Three E-Commerce Conversion Gaffes

Three E-Commerce Conversion Gaffes

This article is the second in a four-part series on the digital superfecta: the four things all companies must get right in order to maximize their growth potential. Read on to learn more about the second leg of the digital superfecta, and find links at the bottom of the article to the other three legs.

Last week, we introduced the concept of the digital superfecta and focused on the first leg of the superfecta: qualified lead generation. This week, we shift gears toward e-commerce conversion, which we define as “the percentage of your traffic that completes a defined objective.”

Usually, conversion means sale, but in the digital world, it can also include actions such as providing an email address, reading an article, filling out a customer lead form, and so on. Conversion goals vary along the customer journey; you won’t expect the same conversion from a first-time website visitor as you would from a returning customer.

Conversion is a broad topic, and a lot has been written on the subject. Here’s a brief overview of our philosophy to set the stage.

Optimizing Conversion is a Three-Part Cycle

Excelling at conversion entails mastering a three-part cycle: setting objectives, measuring results, and correcting course.

For example, a publisher might set an objective of selling their subscription program to two percent of traffic that reads an article. They measure the percentage of people that convert from an article to a paid membership.

If they fall short of their two percent goal, they analyze and modify their site accordingly. Perhaps the value proposition was not explained clearly enough, or too many clicks were needed to get through the checkout process, or customers needed to engage with three articles before becoming primed to buy. In any case, they use the results to change their user experience, then re-run the experiment and re-measure the results.

As you can see from the example above, there are any number of things that could cause you to trip up when striving towards your conversion goals. But we’ve found there are three common mistakes companies make when trying to optimize conversions.

Mistake #1: Too Many Objectives Per Page

Unfortunately, too many websites are a cacophony of content. Dozens of messages are being shouted at the visitor:

“Hey, read these eight articles!”

“You over there—sign up for our newsletter!”

“Sign up for a free trial subscription!”

“Visit our sponsor’s website!”

Disciplined companies have one clear objective per page. Sometimes you’ll need to have two— or maybe even three—different calls to action, but if you have more than that, you’re probably confusing your visitor and hurting conversion. 

In The Paradox of Choice, author Barry Schwartz explains why too much choice has proven to be detrimental to our psychological well-being. He says eliminating choices can greatly reduce stress. 

Here is a summary of one experiment Schwartz described to illustrate his point. In the experiment, researchers went to a gourmet food store and set up a display of “exotic, high-quality jams.” They presented customers with samples and a coupon for a dollar off one jar of jam.

However, the researchers didn’t present the same number of jam varieties to each customer. Instead, some were presented with six options, while others had 24 jams to choose from. While the bigger, jazzier display of 24 jams caught people’s eyes, drawing more customers over to taste samples, in the end, that variety caused an interesting predicament. While 30 percent of customers who were presented with six jam options actually made a purchase, only three percent of those exposed to the 24 options bought a jar.

The moral of the story here is that more choices doesn’t necessarily equal more conversions. How can you limit yourself to one to three goals per page? Your objectives should be context-specific. 

For example, if you’re working on a page where cold traffic lands, your goal should be to get the consumer to read a piece of content. If your page is for warm leads (consumers who have spent some time with your brand), you probably want the goal to be around lead capture (e.g., provide an email address in exchange for a whitepaper). If it’s a place where hot leads will visit, that’s when you should ask for the sale.

Mistake #2: Asking for the Sale Too Soon

Sorry, Glengarry Glen Ross fans, you shouldn’t “Always Be Closing.” For those familiar with the play/movie, in the digital world, coffee is also for lead nurturers. Don’t get me wrong, you have to ask for the sale at some point. Mistake #2A is not asking for the sale at all. But when you do ask for the sale, it needs to come at the right moment.

We’ve all been to those websites that use a pop-up ad to ask for a sale way too soon. If a visitor just landed on your page, fresh from a Google search result, and is encountering your brand for the first time, they’re not ready to commit yet! That’s like asking someone to marry you at the end of your first blind date.

Popping the question prematurely not only keeps you from making the sale in that moment, it also has the possibility to drive the prospect away forever. Come on too strong, and they might get scared off and go running to a competitor’s website.

