Conversion Optimization: The Art and Science of Converting Prospects to Customers

267 Pages·2010·17.05 MB·English

by  Khalid Saleh

Conversion
Optimization
Khalid Saleh and Ayat Shukairy
· · · · ·
Beijing   Cambridge   Farnham   Köln   Sebastopol   Tokyo
Conversion Optimization
by Khalid Saleh and Ayat Shukairy
Copyright © 2011 Invesp. All rights reserved. Printed in the United States of America.
Published by O’Reilly Media, Inc., 1005 Gravenstein Highway North, Sebastopol, CA 95472.
O’Reilly books may be purchased for educational, business, or sales promotional use. Online
editions are also available for most titles (http://my.safaribooksonline.com). For more information,
contact our corporate/institutional sales department: [phone] or [email protected].
Editor: Simon St.Laurent Indexer: Ellen Troutman Zaig
Production Editor: Holly Bauer Cover Designer: Karen Montgomery
Copyeditor: Audrey Doyle Interior Designer: Ron Bilodeau
Proofreader: Marlowe Shaeffer Illustrator: Robert Romano
Production Services:
Newgen North America
Printing History:
November 2010: First Edition.
The O’Reilly logo is a registered trademark of O’Reilly Media, Inc., Conversion Optimization, the
cover image, and related trade dress are trademarks of O’Reilly Media, Inc.
Many of the designations used by manufacturers and sellers to distinguish their products are
claimed as trademarks. Where those designations appear in this book, and O’Reilly Media, Inc.,
was aware of a trademark claim, the designations have been printed in caps or initial caps.
While every precaution has been taken in the preparation of this book, the publisher and au-
thors assume no responsibility for errors or omissions, or for damages resulting from the use of
the information contained herein.
ISBN: 978-1-449-37756-4
[M]
C o nte nts
Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vii
1 The Journey from Clicks to Sales . . . . . . . . . . . . . . . . 1
Converting Visitors to Buyers 2
Landing Pages 4
Fifteen Years of Change 7
Conversion Rates 10
What You Can Accomplish 16
2 The Numbers Behind Your Website . . . . . . . . . . . . . 21
Macro Conversions 22
Key Performance Indicators 24
Micro Conversions 27
Building Budgets for Ecommerce Sites with
Conversion Rates 28
Lifetime Value (LTV) of a Customer 32
Budgeting for Lead Generation Sites 34
Monetization Models and Conversion Rates 36
Bounce Rate 38
Exit Rate 41
Quality of Traffic (Visitors) 47
Resources 58
3 Getting to Know Your Customers:
Developing Personas . . . . . . . . . . . . . . . . . . . . . . 59
What Are Personas? 61
Benefits of Personas 63
Market Segmentation Versus Persona Development 65
A Case Against Personas 68
Back to the Basics: Creating Customer Profiles 70
Brief History of the Four Temperaments 73
The Four Temperaments and Personas 75
Putting It All Together 78
iii
Your Website from a Different Perspective 79
Personas and Copy 81
Adjusting Your Selling Process Through Personas 83
4 From Confidence to Trust . . . . . . . . . . . . . . . . . . . 85
Value Proposition 87
Continuity 96
Congruency 105
Social Proof 109
Membership/Professional Organizations or Affiliations 111
External Reputation 112
Design Aspects 114
5 Understanding the Buying Stages . . . . . . . . . . . . . . 119
Deciphering the Buying Stages Online 120
Complexity of the Product and the Buying Funnel 140
6 FUDs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143
The Buying Decision and FUDs 145
Getting “Personal” with FUDs 146
7 Appealing with Incentives . . . . . . . . . . . . . . . . . . . 159
What Are Incentives? 161
Incentives Versus Value Proposition 163
Positioning Incentives 164
Behavioral Incentives 171
How to Apply Incentives 172
Additional Tips for Using Incentives 173
8 Engagement . . . . . . . . . . . . . . . . . . . . . . . . . . . 175
Measuring the Effectiveness of Engagement 176
Social Media 178
Customer Reviews 182
Cross-Sells and Upsells 184
Customer Feedback Tools 189
Informational Videos 189
Virtual Closets 190
Virtual Help 190
iv ConTenTS
9 Testing: The Voice of Visitors . . . . . . . . . . . . . . . . . 193
The Basics of Testing 194
Creating a Successful Test 199
Forty-Nine Things You Can Test on Your Website 203
10 Be Iterative . . . . . . . . . . . . . . . . . . . . . . . . . . . . 229
When Conversion Optimization Succeeds 230
When Conversion Optimization Fails 231
The Upward Spiral 233
Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 235
ConTenTS v

