What Conversion Rate Optimization is and why you need to start now: The Ultimate Introduction

Imagine you are in possession of a secret recipe for your online marketing. Without high additional expenses, more personnel or additional content offers, it helps you to significantly increase your turnover: It uncovers and eliminates pitfalls on your website, turns your passive visitors into active customers and helps you to understand successes and scale future actions more easily. The good news is this secret recipe exists. It’s called Conversion Rate Optimization. We will show you what Conversion Rate Optimization is and how you can use it most effectively.

WHAT IS CONVERSION RATE OPTIMIZATION AND WHY IS IT SO IMPORTANT?

conversion rate rocket

Online marketers who want to increase their sales have two basic options: Firstly, they can try to increase traffic to their website – for example, by using targeted SEO initiatives, placing more ads on external sites (e.g. SEA) or offering additional content (e.g. more products in the online shop). All these options mean a great deal of additional work: high additional expenditure, additional personnel or more sources. The results are relatively unpredictable. Whether the measures work at all and if so, when, only the crystal ball knows.

This is where conversion rate optimization comes in as a second, more promising option: Instead of attracting additional visitors to your website, you get more out of your current traffic. By optimizing what you already have, you make your existing users feel comfortable with you and ultimately generate more sales.

How exactly does that work? To understand this, we first must understand the concept of conversion.

website-funnel-scetch

Every website has a specific goal: the visitors have to perform a very specific action. When a user performs this desirable action, it is called ‘conversion’ in online marketing. With their conversion, interested website visitors are transformed into customers – or at least into potential users who, for example, register on the site. Depending on which action the provider wishes the user to perform most, the conversion can take place in various ways. Most of them require a click.

Different types of conversions by industries

UniversalOnline ShoppingService ProviderRestaurants
Newsletter subscriptionAdd to shopping cartFill in the contact formReservation for dinner
Visit of a landing pageBuyingDownload additional informationOrdering the delivery service
Call

The percentage of “converted” visitors in the total number of visitors is measured by the so-called Conversion Rate (CR). This is the percentage of visitors of your website or touchpoint who perform the action you want them to do most.

conversion-rate-formula

If the conversion rate is to be increased, i.e. more visitors in e-commerce, for example, should be transformed into paying customers, this is referred to as Conversion (Rate) optimization (CRO, also: conversion boosting).

What is Conversion Rate Optimization (CRO)?

CRO describes the totality of all measures aimed at increasing the percentage of visitors to a website who perform a defined desirable action (conversion).

Why Conversion Rate Optimization (CRO)?

  • Improves key performance indicators (KPIs) such as revenue per visitor and return on investment (ROI)
  • Resources are used more efficiently
  • Promotes knowledge about website visitors and their behavior and systematizes marketing strategies through permanent testing – gut decisions no longer play a role
  • Increases the customer experience (CX) of visitors through higher efficiency

THE CRO-PROCESS: APPROACH CONVERSION RATE OPTIMIZATION CORRECTLY WITH A/B-TESTS

a-b-testing-illustration

But how do you optimize the conversion rate? For centuries merchants and traders have been trying to achieve exactly this – only the terminology has changed and the process has been systematized. Imagine a saleswoman in a small boutique. On an average day, 50 people enter their shop, but only five visitors actually buy something. Of course, the saleswoman wants to get more of these 50 visitors to buy and tries out different things for them. It approaches prospective customers more proactively, involves them directly in a sales conversation, makes the presentation of goods clearer or offers free accessories for high-quality articles, such as an expensive tie that matches the expensive suit. This way she can turn five more visitors into buyers – a conversion rate increase of 100%!

Sales Recommendations

Example: The CRO process in offline retail

In order to find out exactly which of the possible measures lead to success, it is necessary to test them individually and systematically. In this process, the procedure must be defined in advance and must be consistent, because this is the only way to ensure comparability. This procedure is called the CRO-Process in online marketing. As in the example above, an analysis of the status quo reveals possible conversion inhibitors, i.e. obstacles to conversion. The salesperson could lure friends into her shop as test customers and ask for feedback or ask her “real” visitors about why they didn’t buy.

