Get more value from your website and generate more customers and qualified leads using conversion rate optimization (CRO).
The Ultimate Guide to Conversion Rate Optimization in 2020
Written by AJ Davis
Today, marketing teams are focused on getting more traffic to their website. They hope these visitors come to the site and become customers. If they want more customers, they usually spend more on advertising and post more content on social media. This leads to more people coming to the site and taking action.
But there’s an important tactic that can level up all of these efforts. Few marketing teams focus on this tool, yet it can help companies amplify all of their existing marketing efforts and build long-term, repeatable success and growth. This tactic? Conversion rate optimization (CRO).
In this guide, you’ll learn how to get more out of your existing traffic. You’ll understand how to get started, why you should focus on optimizing your visitor experience, and the power of CRO.
Useful Templates for Conversion Rate Optimization
- What is conversion rate optimization?
- Who should use conversion rate optimization?
- When should you use CRO for your business?
- Where should you start optimizing?
- How should you approach optimization?
What is conversion rate optimization?
Let’s imagine a retail store. Lots of people walk by the store. Some people enter the store. And a few people walk in and buy something. Conversion rate optimization is the process for getting more people in the store to buy something.
A conversion is the process of changing or causing something to change from one form to another.
For our retail store, this would mean converting someone browsing in the store to someone checking out and leaving with a purchase.
This can mean:
- Changing a visitor to a customer
- Getting a visitor to being a qualified lead
- Getting visitors from browsers to buyers
Conversions are tied to specific actions or goals on your website. These goals typically include:
- Qualified leads
- Product sales
- Adds to Cart
- Shopping cart completion rate
- Email newsletter sign ups
The conversion rate is the number of times the visitor completes a goal divided by your total traffic.
For our retail store, the conversion rate of 20% would mean that 1 in 5 people who come into the store buy something.
You can use this simple formula to calculate conversion rate:
Conversion Rate = Number of Goal Achievements / Visitors
Conversion Rate Optimization
Conversion rate optimization (CRO) is the systematic process of increasing the percentage of visitors who take a desired action.
For our retail store, we may want to see more people who browse the store purchase something. We could use conversion rate optimization to understand why they aren’t purchasing. Perhaps they are having trouble finding a product that fits their needs or maybe they have questions about how the product works. By addressing these needs, we might get more people to purchase in store and see the conversion rate increase. We might see 1 in 4 people buying something by making systematic improvements to the store experience!
This process includes understanding how visitors land and move through your site, what actions they take (and don’t take), and what is stopping them from completing desired actions on your website.
When you have an understanding of what’s happening and what’s standing in the way, conversion rates will improve by:
- Generating ideas for improving the site experience
- Evaluating which ideas are practical and effective
- Measure ideas to see if they work by running an A/B test
What’s the difference between conversion rate optimization and experience optimization?
They are the same! By describing this process as “experience optimization”, we put the focus on the user and their experience on the website.
Why should conversion rate not be my only goal?
The term “conversion rate optimization” is a bit misleading. Yes, we should want to increase your conversion rate. But it shouldn’t be your primary goal! Revenue is the most important goal - and we can make changes to your conversion rate that can increase orders, but decrease revenue.
For our retail store, we’d get more people to purchase if we steply discount our price from $25 to $1. This might dramatically increase our conversion rate - perhaps 90% of people will buy for this price! For 100 people coming into the store, that would mean:
Scenario 1: 100 People X 20% conversion rate X $25 = $500 Scenario 2: 100 People X 90% conversion rate X $1 = $90 Clearly massive discounts can lead to more sales, but are worse for the business overall.
Increasing your conversion rate is a good goal. But the broader context needs to be taking into account. The ultimate goal for conversion rate optimization is the amount of revenue that your site generated. Most times, the goal of increasing conversion rate aligns with an increase in revenue, but it’s an important distinction to keep in mind.
Who should use conversion rate optimization?
Anyone with a website can use conversion rate optimization. It’s an approach to make sure that your visitors get what they need to become customers. And a great way to grow your online revenue.
Benefits of Conversion Rate Optimization
What are the biggest benefits of using CRO on your website?
You’ll get more customers from the same amount of traffic The biggest benefit is more revenue from existing website visitors. By increasing the percentage of visitors who purchase, you can make more money without spending more money on advertising or marketing. You may have a monthly marketing budget to maintain your traffic volume. You might have paid marketing, content or social media. Either way, traffic costs money. Using conversion rate optimization, you’ll get more customers from the same amount of traffic spend. Acquisition costs per customer will decrease You’ll get more customers with the same marketing budget, which means you’re spending less money per customer. With more profit, you’ll be able to grow your business faster You’ll make more money overall, which means you can either put more money back into the business to grow faster or take out more profit from your business.
Why would businesses not do conversion rate optimization?
With all these benefits, you might be wondering why a business would not be investing in conversion rate optimization. Our customers often weren’t doing conversion rate optimization before working with us - and we’ve come to understand some of the reasons businesses haven’t made the investment.
Here are a few reasons we’ve heard from customers.
- I was “too close” to my website and thought it was good enough.
- There was too much data and not enough actionable insights for how to improve our site.
When should you use CRO for your business?
Do you have website visitors? If yes, you should be using CRO now! Conversion rate optimization is one of the fastest and most effective tools for getting more customers from your existing traffic.
No matter how established or large your company is, you want to get more visitors to become customers and brand advocates - and you want to do this is an effective and reliable way.