Preface
PAINFUl lESSONS lED TO THE CrEATION OF THIS BOOK.
In late 2005, I (Khalid) had the opportunity to lead the design and implementation of
one of the largest ecommerce websites in North America, with a huge budget: $15 mil-
lion. My team of 20 senior ecommerce developers and I built a “feature-rich” website
that integrated with several external systems in a miraculous three months. While I
pushed my team to work harder and spend more nights at the office, the marketing
team assembled first-year revenue projections: $500 million!
Excitement built as the go-live deadline was approaching. However, I still had concerns:
will visitors come to the site? On the go-live day, I sat with the other two architects to
monitor the server’s performance. I was wrong. The website received tens of thousands
of visitors during the first hour. Everyone was ecstatic. Yes, visitors were coming.
As the hours passed, though, my earlier tension built up again. Despite the site receiv-
ing tens of thousands of visitors, customers placed fewer than 10 orders in those first critical
hours. Ten orders was all we had to show our client for their $15 million investment. It
was a disaster.
Why weren’t these visitors converting into customers? Looking back, the low number
of orders wasn’t at all surprising.
We worked with an ad agency to create the design for the website. During the three
months of implementation, we never discussed conversions, or even orders. In most
cases, a few technical people, with little usability experience, decided how to design
vii
different pages, where to place elements, and how visitors would flow through the
website. Both the technical and design companies promised the client a lot and deliv-
ered a great-looking website. It just did not convert.
That painful experience was not unusual. As more companies moved to the Web, most
of them focused on driving visitors to their websites—the more eyeballs a website gets,
the greater the chance that orders will be placed. However, the percentage of visitors
placing orders was small compared to the total number of visitors. Marketers noticed
this, and the practice of conversion optimization was born. While other areas of online
marketing have developed tremendously in the past 15 years, conversion optimization
is still in its infancy.
We started our practice in 2006 with a simple goal: create usable websites that visitors
love, and generate more orders from these sites for clients. Consulting on conversion
optimization projects suffers from the same problems as consulting in other fields. The
quality of work a client receives is dependent on the skill set of the consultant working
for them. Some clients we talked to felt that conversion optimization, while promising,
involves random guessing and a lot of finger crossing. Since the early days of our com-
pany, we knew we had to establish a process and follow a methodology to generate
consistent results for clients.
This book describes the Conversion Framework™, a process we developed in 2007 and
have evolved since. The framework is built around eight principles: the first six princi-
ples cover how visitors interact with different websites and whether they are persuaded
to stay or decide to leave. These principles are:
• Understanding your website visitors through persona creation
• Creating confidence and trust
• Understanding the impact of the buying stages
• Dealing with FUDs (fears, uncertainties, and doubts)
• Using incentives
• Engaging users
As you apply these principles to your website or campaign, you will begin to see what
changes need to be made.
The seventh principle of the Conversion Framework asks you to test any change you
make against your original design. By applying the science of online testing, you will
measure the impact of any change you make on your bottom line. The eighth and
final element of the Conversion Framework asks you to make a long-term commit-
ment to conversion optimization—a willingness to iterate. Conversion optimization is
not something you do only once. It is a long-term effort when done correctly. It should
pay for itself for a very long time.
viii preFaCe