Guides CRO 101 for beginners

CRO 101 for beginners

Learn the fundamentals of conversion rate optimization (CRO), its advantages, and how it differs from other marketing techniques to increase revenue.

1 What is the conversion?

The eCommerce landscape in 2023 is evolving rapidly, driven by recent global events, such as the pandemic. Online shopping has become an integral part of our daily lives, and eCommerce trends are shaping this dynamic environment:

  1. Omnichannel Shopping: Consumers now demand seamless experiences across various platforms.
  2. Personalization and AI: AI-driven personalization is a standard practice.
  3. Mobile Commerce: Mobile shopping is the new norm.
  4. Sustainability: Eco-conscious shopping is on the rise.
  5. Fast Shipping: Quick and reliable delivery options are expected.
  6. AR and VR: These technologies enhance the shopping experience.
  7. Data Security: Protecting customer data is a top priority.

Given this eCommerce landscape, understanding and optimizing conversions is more crucial than ever for eCommerce businesses.

What is a Conversion?

In the digital realm, a conversion occurs when a visitor to your website completes a specific action, such as filling out a form, making a purchase, or subscribing to a service. The proportion of visitors who successfully convert is known as your "conversion rate." These conversions can include:

  1. Online Sales: When a visitor makes a purchase, it's a direct and significant success for eCommerce businesses.
  2. Lead Generation: Conversions also involve visitors expressing interest by providing contact information, turning them into potential customers.
  3. Email Signups: Encouraging visitors to subscribe to your email list fosters ongoing engagement.
  4. Form Completions: Filling out forms, whether for inquiries or sign-ups, is considered a valuable conversion for lead generation.

Why Conversions Matter

Conversions are vital metrics in the marketing funnel. They measure how effectively your website and marketing strategies engage users at various stages of their journey, showing progress down the sales funnel.

Conversions help identify visitors genuinely interested in your products or services, enabling you to differentiate them from less interested users. They also serve as diagnostic tools, revealing issues in website design or marketing funnels, allowing for strategic refinements.

Micro and Macro Conversions: A CRO Perspective

Understanding the user journey is crucial for differentiating between micro and macro conversions in the digital eCommerce landscape.

Macro Conversions: These are high-impact conversions aligned with your website's core objectives, such as making a purchase or booking a service. Tracking macro conversions is essential for assessing the overall effectiveness of your CRO strategy.

For instance, in an online clothing store, a macro conversion occurs when a user completes a purchase, contributing to revenue and customer acquisition.

Micro Conversions: These are smaller, incremental actions, like signing up for a newsletter, adding items to a cart, or viewing product details. It is an action or a set of actions that strongly indicate a user is progressing towards profitable action on your website. ****They indicate engagement and interest, providing insights into user behavior and progress toward the ultimate conversion.

Analyzing these actions helps identify areas where users show interest and what steps lead them closer to the ultimate goal.

For example, a user browsing an online clothing store might view product pages, add items to their cart, and sign up for the newsletter. These are all micro conversions, indicating their interest and potential intent to make a purchase.

Recognizing the difference between micro and macro conversions and understanding their role in the user journey enables informed decisions for website optimization, improving the user experience. This, in turn, increases the likelihood of users progressing from micro to macro conversions, driving the success of your CRO strategy.

2 What is the conversion rate & How to calculate it

Understanding Conversion Rates in eCommerce

In our previous discussion (what is conversion), we emphasized the critical role of conversions in the eCommerce landscape. Now, we'll take a deeper dive into the world of conversion rates, establishing connections with our earlier content, providing insights on how to calculate them, and highlighting the distinctions between global conversion rates and process-specific conversion rates.

Linking Conversion Rates to Conversion Rate Optimization (CRO)

As previously outlined, a conversion rate serves as a fundamental metric, gauging the proportion of website visitors who successfully accomplish a desired action, such as making a purchase, submitting a form, or subscribing to a service. This metric is pivotal in the realm of Conversion Rate Optimization (CRO), reflecting the efficacy of strategies aimed at engaging users and shepherding them through the sales funnel.

Calculating Conversion Rates: A Simple Formula

To calculate a conversion rate, the following formula proves invaluable:

Conversion Rate (%) = (Number of Conversions / Total Visitors) x 100

For instance, consider a scenario where your eCommerce website witnessed 1,000 visitors, and 50 of them completed a purchase. Your resulting conversion rate would be:

(50 / 1,000) x 100 = 5%

This percentage reveals how proficiently your website transforms visitors into customers or achieves other intended actions.

