To calculate your potential ROI on a Conversion Optimization or Landing Page Optimization project, you need to estimate how much conversion rate improvement you an hope to achieve.

How do you estimate your potential conversion rate improvement?

Your potential conversion rate improvement from Conversion Optimization testing depends on a factor that I call your ‘Conversion Rate Elasticity’ (or CRE).

Your CRE is a measure of the degree of impact that making changes to your site’s pages will have on your conversion rate. A site with a high CRE will see dramatic differences in conversion rates for various pages in an A/B split test or Multivariate test.

Your potential conversion rate lift is shown as:

So, if you have a high CRE, improvements you make to your site will increase your conversion rate more than sites with a low CRE.

What influences your Conversion Rate Elasticity?

We’ve identified several factors that influence your CRE, such as:
• Value Proposition potential – If your Value Proposition is attractive to your target audience your conversion rate is probably being reduced by easily change-able factors, which can be tested.
• Degree of external Urgency – In situations with high external urgency, during promotional offers or purchase deadlines, CRE is reduced.
• Primary Call-to-action type – The CRE is inversely proportional to the cost of the call-to-action (CTA). For example, lead generation CTAs will generally have higher CRE than purchase CTAs.
• Traffic quality – Traffic with high Relevance to your value proposition is just waiting to be shown a well-crafted landing page and will have a relatively high CRE.
• Improvement potential in terms of Relevance, Clarity, Anxiety, Distraction and Urgency – If you’ve never analyzed, tested or improved the six LIFT Factors on your site, your CRE will usually be higher than if you’ve done many expertly-designed tests.

How to estimate your potential conversion rate?

This is probably our most commonly asked question: “What should my conversion rate be?” Unfortunately, this is an impossible question to answer accurately and is actually irrelevant. A better question is: “Can my conversion rate be improved significantly?”

In our experience, the answer is, “Yes!”

Whether or not your website has a high Conversion Rate Elasticity, we can help you lift your Conversion Rate by a statistically significant amount. Ask us how to help you calculate your potential ROI from a Conversion Optimization strategy.

(If you are in a rush, here is the registration link – otherwise, read on.)

You probably already know Bryan Eisenberg: he is the co-author of the Wall Street Journal, Business Week, USA Today and New York Times bestselling books “Call to Action”, “Waiting For Your Cat to Bark?” and “Always Be Testing” and has been the keynote speaker for Search Engine Strategies, Shop.org, Direct Marketing Association, MarketingSherpa, E-consultancy, Webcom, SEM Konferansen Norway and the Canadian Marketing Association, among others.

And on April 1st, you don’t have to leave your desk to hear him speak!

In this free webinar sponsored by WiderFunnel, Bryan will guide you through some of the recent changes in the online advertising world and provide you with strategies and proven techniques to maximize your return on investment from your advertising budget based on the latest developments in Internet marketing and advertising.

Are you are currently spending a significant marketing budget on Pay-Per-Click, Pay-Per-Call, and Social Media Advertising?

Then you absolutely owe it to yourself to learn the techniques you need to increase the ROI of these powerful advertising mediums.

Would you like Bryan to answer a specific question?

Easy. Simply post your questions right here on this blog and Bryan will incorporate them in his presentation.

WHEN: Thursday, April 1, 2010 at 2:00 pm EST/ 11 am PST

LENGTH: 50 minutes

COST: Free – But you need to reserve ahead by registering

REGISTRATION LINK here

BONUS! Each webinar attendee will receive an electronic copy of the “Persuasive Online Copywriting” ebook – The actual book on Amazon has sold for over $1000

WIN:
• Attend this webinar and you could be one of 20 attendees qualifying for a FREE custom landing page evaluation!

WHO SHOULD ATTEND?
• Sales, Marketing and eCommerce Leaders and Managers with revenue responsibilities
• Search Engine Marketing practitioners interested in improving the ROI of campaign investments.

When developing a conversion optimization strategy for new clients, determining website goals is obviously important. The Conversion Optimization goal should be selected based on how well it supports the website goals. This is often an area where there’s confusion about what are the priority metrics to improve.

Your Business Goals should determine your Website Goals, which should be prioritized to determine your top Conversion Optimization Goal.

