A/B Testing: What is it and why is it important?

Corte Swearingen | September 15, 2015 Comments
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All too often, I see companies spend large portions of their digital marketing budget on PPC strategies that are driving traffic to a site with low conversion rates. If they just took a portion of that budget and used it to improve overall site conversion rate, they could drastically improve the ROI of their paid advertising spend.

The only proven method for constantly evolving and improving on-site performance is to test different variations of your critical pages and measure which variation produces the most business value.

In the industry, this method of testing is called “A/B Testing” or “Split Testing,” since you are splitting off a portion of that traffic to funnel it through the variation page. Here’s a visual example of how a classic split test works.
A/B Testing

By creating a broad split testing program throughout your website, you can improve on the following metrics:

•    Conversion rate and revenue
•    Newsletter registrations
•    Average order value
•    Conversions from email campaigns
•    Conversions from pay-per-click campaigns
•    # of completed downloads
•    # of completed registrations
•    Article/content consumption

In the years that I’ve been testing websites, I’ve never run across a client that hasn’t been able to benefit from a testing program.

What if you don’t have an e-commerce site? Can you still benefit from a testing program? Absolutely!  Our focus on lead generation for one client allowed them to achieve an extra 35,000 leads in a 12-month period. In another case, a single test to an important lead generation page resulted in a 1052% increase in leads.

Another great benefit to testing is the idea of bringing a more scientific framework into the marketing program. This allows test results to tie directly to critical key performance indicators. With testing, not only will you know when a page variation has one, but you’ll be able to calculate the additional revenue (or lead generation) that page will bring over a projected 12-month period.

Our recommended methodology for testing includes the following:

Business Goals: Developing published website objectives, goals and key performance indicators

Gathering Data: An audit and gathering of data is critical to understanding the site’s various friction points. Combining both qualitative and quantitative data will help you achieve a more complete picture your site’s problem areas. Good sources of data include:
    
•    Web analytics data including checkout funnel visualization
•    Exit surveys
•    Page level surveys
•    User testing for both desktop and mobile
•    Heat maps & scroll maps

Testing Roadmap: Once you start acquiring data, test ideas will start developing. All tests need to have a strong hypothesis and tied to one or more key performance indicator. Below is an example of a strong test hypothesis and goal.

   Test Hypothesis: “By offering an incentive of free shipping for purchasing two products     instead of just one, we’ll improve average order value and profitability”

   Test Goals: Average order value & product revenue

Companies everywhere are discovering the power of split testing and either working to build out their own internal teams or working with a company like Americaneagle.com to help plan, launch and execute a deep and broad long-term testing program for continuous website improvement.

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