Global Conversion Rate vs. Process-Specific Conversion Rates

  1. Global Conversion Rate: This metric offers a comprehensive overview, evaluating the overall conversion rate for your entire website. It measures the website's effectiveness in converting visitors into customers or achieving specific actions across all processes and pages. This high-level metric provides valuable insight into your website's performance in engaging and converting users.
  2. Process-Specific Conversion Rates: In contrast, process-specific conversion rates focus on distinct actions or processes within your website. These can encompass:
    • Checkout Conversion Rate: This metric quantifies the percentage of users who successfully complete the checkout process and finalize a purchase. It is an indispensable gauge of your checkout experience's effectiveness.
    • Cart Conversion Rate: This rate tracks the percentage of visitors who add items to their cart. It plays a pivotal role in assessing how efficiently your website encourages users to take this crucial step.
    • Account Creation Conversion Rate: This metric measures the percentage of visitors who create an account on your platform. It is vital for evaluating user engagement and lead generation.

Why Distinguish Between Global and Process-Specific Rates?

The distinction between global and process-specific conversion rates is paramount for targeted optimization, yielding the following advantages:

  • Diagnostic Insights: Process-specific rates illuminate areas necessitating enhancement. For instance, if your cart conversion rate is lower than expected, it signifies issues within the cart experience that warrant attention.
  • Tailored Strategies: Differently tailored strategies can be designed to enhance diverse processes. For example, if your account creation rate is underperforming, strategies like optimizing the registration form or offering incentives can be devised.
  • Holistic Performance Evaluation: The global conversion rate offers an all-encompassing view of your website's performance, while process-specific rates enable an in-depth analysis of specific areas. This multifaceted approach ensures a well-rounded Conversion Rate Optimization (CRO) strategy.

By competently employing both global and process-specific conversion rates, eCommerce teams can comprehensively optimize their websites, thereby augmenting their odds of success in the fiercely competitive eCommerce landscape of 2023.

3 What is conversion rate optimization

CRO: a timeless strategy that's always been

In a previous chapter of my life, I worked at a Big Retailer warehouse. It was a time when I'm almost certain WhatsApp didn't exist, but Facebook was already on the scene.

When I started working there, my boss explained how things operated. The phrase that stuck with me was, "Here, information flows from the bottom up. Any idea or improvement proposal should originate from the people at the base, not from top management.”

That got me excited. So much so that I carried a notebook with me every day, jotting down ideas on how to optimize processes. Most of them were either trivial or had already been tried and tested, but a few of them actually worked.

As time went on, my passion for this way of working led to me being entrusted with the mission of evangelizing this methodology (based on Toyota's Lean manufacturing) within any company I worked in.

I share this because Conversion Rate Optimization (CRO) is neither new nor magic nor the latest marketing trend. It's something that has been practiced for many years in the offline world.

Consider a restaurant strategically placing its most popular dishes at the top of the menu to boost orders. Or a retail store arranging products strategically to encourage more sales of certain items. These are real-world instances of CRO at work, where businesses refine their processes to enhance outcomes.

Forward-thinking companies, aware of the value it brings, have integrated CRO into all their processes. Take the big retail company I worked for, for example, which cultivates a culture of optimization in product development, logistics, sales, and throughout the entire organization.

Now, let's simplify CRO. Conversion Rate Optimization, or CRO, is like tuning your car for better mileage. It involves strategic adjustments to your website, much like a mechanic fine-tunes a car's engine. The goal is to increase the number of visitors who take a desired action on your site, whether that's making a purchase or signing up for a newsletter. CRO's aim is to maximize your website's performance, converting more visitors into satisfied customers.

So, when will you adopt this approach to elevate your results in the world of CRO?

4 What are the benefits of conversion rate optimization?

Why is conversion rate important?

Conversion rates serve as a powerful tool for assessing the performance of various digital marketing strategies and channels, be it on your website, e-commerce platform, or other digital business.

Understanding the behavior of your site visitors, their interactions, and the actions they take is instrumental in evaluating the effectiveness of each page, call to action (CTA), or the platform itself. As we embark on this exploration of the extensive advantages of Conversion Rate Optimization (CRO) practices, it's vital to recognize that CRO goes beyond e-commerce and offers transformative benefits to businesses across diverse industries:

Understanding the Multifaceted Benefits of CRO:

1 Enhanced user experience across Industries

  • Media & Publishing: In the digital news realm, CRO isn't confined to e-commerce; it greatly enhances user experience. By optimizing user interfaces, content placement, and navigation, digital news platforms can engage readers effectively, leading to increased ad revenue and subscriptions.
  • SaaS Providers: SaaS providers find CRO invaluable. Simple tweaks to trial periods, pricing pages, or feature highlights can significantly enhance conversion rates from site visitors to paying customers.

