Improving Your Website’s Business Value
There are essentially two “knobs” you can turn to make your website more profitable; the knob of traffic and the knob of conversion rate. In an ideal world, you’re able to crank both these up simultaneously.
By far most companies focus on the traffic dial, but very few focus (or even budget any marketing dollars) on improving the conversion dial.
Focusing Only on Traffic Acquisition is a Costly Mistake
I once spent time with an e-commerce company that was spending millions of dollars on pay-per-click strategies, social media contests and sophisticated email programs. They were generating thousands and thousands of visitors to their site each week. They only had one problem. Their e-commerce conversion rate was less than 1%, much lower than the industry average of 2-3%.
They were making more money with these traffic generation strategies, but only by squeezing more and more visitors into the top of their under-optimized purchase funnel.
This is a great example of a company focusing almost all their marketing budget on turning up the traffic dial, but no efforts on turning up the conversion dial.
Let’s project out revenue if this company actually allocated some of their traffic generation spend and focused it towards some on-site conversion improvements like A/B testing. We’ll assume that if the marketing budget stays constant, we’ll be spending less on traffic generation, and so we’ll see a dip in traffic. However, the money we start spending on conversion optimization will work to increase overall revenue.
Year 0: This row shows actual 12-month revenue and conversion rate numbers from this company.
Year 1: In Year 1, if the company allocates some of its traffic acquisition spend to conversion optimization work like A/B testing, and improves conversion rate from 0.89% to 1.5%, they would see an additional $4,800,292 in revenue even though overall traffic to the sites drops by 14%. This is a great example of the power of conversion rate optimization.
Year 2: In year 2, if they were to allocate even more spending from traffic acquisition to conversion optimization, and were able to improve conversion rate to 2.5%, then even though traffic levels drop once again, they would still see an incremental revenue gain of $6,475,000.
While these two scenarios are hypothetical, the numbers are well within reason to achieve, but by ignoring the conversion dial and focusing almost exclusively on the traffic dial, this company is missing out on a major opportunity. By the way, this company has recently started doing A/B testing, so I’m sure they’ll be seeing some nice revenue improvements soon.
I’m not recommending you necessarily step down your traffic generation spend, but if you aren’t focusing a portion of your marketing budget to onsite optimization, you’re missing a very real opportunity to improve business revenue.
Turning Up the Conversion Dial
The best way to move the conversion dial is to engage A/B testing. A/B testing is a scientific way to quantify whether changes made to a page are actually causing an improvement in business metrics.
Here’s how it works:
Once a page is selected for improvement, a change is made to the page. Maybe we test a different value proposition or perhaps we test a different image or call-to-action. Whatever the change, we make sure there is a specific goal tied to that element change that we can measure. If we are changing the call-to-action on a button, then our test goal is to measure how many people click on that button.
This simple correlation between a changed element on a page and the expectation of what will happen forms the basis of a formal test hypothesis. It could be as simple as this:
Example Test Hypothesis: If we change the call-to-action on the button from “Submit” to “Get Your FREE Report Now,” we’ll see an improvement in form submissions.
Once we’ve defined a test hypothesis, we create a page with that change and send 50% of page traffic to the original, and the other 50% to the test variation. We can then measure, with statistical validity, which version drives more form submissions.
A/B Testing allows you to scientifically improve your conversion rate
Dale Carnegie Case Study
Dale Carnegie did not want to remove any of the form fields, so we instead focused our efforts on improving the overall value proposition.
Some of the elements we changed included:
- A stronger value proposition at the top of the page
- Bulleted benefit statements that were easy to scan and understand
- Better alignment of the form fields
- A more prominent download button with a stronger call-to-action
- A visual reinforcement at the bottom of the page that pointed towards the download button.
- A more visually appealing use of corporate colors
We sent 50% of the page traffic to the original page, and 50% to our test variation shown above. The results were impressive – a 17.1% improvement in form submissions which resulted in thousands of additional leads for Dale Carnegie over a 12-month period. Below are the actual test results from Optimizely.
Optimizely test results showing a 17.1% improvement in form submissions
Are You Ready to Improve Your Conversion Rate?
If you’re not currently utilizing A/B testing as part of your digital strategy, we’d like to invite you to give it a try.Contact Us Today!