If you're into conversion rate optimization (CRO) you may well be wondering, as this New Year dawns: When will CRO get the attention it deserves? Will 2011 be the year for CRO?
My answer, after much prognostication in this season of reflection and projection, is: Yes! Why? Because the numbers have become too compelling to ignore.
Even if you find social media initiatives more exciting to think about, they will waste money if you aren't optimizing conversion of the traffic that they generate.
Consider the primary factors determining website ROI:
- Conversion rate
- Average order value
The way of the CRO says that increasing conversion isn't only the cheapest option for increasing website ROI, it's also the most productive. Think about which of these two paths to doubling site revenue would be cheaper:
- Double the traffic.
- Double the conversion rate.
If average visits per month have been running around 300,000 and the conversion rate is 3 percent, then the first option means you need 300,000 more visits; the second option means boosting the conversion rate to 6 percent.
With today's tools and the many lessons we've collectively learned about CRO, you can easily hit that 6 percent target for an investment of about $12,000 per month. Spend that money on the right combination of software and staff (that doesn't have to spend 100 percent of their time working on CRO) and you really can move that needle.
Now, do you think you can get 300,000 more visits to your site for $12,000 per month? That's $.04 per visit.
Bear in mind that, in order to double revenue, this new traffic needs to convert as well as your current traffic. Sure, you can find some obscure long tail keywords in Google AdWords for $.05 a click, but getting good traffic for $.04 per visit strikes me as near to impossible (please feel free to let me know if you think otherwise).
Remember that, depending on how you monetize traffic, a significant portion of your site's revenue might be from repeat traffic (less so for lead generation sites, more so for retail, and so on). A good CRO program will not only increase conversion for first time visitors, it will also foster more frequent buying from loyal customers.
Conversion rate optimization is about making sure visitors get what they came for, presenting content relevant to whatever brought them to the site so they aren't distracted from the frictionless path that your diligent testing has designed for them to reach the checkout page, form submission, download, or whatever event you're striving to make happen.
That's why sites like QVC.com and Office Depot regularly achieve conversion rates above 18 percent. And guess what? The things that deliver conversion also happen to be things people like.
Converted visitors come back. They trust you. They open up to your suggestions. And that means you can keep growing the average revenue per session number.
Happy, converted customers also tend to talk about their experiences. They share on social sites. They drive more traffic to your site.
So the money you budget to get your conversion rate to 6 percent could get you even further. And unlike buying fresh traffic at X pennies per hit, there's really no incremental cost involved in CRO once you have a testing and targeting program in place on your site and embedded in your organization.
This time last year, my good friend Bryan Eisenberg wondered if 2010 would be the year that CRO was fully embraced by online businesses. By the time he was speaking at eMetrics in May, he was acknowledging that social media had distracted a lot of people from CRO.
Social media is a terrific tool for growing your business online. However, without a culture of testing and optimization embedded within your organization, whatever results you get from social media are bound to be less than if you work on social media with that culture in place. And the low hanging fruit in social media is disappearing fast.
As with any channel that is new, like e-mail and a web presence once were, you'll eventually have to work smarter and smarter to get good results from social media. For "smarter and smarter" read "optimized."
And lets face it, CRO more than pays for itself. Even if you don't double conversion rates across the board, wielded wisely, CRO tools and expertise will positively impact a whole bunch of your key metrics, from AOV to RFM, from e-mail list size to social media buzz. Let the optimizing begin.