2 Cost-effective marketing in the digital space

  • Digital Marketing Agencies: Digital marketing agencies leverage CRO to maximize ad spend. Optimizing landing pages and ad copy reduces the cost per lead or acquisition, resulting in higher returns on clients' investments.
  • Tech Startups: Tech startups can benefit from CRO by focusing on user onboarding, mobile app optimization, and conversion paths, effectively competing with industry giants by providing superior user experiences.

3 Improved engagement and brand trust

  • Social Media Platforms: Social media platforms use CRO to increase user engagement and ad clicks. By making simple adjustments to the placement and design of ad content, they achieve higher engagement rates and deliver superior advertising results.
  • Non-Profits: Non-profits benefit from CRO by optimizing their websites to increase donor contributions, building trust with their audience, and fostering ongoing support.

4 Enhancing content publishing and subscriptions

  • Content Publishing Platforms: Content publishing platforms can use CRO to optimize content recommendations and reduce bounce rates, keeping readers engaged, fostering return visits, and ultimately leading to increased ad revenue.
  • Subscription Box Services: Subscription box services often rely on CRO to encourage sign-ups and reduce churn rates. Even small changes in subscription models or product recommendations can lead to sustained growth.

5 Additional benefits of CRO

Let's delve further into the supplementary benefits of Conversion Rate Optimization:

  • Lower customer acquisition costs (CAC) : Increased conversion rates result in more users converting with the same amount of site traffic, effectively lowering CAC and offering higher ROI on CRO efforts.
  • Continual UX improvement: CRO initiatives enhance the overall user experience, from removing confusing elements to streamlining navigation, ultimately delivering a more user-friendly environment.
  • Positive Impact on SEO: CRO and SEO are powerful when used in tandem. CRO focuses on high-quality, user-friendly content, aligning with SEO objectives and ultimately increasing your search ranking, driving conversions.
  • Audience insights: CRO efforts provide actionable insights into user behavior, offering a comprehensive understanding of your visitors and better planning for future changes and marketing initiatives.
  • Brand reputation enhancement: Consistency in design, messaging, and user experience elevates your brand's perception. Happy visitors lead to trust, word-of-mouth promotion, and business growth.
  • Reinforcing the importance of CRO : Statistics from various industries underscore the significance of Conversion Rate Optimization:
    • Nearly 60% of B2B marketers regard CRO as the most valuable metric for landing page performance.
    • For 70% of marketers engaged in CRO, the outcomes of their experiments inform other marketing decisions.
    • Businesses using CRO tools report an average ROI increase of 223%.

CRO is the key to optimizing your digital business, yielding enhanced user experiences, increased conversions, and sustainable long-term growth.

5 When should I use conversion rate optimization?

At Air360, Conversion Rate Optimization (CRO) is far from a one-size-fits-all solution. With our extensive experience working with big brands, we have witnessed firsthand how CRO can yield remarkable results when employed strategically. We'll delve into the ideal situations for deploying CRO, supported by practical use cases from a diverse range of industries.

1. Leveraging CRO When Launching a New Website or Redesigning:

  • E-commerce: When embarking on a new e-commerce venture or redesigning a website, CRO implementation is pivotal. Analyzing user behavior on the fresh platform and optimizing its layout ensures a seamless transition, ultimately maximizing conversions.
    By tracking user interactions, studying click patterns, and analyzing navigation choices, we gain invaluable insights into what works and what doesn't. This data-driven approach helps us identify pain points, bottlenecks, and obstacles that might discourage users from completing their journey. The result? A more user-friendly, intuitive, and enjoyable online shopping experience.
    Example: An e-commerce business undergoes a website redesign and uses CRO to identify that the previous layout made it challenging for users to find product categories. By simplifying the navigation and improving category organization, they create a more user-friendly experience, ultimately leading to higher conversion rates.
  • B2B SaaS Providers: For B2B software-as-a-service providers, CRO is indispensable during software platform launches or UI revamps. It simplifies user onboarding, thereby enhancing the overall user experience.

2. Harnessing CRO After a Significant Traffic Increase:

  • Media & Publishing: Media and publishing platforms often witness surges in viral content. CRO comes into play, optimizing content placement, suggesting related articles, and enhancing ad layouts to capitalize on increased traffic.
  • Social Media Platforms: During trending events, social media platforms observe spikes in user activity. CRO enhances user engagement and ad click-through rates, optimizing results.

3. Employing CRO During Seasonal Sales or Promotions:

  • Retail and E-commerce: Holiday seasons or special promotions provide prime opportunities for CRO. By refining product placement and checkout processes, businesses maximize sales and minimize cart abandonment, enhancing revenue.
  • Travel and Hospitality: In the travel industry, CRO proves its worth during peak booking periods. Airlines, hotels, and travel agencies streamline their booking processes, encouraging visitors to complete reservations.

