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Data & Analytics

Are your Conversion Rate Optimisation initiatives running out of steam?

by Peter Ballard
16th June 2020

Are you finding it harder to realise big gains from your optimisation efforts?

If so, you are in a similar position to a growing number of your peers.

It’s easy to fall into the trap of thinking that this lull is natural and that it is to be expected after the biggest wins come in the early days of optimisation, when the so-called low hanging fruit were there to be taken.

But this misses the whole point of optimisation: the job is never finished.

Conversion Rate Optimisation (CRO) has to be an ongoing activity because consumers are continually evolving and products and services need to change to keep pace.

Take the recent Covid-19 experience as an example.

Overnight, the e-commerce landscape changed for everyone with a business to run. Physical retail outlets were shut, call centres overrun, and consumers were locked down in their homes.

This placed a much greater importance on digital channels for existing retailers, and triggered new ways of buying products and services across all sectors.

Many shoppers found themselves going online for the first time for certain transactions, and many businesses established all new ways to get their products direct to consumers.

And the change was profound. In April 2020 first-time purchases on ecommerce sites of traditional chain stores were 119% up on April 2019. And global sales on Amazon increased 26% in Q1 of 2020.

CRO is one way that a business can keep pace with changes in the market, because it requires a deep understanding of the changing preferences and behaviours of the target consumer.

Being quick to understand the “new normal” and first to change the design of your online experience and sales funnel can create a clear competitive advantage, which translates directly into increased conversion rates and additional revenue. 

Why aren’t more businesses placing CRO at the heart of their post-covid recovery strategy? 

Adobe recently estimated that those businesses which are leaders in digital dedicate nearly 5% of their overall marketing budget to CRO activities, while the average is nearer to 1%.

So, what happens in those businesses who find that they can’t justify a greater spend on CRO? Why are they not enjoying the same returns as the leaders in their field?

I’ve worked in and around the area of CRO for nearly 20 years and there are three common mistakes that I see businesses make with their CRO efforts.

Unless your organisation can overcome these structural and philosophical challenges, you are unlikely to get the best out of your CRO spend:

Too much focus on data science, not enough on understanding humans 

Overtime, CRO has become synonymous with the industries' obsession with data analytics and more recently, data science.

Whilst data is the fuel on which CRO runs, it’s not the only element in the mix. Like a fire which needs both fuel and oxygen, CRO needs both quantitative data and qualitative behavioural insight.

The data that we get from site logs and page views is the “what” - it tells us what is happening, how many users are exiting, how many make it to the next stage of the journey - but it doesn’t tell us why. Behavioural insight provides the “why?”. 

Many in-house CRO teams, and also sadly, a number of boutique CRO agencies, have relied too much on studying the “what” at the expense of the “why?”.

The why is hard, it requires primary research, conducted by trained researchers, observed and interpreted by behavioural scientists, to delve deep into the unpredictable and sometimes irrational, reasons a shopper chooses to buy from one company but not from another.

There are moments all the way through a browse and buy experience that trigger emotional responses, some rational some not.

It’s the work done in understanding these responses and how to design for those moments that delivers the maximum return on CRO investments.

Chasing short term wins over long-term sustainable changes to user experience

This is a classic CRO agency trick.

The pressure is on to show a return quickly to a new client. So, you might find yourselves persuaded to prioritise short term promotions, discounts, short-cuts into the shopping basket, and other means to immediately lift conversion.

But if those changes come at the expense of building a sustainable position in the market, or a transparent and fair relationship with the customer, with the aim of building loyalty and heightening the likelihood of repeat purchases over a customer's lifetime, then those quick wins are coming at a considerable cost.

This goes beyond A/B testing and starts to set the direction for innovation in the customer experience, which means creating a long-term roadmap for enhancements.

This requires strong design leadership and a philosophical belief in “insight driven design”. Using the insights gained to help inform new ideas for innovating and improving the customer experience to deliver genuine, valuable, sustainable differentiation.

Companies need to look for long term partnerships when it comes to CRO, and incentivise the chosen partner to build value over time.

Look for agencies that are prepared to be rewarded for the long-term sustainable difference they can make, not just the eye-catching returns made in the first few months.

Failure to align CRO to overall business objectives and secure the right skills

Are your CRO objectives aligned to your overall business vision, strategy and goals? In too many organisations CRO sits too low down in the organisational structure.

Ownership of the CRO relationship is often delegated well below the C-suite, which means that it often sits in a siloed part of the organisation, lacking board level visibility.

Yet CRO can be one of the main levers that an organisation has to improve its performance and business fortunes. And to really maximise the returns from CRO, it needs to influence change right across the organisation.

To properly tune the customer experience from first touch point to the completion of a transaction, and then on into the self-service environment of being a customer, CRO needs to track the experience delivered at every-single touch point.

This means in every interaction with an employee, automated process or self-service function.

This may mean making changes to marketing, sales, website, mobile site, frontend or backend systems and processes, call-centres, operations, fulfilment and customer relations.

All of these typically sit in different areas of the business, sometimes with different physical locations. Yet, these business units and owners need to be united in their understanding of CRO and what it can achieve for the business if it’s committed to and acted upon in a joined-up way.

CRO needs to have a champion with a seat at the board table, and for that it needs strong experienced practitioners who are respected and trusted by the C-suite.

However, these folks are hard to find. And even harder to attract to commercial organisations. The top CRO talent still tends to prefer the agency environment, where the challenges are more varied and the knowledge gained more valuable for their career.

Why you need CRO now more than ever

2020 has changed the ecommerce landscape for good and there’s never been a more important time to get serious about CRO.

If you’re wondering about whether you’re getting a full return from your CRO efforts, it’s time to cast a critical eye over your optimisation efforts and see if the three points we’ve outlined are affecting the results you’re seeing.

One thing is certain, there will be new disruptors and new leaders in your market. CRO is a way of business that can define whether you are out in front or back in the chasing pack.

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