It’s been a long time coming but it seems the thinking may be changing, at last. For years our industry has been fixated on visitors – success being measured by how many people visited a website.

Strange that it’s taken obviously very intelligent retailers such a long time to realise that yes, visitors are indeed welcome, but it’s how many of them that end up as a customer that really counts.

Our focus has always been on conversion and the methods by which a company can convert more visitors to its e-commerce website into buyers, and how to encourage the buyers to spend more. This will be the context for a series of Ferrety blogs over the next few months, broken down into sub-sections covering basket, checkout (if you ever hear us use the term ‘shopping cart’, please come and shoot us), drivers for conversion, including a look at some of the partners and services we’ve hooked up with, general usability, testing methodologies and some observations on the current state of play in this wonderful industry we find ourselves in.

There are a multitude of e-commerce businesses out there that don't understand, or pay no attention to the conversion process at all, it seems. Usability testing may be confined to friends and family, most likely not undertaken at all, but cerebral and software limitations mean that vendors knock out 'one size fits all', unpersuasive sites with bad nav and a 5-stage checkout, and end-users just accept what’s there because that’s just the way it’s always been. and as such, don’t question the fact that they are being asked to ‘Create an account’ before checking out, or even adding to their basket in some bizarre cases. Well, it seems like more and more users are beginning to question things now...

It all seems all so very logical to us – we’ve been extolling the virtues of conversion optimisation for years now, and have been practising it successfully too.

It’s still staggering how many e-tailers think along the lines of ‘We get orders, therefore it works’, but at Lost Ferret we understand that the little things matter a lot - speak to any professional at the top of their game and they’ll focus on the tiny details as opposed to the bullet points.

Technology now allows pretty much anything, it seems, but it’s the application of the technology that’s the clever bit. Traffic can be split and varying testing techniques applied to websites whether e-commerce or lead-generation in order to do all manner of clever things to aid understanding, but there are too many ‘normalised’ retailers who still refuse to acknowledge that it’s possible for things to be improved or just pay lip service to it.

A recent report from Econsultancy has A/B testing at the top of the ‘to do’ list for businesses with 46% saying they plan to do some. Multivariate testing is down at number 4. It will be very interesting to see how, or if this has changed when the next Conversion Report comes out.

It will also be very interesting to see if the ‘satisfaction with conversion rate’ % goes up in line with any increase in those undertaking testing. The reasons behind the actions and motivations are beyond the scope of the report, and I’ll wager that most of those that do it themselves would be better served focusing on other aspects of running their businesses, but this is a subject for another day - in fact several days.

While there’s a school of thought that encourages businesses to ‘have a go’ at the analytics and testing themselves, in our experience there’s a distinct lack of understanding as to what to test, and therefore, resources are wasted.

On the flip side of that, it is a step in the right direction though - return on marketing spend is king here. I was speaking to someone a while back who told me that he’d had his marketing budget cut by £100k. He sounded for all the world like his dog had just been run over, and it made me think I could make a bit on the side by knocking out a country & western number about marketing money being cut.
It was music to my ears though.

In such challenging times there’s a need to become more efficient in order to maximise return and so the old thinking needs to be discarded – in fact the old thinking is no longer possible when marketing budgets are slashed because the way the old thinking worked was to spend more on marketing to make more money. A cut in marketing budget will most likely be accompanied by a cut in price - and I do understand there’s a need to compete and move product, but personally, I am sick to death of the word ‘discount’.

It seems perverse, in fact, that when a retailer needs to become more profitable to stay ahead of, or even just in the game, the first thing to suffer is marketing. But surely, cutting marketing spend is only sensible and sustainable in the event that a retailer does something to increase the return on the spend that’s left.

So in a time when an online retailer needs to be more profitable or else perhaps they’ll disappear, the answer is to increase conversion rate.

Consider the following example...

So, by increasing your conversion rate you can increase your level of profitability dramatically with a constant level of visitors, whereas increasing revenue by upping marketing spend actually doesn’t help much at all.

I refuse to do the whole meerkat thing, but isn’t this a very simple concept to grasp?

Please note: we offer an analytics and conversion optimisation service as an after-sales service only, and not on 3rd party sites.

We’ll be discussing some of the other points above in future posts soon.