I was a recent guest on the IMRG Weekly Data Show (#175 for those keeping score). The show was focused on conversion rates, which are down across the board.
A combination of tough economic conditions and unpredictable weather has given retailers some real challenges. In these challenging times, some guidance is needed on some things they can try that will improve results quickly.
And that's what we tried to do on the data show. Three ideas of places to start based on actual case studies from retailers.
Idea 1: The power of segmentation
Not all customers and visitors are the same. You know this already.
Personalizing your approach based on context can really pay off. A recent study by McKinsey & Company revealed that personalized customer experiences can lead to a sales uplift of up to 15%.
Wellness retailer Bodykind wanted to improve conversions across new and existing customers. Here’s how they did it:
New vs. returning customers
Initially, visitors showing exit intent would see the offer without meeting a minimum level of spend. Bodykind then saw a change in AOV from returning customers, who typically spent more than those yet to buy from the brand.
The right course of action was to only engage customers with a cart value above £30 ($37). However, this impacted acquisition levels, as new customers were less inclined to go this high on their first order.
To grow acquisition levels while keeping returning customers at a high AOV, we tweaked the campaign to give new customers the offer provided they had a cart under £45 ($55), with no minimum spend required. Meanwhile, returning customers saw the offer provided they had a cart less than £45 ($55) with a minimum spend of £30 ($37).
The results
This personal touch resulted in a surge in conversions and AOV, aligning with the company’s strategic goals and bottom line.
Existing customers who needed a cart value of £30 ($37) to redeem the offer were converting +186% better than new visitors. They spent more, too, evidenced by an AOV of +34% against new visitors.
Most importantly, Bodykind saw additional profit per order.
Ideas to try
- Use customer data: Analyze purchasing behaviors and tailor offers to customer segments.
- Test offers: Find out which offers, copy, and imagery lead to better conversion rates.
Read the full Campaign of the Month >
Idea 2: Optimization with A/B testing
Promotions can be a double-edged sword, and finding the way to deliver the best return can be a challenge. Fashion retailer US Polo Assn. wanted to test their promotions to determine which type yielded the best results.
Percentage off vs. £/$ off
RevLifter worked closely alongside US Polo Assn to decide on the right experiment to run. One idea was to trade the existing ‘% off’ for ‘$ off,’ which – if structured correctly – would increase profit by reducing the amount the brand gave away.
The experiment would lean on RevLifter’s multi-variant testing to expose the ‘$ off’ promotion to 50% of US Polo’s qualifying customers, with the remaining 50% seeing ‘% off.’
Would customers react better to getting ‘$ off’ their purchase? Would they spend more or convert better? In this case, they would barely need to. Given the profitability of using ‘$ off,’ a similar result would be viewed as a positive outcome.
The results
The simplicity and predictability of a fixed discount eventually won the race, providing value to customers and profit preservation for the business.
Ideas to try
- Run your own tests: Don’t assume, test. Determine the most enticing type of offer for your customers through A/B testing.
- Value efficiency: Always seek the most efficient way to entice customers. Valuable promotions need not be the most expensive.
Read the full Campaign of the Month >
Idea 3: Dive into the data to find behavioral cues
Shop4Runners, a German sportswear retailer, noted an unusual trend among their customers. Many were copying product names to search for lower prices, indicating a significant number of deal seekers in their customer base.
Targeting the search-and-compare crowd
Recognizing that not every abandonment is due to hesitance, Shop4Runners needed a tactical approach.
To reduce instances of customers leaving its site to compare prices, Shop4Runners launched Ctrl+C Codes. Offers for ‘€10 off’ fired when certain product names were copied onto the clipboard, ready to be pasted into the browser.
The results
The initiative honed in on a specific behavior to offer relief, and the results were tangible—a notable boost in conversion rates, AOV, and revenue from all their campaigns.
Ideas to try
- Behavioral analysis: Use tools and platforms to understand how customers interact with your site.
- Pinpoint offers: Identify friction points in the shopping experience and create offers that directly address them.
Read the full Campaign of the Month >
Use every tool at your disposal
By implementing these strategies, marketers can fortify their sites against abandonment and enhance the customer's path to conversion. Remember, in the world of online retail, every interaction is a potential transaction, and optimizing these interactions drives ecommerce success. Don't let any opportunity be missed.
Stay vigilant, stay optimizing, and stay converting. Your customers will thank you, and so will your bottom line.