4. Capitalizing on CRO When Expanding to New Markets:

  • Global E-commerce: Venturing into new markets presents a golden opportunity for CRO. E-commerce businesses adapt their websites to cater to local customer preferences, effectively increasing conversion rates.
  • Tech Startups: Tech startups entering new regions can significantly benefit from localized CRO efforts, ensuring their product resonates with the target audience and drives growth.

5. Adapting to Algorithm Updates with CRO:

  • Digital Marketing Agencies: In the ever-evolving digital landscape, CRO is a guiding light for digital marketing agencies. As search engine algorithms shift, CRO enhances landing pages, CTAs, and user engagement, ensuring websites stay optimized for maximum visibility and performance.
  • Content Publishers: Post-major algorithm updates, content publishers turn to CRO to improve content discoverability and enhance user experiences, maintaining and improving their online presence.

6. Navigating Changing User Behavior with CRO:

  • Non-Profit Organizations: Non-proprofits employ CRO when donor behavior patterns shift. Optimizing donation pages and engagement processes ensures continued support and sustains their mission.
  • Subscription Services: Subscription-based businesses adapt to changes in user preferences with CRO. By tweaking pricing models and subscription paths, they retain and acquire more customers, sustaining growth.

7. Ongoing Website Maintenance with CRO:

  • E-learning Platforms: For e-learning platforms, continuous CRO efforts are a game-changer. Regular analysis and optimization of user paths and content placement lead to increased course enrollments and heightened user satisfaction, supporting educational goals.
  • Healthcare Providers: Healthcare providers integrate CRO into ongoing improvement initiatives, ensuring patients can seamlessly navigate their websites to find relevant information and make appointments, enhancing patient care.

In conclusion, CRO is a dynamic process that adapts to the evolving digital landscape. The timing of its implementation significantly impacts business success. Stay tuned for more insights into the world of Conversion Rate Optimization.

At Air360, we believe that conversion rate optimization (CRO) is a versatile strategy, not one-size-fits-all. Our extensive experience working with big brands has shown how CRO can yield remarkable results when used strategically. Let's explore the ideal situations for deploying CRO supported by practical use cases from various industries.

1. CRO for New Website Launches and Redesigns:

  • e-commerce: CRO is pivotal when launching a new e-commerce venture or redesigning a website. It ensures a seamless transition and maximizes conversions by analyzing user behavior and optimizing the layout. By tracking user interactions and analyzing navigation choices, we create a user-friendly online shopping experience.
    Example: An e-commerce business redesigned its website, making it easier for users to find product categories. Simplified navigation and improved organization resulted in higher conversion rates.
  • B2B SaaS Providers: CRO is indispensable during software platform launches or UI revamps, enhancing user onboarding and overall experience.

2. CRO After Traffic Surges:

  • Media & Publishing: CRO optimizes content placement, suggests related articles, and enhances ad layouts when viral content leads to increased traffic.
  • Social Media Platforms: During trending events, CRO boosts user engagement and ad click-through rates, optimizing results.

3. CRO for Seasonal Sales and Promotions:

  • Retail and E-commerce: CRO refines product placement and checkout processes during holidays or promotions, increasing sales and reducing cart abandonment.
  • Travel and Hospitality: In the travel industry, CRO streamlines booking processes, encouraging visitors to complete reservations during peak booking periods.

4. CRO for Expanding to New Markets:

  • Global E-commerce: CRO adapts websites to local customer preferences, effectively increasing conversion rates when venturing into new markets.
  • Tech Startups: Localized CRO ensures products resonate with the target audience and drives growth in new regions.

5. Adapting to Algorithm Updates with CRO:

  • Digital Marketing Agencies: In the evolving digital landscape, CRO enhances landing pages, CTAs, and user engagement in response to algorithm shifts, optimizing websites for maximum visibility and performance.
  • Content Publishers: Post-major algorithm updates, CRO improves content discoverability and enhances user experiences, maintaining and improving online presence.

6. Navigating Changing User Behavior with CRO:

  • Non-Profit Organizations: CRO optimizes donation pages and engagement processes when donor behavior patterns shift, ensuring continued support and mission sustainability.
  • Subscription Services: CRO helps subscription-based businesses adapt to changes in user preferences by tweaking pricing models and subscription paths, sustaining growth.

7. Ongoing Website Maintenance with CRO:

  • E-learning Platforms: Continuous CRO efforts lead to increased course enrollments and heightened user satisfaction by analyzing user paths and content placement, supporting educational goals.
  • Healthcare Providers: CRO enhances patient care by ensuring seamless navigation to find relevant information and make appointments in ongoing improvement initiatives.

In conclusion, CRO is a dynamic process that adapts to the evolving digital landscape, significantly impacting business success.

