Today I’ll talk about one of my favorite topics, Conversion Rate Optimization (or CRO). I won’t be speaking about tools, case studies, or tips on what layouts or buttons colors work best;
Dr. Pete, Paras Chopra and Oli Gardner have written some excellent blog posts on these topics recently. Instead, over the next several weeks, I’ll be posting a few lessons I’ve learned from doing CRO successfully (and unsuccessfully) for a variety of organizations. These are things I wish I had known when I got started.
Today’s post will focus on how to convince your organization to do CRO.
Make the Case for CRO using Simple Math
CRO may be popular on online marketing blogs, but I’m always surprised to learn that most organizations aren’t doing it. At the recent SEOmoz PRO Training Seminar in Seattle, conversion rate guru Tim Ash asked the audience how many of their companies were doing CRO. Of the 300 or so in the audience, only a few dozen individuals raised their hands. Of all the things I’ve worked on in online marketing, nothing has delivered a higher ROI than conversion rate optimization. And yet, it remains less popular than it should.
One explanation I’ve heard is that it’s difficult to get started. But with free tools like
Google Website Optimizer, and affordable, yet capable services like Unbounce and Visual Website Optimizer, this excuse is quickly losing ground. The best explanation I can venture is that CRO doesn’t happen because it’s difficult to prioritize against the stack of urgent projects that marketing teams tackle each day.
Your first job should be explaining the potential return-on-investment of a CRO project. If your marketing team, boss or client knew the estimated ROI of CRO using metrics from their own business, they’ll be more likely to prioritize it ahead of other projects. So what’s the best way to make the case for CRO?
Use simple math. Take the numbers of conversions/goal completions from key process of your website, and show what would happen if they performed better. Imagine saying this to your boss or client:
The above example was generated using a
simple Excel spreadsheet I created. Download the worksheet and just fill in the white cells with blue text (further instructions are later in this blog post). The spreadsheet will calculate a simple ROI and provide an easy, yet surefire argument.
The boxed quote above reflects the outcome of a retail web site example that has 632 sales a month with an average transaction size of $40. See the details in the screenshot of the spreadsheet below:
What to enter into the spreadsheet:
Experience Name
A friendly name for the User Experience you are considering optimizing using Conversion Rate Optimization. For this example we are using the Checkout Page of an typical retail e-commerce website.
Monthly Visits
I’d recommend the number of total Visits (for an average month) to the first page of the user experience you’d like to optimize using CRO. In this example above, this is how many Visits occurred on the checkout page of a given month. I believe Visits are better than Unique Visitors as they take count someone who visits twice during the same day as two distinct visits. I wouldn’t recommend using Page Views in this cell, since page reloads and other behaviors can make this number larger than it should be.
Monthly Conversions
The monthly conversions or successful completions to this user experience. In this example, the number of times a purchase was made from the Checkout page. For simple websites that have a single purchase experience, this is usually an easy number to determine. If not, make a best guess.
Average Cash Per Conversion
This is how much money you make on average for each conversion that is completed. An optional, but desirable field. A monetary estimate makes for a more compelling argument. For the example above, the company makes an average of $40 for each transaction. If you are a subscription business, this is where you would enter your
customer lifetime value.
If you don’t have easy access to monetary values like average purchase size or customer lifetime value, just use the raw number of conversions to make your case. Using the data entered above, that would be the following (note that the Excel worksheet provides both):
Conversion Rate Increase
The estimated improvement that might be achieved using Conversion Rate Optimization. What percentage increase should you use? It’s up to you, but I like to estimate 10% improvement, because it’s believable and if your user experiences are not already very well optimized, this percentage is usually easy to achieve. But in my experience, if executed well, your first test will do, much, much better.
Keep it simple.
This is a simple ROI calculation. Some may argue it’s too simple, but it makes a compelling argument that’s easy to grasp. The key lesson here is while 10% may not seem monumental, when you see the expected ROI, it often is. And for a low effort with a big reward, it’s a slam-dunk. Use simple math to make your case and you’ll have a better chance of getting your organization on board with conversion rate optimization.
What’s worked for you?
What’s helped you convince your organization or client to start doing conversion rate optimization? Please let me know in the comments!
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Jamie Steven is the VP Marketing at SEOmoz, and a lover of pumpkin-flavored beverages including lattes and beer—both excellent choices for chilly fall weather.