Strategic Conversion Optimization goal development

Many of the metrics found in your standard Web Analytics setup are not appropriate goals for optimization, even though they may be relevant Key Performance Indicators (KPIs) for your website.

Bounce Rate, for example, is a common KPI and an indicator of the Relevance of a particular page to visitors entering the site. If your site-wide bounce rate is 43% and a popular entry page is 56%, for example, the page may not be meeting the expectations of incoming visitors.

A higher bounce rate isn’t necessarily a problem.

Example #1: In one case, the page in question may have a high natural search ranking for non-revenue-producing keywords, bringing in non-target visitors. Those non-target visitors aren’t hurting you and can be disregarded (unless you can figure out a new way of engaging them in a relevant offer). Your true bounce rate for your target visitors may be lower than you think.

Example #2: In another case, your page may actually be doing a better job of communicating your message, so more visitors that aren’t ready to convert can leave rather than navigating the site to try and figure out what you sell. This also isn’t a bad thing and may still allow for a relatively high lead generation or purchase conversion rate.

But, a high bounce rate can suggest a problem, too.
So, shouldn’t you try to lower a high bounce rate with testing if you can?

No.

If you set bounce rate reduction as your A/B test or Multivariate optimization goal, you could hurt your true revenue-producing goals.

Here’s how your bounce rate could be lowered without improving revenue:

• Changing a single landing page into a multi-page microsite experience
• Moving some information, like pricing, onto a second page
• Simply adding links to popular news or blog content
• Replacing productive offers with free offers that may have lower revenue-producing value

If you were to test these as test variations, you could easily lower your bounce rate and believe your test was a success. But that new page may have hurt revenue production while “improving” your bounce rate. Do you see how you could inadvertently hurt your results?

So, what should you measure?

Your conversion optimization goal should be as close to revenue as possible, ideally recorded after a purchase. Although the most relevant goal will depend on your website goals, here are some typical conversion optimization goals that lead to revenue improvement:

• Ecommerce purchase conversion rate
• Average order value
• Return on Ad Spend
• Revenue per visitor
• Lead generation inquiry conversion rate
• Software download conversion rate
• Trial registration conversion rate
• Click-to-call conversion rate
• Click-to-chat conversion rate
• Request a quote conversion rate
• Request a demo conversion rate

Start with your Business Goals, then determine how your website goals should support that. Only then will you be able to prioritize and select the right Conversion Optimization Goal for your situation.

Vancouver Olympics Store
A/B Split Testing

With the closing of the Vancouver 2010 Winter Olympics, all the medals have been handed out, and all the tourists have fled the city. I was fortunate to have been a part of the Elastic Path Software Team that managed the Official Vancouver 2010 Olympic Store since the store launched in December 2007. So, in the spirit of the Games, I will share a little retrospective on my experiences!

During early days of the online store operations, it had a very limited product assortment. Each week as we got closer to the Games, more and more products got shelved in our warehouse. Eventually, the warehouse grew to almost up to 5,000 SKUs.

With that much inventory to sell in a very, very short period of time, we had to ask ourselves, how do we sell all of this quickly? Is the current customer experience worthy of a gold medal?? Is there a way to increase online revenue?

We knew there were areas of the site that could use optimization: our homepage could be less busy; our product details page could better display key information; our checkout process could be shorter (too many people were abandoning the process mid-way).

So many opinions, so little time

However, since these were “opinions,” and nobody had answers based on facts, we decided to quickly validate the various theories, just in time for the Winter 2010 Games buying season (this deadline was a serious one!).

First we had to decide on which testing tool to use. We selected Google Website Optimizer (GWO) because we expected it would be easy to implement. GWO is a free website testing and optimization tool that would help gather data to reveal which page converted best.

However, we had the challenge of integrating GWO into our backend. Even with our strong team of developers, we had to enlist external help in order to meet the tight deadlines.

We turned to another local company, WiderFunnel Marketing Optimization, for help with our A/B split testing project. They were amazing at walking us through the entire planning, design, and technical implementation process while answering all of our questions. In addition, WiderFunnel interpreted the various data points we had gathered in Google Analytics so we could confidently select the winning page templates.

