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THINK Contributor

Is your retail CX strategy focused on conversion-rate optimization?

By , November 18, 2016
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Digital marketers need to master conversion-rate optimization (CRO), especially in the retail space. According to a new study from UPS and ComScore, online shopping has surpassed in-person shopping. Yet a new strategy report from Forrester suggests that retailers are not maximizing their customer experience (CX) opportunities throughout the digital purchase cycle.

As a result, retailers miss out on the opportunity to convert visitors into buyers or to increase the lifetime customer value of an individual customer with multiple purchases. To determine whether your retail CX strategy is driving effective conversions, it’s important to step back and look at it holistically within the context of your business. To create an effective retail CX strategy that is focused on conversion means looking at how you design your entire digital experience, rather than simply implementing a series of tactics.

I chatted with Arun Sivashankaran, founder and CEO of the conversion optimization and personalization agency FunnelEnvy, to get an insider look at the top mistakes retail brands are making with their customer strategy. The company has worked with major brands including Zillow, Hewlett-Packard, Hugo Boss, TripAdvisor and many others. 

Focus on Conversion-Rate Optimization

With respect to CX strategy, Sivashankaran notes, “It’s about getting the right information to the right person at the right time.” Early on, brands need to focus on developing their traffic flow through strategies such as organic SEO, paid promotions like PPC and advertising, as well as other approaches to raise brand awareness. But, once the traffic flow is in place, it’s critical to think about conversion optimization and what you can do to get more of those people to buy. Identify friction in the customer journey, address those areas that need it, and achieve increased conversions.

Understand what makes your customers convert or click away. See IBM’s Customer Experience Analytics in action.

Opt for the Right Key Performance Indicators (KPIs)

“Another common mistake is not focusing on the right KPIs,” says Sivashankaran. “Instead of focusing on the most important KPIs that impact the bottom line, brands are focused on vanity metrics.” Such metrics — such as page views, visitor numbers and add-to-cart numbers — are easy to measure and are directionally useful. Ultimately, however, brands get the most mileage when they focus specifically on the KPIs that have a monetary value, such as revenue and lifetime-customer value. Otherwise, it’s easy to become distracted and spend significant resources focusing on aspects that don’t yield a meaningful lift in your performance.

Take a Siloed Approach to CRO

Conversion-rate optimization doesn’t happen in a vacuum; it’s part of a brand’s larger efforts to build a compelling customer experience. As Sivashankaran notes, conversion optimization has to be embedded into every part of a retail brand’s digital presence: design, copywriting, persuasion, social integration and data collection. It’s nearly impossible to generate real ROI when it’s treated in isolation. Instead, when brands approach conversion optimization as an integrated strategy that reaches the right velocity and number of tests, they begin to see real results in purchases and in their relationship with customers.

Blend Third and First-Party Data

One of the biggest insights Sivashankaran shared from his work was on the data mix brands use to develop their conversion optimization planning. Brands have access to a wide range of data, including their own proprietary customer information and third-party data sources. Relying on just one or the other limits the insights and conversion breakthroughs that companies have access to. “We’ve seen more advanced brands doing great work beyond traditional CRO by using first-party data like behavioral and customer data to drive really meaningful personalization,” he says. Brands should aspire to bring first-party data and third-party resources together to get a complete view of the customer journey and drive meaningful, personalized experiences for their audiences.

These days it’s essential that retail brands have an effective CX strategy, and such a strategy must bridge two sets of goals — the customer and your business. When you make it easy for customers and website visitors to achieve their objectives, the result is increased sales. As Sivashankaran notes, an effective strategy translates into a measurable, positive change to your company’s bottom line. By thinking about the big picture in your approach to conversion-rate optimization, integrating it at the right point in the buying funnel and focusing on the right data, your company will see significant ROI.

 

Liz Alton writes about digital marketing and her work has been featured in USA TodayForbesIncHarvard Business Review and Entrepreneur. Her specialties include all things marketing, technology, B2B, big data/analytics, cloud and mobility. She holds a bachelor’s degree in journalism from University of Massachusetts, Dartmouth and an MBA from Western Governors University. She is currently pursuing a master’s in journalism from Harvard University. Liz is a paid contributor to THINK Marketing.

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