This results in hypotheses about improvement potentials or possible connections, for example: “A personal consultation increases the number of customers who actually try something on by 300%”. After a prioritisation the most important hypothesis is then tested in a so-called A/B-Tests: 50% of her visitors now advise the saleswoman personally by explaining to them which fit flatters her figure the most. The other 50% will be treated exactly as before. After some time, the results are analyzed and expanded: The salesperson is now considering how she could expand the success of the consulting. For example, interested parties could not only be advised on the right fit, but also on the type-specific colours and styles of garments. In a new Round she also tries out these ideas according to the same scheme.

Conversion Rate Optimierung durch A-B Testing

The optimization also works in a similar way in the digital area, in order to move online visitors to the desired action. In principle, online marketers today proceed in a similar way, but thanks to data analysis and evaluation, they can systematize the process even further and find out exactly which measures are most effective and where optimization is most worthwhile.

How to: The CRO process

Conversion Rate Optimization is based on A/B testing, a scientific method that should be precisely defined and systematically performed. It makes sense to develop an individual procedure for your company. The following basic structure helps:

1

Analysis of the status quo

Identify problems and opportunities to uncover optimization opportunities. Helpful: Analytics tools such as Matomo or Webtrekk, which provide information about the behaviour and demographic characteristics of your users, as well as qualitative analyses through surveys, interviews or user-friendliness tests. Practical tips for data collection and analysis you can find on Quicksprout.

analyse des status quo
2

Develop hypotheses

In a brainstorming session, derive possible optimization measures from the analyses and draw out hypotheses about their influence on user behavior, e.g: “Reducing the load time by 0.2 seconds reduces the bounce rate by 5%”. Useful hypothesis examples can be found at Craig Sullivan.

3

Prioritize test ideas

There are various methods for this. According to one of the most used methods, the PIE of Widerfunnel, potential (expected uplift on the page), importance (volume and value of the page traffic) and simplicity of implementation are equally considered.

priority
4

Testing a variant

The hypothesis with the highest priority is then tested. The key to success in the A/B test: In each variant, only one thing is changed and compared with the original variant by displaying each variant to an equal percentage of all site visitors. This is the only way to derive meaningful results from the A/B tests. This Guide will help you choose the right A/B testing tool.

5

Interpret and extend test results

Note: Important lessons can also be learned from failures! It is also worth considering how successful methods can be extended and transferred to other positions. If adding a testimonial was worth it, you might ask yourself: What happens if I display five? And: Can similar trust elements achieve similar success elsewhere in the funnel?

ask your customers survey
6

Keep on optimizing

Conversion Rate Optimization is not a one-time thing, but a permanent cycle. The knowledge you have gained from previous A/B tests can be fed back into the loop. The status quo only needs to be reanalyzed in phases. If you follow this process, you will continue to optimize your conversion rate.

Possible elements for an A/B test

A/B testing can be used for almost anything on your website. A small collection of inspiration:

  • Headings
  • Pictures
  • Texts
  • Banner
  • Social proof
  • Navigation
  • Call-to-Actions (CTAs)
  • Links
  • Pricings
test-fail-improve-circle

You got it? – Then we’re ready to go: We now show you some examples of possible methods for Conversion Rate Optimization. To learn how not to do it, take a look at our CRO negative examples.

OPTIMAL USABILITY: 3 TIPS FOR BETTER USER COMFORT

A very basic starting point for optimizing the conversion rate is usability optimization. For a conversion to take place at all, the visitors to your site must first find their way around well and quickly: The easier and effortless it is for a prospective customer to find his way around your site, the better is the usability and thus the satisfaction of the customer. The likelihood of him converting is increasing.

According to the PwC-Study factors such as efficiency and convenience are very important to 80% of B2B customers for their customer experience – they would even be willing to pay more for them.

What is Usability?

It describes the usability of a product or offer – i.e. the combination of effectiveness, efficiency and satisfaction in its use.


Do not confuse!

User Experience, on the other hand, expands the term to include aesthetic and emotional factors such as fun to use, confidence building and appealing design.

Don’t forget!

Instead of questioning one’s gut and simply start testing, one should conduct a in-depth analysis of the most promising optimization measures and proceed in a structured manner (see chapter 2). There are various test procedures for usability optimization. You should go through this first and only then decide whether conversion boosting is worth it here! A detailed usability test guide is available from TestingTime. The following starting points are often worthwhile:

Performance and loading time

In our fast-paced world, online users are showing little patience, as TruConversion shows: 83% of us expect a loading time of less than three seconds. On the other hand, the average actual loading time for online shops, for example, is 10 seconds! Here is real conversion potential: An improvement of only one second can increase the conversion by an incredible 7%.