Going for Gold!

We completed four different A/B Experiments. WiderFunnel provided the conversion analysis, hypotheses, wireframing, graphic design and development in two of those experiments. The other two experiments were done by our own in-house team.

In these experiments, we tackled our four most important problems: checkout process, product details page, homepage, and category page. Each one of the experiments generated improved conversion rates and improved average order value!

In addition to more sales per web visitor and a higher revenue per order level, we noticed another benefit impacting our company, a cultural change. Since we began engaging in testing and optimization, we’ve noticed that opinions expressed in meetings were now being complemented with facts, new feature implementation processes have better structure, and team members had a renewed trust in each other because decisions were now data driven.

When something sparks a debate, someone always pipes up, “Why don’t we test that?”

About the Author
Captivated by innovation, Jānis Lanka (@janislanka) is particularly drawn to fresh thinking in areas such as ecommerce, entrepreneurship, marketing, design, and user interface. Jānis currently heads the front-end taskforce at Elastic Path Software, an enterprise ecommerce solutions provider.

We at WiderFunnel understand that client-side issues are critical to implementing a successful Conversion Optimization strategy and that implementing the strategy itself impacts corporate culture.

To share these insights for discussion, we are starting a series called “The View from the Conversion Trenches”. Elite marketers will share their perspectives on Conversion Optimization and the resulting organizational realities, priorities and culture changes.

The View from the Conversion Trenches

Article #1
The Official Website of the 2010 Olympics Store – the inside scoop
Jānis Lanka, Elastic Path Software

What happens after an athlete works so hard; is so focused; devotes his or her entire life and being to the one moment when they win Olympic gold… Then what?

Many athletes train for years, reach the apex of their careers during the Olympics and then crash. After the peak of competition is over and the highs of winning, commercial endorsements, sponsors, and the excitement dies down, according to experts, depression sets in. This is known as post-competition depression.

Is this the same as what sometimes happens after getting a breakthrough improvement on the website conversion rate?

OK, this idea isn’t as crazy as it sounds. But let me back up first.

Many athletes spend years preparing for a narrow window of opportunity such as the Olympics. Intense preparation, daily practice and adjusting life to meet the sport’s needs dominate the athlete’s life. Then, after the Olympics, the elite athlete often loses her or his sense of purpose – often experiencing depression if unprepared for the transition.

For example, in a recent interview, Victoria Pendleton (who was part of a Great Britain track cycling team that dominated the velodrome in Beijing, won the Olympic gold medal in the women’s sprint track cycling event) said “You have all this build-up for one day, and when it’s over, it’s: ‘Oh, is that it?’ You’re relieved but kind of sad and numb. It’s over.” The pressure is enormous. “People think it’s hard when you lose,” she said. “But it’s almost easier to come second because you have something to aim for when you finish. When you win, you suddenly feel lost.”

Failing to meet a goal most certainly is disappointing, writes coach Dean Henbert. And it is absolutely normal to have an emotional reaction to that. “When an elite athlete fails at a goal, they tend to pick themselves up and continue the fight after a very short time. Even in the case of epic failures, we have all seen renewed focus and energy to either persist and attack once again that race goal or to fervently pursue OTHER goals.” Contrast that to the successful endeavour. The elite athlete labors a lifetime to get to the Olympics. Suddenly it’s race day. All the preparation pays off. You did it!

And now what?

Such a reaction is natural, according to Mark Bawden, the lead performance psychologist at the English Institute of Sport. “To win an Olympic gold is a life-changing moment, but then there is a crash back to reality,” he said. “It can be as powerful an experience to come down from success as coping with adversity.”

So why am I thinking this has anything at all to do with Conversion Optimization?

First, let me say this: Marketers who move beyond the well-travelled path and embrace conversion optimization and other metrics-driven marketing strategies are elite marketers. Like elite athletes, they spend years preparing well thought out and executed marketing strategies and tactics. They know, as well as any expert knows, that stellar results call for practice and focus and the mastering of skills. It takes 10000 hours of practice. There are no shortcuts.

When these elite marketers do not get the results they seek; they refocus and try again. And again and again.

