E-commerce competition is increasing, complexity is rising, and marketing costs are significantly going up. It is time to work continuously and strategically on conversion optimization so you can get the most out of all your marketing initiatives. In this post, we will provide an overview of what conversion optimization is, why it is important to work on, and how you can get started implementing this as a fundamental part of your e-commerce business.
Hvad er konverteringsoptimering (CRO)?
Conversion optimization is about optimizing your webshop or website to convert as many visitors as possible. The goals for a conversion vary and can consist of both hard and soft conversions.
Regardless of whether you want online sales, products added to the cart, products added to a wishlist, or email signup, the common factor for all points is that conversion optimization improves the shopping experience and supports your CTA strategy.
Guides with the top 10 conversion optimization points have been misused in recent years to gather leads through various forms of value exchange.
The truth is that there is no shortcut or simple solution to improving and optimizing your conversion rate. It is about analyzing and understanding your visitors' behavior, deriving hypotheses, split testing, and optimizing based on your results.
Hvorfor er konverteringsoptimering vigtigt?
With the sharply rising CPM prices, it is crucial to get as much out of your marketing dollars as possible. Below you will find an overview of the platforms' price development in CPM from 2021 to 2022:
Meta CPM: +61% YoY
TikTok CPM: +185% YoY
Programmatic Display CPM: +75% YoY
Search CPC CPM: +14% YoY
Amazon CPC: +14% YoY
When a visitor lands on your webshop, your marketing has won, and now it’s time to sell. It is essential that we understand their behavior but especially their pain points, so we minimize the chance of them bouncing from the webshop.
Working proactively with conversion optimization is not only good for the conversion rate, it also affects the user experience. A good shopping experience creates loyalty, preferences, trust, and supports the long-term relationship that is significant for your customer lifetime value (CLV).
Conversion optimization can also support other parts of the business, to gain a deeper understanding of your webshop's visitors and customers. There are countless ways to implement a conversion optimization strategy, but the most important thing is that it should be part of your short-term and long-term strategy and serve as a constant tool to improve the user experience and generate better figures on the bottom line.
How do you work with conversion optimization?
Conversion optimization is an iterative process where you continuously feed new data after completing hypothesis testing, and this is the foundation for a healthy optimization strategy. What is crucial for your success is that you work continuously with it and relate to the data you have available.
Below you will find our process for working with conversion optimization:
1. Analyse & Research
It is important to have a holistic approach to analysis work and to think about the entire ecosystem. By this, we mean that you should include your entire conversion funnel to gain insight into where your visitors and customers encounter pain points and potentially bounce.
It is important to understand which profiles visit your site, as they have different intentions on your webshop. Therefore, be aware of how you analyze behavior in relation to your CTA strategy.
2. Hypotese
When we formulate hypotheses, it is based on the behavior we have examined through analysis and research. In this process, it is important to segment your visitors into profiles, as previously mentioned – so you focus on one thing at a time.
Your hypotheses should be built based on what each individual profile wants to achieve, and you should therefore try to simplify the process and provide that specific profile with what they are looking for and requesting.
An example of a profile could be: Visitors who intend to make a purchase. Here, it is important that you have a webshop that is easy to navigate, so they can find what they are looking for. Remove pop-ups that disrupt the buyer from taking actions and prolong the journey to the cart. Streamline the checkout process and highlight what is important and creates value for the customer, so it minimizes the chance of them bouncing from the checkout flow.
3. A/B testing & implementering
In this phase, we test the established hypotheses and look at the performance metrics that we have set for the given test.
'A' is referred to as the original version, while 'B' refers to the new variant – which has been designed and implemented with the aim of confirming or refuting a hypothesis.
The best performer of the test will be implemented thereafter with the expectation that it will optimize the customer experience and increase your ROI.
When we A/B test, it can be based on both qualitative and quantitative data, where, for example, qualitative surveys post-visit or post-purchase are a good way to take a deeper step to understand the experiences of visitors and customers. Qualitative data can contain very useful knowledge that we cannot find in quantitative data.
4. Iteration
As previously mentioned, conversion optimization is an iterative process where persistence is a prerequisite for success. Not all your tests will result in a positive output, so it is important that you manage to have a test & learn approach to this process.
You can advantageously divide your conversion optimization efforts into two, where you have a short-term and a long-term strategy.
Den kortsigtede strategi supports your marketing initiatives, such as optimizing product pages before a specific campaign, to ensure the highest possible conversion – when the marketing has succeeded after driving traffic to your website.
Den langsigtede strategi should support your CTA strategy, which you can segment by target audience and profiles. Here, the focus is on understanding the entire navigation depending on your intention as a visitor to the site. Your CTA strategy is likely tied to your company's overall business goals and should potentially be able to handle both B2C and B2B visitors. It is therefore essential to gain perspective and input from several departments in the organization, which can provide valuable insights through their experience and knowledge.
