO?

Do You Have a Business Plan for Your CRO Strategy?

Net Sales

Profit Margin

Opportunity Cost: ! 500‘ Profit

Challenge needed?

Compare the effect of two optimization strategies:

Net Sales

Profit Margin

Opportunity Cost:

! 2.2m Profit

Now you can re-invest ! 2.2m in optimization...

More-Growth-Through-Testing-Rule #1

‣It‘s not about conversion rates. It‘s about GROWTH.

‣ Set your goals properly.

‣ Measure your optimization efficiency.

‣ Average Uplift per Test

‣ Amount of Tests per Year

‣ Cumulated Uplift per Year

‣ Test Success Rate

‣ ROI per Test (%)

„If you

double the number

of experiments

you do per year you're going to

double your

inventiveness“

Jeff Bezos, CEO amazon, 2004

Growth of Top 10 e-Commerce Ventures in 5 Years (DE)

2008 2009 2010 2011 2012

The Zalando Effect?

So, what‘s the problem?

For a 25% Compounded Global CR Increase, You Need...

2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5 10 Tests à 2.5%?

5 5 5 5 5 5 5 5 5 5 10 Tests à 5%?

5 5 5 5 5

20 Tests à 5%and 50%

success rate?5 5 5 5 5

Problem #1:Organizations are too lame to execute 20 tests per year.

Problem #2:This is really expensive and

complex. Organizations hate both.

Problem #3:Most CMOs still prefer to

buy 25% more traffic.

„We do 200 experiments per year. We test everything. We don‘t need help.“

„Whats your success rate?“

„10%“

Reality Check:

Wait...

Why only 5% average uplift per test?

‣In the last case study, they talked about 45% Uplift!-> E-Commerce conversion rate is not email subscription or download CR.

‣My last test had 33% Uplift!-> Was it real? Don‘t confuse statistical significance with validity. Tests should run around 4 weeks for a sufficient sample.

A/B Test Result

Reality

„I can‘t feel the uplift!“

Testresults - Significance versus Validity

1 week500 vs. 550 conversions

+10% Upliftsignificant - wohoo!

2 weeks1000 vs. 1030 conversions

+3% Upliftnot significant - :-(

Run your experiments longer to get valid insights!

KPI: Average E-Commerce CR Uplift per Template Type

Homepage Category Product Page Cart Checkout Site Wide

9,81 %

7,3 %6,59 %

9,28 %

6,35 %

3,32 %

Average Uplift by Template Type (n= 134)

‣It‘s all about effectiveness. ‣ To increase real CR, you need many really good test results.

‣ Average Uplift per Test influences your growth directly.

‣ So: Do the right things!

‣ Don‘t do it too fast.

‣ Don‘t test everything. It is expensive.

Part II: Where do good optimization ideas

come from?

where would you buy?

quantitative qualitative

How much? Why?

Traffic

Website

Web Analytics

Traffic

Website

Web Analytics

Motor Control

prefrontal Cortex

Limbic System

Perception

Traffic

Website

Web Analytics

Motor Control

prefrontal Cortex

Limbic System

Perception

Test: facebook Acount Deaktivierung

fb cancellation seite beispiel

Test: facebook Acount Deaktivierung

„I have to buy it.“

Brand, Emotion, Value

„I want to buy it.“

Psychology

„I can buy it.“

Usability, Accessability, Visibility

Web Arts ROI Pyramid

Factors, that influence the chance of conversion, can be

identified with a conversion framework

7E Framework

You are too dumb to buy here.

Conversion Optimization means:„Get a relevant unique value

proposition in the users mind.“good feeling

‣It is not hard to implement a testing tool. It‘s hard to find the right thing to optimize.

‣ Find out, what motivates users.

‣ Analyse your website from different perspectives:

‣ Web Analytics: Where is the problem?

‣ User Testing: How do useres think about it?

‣ Persona: What do they not tell us?

‣ Expert Evaluation: Which psychological principles could we use?

Conversion DMAIC® Lean Innovation Process by Web Arts AG www.web-arts.com

quantitative

qualtitative

BACKLOG

CONTROL

IMPROVE ANALYSE

DEFINE

MEASURE

André Morys

Web Arts AG

andre.morys@web-arts.com

Tel. +49.6172.68097-15

www.web-arts.com

Thank You!

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