6 What is CRO for e-commerce

If you're involved in the world of e-commerce, you've probably heard of CRO, but the exact definition can be a bit fuzzy. According to Wikipedia, Conversion Rate Optimization (CRO) is about increasing the percentage of website visitors who become customers or perform any desired action on a web page. However, this definition may not fully capture the essence of CRO.

In the world of e-commerce, CRO goes beyond simply increasing the conversion rate. It's a strategic process that aims to improve efficiency, profitability, and the overall success of an online business. Here, we'll delve into what CRO means in the context of e-commerce and how it can drive your online success.

E-commerce CRO: More Than Conversion Rates

E-commerce CRO is about maximizing profitability through efficiency. It's not a one-time fix, opinion-based, or about copying competitors blindly. It's a data-driven, strategic journey.

The Role of Segmentation in E-commerce CRO

Segmentation is a cornerstone of successful e-commerce CRO. It involves categorizing your audience into distinct groups based on characteristics, behaviors, or preferences. By tailoring CRO efforts to these segments, you enhance efficiency and effectiveness.

E-commerce CRO Methodology

Implementing e-commerce CRO follows a four-phase methodology:

  1. Research: Gather data to understand user behavior, weaknesses, and improvement opportunities.
  2. Hypotheses: Formulate hypotheses based on research to address deficiencies in different segments.
  3. Testing: Test hypotheses through controlled experiments to identify impactful actions.
  4. Results: Analyze test results and make data-driven decisions to implement changes.

Ideal Conversion Rate for eCommerce

Determining an ideal conversion rate is nuanced and influenced by industry, product type, website design, and audience. On average, e-commerce sees rates of 2.5% to 3%.

Improving global conversion rates in e-commerce requires focusing on micro conversions, which are key stages in a customer's journey. Enhancing these can boost your overall conversion rate.

Global Conversion Enhancement

Defining the right conversion rate for your e-commerce business requires careful evaluation. Continuous monitoring and optimization are key for sustained success.

To boost your global conversion rate in the intricate landscape of e-commerce, focus on optimizing various micro conversions:

  1. Product Page Views to Add to Cart: Showcases early interest in products.
  2. Add to Cart to Initiate Checkout: Indicates strong purchase intent.
  3. Initiate Checkout to Complete Purchase: Converts visitors to customers.
  4. Newsletter Sign-ups: Nurtures leads through email marketing.
  5. Account Registrations: Enhances personalization and repeat purchases.
  6. Cross-sell and Upsell Conversions: Increases order value.
  7. Product Review Submissions: Builds trust and social proof.
  8. Social Media Engagement: Boosts brand visibility and loyalty.
  9. Wishlist Creations: Shows strong product interest.
  10. Referral Program Participation: Drives brand growth.
  11. Customer Account Updates: Reflects an ongoing relationship.
  12. Mobile App Downloads: Boosts mobile sales and user experiences.
  13. Subscription Box Sign-ups: Ensures recurring revenue and satisfaction.
  14. Customer Support Interactions: Increases loyalty and positive word-of-mouth.
  15. Abandoned Cart Recovery: Recovers revenue and reduces cart abandonment.
  16. Repeat Purchases: Highlights loyalty and satisfaction.
  17. Membership Sign-ups: Offers exclusive benefits and repeat purchases.
  18. Gift Card Purchases: Potentially leads to future sales.
  19. Product Customization: Enhances the overall customer experience.

Optimizing these micro-conversions can supercharge your e-commerce strategy, boost revenue, and enhance customer satisfaction, ultimately improving your global conversion rate.

7 What is conversion rate optimization in digital marketing?

Understanding CRO in Digital Marketing

Conversion Rate Optimization (CRO) is the secret sauce that can significantly boost your eCommerce strategy. It's the fine art of turning your website visitors into customers, and it plays a pivotal role in the world of digital marketing. But what exactly is CRO, and how does it work? Let's break it down.

In the ever-evolving landscape of digital marketing, one term frequently thrown around is "user acquisition." it is the initial step in engaging potential customers. It's the moment when a visitor transitions into a potential lead or user, which is a critical juncture in the customer journey. This is precisely where Conversion Rate Optimization (CRO) comes into play and why it is exceptionally vital for optimizing the acquisition process.

The Role of Acquisition CRO

Acquisition CRO focuses on optimizing the initial stages of your customer's journey. It's about making sure that when people land on your website, they not only stay but also take meaningful actions. This can include downloading an app, signing up for an account, or making that all-important first purchase.

Now, let's delve into the heart of the matter: What is conversion in marketing?

