Conversion Optimization from the Business Perspective:

The Dollars and Cents Behind It All

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I’m the business guy that understands technology.

Neon Rain Founded in 2002 Clients from Denver to Singapore

The piecesTraffic

Conversions

Retention

SEO / PPC

Offer

Unique Service

The piecesTraffic without Conversions and Retention

Open drain

The piecesTraffic with Conversions but no Retention

You have to keep the inflow greater than the outgo

The piecesTraffic with Conversions and Retention

What’s your focus? Stop looking at the wrong metrics

i.e. Trying to rank #1 for keywords with no traffic

The right metricsDefine what matters

Let’s start with a riddle3 women are having dinner and the bill comes to $30. Each of them puts in $10. 3 x $10 = $30

As the waiter rings them up, he realizes it should have totaled $25.

The waiter starts to take the $5 back to the women but realizes that he can’t split the $5 over 3 people so he pockets $2 as a tip and gives each woman back $1. Therefore, now they have paid $9 each.

$9 x 3 women = $27, now add in the $2 the waiter kept and that totals $29.

So, what happened to the missing dollar?

BaselineKnow your numbers: Goals / Unique Visitors = Conversion rate

Example: You spend $2,000 / month on PPC and get 10,000 impressions and 500 clicks. Your initial conversion rate from PPC to click is 5% and your cost is $4 / click.

On your website you can see that 1 in 10 contacts you. Now your conversion rate is 10% of the clicks or 50 contacts out of 500 clicks.

Even further down the line you know that you close 5 new clients from your sales process. 5 out of the 50 contacts is again, 10%.

If we look up the chain we can see that out of 500 clicks you closed 5 new clients. That is a 1% conversion rate. You also know that your acquisition cost is $400. (You spent $2000 and got 5 clients)

Even better, add in your average lifetime sales value to the equation.

The ProcessIf you can measure it, you can change it.

Then test and measurecontinually.

Example of a metric

This particularclient sells ink

Example of a metric

This client sellsreplacement inkcartridges.

Getting to the coreThey made money off their email marketing. They would make an average of $1 for each person on their list.

The goal: Get more people on the list

Tweak itTo increase purchases they would send “perfectly” timed email.

Just before their ink ran out.

Data was based on historical purchases.

Their “metric” was email sign ups

Ways of testingA/B Testing (Split test)Testing one component with 2 different options - including a control

Multivariate TestingTesting multiple components with many different options - including a control

Example of A/B TestText initially said “Buy Now”Baseline: ~3% bought

Changed to solid backgroundwith no significant changeChange: Not measureable

Changed to “Add To Cart”Change: ~+3%

Example of A/B Test

Increased % of visitors using wishlist by ~+43%

Example of A/B TestIncreased % of visitors using

wishlist by ~+43%

Oops % of people buying down by -1%. Net of +2% now

Example of A/B TestWe Decided to leave it.

They setup an automated email campaign that prompted people to buy the contents of the wishlist with a promotional code

Went from < 1% buying their wishlist items to +16%

Example of A/B TestWhere did we get the idea?

Test and MeasureThings you can A/B test:

Headline verbiageColors

Call to Actions / ButtonsProduct photosPrice (up sell)

Amount of copy (long or short?)Video?

TestimonialsTrust symbols

Problems...In the last example, the client told us their average dollar

sale was $86.

All of their marketing, acquisition cost tracking, ad spend, etc. were based on that number.

They were wrong, it was $27. Lesson 1: Test your assumptions.

Lesson 2: Put a $ value on every test.

Multivariate Testing

Localization

Benefits

Audience

Headline

Banner

Button / CTA

Trust Seals

After finding out what combination converted the

best.

A conversion was measured initially as someone that got

past the first page.

Then as someone that applied for a loan....

The cost to acquire a new customer was greater than the commission they were

paid.

After an investment of over $20,000 they scrapped the

project.

They were ecstatic to finally figure out why it wasn’t

working.

In the past they had spent over $450,000 with no clue

as to what was wrong.

Tools for testing

Tools for measuring

Recap the riddle3 women are having dinner and the bill comes to $30. Each of them puts in $10. 3 x $10 = $30

As the waiter rings them up, he realizes it should have totaled $25.

The waiter starts to take the $5 back to the women but realizes that the can’t split the $5 over 3 people so he pockets $2 as a tip and gives each woman back $1. Therefore, now they have paid $9 each.

$9 x 3 women = $27, now add in the $2 the waiter kept and that totals $29.

So, what happened to the missing dollar?

The answerThere is no missing dollar...

1. Restaurant kept $25 for the bill2. Waiter kept $2 for his tip3. Customers got back $3 in change

$25+$2+$3 = $30$9 x 3 people = $27

Lesson #1Don’t get caught up in the wrong

details.

Focus on the end goal and figure out what gets you there.

Lesson #2Don’t expect one change to create

massive results.

It is usually a series of changes over time that creates incremental

increases.

Lesson #3If you aren’t sure what to test.

Survey your existing visitors to figure out where they get stuck.

Lesson #4Wait until you have enough statistically relevant data.

Don’t cut your test short, wait until you have enough of a delta to know.

Lesson #5

Most of the time continual tweaking is better than redesigning.

Arif Gangji

Direct: 720-230-9410Email: arif@neonrain.comWeb: www.neonrain.com

@arifgan

www.linkedin.com/in/arifgangji