With A/B testing, you will learn which design ideas are the most profitable. To avoid losing money on testing, businesses must plan adequately and use the information provided by the tests wisely. Before running tests, set clear business objectives to ensure that actionable plans will be formed from the data.
Analyze Metrics Thoroughly
CRO is often misused as a term to imply several optimization tasks for customizing an e-commerce site. It focuses on one metric, which is conversion rate. However, there are other individual important tasks for optimizing a website. One of the main considerations to focus on in relation to CRO is the bottom line. Any strategy must be measured for long-term success. For example, offering a 50 percent discount on all merchandise for a day or offering a free item for simply submitting an email address are two strategies that would likely make conversion rates soar. However, the rates would be soaring while the business would be losing money or barely breaking even during those times. When your data summary shows that a winning A/B test brought more sales, be sure that those sales were profitable before you make any permanent changes.
Both lead quality and margins are important considerations, and focusing only on CRO without them can be disastrous. The lesson to remember on this topic is to avoid taking improved conversion rates as a sure sign that a certain variation will bring long-lasting success. When assessing A/B testing information, be sure to look at the test’s effects on mobile versus PC users, new versus returning users and other categorical data. This helps pinpoint the most important target audiences.
Measure Your Costs
Testing can be a considerable investment. In addition to paying for software, you have to spend time learning it or training staff to use it. Also, related tools and resources add up. You may have to hire source developers to create customized tests or designers to create wire frames. If you pay someone to keep up your site, you may also have to pay to make changes on your site after you find a winning strategy. In the end, any changes should earn you more money than the process costs to implement. Your profit margins may not be as large at first but should show a positive improvement over short, medium and long terms.
Budgeting is a must for effective CRO outcomes. Plan on some test ideas losing and only a few winning. Keep in mind that finding the most optimal strategies is a process that takes time, trials and errors. If a potential process outweighs its possible financial benefits, rethink the strategy. Budget restrictions are often tighter for smaller businesses that lack in-house developers. However, A/B testing should still yield profitable ROI when executed properly. Testing-related costs can usually be scaled, which means that they only increase when the business grows.
Give Your Tests Time
One of the biggest mistakes made by small and large companies is picking a winner too early. When you see a trend that indicates a winning strategy, be patient. Watch it for a while to see what changes. You must be sure to pick a sustainable design and not one that will only work for a season or a short period of time. Look at what is driving the success to see if that factor is temporary or constant. Only trends with statistical significance should be placed in the potential winner’s bracket. To be statistically significant, a result must be due to implementation of changes and not just luck or temporary trends.
When aiming for a level of significance, aim for high numbers such as 90 to 95 percent or more. The odds of the improvement being concrete and not based on chance are much better at such levels of significance. Also, be sure that the sample size of site visitors is big enough. Your sample size will vary based on expected changes, your baseline conversion rate and other factors. Higher statistical significance usually means that you will need more traffic. Also, more traffic is needed to detect small improvements.
Fortunately, there are software programs and special calculators to help you crunch numbers and make sense of them quickly. As a rule, you should run tests throughout an entire business cycle and compare them to other cycles. Take any external factors into consideration when doing this. Keep in mind that it may take months or even a year or longer to gather enough concrete data. However, you can still apply conversion rate optimization principles.
When tests take longer to reach positive results, there are more opportunity costs for the company. Also, some businesses waste time by testing the wrong things or not testing enough. For example, running only one test per month would not yield favorable returns. When implementing a test, keep a simple mentality that focuses on problem identification, quick solutions and thorough results analysis. Watch for small gains to see if they pick up momentum over time for statistical significance.
Another issue to consider is test complexity. While you should aim for big wins, you must be sure that your data summary provides enough in-depth information to pinpoint what tips the scale. For example, it could be an improved call-to-action button or a new mobile-friendly website design. These issues can easily be overlooked when other data points become the only focuses. Keep in mind that you can use multivariate testing, which is the inclusion of multiple tests at once instead of one at a time. Be sure that individual categorical data can be measured for each one without affecting the measurement of the other tests. Just be cautious when analyzing your traffic to make sure that it does not overlap between tests and skew the results.
You must prioritize your testing ideas. If you lack structure in setting up a testing plan, you will fail. Use a robust process, a strong hypothesis and solid research data. Without ample qualitative research, you will not have a clear picture of your site’s areas of performance that need improvement. Also, you will not know why they need improvement. The research phase affords understanding for customer pain points and solutions. Your research will make you more knowledgeable about developing informed estimates for change impact. Be careful to avoid overestimating potential impact or missing out on impressive wins.
The Sentient Ascend program is great for testing more in a shorter time frame, and Aware is good to use with it. Sentient Aware is a valuable AI tool for e-commerce personalization. When you use the two tools together, you can personalize your e-commerce platform for optimal ROI and track your success. Think of Aware as your new top sales staff. With an advanced AI platform, you have better insights. Also, your customers have a better experience, which means more conversions and a positive impact on your bottom line.