METHOD 3 : CONVERSION RATE OPTIMIZATION (CRO)
INCREASING YOUR CUSTOMER LIFETIME VALUE WITH CRO
Conversion Rate Optimization (CRO) essentially results from a focused, applied methodology for improving your website’s sales performance. While various techniques are used to identify data-driven hypotheses, CRO is typically proven through A/B testing that quantifies the conversion rate improvement with scientific validity. It’s an iterative process of small wins that build momentum over time. Let’s say your website converts at 3% per 1,000,000 daily visitors—that’s 30,000 conversions per day. If we increase that rate to 5% (3% + 1.05 = 3.15%) you’re up to 31,500 conversions per day! If you’re like most enterprise retailers, you can run dozens of these optimizations per week to make multiple incremental improvements. These wins gradually add up, as was the case in the above example—a multimillion-dollar increase in CLV in just two quarters. How do You Build Hypotheses that Lead to Increased Conversions? 1. Start by analyzing the customer journey. How many average clicks to purchase? Where do you lose the most customers in the funnel? 2. Consider best practices across devices and channels. Where are current practices outdated or not meeting customer expectations? 3. Review heatmap data of your most visted pages. Are there clicks on static images? Is distracting content confusing the customer? Is the only call-to-action (CTA) at the bottom of a long page that requires excessive scrolling? 4 . Prioritize optimization of entry-pages, traffic, and above-the-fold experiences. Where do you see potential for the greatest impact? Once you understand these key areas, you’ll implement more impactful solutions. It’s critical to know which pages and site areas attract the most visitors, and which underperform. If you identify bounce or cart abandonment issues, prioritize your testing initiatives around those areas. That’s when you’ll quickly see incremental improvements and increased revenue.
Data to Dollars
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