However, sometimes in our work we see that, after a wildly successful breakthrough, elite marketers in companies engaged in improving their online conversion rate stop altogether. After all their thought-leadership, their work and their push towards excellence on the website, nothing. No more tests. That’s it.

I have often wondered why that was – until today.

It now seems to me that these elite marketers are not seeing conversion optimization correctly: they see breakthroughs in conversion lift as their Olympic event. That is, the test is a one-time event. As a result, once a breakthrough conversion rate lift is attained there is no more to strive for. The Gold, so to speak, has been won.

But Conversion Optimization isn’t like an Olympic event at all.

Instead, Conversion Optimization is an ongoing strategy, perhaps more like a marathon (if I absolutely must continue with the sports analogies). Conversion Optimization is a strategy which sees the website as a capital asset that has to be improved. Again and again. Because customers change. Because products and value propositions change. And because the competitive landscape continually changes.

How to re-focus Conversion Optimization thinking to “strategy”?

Interestingly enough, the research on post-competition depression in elite athletes says that the person who is most likely to experience this is more often than not, the first-timer and that, a major reason for the loss and lack of motivation is that the elite athlete forgets to set the next goal.

In other words, inexperience and lack of goal-setting will do you in.

So, as an elite marketer, you need to remember that purpose and goals focus our behavior and thoughts.

You have won Gold. Now do it again.

PS. Yes, Canada won Olympic Gold in Hockey (and this blog post took me longer to write than the seven minutes and 40 seconds into the extra period that it took Crosby to score)

So, building on that new wave of interest, I am pleased to tell you that on Wed, Feb 24, we will be presenting our next client case study where we optimized for phone call conversions: “Learn How to Make the Phones Ring 48% more with A/B testing!” (who comes up with those headlines??)

Cook - An American Express Travel Representative

Success was outstanding: the client improved their phone calls by 48% each day.

To register, click here.

How does an organization like Disney create such a remarkable reputation? What can we learn from it?

On a recent family visit to Disneyland, I aimed to gather clues to their success. As with each visit (this being the fourth in as many years) I was again impressed by the organization’s quality of execution.

What can Disneyland teach us about experience optimization?

“Walt Disney made it clear we could never rest on our laurels, so continuous improvement has been an integral part of our culture”
- Julie Hodges, Vice President, Organization and Professional Development, Walt Disney Parks and Resorts. (source)

Here are a few observations that were good reminders for me.

Systematize for contingencies
It rained for the first hour of our three-day visit to the Park. While we grabbed breakfast at a Disney bakery, I watched as the rain-contingency plans were executed.

During a rain spell, souvenir shops are instantly transformed into rain-preparation shops with ponchos, umbrella hats and stroller covers appearing at the front of the stores.

As soon as the clouds passed, a “Cast Member” with a squeegee the size of an industrial broom pushed the water off the deck in an efficient pattern beginning with the highest traffic areas.

It wasn’t until then that I noticed that the pavement texture throughout the Park was selected to provide texture for wet grip and yet be smooth enough for an effortless squeegee.

The secret here is that no discussion is needed when rain happens. Everyone knows the plan and it is executed quickly.

• Does everyone on your team know exactly what to do when the inevitable challenges happen?
• Do you have written and rehearsed contingency plans?

Communicate with personality (always be in character)

Communicate with
personality

Disney uses each interaction to reinforce the brand. For example, imagine the traumatic experience of parents being separated from their child in the Park. The “lost parents” area at Disneyland reminds us that: a. the kids are in charge, b. everyone is safe, c. even a terrifying event can be turned into fun.

• What is your communication personality? Fun, precise, innovative, empathetic, trustworthy, formal, knowledgeable, refined, aggressive, personable? Pick 2-3 and set the tone for the organization.

Manage expectations

Manage expectations

In the high season, wait times for popular rides are notoriously long. Disneyland manages expectations by posting wait times at the front of the line that are a little more than the actual wait times.

• Are you setting expectations that you can’t meet or not setting expectations at all?
• If you promise a 24 hour response time, why not have a real response time of 2 hours?
• If you have shipping costs, why not tell your visitors before they get to the shopping cart?