Conversion Rate Optimization & Traffic
We often hear that businesses think they need “enough” traffic to do CRO. Yes, for certain tools to bring actionable and statistically reliable information (like A/B Testing), you do need to have enough traffic.
If you don’t have a lot of traffic, you just need to re-tool your CRO tool belt. Any size business should be talking to their customers, reviewing their analytics and click tracking data, and identifying (and fixing) pain points.
Where should you start optimizing?
The key to successful experience optimization
To optimize, you need to know who to optimize for, where they go, and what elements need optimized. This data is a cornerstone in any successful CRO program. You should start by getting this data, so you aren’t making updates based gut feelings alone.
Step 1: Identify your customer
You need to know your customer. Who is your ideal customer for what you sell? What specific benefits is your customer seeking when they buy your product?
By knowing your customer, you can better present your product and how it solves their needs. You’ll want to imagine being this customer (or better yet, get feedback from these customers) as you make changes to your website.
Often marketing teams will build customer personas to bring these customers to life. Personas should include
- Customer Demographics & Personality
- Goals & Frustrations
- Preferred Channels
- Other brands & influences in their purchasing decisions
Just remember that you aren’t building a website for you or people like you. You are making an experience for your target audience and their needs. Know thy user.
- User Research and Surveys
Step 2: Identify where customers go & what they do in the customer journey
Once you know your customer, you need to know the hard numbers on how people interact with your website. Use a web analytics platform, such as Google Analytics to understand where customers go and how they convert.
You can use analytics to understand the customer journey on the website. Where do people enter your website? What pages do they interact with once they are on the site? What browsers or devices are they using? Where are visitors leaving your website before purchasing?
This information will focus your conversion rate optimization efforts. You should put your effort into pages that people see and that are along the path to purchasing. Important Tools
- Google Analytics: A web analytics tool provided by Google.
- Moz Pro: Identify top landing pages & on-page optimization tips
- Click Tracking tools like Hotjar
Step 3: Understand visitor pain points or frustrations
After knowing how visitors interact with your site, you need to understand “why” they behave this way. Sometimes you’ll know why without asking customers. You know visitors are landing on certain pages because your campaigns are pointing to them. You may not know why visitors are dropping out of the funnel on the product page.
You’ll need to use user research to collect qualitative data. You should focus on your ideal user / personas instead of solving every pain point for every type of person.
User research helps improve conversions by providing more information about visitors. You can learn:
- Why did visitors come to your site?
- Why do they navigate to specific pages?
- What is frustrating about purchasing on your website?
- Why are they interested in your product over your competitors?
- What pain point are they solving with your product or service?
- First impression testing using tools like 5 Second Test
- On-site surveys using tools like Hotjar or Ethnio.
- Usability testing using tools like UserTesting or Try My UI
- Interviews. You can find participates using tools like Respondent or User Interviews
Step 4: Identify ideas to solve & measure if they worked
With all this important data, you’ll begin to develop ideas to address customer needs through your website. Encourage your team to share their ideas using a collaborative ideas tool like Hypothesis Library, so you can consider many ideas and go with the best ones.
Once you decide what to test, you can set up an A/B test to understand the impact of this change and make a decision on data. Important Tools
How should you approach optimization?
Good Optimization Practices
Keep these rules in mind as you do conversion rate optimization.
Don’t copy competitors Many businesses are just guessing. You can get ahead by knowing what works by making data driven decisions. Even if they are testing, you don’t know if what works for their customers will work for yours.
Keep the user in mind You should keep the customer experience in mind for any changes you are making. Will customers leave with a positive feeling after their experience with your business? Avoid dark UX patterns that “trick” people into converting.
Iteration is key What works best for your customers isn’t always obvious. Sometimes you need to take a few swings at the bat before hitting a homerun.
The best way to get a better conversion rate is to understand what your visitors need, be as clear and compelling as possible, and then test it to confirm that it is impactful.
We recommend separating out the three stages of every optimization program using our GEM Optimization Process.
Here are the three key steps:
- Generate Ideas
- Start with Data: Use data to understand where to focus your optimization. Limit your ideas to improvements to these sections.
- Build off of Customer Insights: Solve problems your customers have and focus solutions on their needs (not yours).
- Involve the whole team: Collect ideas from customer service team members, developers, designers, marketers.
- Practice Creativity: Stay open-minded as you explore test ideas. Don’t eliminate ideas when generating them. Write them down (or better, log them in a tool like Hypothesis Library. Collect a wide variety of ideas before moving to the next step.
- Evaluate Ideas
- Identify prioritization criteria: Before you decide what to test, have a conversation with the team to know how you’ll know where to focus your efforts.
- Score your ideas: Systematically evaluate each idea, so the best ideas bubble up.
You should end up with a short list of feasible and high impact ideas to get started on.
- Measure Ideas
- Make a measurement plan: Before you implement, identify how you’ll know if an idea “worked” or had an impact on your conversion rate.
- Measure, measure, measure: Don’t forget to measure.
- Implement Winners: Only make changes permanent that work. Throw out any losing ideas and iterative on the solution until you find something that works.
Get out there
There are so many things you can do to improve your website! It all started with making sure you have these three elements:
Empathize with the visitor. State the goal or problem they are dealing with. What’s this website about? Who is it for?
State in plain language what you sell or offer. How do they solve my problem?
State why you are the business to buy from. Why should I work with them for my problem?
You’ve made it this far, so we hope this guide has been a good resource for you! Get started improving your customer experiences & increasing your online revenue.
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