That’s why it’s important to establish a clear path for nurturing your leads. Design your website so that your landing page presents a call to action inviting visitors to learn more. From there, take them to some more detailed, valuable content about your brand.

Then, once the visitor has been to a few pages on your website and is beginning to trust you, you can make the offer: a related how-to guide in exchange for their email address. At this point in the game, you’ve already established a bit of a relationship, and now you’re coming in with an appropriate next ask. Think of this as asking your blind date out to coffee next week, rather than jumping right to wedding bells. The prospect is a lot more likely to say yes, because they feel like they know you a little bit, and this is a fairly low-pressure next step.

From there, you can continue to provide valuable, useful information to the prospect via email. Then, once you see that they’re engaging with your emails, you can send a hard offer and go for the close.

One key point: Be ready to strike when the iron is hot. Once a prospect signals they’re ready to buy, get offers in front of them, or if appropriate to your business, get on the phone with them. Research has shown that companies that dawdle when responding to prospects often miss out on opportunities!

Mistake #3: Jumping Quickly to Conclusions from A/B Tests

A key tool to conversion optimization is A/B split testing. That’s the process of creating two different user experiences and seeing which version (version A or version B) leads to higher conversions.

This is an extremely powerful tool, but we’ve seen it abused. Many companies get overly-excited because their yellow call to action button led to a 20 percent lift in sales over the green call to action button. They jump to the conclusion that by switching all their CTA buttons to yellow, sales will skyrocket, and then they’re sorely disappointed when things stagnate instead.

Of course, if we think back to high school science class, we know that this jumping to conclusions based on research is not a great idea. One of the foundational rules of scientific study is that correlation does not prove causation. Yes, in the example above, the yellow CTA seemed to result in a lot more clicks. But was it really the color of the button that made the difference? In some cases, if a meaningless variable is being tested, it can lead you to draw erroneous conclusions about the reason for a difference in conversion rate.

The other major pitfall in A/B testing is engaging with too small a sample size. You can’t run the experiment on 10 people and call it a day. You need a more substantive sample size to be able to say with any certainty that the differences between how people engage with version A versus version B are significant and representative of how the rest of the population will engage with the content. I like this tool for determining the number of visitors you need to have a valid test. Try it out. You’ll probably realize your existing samples sizes are too small.

Sample size is a particularly pernicious problem for price tests, because the number of people who actually convert is much smaller than the total number of visitors. You need long time periods to have enough data to declare a winner in a price test. While we still recommend A/B price tests, we recommend starting with other types of analyses, like the Van Westendorp Price Sensitivity Meter, since we know that it will take a long time to run a statistically meaningful A/B price test.

The beauty of the digital world is that tools and techniques are available to help you avoid these three common mistakes. And by dodging these pitfalls that often sink e-commerce businesses, you can generate greater conversion rates throughout your customer journey, from lead capturing to closing the sale.

If you’d like to learn more about the digital superfecta, check out Leg 1: Qualified Lead Generation, Leg 3: Project Management 10 Question Challenge, and Leg 4: Don’t Be Scared of Analytics: A Seven-Step Plan.

About the Sterling Woods Group, LLC

The Sterling Woods Group’s mission is to help clients make sense of their data to predictably grow sales. We apply data science to help you optimize your sales funnel, improve your marketing ROI, launch new products successfully, and enter new markets profitably.

We use a hypothesis-driven, data-supported methodology to discover insights that no one else is paying attention to. Then, we help you assemble the right sales strategies, marketing plans, technologies, and resources to seize this opportunity.​

About the Author

Rob Ristagno, founder and CEO of the Sterling Woods Group, previously served as a senior executive at several digital media and e-commerce businesses, including as COO of America’s Test Kitchen. Starting his career at McKinsey, his focus has always been on embracing digital technology and data science to spur strategic growth.

Rob is the author of A Member is Worth a Thousand Visitors and is a regular keynote speaker at conferences around the world. He has been featured on ABC, NBC, CBS, Fox, and Digiday.

He holds degrees from the Harvard Business School and Dartmouth College and has taught at both Harvard and Boston College.

Rob lives outside Boston, MA with his wife, Kate; daughter, Leni; and black lab, Royce.​

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