Turn downsides around
You would be surprised if you calculated the ratio of ride to waiting ratio at Disneyland. One of their greatest innovations has been making lineups nearly enjoyable with themed audio & video surroundings. The themed waiting experience adds to a sense to anticipation rather than boredom.

• Do you know what the biggest pain points are for your customers’ experience with you? How can you turn them into a benefit?
• Can longer delivery times equal better quality, like a fine restaurant?

Segment your audience
For the “professional riders” that aren’t interested in the lineup experience, they’ve added the “Fast Pass” system. You have the option of taking a Fast Pass from each ride, which gives you a time of the day to return and move to the front of the line. If you’re an adrenaline enthusiast, you can play the system and minimize your wait times.

The more relaxed visitors can still enjoy the themed lineups at their leisure.

• Can you segment your experience to appeal to major visitor segments or personas?

Provide a consistent experience every time

Consistent experience

Disneyland doesn’t have “bad days”. They make every day feel special with parades, special characters and full ride service. Have you noticed the street litter at Disneyland? There is none!

If you have a services business, you know that consistency of service is one of the biggest challenges. Nobody is “on” every day, right?

Disneyland has found the most reliable way to increase consistency: acting. Their staff are called “Cast Members” and they are trained to perform every moment that they are in the park. This isn’t just a job; it’s a performance. When you perform, you can ignore how you’re feeling and put on a different persona.

Frame your value proposition
Disneyland doesn’t just provide rides and attractions; they provide an interactive theatre experience. It is an escape into an fairy-tale world. Their ride planners are called “Imagineers” and their staff are “Cast Members”.

With this perspective they consequently need to pay attention to the details. To provide an escapist experience, there can be no holes in the canvas, and that is what makes Disneyland so spectacular.

• What need are you actually filling for your customers?
• Do you provide rides, or an escape from reality?
• 2″ drill bits or 2″ holes?
• Retail clothing or “looking great”?
• Business software or “looking indispensable”?

Be extraordinary
When Disneyland creates a fireworks show, it’s like nothing you’ve seen before. They don’t just light some off-the-shelf fireworks timed to some music. They invent new ways of using fireworks to tell their story. They mix, lasers, surround fireworks to colour the sky, actors suspended from high wires, projections onto buildings, flame torches and custom- designed fireworks. There’s a standard of excellence that they won’t compromise.

Commit to Continuous Improvement

Continuous Improvement

Imagine if you had created a “Magic Kingdom” that was the pioneer and envy of all worldwide theme parks. Would you feel motivated to tear up a ride and build a new one?

Much like the WiderFunnel Kaizen Method for Website Optimization, Disneyland is continuously improving and updating the experience. They survey visitors year-round to learn which rides are attracting visitors to the Park, and they continuously “Imagineer” new ones. There’s even a building that shows their development plans and sketches for the next three years.

• Are you too comfortable with your current level of success?
• How can you foster new ideas that could shake up the status quo for your website experience?

Have fun!
You can’t leave Disneyland without being inspired to have fun.

Life is too inexplicable, random and short to take too seriously. A scientific approach to continuous improvement should not remove the wonder and excitement of life’s discoveries. Disneyland shows that discipline and fun can live under the same roof.

Being very clear in understanding the services you will get from a conversion optimization services provider is crucial because, if you don’t have this absolutely clear, you may be in for a nasty surprise in terms of the total cost of engaging with them – and it might be too late to pull out.

So in this blog post I hope to provide you with guidance when considering hiring a Conversion Optimization services provider in terms of what you should be looking for.

Does your company deliver…? Yes or No

There is a fairly long list of tasks and services normally associated with conversion optimization. The list below represents the questions you should ask of the potential conversion optimization services provider (as in, “Does your company deliver…?”)

The conversion optimization services provider you select needs to identify up front what they will deliver vs. what will be expected of you and your team.

There are no wrong answers – but you must remember that, for any of the tasks and services they do not provide, you and your team will be expected to!

For each item where the answer is No, you should budget for additional amounts (and, to be honest, you should also question why they don’t provide these basic requirements to proper and thorough conversion optimization services).