Defining Conversion in Marketing

Conversion in marketing occurs when a user takes a desired action in response to a Call to Action (CTA). These CTAs can be embedded in ads, offers, or push notifications. The action taken may vary, depending on your campaign objectives. For example, in the mobile marketing world, conversions can be a download, app installation, sign-up, or a purchase, among other actions.

Why is Conversion Important to Marketers?

Conversion is the compass that guides marketers in their digital wilderness. Here's why it's crucial:

Measuring Campaign Performance: Conversion rates are key performance indicators (KPIs) that help assess the effectiveness of marketing campaigns. Without tracking conversions, it's challenging to determine your return on ad spend (ROAS) or gauge the success of your efforts.

Tailoring Campaigns for Success: When running user acquisition campaigns, conversion rates provide a vital yardstick. They reveal how successful each campaign is and can be used to set return on investment (ROI) expectations when scaling up.

Aligning with Company Goals: Not all conversions are created equal. While a high conversion rate for new accounts or app installs is a great start, the ultimate goal might be generating revenue through purchases. You gain a holistic view of your user's journey by considering multiple conversion events.

Beyond the Basics: Other Uses of Conversion Rates

Conversion rates offer more than just campaign evaluation:

Comparing Advertising Channels: They allow you to compare and contrast the performance of various advertising channels. This data can be invaluable for optimizing your marketing strategy.

User Segmentation and Targeting: By analyzing conversion events further down the funnel, you can identify valuable user segments. This information can enhance the targeting and segmentation of your campaigns.

Enhancing User Experience (UX): A lower-than-expected conversion rate may indicate issues with your web/app user experience. It serves as a spotlight on areas for improvement, such as sign-in problems or other UX hurdles.

Testing Development Changes: When development changes are implemented, conversion rates can be a litmus test for success. For instance, if you overhaul the onboarding process and see a significant improvement in conversions, it suggests that onboarding plays a critical role in the customer journey.

In conclusion, CRO and conversion in marketing are essential tools for eCommerce success. By optimizing your website or app to enhance the user experience and tracking conversions, you can increase your ROI and guide your digital marketing strategy to new heights.

8 Acquisition vs CRO

For many years, businesses have been focusing a significant proportion of their marketing budgets on acquisition, under the pretence that more traffic will naturally lead to increased sales or revenue, which should, in turn, lead to business growth.

But it’s not always that simple.

Let’s start by looking at acquisition activities.

For an acquisition campaign to be considered a success, it needs to generate revenue. The traffic generated by your acquisition activities could be created organically, or it could be part of a paid-spend campaign. If you are investing money into attracting website traffic, you need to feel confident that you will receive a return on your investment. This could be an immediate return, such as the purchase of a product via your online shop, or it could be a longer-term return on your investment, such as building a relationship with a potential client.

If your sole focus is on acquisition, then a key part of your work will be based on improving your search engine rankings, improving organic traffic, and enhancing the online visibility of your business. But that’s where the work stops. Once the visitors have landed on your website, the task of converting them into paying customers moves elsewhere.

How are acquisition and CRO connected?

In our experience, too many businesses fail to see the connection between the two activities.

We believe that while it's vital to generate traffic and entice people to visit your website, it’s just as important to convert those visitors into paying customers. And beyond that, it’s important to make sure that any conversions align with your wider business strategy. This is the most effective way to ensure that you are maximizing the impact of any increased revenue.

This is why we think it’s important to take a holistic approach to any digital marketing activities. Acquisition and CRO should not be managed in siloes. Instead, they should be carefully connected and thought through as part of your wider digital strategy. By considering them as a complementary duo, you’ll be better prepared to take advantage of new opportunities or react to changing environments.

What’s more, it can also be far more cost-effective.

Let’s explain more.

Taking an acquisition-first approach

If you focus solely on your search engine KPIs, then you may start to pay too much attention to the technical aspects of acquisition, namely technical SEO. It can be easy to become focused upon these metrics without understanding their wider implications.

For example, we know that websites need to have a mobile-first approach to design and build. This is because consumers are increasingly using their phones and/or tablets to browse and shop online. An SEO team may recommend that you make minor changes to a page to improve its visibility on mobile to improve the search engine performance. Your SEO team could suggest reducing the number of images in a bid to improve site speed.

However, because their sole focus is upon the technicalities of SEO, they may not have to consider whether those changes could hurt that page's conversion rate.

The result could be that while that particular page ranks better organically, the conversion rates drop. As a result, your business may need to invest more in paid-spending activities to make up for the lower conversion rate.

Taking a CRO-first approach

Similarly, taking a CRO-first approach to your website means that too much attention is focused upon improving the conversion rate, without understanding how that could impact the wider SEO implications.

