In the late 1990s, just as the internet was taking off, Johann was working at a media company that was transforming itself into an internet company. Since he was there from the start of the transformation, he was able to learn all about eCommerce on the job. There were no blueprints or books on how to become an internet company at the time, so they made a lot of mistakes, wasted a lot of money, and learned a lot of lessons.
Johann now uses all those lessons he learned to teach other companies all over the world. Mistakes are expensive, but hopefully each mistake is only made once, then the companies can apply what they’ve learned in line with lean methodology.
Listen to learn more about lean methodology.
Deciding to Write the Book
Johann had read every book on conversion rate optimization, many of which are very good. However, there weren’t any books focusing specifically on eCommerce, and the few that mentioned it seemed to barely scratch the surface. There is a gap in literature surrounding the optimization of eCommerce sites. So Johann and his co-author set out to write a book for their younger selves going through all the mistakes and lessons they’d learned. It’s a practical guide that takes the reader through the entire process from day one.
eCommerce Literature
Any business owner needs to understand how to make a profit, how money flows, how money is generated in a business, the laws of running a business, marketing principles, and consumer psychology. Owners of eCommerce businesses also need to know how those things apply to selling products online.
Johann’s book goes into all the different facets that come together in conversion rate optimization. It’s not just about tweaking the website, it’s about tweaking the business.
Conversion Rate Optimization Is a Misleading Misnomer
The concept of optimizing a business’s conversion rate is potentially very misleading. Instead of only comparing the number of people who visit a website with the number of people who buy from it, the business must look at many other factors and variables that go into that.
It’s possible for a business to increase their conversion rate and see a decrease in profit and revenue at the same time. Conversely, their revenue could increase even as their conversion rate decreases. A business can magically double their conversion rate by dropping all of their prices and selling below cost, but that does nothing for their profits. It’s a misleading metric.
Listen to learn how increasing CRO can be similar to growing social media accounts.
Segments on Google Analytics
Conversion rate optimization does have its place, and one way to deal with it meaningfully is to compare different segments. Use Google Analytics to apply segments to everything, then build on that. Google Analytics gives you aggregate numbers by default, but there is no average visitor, so you have to slice it up.
One way to segment in Google Analytics is by selecting primary and secondary sources from your drop down menu.
The second way to segment in google Analytics is to set up advanced segments. You can answer virtually any question just by being clever about how you set up those segments. However, when you slice it so thinly, you may end up with very small sample sizes. Be careful of the interpretations you make.
Listen to learn why conversion rate is not a statement, but a question.
Segment Personas
Johann recommends segmenting personas by goal, not demographic. In most cases, what leads people to make a decision to buy is not how old they are, where they live, or what gender they are. They decide to buy because they have a need that is driving a goal. What is your customer trying to achieve by buying your product? Split personas into those goal categories.
Listen to learn why personas have gotten a bad rap.
Merchandising Analytics
Merchandising analytics is a blind spot. Everyone knows what their leading categories or bestselling products are, but merchandising analytics digs deeper into that. It allows you to tweak your product mix and how you present your products.
Sometimes even loyal customers who have bought from a company for years can buy one particular product, then buy less from the company in the future. Merchandising analytics helps pinpoint that product. To fix such a problem, the company must speak to the customers and find out what’s going on.
For example, one famous bricks and clicks brand Johann worked with had a particular handbag that was selling very well in stores, but while there was plenty of traffic to the handbag on the website, it wasn’t selling well online. The team had lots of debates about what was causing it, but after they spoke to their customers, they found that people online weren’t sure how to match the handbag to boots or clothing. That hadn’t even been one of the options that came up while the team was debating the issue.
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