Here is the conversion optimization services checklist:

Planning

• Alignment of your business goal online with experimentation objectives
• Web analytics research to inform the opportunities for optimization
• Competitive review
• The assessment of your technical environment to ensure compatibility with testing technology
• Testing technology recommendations
• Categorization of segments and traffic sources
• Traffic sources & volumes
• Post-conversion sales analysis
• Identification of the specific conversion funnel step objectives
• Identification and prioritization of all your conversion funnel experiment opportunities
• Conversion Optimization strategy (A/B/n, MVT, etc)
• Development of experiment Hypotheses
• Test design

Experiment Execution – for multiple test Variations

• Wireframes
• Layouts
• Graphic design
• Copy and content
• Mockups
• Variable content box placement
• All HTML and images

Technical installation

• Testing tool
• Variable content box code
• Experiment Combinations fully tested before launch

Results Analysis

• Periodic client updates
• Hard coding of winning variation
• Recommendations for future action

In summary, then, it is key to have roles and responsibilities well defined prior to the start of the conversion optimization project.

If you have internal staff not fully utilized and experienced in running online experiments, then the list above does not need to be fully supported by the conversion optimization services provider you select.

However, if time is of the essence and you do not have the internal resources available, you will want the conversion optimization services provider you select to be able to deliver as many of the required services as possible.

(Not coincidentally, we at WiderFunnel deliver all the services listed above because, you see, “we do the work; you get the glory”)

The LIFT Model

At Eastern Michigan University’s College of Business, we’ve developed a hands-on program to teach students the ins and outs of search engine marketing. Two courses are at the core of this program:

• Google AdWords and Landing Page Design
• Google Analytics and Landing Page Optimization

In both courses, students work with non-profits who have received search engine advertising grants from Google with a monthly budget of $10,000. In the AdWords course, students build out the non-profits’ pay per click search advertising accounts. In so doing, students often achieve significant increases in visitors to the non-profit’s web site, sometimes by as much as an order of magnitude. In the landing page optimization course, students help the non-profits increase their conversion rates for these visitors, sometimes by multiples of four or five. I’ll be describing one case in more detail below, and I’ve detailed a number of others here.

The non-profits we work with are similar to small businesses in several respects:

• They are often facing extreme budget pressure.
• Their marketing staff often do not have a detailed understanding of search engine advertising.
• Their landing pages are often not designed to highlight their offering’s value proposition to their visitors.

The value proposition is of course key for conversions, and we have found WiderFunnel’s LIFT model quite helpful in organizing landing page redesign around it. In search advertising, strong clues as to the value proposition the visitor is seeking reside in the key words the visitor searched on and the advertising appeals they responded to. All of this information is available in either the Google AdWords or Google Analytics interfaces or both.

Once the value proposition the visitor is seeking is understood, it is possible to develop testable hypotheses around clear, relevant statements of that value proposition that might work on the ad’s landing page as well as identifying landing page elements might be distractions from it. Finally, one can determine sources of anxiety on the landing page and how to raise the visitor’s sense of urgency to take the next step down the funnel. It is worth noting that these efforts need not all be focused on the pure goal of increasing sales or revenue, though that often is a major objective.

Take for example the Organization for Bat Conservation (OBC).The OBC essentially exists to raise awareness about the good things bats do in nature. One of the OBC’s major search advertising campaigns targets people seeking information about bats. Students engaged in a three step process:

• They identified searcher interest by analyzing keywords searchers used and the ads they responded to.
• In consultation with management, students determined the best resources on the site for this segment and set getting visitors to those resources as the goal of the landing page.
• Students developed and ran a Google Website Optimizer experiment pitting three alternative landing pages developed using LIFT Principles against the original.

As further detailed in this report, the best student designed alternative led to an improvement of over 400% against the original, and the organization has adopted the student landing page. This case illustrates the unique value proposition of our program at EMU. Students access sophisticated frameworks and technologies as they help real organizations solve real problems they face in their ongoing business operations.

About the Author
Bud Gibson is a professor of Computer Information Systems at Eastern Michigan University and the founder of MichiganInnovators.org, an educational non-profit. He has a PhD from Carnegie Mellon University and an MBA from the Wharton School. He has extensive experience business consulting in North America, Europe, and the Middle East. His current passion is developing web optimization training programs at the university level.