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If you ask anyone in the industry what the biggest trends and challenges of the last 12 months have been you will receive a range of answers.
Chances are the answer will involve ‘not provided’ and content marketing if you are speaking to someone working in the SEO field.
If you are talking to someone with a PPC focus they will probably cite PLAs or rising CPCs.
If it’s a social guy you’re chatting to he will tell you how his channel is finally starting to deliver an ROI.
They will probably all talk about the phenomenal growth in mobile and tablet usage.
What there seems to be very little discussion about right now though is the marked increase in the amount of times potential customers visit your site before committing to a purchase.
This is partly influenced by the changes in device usage but is also symptomatic of changes in user behaviour – price comparison, voucher usage, and the convergence of offline and online worlds all contribute to this trend.
The challenge it creates is how to limit the amount of times we are paying to bring these same users back to the site, and how to pay as little as possible each time.
It’s a challenge which affects everyone working in digital and will hopefully drive more unified strategies, and make us all work closer together.
Customers making more visits before committing to purchase
It is a trend we have seen increasing in significance across practically all of our clients, leading to us carrying out a study into how behaviour has evolved year on year.
We looked across all of our clients who use Google Analytics, had a consistent data set-up year on year (YoY), and had no huge changes in activity which would skew the data (such as a huge increase in marketing spend or significant site changes).
This gave us a range of clients across fashion, automotive, health, property, finance and education with varying degrees of marketing spend and sophistication.
We then compared data from time lag and path length reports for Q1 2013 against Q1 2014 and the results were surprisingly consistent.
- Nearly 80% of the clients we analysed were seeing an increase in visits to purchase YoY, with an overall average increase of 8% and several over 20%.
- One and two visit journeys still make up 50%-80% of conversion volume, but this was down on average by 4% and 1% respectively YoY.
- The most significant trend though was in longer journeys to sale. Journeys of 10 steps were up 30%, 11 steps 50% and 12 or more steps were up a huge 85% on average YoY.
- Unsurprisingly the time taken to make a purchase is also on the increase, up 9% YoY, with longer journeys again seeing the bigger increases.
It’s also worth bearing in mind that these results don’t account for cross-device behaviour. It’s fair to assume this has also led to a sizeable increase in visits to purchase not represented here, so these figures are effectively the tip of the iceberg.
So why is this so significant, and what will the impact be on your marketing activity?
Rising online marketing costs
If you are looking to improve your marketing ROI half the battle will be to bring costs down, or simply stop them from rising.
You may have managed to reduce your CPCs by 10% year on year, but if you need to get potential customers back to your site 20% more times your overall marketing CPA will still be up 10%.
Measuring the trend for your business
We have used Google Analytics for all of our analysis to provide consistency, but you should be able to get this data from any analytics system.
The first thing to do is ensure you are tracking and measuring everything. Any point that could represent the end of a customer’s online journey needs to be tracked, whether a lead, a sale, or a store locator.
Once you are satisfied this is the case get some data and measure the year on year trend. If you have seen an increase in average path length it is definitely worth exploring further, but even if there has been no major increase there are still opportunities to decrease it, particularly if you are seeing an average of two or higher.
Strategies for reducing your total cost of sale
Driving cheaper traffic
The first step is to understand and rank your current traffic-driving costs. Your strategic aim should be to maximise the use of the cheapest ones wherever possible.
Taking remarketing as a prime example; this has often been seen as poaching sales from other channels, and being credited with sales you would have received anyway. This is an old-fashioned, siloed view of your activities.
You may have received that sale anyway, but they still have to find a way back to your site. If remarketing is one of your cheapest ways of achieving this then you should be maximising it, if it is more costly than many other routes you should be using it more sparingly.
Google remarketing lists for search advertising (RLSAs) can also be used very cleverly here to either upweight or downweight your bid for previous site visitors. Which way you go on this will again depend on how search ranks within your traffic cost model.
It goes without saying that you will also want to be driving as much ‘free’ traffic as possible through direct, organic and referrals. This has always been the case and these channels are clearly much less controllable than paid media, but there are still things to consider.
Should you invest, or increase investment, in growing your brand (either on or offline) in order to increase direct and branded traffic? Should you increase efforts within SEO? Should you look to forge partnerships with specific sites to drive traffic at certain stages of the purchase process?
As ever costs need to be weighed against benefits in terms of both traditional ROI metrics and their role in visits to purchase.
Reducing path length
The other opportunity is to reduce the number of visits required by a user in order to convert on your site.
I can’t remember the exact quote, but I read somewhere that Larry and Sergey’s ultimate aim with Google is to know exactly what you want to the point of being able to deliver a search results page with only one result on it.
You need to be thinking along similar lines to reduce your path length – give a potential customer everything they want, and no reason to go elsewhere.
The most basic element of this is setting and matching user expectations. Be clear in your ads and content which drive traffic to the site what they will get, and make sure this is delivered on arrival. This is obviously not a new concept, but now more important than ever.
Beyond this you need to think about every possible barrier to a customer making an immediate purchase. Again this points to some fairly classic tactics – social proof, clear pricing, delivery information etc.
But could you go beyond this. Show competitor pricing? Offer a cooling off period? One-day only offers?
Personalisation is also a key tactic here. Every time a user visits your site you are acquiring valuable information about them. There are a number of ways you can use this to deliver increasingly personalised experiences with every visit, simplifying (and hopefully shortening) their journey to sale.
This can now be achieved cross-device, using dynamic message overlays and all kinds of sophisticated segmentation to deliver dynamic landing pages and is a topic for an entire post in itself!
Measuring the impact on your path length
Crucially all of the above can be tested and measured without the need for any complex data crunching or a fully-fledged single customer view.
Simply implement some common-sense strategies based on the above, then re-evaluate your path length and see if it has been impacted. Ultimately what you are looking for is a reduction in overall marketing costs or an increase in overall site revenue.
It’s testing and analysis on a very basic level, but it is an approach any business can benefit from, and in an area which I believe will be an increasingly hot topic over the next 12-24 months.