Optimizing conversion rates is one of the most challenging aspects of eCommerce. To do this, businesses must reject old practices in favor of new methodologies, backed by experimentation and external leadership. How can CRO assist in enhancing conversions now that eCommerce is in full swing, with record numbers and an increasingly bright future?
In 2020, Latin America was the fastest growing region in the world in terms of digital commerce. According to a Business Insider study, over 38 million people in the area made their first digital purchase during this time. By 2021, the consultancy forecasts that the total of digital buyers will increase to 248.7 million, which represents almost half of the population that is of 14 years of age or older.
On the other hand, retail eCommerce sales in Latin America grew by 63.3% during 2020, totaling more than 104 billion USD. These revenues were five times more than the 12.5% increase forecasted in November 2019, only a few months before the pandemic broke out; and more than the triple of the estimated growth projected in May 2020.
When it comes to eCommerce growth, Spain is no exception. Experts estimate that since the pandemic began, operations through digital channels in the Iberian country have increased by 22.9% reaching $32.89 billion. These are expected to continue to rise until 2023 reaching $41.72 billion.
In short: It is a great time to promote eCommerce. Taking the leap –and doing so in a planned, orderly, and efficient manner– it’s either now or never.
CRO: Buddhism applied to marketing
Buddhism transmits a fundamental idea that motivates subjects in the pursuit of their dreams. Gurus often repeat “Everything we see in the physical world was first an idea in someone’s mind”. This encourages the individual to first imagine what their ideal situation, objective or goal would be, and then experiment until they achieve it.
When it comes to CRO, the same idea applies. Any experiment begins with an idea, with a notion in the mind of an individual or a work team. The concept is then put to test, and the outcome is assessed to see if it is as predicted.
All companies that sell through digital channels want and need to increase their conversion. What if they could organize their ideas in a systematic way in order to materialize them?
Conversion Rate Optimization (CRO) is not just a metric, contrary to popular belief. It’s a method for increasing a website’s conversion rate by employing a set of techniques. CRO proposes eCommerce, a scientific system that allows for the validation of various hypotheses through continuous experimentation.
The fundamental issues that determine a website’s success or failure are familiar and well-known: content, usability, design, checkout, and mobile-responsiveness, to name a few. CRO’s job is to analyze each of these aspects, experiment with them, and purpose improvements in order to create a more relevant and optimized experience.
The main objective of CRO is to increase conversions through improving the efficiency of the web shop through greater usability, rather than by advertising investments in an effort to attract more traffic.
When it comes to conversions, it’s common to think of and measure them solely in terms of sales, when in reality they’re much more complex than that. First and foremost because achieving a conversion is a time-consuming process. Second, because it, like any process, has intermediate steps and objectives known as “micro-conversions,” such as user registration on a website, newsletter subscription, or downloading a document, to name a few examples.
Methodology, testing and experimentation
- Follow Plan-DO-Review. A document is created, with each line detailing the experiments to be validated.
- Design of experiment. These tests must, in principle, be conducted in closed hearings. Additionally, resources and execution times are determined in this step. Companies may, for example, concentrate on changing one aspect of their website, such as targeting certain content towards female or male audiences.
- Analyze the results to validate if the proposed hypothesis is fulfilled or not. Furthermore, adjusting the different variables will enable future experiments to be more effective and efficient. The more users involved in the experiment, the faster the hypothesis can be validated.
Organizations that don’t experiment don’t innovate, and by not innovating they lose competitiveness. Those who take risks, on the other hand, are more likely to achieve success. In other words, the company’s pace is nearly entirely dependent on the speed of experimentation. The same phenomenon happens with people in the race to achieve their goals.
Work as a team, delegate, and eliminate silos
The other significant challenge in implementing CRO is eliminating the concept of silos. They are the companies’ failure to develop communication and efficient collaboration between different sectors or business units. In silo systems, information is not shared (or shared very little), and flows vertically in isolation, rather than horizontally and publicly.
Before transforming data into valuable information, a functioning system with specialists from each sector must be established. IT, marketing, and UX are usually kept separate. This distance is not only physical, but is also affected by different directors, budgets, priorities and even KPIs. As a result, combining efforts from many sectors in pursuit of similar objectives is insufficient. Knowledge, methodology and collaborative effort must be contributed. Collaboration and harmony between the different areas is essential to attaining success.
At this stage, the role of CRO consultants, as is the case of Multiplica, is to serve as the focal point for different areas, coordinate efforts and propose the same experimentation strategy. Having external leadership allows you to overcome barriers. Particularly when it comes to coordinating both the work and goals of multidisciplinary teams.
If you want to know more about technologies and approaches that can help your marketing efforts, we invite you to contact Luciano Lopatin, US Tribe Leader at Multiplica.