An introduction to segmenting Ecommerce site visitors to increase conversion rates
We humans tend to stick with what we know. That can lead to great things as we specialize (the invention of the light bulb and the telephone for instance). But it can also lead to diminishing returns, especially when our business requires us to deliver results across a variety of disciplines.
For online merchants, familiarity with the methods for driving website traffic often creates a tendency to get caught up in driving more and more traffic. As an industry, we’re starting to see increased focus on optimizing conversion rates as an alternative to chasing increasingly expensive sources of traffic coming from SEO, PPC, email, and social campaigns.
But as with most relatively new fields, venturing into conversion optimization can be daunting, and it can be hard to figure out where to start. A good place to start is by figuring out where you currently stand. There are many analytics tools that help merchants understand their visitors by segmenting the traffic.
Critical to success for small and mid-size sites is making the segmentation data accessible, and then testable. It’s achievable and appropriate for large merchants to do deep mathematical modeling of traffic and personas – but for the majority of the market it can be incredibly powerful to simply monitor basic visitor segments and then consider new ways to interact with them.
A basic analytics package (Google Analytics Advanced Segments for example, or Spring Metrics) can help. Ask how many first-time visitors am I getting? How many repeat visitors? What times of day are heaviest? What are the geographical regions? What are the sources of my traffic? Which ones convert best and which ones don’t convert very well at all?
A daily regimen
The trick to most things is consistency. Spending just 10 minutes a day looking at how your site traffic segments are performing will provide you an entirely new arsenal of insights in just a few weeks. And as with most journeys, the hardest steps are the first few: finding and configuring a tool that can make that 10 minutes productive—and even enjoyable.
Merchants need a solution that is quick to set up, easy to use, and provides an appropriate depth of information for their business. Adobe Omniture is incredibly powerful, but it requires a significant human investment to set up and tune.
Reading the tea leaves
All merchants are unique. Understanding what motivates your particular visitors to convert is often the linchpin to unlocking the gates to higher conversion rates.
Examples of how store owners have improved their conversion
These are examples of insights gained by store owners who invested only a small amount of time to understand their traffic better:
- One customer found that their first-time visit customers had a significantly different sales objection than their second-time visitors. First-time visitors responded much better to a message that established product credibility—they needed to see and hear testimonials and third-party validation to overcome initial skepticism. When visitors returned, testing showed that an emotional appeal (“this will make you feel better”)—backed up again by testimonials and examples—was most effective at closing the sale.
- In another example, a business products customer found that special treatment for visitors arriving from comparison shopping engines (CSEs) made a difference in conversion rates. Perhaps unsurprisingly, that segment was primarily motivated by price. Segmentation allowed them to display a lower price to only that segment, which protected margins in other visitor segment while increasing the site’s conversion rate and revenue.
Common behavioral segments include:
- Visit count
- Time on site
- Source (search, email, PPC, social, etc)
- Geographical location
- Mobile / tablet / desktop
- Conversion history
- Clickstream (page visit history)
Try a few of these and you’ll be surprised what you see on your site.
Bringing it together. A summary of how to segment for greater insights
- Find a simple tool. Don’t get hung up with complicated tools. Find something that takes less than 30 minutes to install and delivers human-readable data.
- Learn something small every day. Find a time slot that works for you, and spend 10-15 minutes every day looking at your traffic segments. In a week or two you’ll find that you’re developing a sense of where things are going well—and where they’re not.
- Explore two segments. Pick one segment that is doing well and write down the top three attributes you think contribute to its performance. Next, pick a segment that is doing poorly and write down three ideas to improve its performance.
- Focus on high-volume, underperforming segments. The greatest gains in conversion rates (and therefore revenue and margin) often come from increasing the worst-performing segments, not from further optimizing the best performers.
- Test, learn and repeat. Adopt an incremental improvement mentality. If you can take a visitor segment with just 20% of your traffic and improve the conversion rate from 2% to 3%, you’ve got a 10% improvement to your site-wide conversion rate! Big results from small changes.
The incredible leverage possible from conversion optimization is increasingly available to a wider range of merchants. If you aren’t already doing so, it’s worth taking a look at segmenting your traffic and converting more of your existing site traffic into customers.