There is no denying the potential of e-commerce as a rival and subsequent successor of conventional business methods.
The stats also convey the rising popularity of the platform. E-commerce sales conducted worldwide have accounted for 11.9 percent of all retail sales; and the number is expected to rise to 17.5 percent by 2021.
However, an in-depth analysis unearths vital issues that serve to hinder the growth of e-commerce. The global average conversion for e-commerce remains at 2.86 percent; to put that into perspective, Amazon boasts a conversion rate of 13% – which is almost 4.5 times that of the industry average.
While one-tenth of the world is buying online, there is still significant ground left to cover for the industry.
Why Is A/B Testing Important?
No matter how successful your business is, there is always an underlying need to improve your conversion rate. From entrepreneurs to chief executives, sole proprietorships and multi-nationals – all commercial entities can benefit from improved conversion rates.
The requirement is further amplified on the internet led world of e-commerce, where the conversion funnel is consistently highlighted. Every aspect of the buyer journey comes under intense scrutiny to increasingly focus on conversions.
While there is the incentive of increased conversions, there is an inherent risk in testing new features and having them backfire. Because of this, many online retailers abstain from testing.
However, that is what separates the average stores from ones with extraordinary conversions and exceptional revenue. Successful retailers are not marketing geniuses that devise strategies that work every time, but they believe in testing out new ideas to see what drives conversions.
How do they do it? Through A/B testing.
What Is A/B Testing?
Most businesses think of A/B testing, or split testing, as small tweaks made in to the design components such as the color palette or the call-to-action buttons; but it goes much deeper than that.
In essence, A/B testing encompasses an entire methodology to determine which design, content form, and format proves more successful and effective for the visitors on your site. A/B testing allows companies to test a variation of a page’s functionality, and all its elements, to check what influences consumer behavior. While there are other methods to increase conversions rates, including abandoned cart emails, A/B testing can be one of the most reliable ways to increase your site’s profitability.
Another misconception which needs clarification is that many people think A/B testing is a one-off process. Ideally, A/B testing entails a website is subject to repeated testing until you reach the optimal level of conversions.
How Does A/B Testing Work?
Primarily, there are two broad types of split testing procedures: client-side and server-side testing.
Contrastingly, server-side testing involves zero modification on the browser level. A randomly chosen web page variation is sent from your server to the visitor’s browser. Effectively, server-side testing eliminates on-browser alterations, and the possibility of the flicker effect.
Regardless of the type of tool being used the underlying goal remains the same: bifurcate the incoming web traffic into multiple sections, with each viewing a different variant of the e-commerce website that incorporates design changes to find which variation works best in terms of conversions.
When it comes to Amazon, they may test a number of fields featured in their checkout process.
Statistical Significance Plays A Role
There’s a caveat ,however, that restricts low-traffic websites from conducting A/B testing.
Like all statistical inferences, A/B testing relies on statistical significance. In order to generalize findings and infer strategies from the results, a certain amount of visitors must be reached during the testing period.
If you don’t have significant visitors visiting your site during the test phase, there is a possibility that the consumer behavior displayed is an anomaly to that of your target audience’s.
How To Use A/B Testing To Improve Conversion Rate
In an attempt to curb time and resources, many organizations resort to commonplace conversion optimization practices.
Not only can this be a waste of precious resources, but it is often ineffective in bearing results. What might work for one industry is not likely to work in another.
A successfully implemented A/B test requires organizations to analyze and address their own challenges and come up with successful tweaks, ensuring such a philosophy pushes the company to test every part of the consumer journey, from the home page to the checkout.
Here are some A/B testing strategies that have worked for various businesses, and can work for your business as well:
Test Recommended Products or Related Products with Customers
Upselling and cross-selling are two dominant aspects of e-commerce. Purchase a hammock, and Amazon recommends a hammock stand or a pillow that complements your purchase.
Surprisingly enough, 59% of retailers remain unaware of the potential benefit that can be achieved by adding upsells and cross-sells on the main product page. Some websites emphasize a simple layout devoid of recommended products to ensure easy navigation, whereas some websites insist on showing related products to boost sales. What works?
The answer differs from website to website, and there is only one way to find out if it works for your website: testing. Businesses can test a variety of pages; a version with upsell and cross-sell recommendations and a version without recommended products.
There is also room for added creativity. Businesses can add a version where recommended products only appear after an item has been added in the checkout cart. The higher the amount of variations a company is willing to test, the deeper the insights that are available.
Fine-Tune Your Call-To-Action (CTA)
The call to action button, as the digital marketing expert Neil Patel puts it, is the most influential element of your webpage. Period.
All visual details and carefully crafted content eventually leads to a call-to-action button, and the more people click on that button, the higher the conversions for your business.
However, a successful CTA requires a substantial amount of experimentation. Here are some components of a CTA where A/B testing can reap benefits for your website’s conversion rate:
One of the most important factors to consider is where will you place your call-to-action button.
Most designers tend to place it above the fold, as they think it gets most exposure and visibility this way.
Nothing is set in stone, and it is imperative to test different versions to arrive on the one that gets the most clicks.
Colors are linked with psychological triggers, and therefore choosing the color of your CTA button is of utmost importance.
A study by Hubspot highlighted how a red CTA managed 21 percent more conversions than a green colored one. While the general rule remains to have a CTA button with a contrasting color than the rest of the page, the only way of knowing what works best within your industry and niche is to split test with a different colored call-to-action buttons.
The core of your call-to-action button: the text. What length is the optimal text? Does it lack powerful words or is their usage a little excessive?
There are various questions regarding CTA content, and they all lead to one definitive answer: A/B testing. The importance of CTA content far exceeds the digital arena; ex-POTUS Obama is a classic example of someone who raised an additional $60 million just by tweaking his call-to-action button.
Tweak Your Pricing Display
E-commerce stores are usually very straightforward with the price (which is definitely good), but did you know that how you display the prices can also affect consumer conversions?
A study discovered that the addition of commas and cents could change consumer perception towards prices. The study concluded that the longer the price range, the higher is the consumer going to perceive it.
For instance, ‘1500’ is perceived as heftier than ‘$1500’, which is perceived to be more expensive than ‘$1,500.00.’
If that perplexed you, consider this. Another study revealed that the consumers react positively to prices ending with the number 9, as opposed to other numbers. In that study, items of the same price point, such as jeans, were tagged with prices such as $43 and $49.
To the researcher’s amusement, the $49 jeans outsold the $43 one by 24 percent!
If anything, such findings highlight how diverse industries and target audiences react differently. The key takeaway for organizations is to not mix up correlation with causation.
Every audience and niche behaves differently, and one can only find what works after testing different components enough times to derive a predictable pattern.
In addition to these changes, you should always consider building your site’s trust.
The fundamental difference between e-commerce and conventional marketing remains its ability to evolve continuously into a further consumer-centric platform. In this regard, A/B testing has proven to be a game changer for businesses that have leveraged e-commerce to amass considerable gains.
When asked about how much A/B testing Amazon conducts, CEO Jeff Bezos replied: “Our success at Amazon is a function of how many experiments we do per year, per month, per week, per day…”
And I think that sums the point of this article: Do not neglect A/B testing.
Recommended reading https://cxl.com/blog/ab-testing-guide/ for more on A/B testing.