by Wayne Morris
As many as 40% of companies report being dissatisfied with their conversion rates. That’s despite the vast sums spent on building professional web stores, not to mention the expensive advertising and search optimisation strategies employed to drive visitors to these sites.
Perhaps a more worrying statistic is that 38% of companies believe they have ‘very little control’ over conversion rates, and 3% feel they have no control at all. In a bid to get back that control, ecommerce businesses are increasingly focusing on more refined customer profiling and targeting, and greater personalisation of the web experience - including tailored recommendations and offers.
The difference in conversion rates, if the right foundations for web strategies are put in place, can be substantial. Some 86% of companies that have combined user testing and analytics have reported a large increase in sales, and companies with £10m+ revenues are twice as likely to see an increase. So what’s holding other web brands back?
In some cases, it is a lack of appreciation of consumers’ on-site behaviours. It’s all too easy to assume that if enough money has been spent on designing the pages and driving traffic to them, sales will take care of themselves.
Many retailers also see the basics as something they dealt with a long time ago, having learnt the hard way about customers’ low tolerance for slow-loading pages and hard-to-navigate shopping experiences. But it’s essential to keep fine-tuning your web presence based on consumers’ growing expectations and changing preferences.
Other challenges are logistical. Competing priorities may be taking up the IT department’s time, or perhaps the content management system isn’t readily adaptable. There could also be a lack of alignment between those charged with driving traffic to the website and those responsible for making it stick.
Even once you understand there are intricacies involved in converting browsers to buyers, the next question is how to capture the granular data that delivers the insight into these subtle behaviours.
As easy as A, B
One option is straightforward AB testing – comparing a new web experience with an existing one, to see which gets better results. That’s still an excellent source of insight but today, you can really push the envelope with multivariate testing, which allows much more granular comparisons at a number of different levels and based on real-time customer behaviour.
Because you can test so many different variations of the site at once, on such large numbers of real users, you can quickly determine which combinations of enhancements elicit the optimal purchasing outcome. It’s a more subtle approach, but one that allows numerous tweaks, big or small, to be served to web users without them even knowing.
Using data to drive personalisation and conversion rate optimisation
Of course, you have to bear in mind that this is not a one-time fire-and-forget solution. Your customers are constantly telling you about themselves, providing you with the richest and most relevant data you could require. But to exploit this knowledge fully, retailers must devote time and resources to extracting the data that is of tangible value.
This may mean establishing who the most profitable customers are: the 20% of consumers accounting for 80% of their revenue. Can you increase their basket value simply by providing a superior shopping experience? Are you missing opportunities to engage with them on a deeper level?
Alternatively, you may want to devote resources to improving conversions among the worst performers - those visitors you’ve spent a fortune to attract through pay-per-click campaigns but who perhaps aren't becoming regular customers. What if you could get them to stick around a bit longer, tempt a few more into finding what they need?
Whatever the game plan, it’s important to look for something actionable in the data. This may be as simple as spotting that large numbers of people are shopping in their lunch hours, prompting you to change your on-arrival messaging to something relevant or targeting a special offer to see whether this boosts conversions.
Knowledge is power
In the holy grail of the personalised web experience and customised recommendations and offers, it is more intelligent use of analytics that delivers the knowledge that a retailer needs to refine their website and boost conversions.
If you take this wealth of data and plug it into the right real time decision engine, it should produce actionable data, which can often be integrated back into your site without the need for immediate human intervention. Such insight can ensure the right people are sent down different paths in the site, shown different things and treated differently. And most importantly, you retain the ability to measure how this changes their behaviour and influences their propensity to spend.
In 2012, the battle to attract customers to your site and stand out is no longer the whole story; it's what you do with them once they're there that counts.
Wayne Morris is UK general manager at Maxymiser