Ladezeit und Performance Online Shop

What you can do

To keep server, transmission and client rendering performance running smoothly, you can optimize graphics and images, compress JavaScript or use content delivery networks. The lazy loading method is particularly suitable for image-heavy websites, in which images are only loaded when the user has reached them in his browser window by scrolling.

Intuitive navigation

Online users want to find their way around quickly. The key to this is smooth, transparent and intuitive navigation with a clear structure and no surprises. Meeting the expectations of visitors is the key to high conversion rates.

Orientation on the mainstream

Even if it seems counterintuitive, in this case it is worth swimming with the current and orienting yourself to the common structure of websites in your industry. Also helpful are appropriate headings and descriptive images for categories, compact teaser texts or progress bars when going through processes such as the checkout in online shops.

An example: at thomann.de, a popular online shop in Germany for music supplies, not only the products themselves, but even the product categories are illustrated.

example-Thomann-Categories

Successful searching

We know from ourselves: While searching for information, products etc., we are spoiled by Google. If we are not conducting a scientific research, we will most likely only look at the results on page 1. If we do not find what we are looking for here, we will rather start a new search with other terms than clicking on the next page. We have transferred this behaviour to other websites and services. For example, 40% of visitors leave online shops immediately if they don’t find the product they want right away. A real conversion trap!

Finding instead of searching

Equip the search function with precise filters and suggest meaningful search terms directly during the input. If the searches of your users are successful, you will not only benefit from high conversions, but you will also be able to continuously optimize the search and even your offers: Because frequently appearing terms often point to a trend.

An example: Again Thomann does a lot right here! The online retailer gives practical tips for the most goal-oriented search processes as possible – a real added value for the users, even beyond your offer!

example-Thomann-search-Tips

SHOPPING CART & CHECK-OUT OPTIMIZATION: HOW TO AVOID CART ABANDONMENTS

Especially in online retail, essential conversion areas are the shopping carts, the purchasing process and checkout: the path to conversion, i.e. here to the final purchase, is particularly long. After clicking on the “Buy” button, the shopping cart is checked, the shipping method and payment method are selected, data is entered and, if necessary, the payment is made directly. A complicated process with many steps, where each individual step has the danger that the user interrupts or stops his purchase. The bounce rate in e-commerce is therefore a critical success indicator for conversions and is closely linked to it.

Bounce Rate: let’s get out of here

The bounce rate is defined as the percentage of visitors, who enter a page and leave it immediately (e.g. after about 5-10 seconds or before the first click).

Bounce in Display

Although critical, the bounce rate optimization in e-commerce is still often neglected – perhaps because the task seems so complicated and big. We all tend to postpone challenges that seem insolvable instead of tackling them immediately – and because the optimization in online shops never comes to an end, the bounce rate is often not tackled. The result:

On average, 70% of all online shoppers interrupt their purchase even though they are already in the checkout process! This affects every industry and leaves enormous sales potential untapped. Online retailers who do pioneering work here have the chance of real conversion boosting with a great competitive advantage.


CTA-What-is-situationalization

Best of all: Contrary to popular belief, many reasons for cancelling a purchase are simple and can be easily fixed once they have been discovered. To see this, it’s worth taking another look at offline shopping: Imagine that the self-service terminal in the supermarket wouldn’t work, the carrier bags were out of stock or no credit card was accepted: All simple, fixable reasons, but you would leave your groceries in the store. Accordingly, online is also essentially about creating orders, making the process intuitive and smooth and offering all the desired options. To quickly, efficiently and systematically find the right adjusting screws, apply the CRO Process here as well.

For advanced conversion optimizers it is worth considering psychological aspects as well as practical ones. Practical tips on the best conversion triggers can be found in this blog article.

Typical reasons for aborting a purchase (with solutions!)

Easy solution, fast conversions: Fixing these bounce reasons will boost your conversion rates!

  • Shopping cart visit requires page change
  • Previous visits are not taken into account
  • Total shopping basket value seems too high
  • Unclear information about shipping & payment
  • Non-transparent returns policy
  • Expectation of free shipping is disappointed
  • Fade in as pop-up
  • Storable wish list
  • Offering additional free products
  • Transparency & variety of options
  • Early, prominent clarification
  • Free delivery from minimum value

Your chance to increase your sales: offer additional products to reach the order value!

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