From lingerie companies A/B testing their models, to Amazon’s authority and leadership in ecommerce and customer experience, the internet is full of examples of how conversion rate optimization has helped organisations achieve better outcomes and better serve their customers.
However, examples can only take you so far. In order for companies to create a sustainable competitive advantage from conversion rate optimization (CRO), a strategic approach must be taken.
The 2014 Conversion Rate Optimization report by Econsultancy and RedEye has revealed some characteristics of organisations that are successful in their CRO efforts and the following four characteristics are among the most correlated with success.
A huge appetite for testing
It should almost go without saying, but companies that test more often derive greater rewards from their activities. Companies that saw a significant increase in their sales conducted 6.45 tests per month, compared to just 2.42 tests among organisations that saw their sales decrease.
While the above may seem obvious, companies must ensure they have sufficient resource to implement the appropriate number of tests.
More than half (57%) of companies cited a “lack of resources” as a barrier to improving conversion rates, by far the most common barrier.
What are the biggest barriers preventing your organization from improving conversion rates?
Testing effectively requires companies to do more than just conduct the test to achieve better rates.
Organisations must review their results and use these insights not just to inform processes and activities that are thought to have already been ‘optimized’, but also to fuel further tests.
It is only through this process that companies will remain agile and responsive to consumer demands and competitive pressures.
Testing within a structured approach
If conducting a higher number of tests leads to greater conversion rates and increased sales, it would be wise to take a structured, deliberate approach towards this.
Currently, only three in ten companies are taking a ‘structured approach’ to improving their conversion rates.
Without a structured approach, it is very easy for marketers to see the optimization of conversion rates as a solely tactical activity, driven by quick wins.
The vast majority of companies (85%) that take a long term view on this are seeing improved sales. This suggests that while CRO can have short term benefits, a structured approach can provide consistent, efficient and significant improvements to the performance of the business.
Use multiple methods for testing
Chances are if you are already optimizing conversion rates, you probably engage in some form of A/B testing. The good news is you are in good company.
Two-thirds of companies (67%) are using the method as part of their CRO efforts and it is considered to be ‘highly valuable’ to the largest proportion of respondents (62%).
Which of the following methods do you currently use to improve conversion rates?
However, a lot more headway can be made by organisations that engage in different types of testing methods. Specific combinations of methods can also lead to higher success rates.
Of the companies that used customer journey analysis, copy optimization and segmentation, 95% saw an improvement in their website conversion, compared to an average of 72% among other respondents.
Irrespective of the combination of methods, it is worth bearing in mind that each test is different and will provide different insights.
In order to choose which methods are most appropriate, setting clear testing objectives and following a plan and process (structure!) should point towards suitable testing methods.
A corporate obsession with conversion rates
As clichéd as it may seem, an insatiable appetite for improvement of conversion rates is key. CRO is not just about getting the best results and then being content.
The competitive environment is changing at a rapid rate and having an infrequent, tactical approach to the improvement of conversion rates will leave organisations merely scratching the surface on the potential for improvement.
Ultimately this is down to the culture of the organisation. If CRO is truly going to be a significant part of any organisation’s digital activities, it must be embraced and spearheaded by senior management who can push the agenda across the organisation.
Without the appropriate culture and support… well, you get comments like this shared by a digital manager at a recent Econsultancy roundtable:
I was told by a member of senior management that, if I need to test out what works, then I must not know how to do my job.
For more statistics and insight on how to improve your conversion rates, download the 2014 Conversion Rate Optimization report.