You may look at your website page and feel that visually it could benefit from a refresh. Perhaps your customer analytics are telling you that visitors are not reading lengthy product descriptions. Instead, they simply want to view individual product photos before making a purchasing decision. From a CRO perspective, you could recommend reducing the written content and increasing the number of images. However, that content may have been heavily optimized to attract organic traffic. By removing the content, you may have increased the conversion rate. You may also have inadvertently prevented any new customers from finding that particular page because the changes cause the page to fall down the search engine page rankings.

The result, like the acquisition-first approach, could mean that you have to spend far more on paid activities than you need to. This is because you’ll need to use paid-spend options to increase that page’s visibility within search engines.

What are the benefits of considering acquisition and CRO at the same time?

It is clear that by taking careful consideration of both acquisition and CRO activities at the same time, you could find that you have a far more cost-effective digital marketing strategy.

We believe that by considering them a partnership and ensuring collaborative working between different teams or departments, you’ll yield far more effective results. This can, in turn, provide you with a superior return on your investment.

There are so many elements of a good acquisition campaign that are intrinsic parts of conversion optimization that it’s a no-brainer that the two activities should be carefully combined. A core part of your CRO strategy is to ensure that the UX is carefully thought through. This can include the page layout, the overall visual image, the site speeds, etc – all of which are hugely relevant for SEO tactics. The better optimized the page, the easier it is to attract the right organic traffic that intends to convert to a paying customer.

Are your acquisition and CRO activities aligned with your broader business strategy?

One final element that is often missing from both acquisition and CRO campaigns is having an innate understanding of what your wider business strategy is.

In an ideal scenario, your newly combined acquisition and CRO activities will increase traffic to a particular page. Conversions will be quick and easy because you’ve used all of your available data metrics to understand what the visitor is looking for and what they expect to find on your site. You’ve put everything in place, but it may still not necessarily lead to increased revenue.

This is because you need to be clear about your wider business performance.

If you’re a retailer with an online store, have you focused your attention on the products that provide you with greater margins? To increase your revenue, you need to factor in how much you are spending on acquisition or CRO activities with the manufacturing/production costs of that specific product. The higher the profit margin, the better the revenue generated.

If we come back to the theme of collaborative working, you should ensure that your marketing and acquisition teams are working closely with your sales teams. This way, you can prioritize your most important products or services. By focusing on your best-sellers first and foremost, you can quickly and effectively improve your revenue and create an effective return on your investment.

For the past 5 years, we have worked with big DTC brands,and although CRO back in the day was not as widespread as it is right now, we still face today the same objection from marketers we had to deal with in the very beginning:

"My business is doing okay. Investing in traffic acquisition works for us. Why rock the boat with that CRO thing?"

Don't get us wrong, we do understand why you might be reluctant.

Why fix it if it ain't broke, right?

But is accepting the status quo the right call? Why would you be content with "good enough" KPIs when you could get more revenue out of your marketing budget? Instead of apprehending the unknown, you should fear missing out on the extra revenue that's spilling through your fingers.

There is but one valid reason to ignore CRO: Marketers have lots of reasons why they discard CRO. Most of them are utter nonsense. Let's see:

  1. I don't know what it is: While ignorance is no excuse (marketers usually stay on top of major digital trends), this is easily remedied by defining CRO and how it could benefit your business (in fact we will do just that in a minute).
  2. I can't afford it: If you spend some of your marketing budget acquiring traffic, then chances are you can afford it; and investing part of that budget into CRO might bring in a bigger ROI (but more on that later).
  3. I don't have time: We're all busy. We all have to set priorities and focus on what we think will move the needle faster; but before you put CRO in the "low priority" tier (aka. the "I'll never get around to that" category), you should assess the actual ROI potential (and not just discard it based on your gut feeling).
  4. I don't have the required skill-set: We can't be good at everything; in fact, we are completely useless at a lot of things. But guess what: you can always hire people who have mastered the skills you need.
  5. I don't think that's worth it: You have assessed the potential ROI of CRO for your business and found it's not worth the investment. This is definitely a valid reason - THE one and only valid reason - but only if you ran the numbers and assessed the ROI potential ( We will show you how in a bit).

If you have reached this point in the article, then you can't just stop and fall back on the aforementioned excuses to ignore CRO. Now you just have to keep reading to know how to run the numbers and figure out whether or not CRO is a good option for your business.

Above all else, you shouldn't settle for less revenue just because it's easy. Don't ignore the cost of missing out on CRO as it could be huge.

Let's get to it.

How does CRO work?

CRO is a process that relies heavily on two pillars:

The first is A LOT of research - it is a learning process that brings you closer to your audience; obviously the more you know about your visitors, and their interactions, the more you understand them; and the more you understand them, the better you are able to identify what could potentially generate a conversion increase.

The second is A/B testing - which is the process of creating another version of a page (based on the research you conducted) and splitting your traffic between both page variations. Then you compare their respective conversion rates and permanently implement the highest performer.

Successful optimizers spend most of their time doing research, not working on A/B tests. So if you end up working on CRO yourself, make sure you don’t jump into A/B testing without doing prior research.

I am telling you this because A/B testing solutions tend to market their products as one-stop shops for CRO. But if you are serious about getting actual results, don’t skip on research and instead start by diving into Google Analytics, surveys, user tests, and so on. That's the road to success, the path to higher conversion rates.

Two valid, complementary approaches to revenue growth

You have two options to choose from when it comes to increasing sales:

  • Either you spend money on acquiring more traffic (and keep converting that traffic at the same level)
  • Or you invest in CRO to convert more of your visitors into customers (without bringing in additional traffic)

Most businesses invest in traffic acquisition as a matter of course. The question becomes: should you use part of your acquisition budget on CRO instead?

Doubling down on acquisition vs. investing in CRO

Let’s compare both options by taking a simple example. Let's say you currently get 10,000 visitors a month (and your acquisition cost is $0.5 per visitor); you convert 2% of this traffic on average, which represents 200 transactions a month. You sell 1 product that costs $50 (it is meant as a simple example after all!) so your monthly turnover is $10,000.

  • 10,000 visitors X 2% conversion rate = 200 transactions / month
  • 200 transactions X $50 = $10,000 / month

Let’s say you wish to increase your sales by 50% and get from $10,000 to $15,000 monthly turnover. You have two options:

  1. You get 50% more traffic: you spend $2,500 on acquiring new traffic.
  2. You increase your conversion rate by 50%: you convert at 3% instead of 2%.

More acquisition VS. Acquisition + CRO

Assuming you are a rational person, in a perfect world, you would choose whichever option is the most cost-effective, which means you would invest in CRO only if it costs less than $2,500 to get a +50% conversion boost.

We are not, however, in a perfect world, and it is not possible to predict by how much you'll be able to improve your conversion rate if you spend $$2,500 on CRO (either in time spent or money).

Even though the investment required to achieve the same result with CRO is usually bigger than through pure acquisition over the course of a month, I would still recommend you pick CRO in most cases (unless your cost of acquisition is very low).

Why? Because any conversion increase created during that month will last for a long time, whereas you would need to spend an extra $2,500 every month to keep selling 50% more products.

So even if you are not ROI-positive after one month, it will definitely pay off in time. You will be able to get a higher monthly turnover without having to spend more money on acquiring traffic every month.

Time to run the numbers!

It's time for you to do the math and weigh both options so you know which would be the most cost-effective to generate sustainable growth for your business.

9 Growth hacking vs CRO

Growth Hacking and CRO are two distinct but complementary strategies in the world of eCommerce. Digital teams often use both to enhance our online businesses. Here are the key differences:

  1. Focus and Goals:
    • In CRO, our primary focus is on optimizing the existing website or product to improve conversion rates. We aim to make the most of the traffic we already have by enhancing the user experience.
    • Growth Hacking, on the other hand, is more about finding innovative ways to acquire and retain customers. It's a broader approach that encompasses marketing, product development, and creative tactics to achieve rapid growth.
  2. Approach:
    • CRO is a methodical and data-driven approach. We use experience analytics and A/B testing to identify weaknesses in the conversion funnel and make incremental improvements.
    • Growth Hacking is often associated with creative, unconventional, and sometimes risky strategies. It's about finding shortcuts and quick wins to drive growth, even if they are not always sustainable.
  3. Timeframe:
    • CRO is a more long-term strategy. It involves continuous, incremental improvements and can take time to show substantial results.
    • Growth Hacking is often about achieving quick, sometimes viral growth in a short timeframe. It might involve rapid experiments and adjustments.
  4. Metrics:
    • In CRO, we're closely monitoring metrics related to conversion rates, such as click-through rates, bounce rates, and cart abandonment rates.
    • Growth Hackers tend to focus on a wider range of metrics, including user acquisition, retention, and viral coefficient, to identify what's driving growth.
  5. Testing and Experimentation:
    • CRO relies heavily on A/B testing and data analysis to make informed decisions.
    • Growth Hacking involves more rapid experimentation, trying out various strategies to see what works and discarding what doesn't.
  6. Team Skills:
    • CRO often requires a strong understanding of analytics, UX design, and website optimization.
    • Growth Hacking involves a mix of marketing, product development, and often unconventional thinking.

Digital and eCommerce teams should recognize that both Growth Hacking and CRO have their places in their toolkit. CRO is about refining the user experience on the existing platform, while Growth Hacking is more about finding innovative ways to fuel rapid growth. Depending on our business goals and resources, we may use one or both strategies to drive success.