#38 – E-Commerce Metrics That Matter

How can you double your E Commerce conversion rate using one simple method? Does such a thing exist? Yes, it does. And it's our ace in the hole. Anybody can do it. It is not complicated yet. It requires time, and I think that's a secret there. You will always have to invest the time. So if I have to choose the one method to double my E Commerce conversion rate in the next 60 days, here is what I will do. We're talking metrics. What we track, what we don't track, what people talk about. It's all metrics intensive. My name is Khalil Slade, and I love to talk about conversion rate optimization.

I'm Simba and I love asking questions about conversion optimization.

This is CRO Live hour, a show all about a B testing, experimentation and conversion rate optimization.

Each episode, Khalid amazes me, answering some of the difficult CRO questions, dropping insights like, it's no big deal.

While pretty much every episode will take on a new set of conversion rate optimization questions that are not easy. We will talk strategies, we will talk process, and we will talk tactics. Simba will be bringing all the questions.

Oh man. I bring tough questions like, do a B testing results fade over time? How do you go from low to high, testing velocity? How do you measure the success of a conversion funnel? And how do you align your CRO program with a growth strategy? Yeah, Khalid, these are very, very tough questions.

Yes, they are, but we always answer them here. And if you love conversion optimization like we do, and certainly like Simba does, subscribe to the CRO Live Hour POD podcast today, wherever you listen to your podcasts. Okey doke. Another week, another CRO Live hour. We skipped last week, unfortunately, because Simba had picked up a whole bunch of questions that I felt I had nothing of value to add. And I'm like, you know what? It's not my area of expertise and I know people ask those questions. I appreciate those questions, but if I have nothing of value to add, you know, might as well just, you know, say, you know what? No, it's not good. Simba, how was your week?

It's been a good week, I think. Same as the previous other weeks. I don't think I will ever have to say that I had a bad week because I think I enjoy what I do and my team performed better even though, like, the season is over. So yeah, it's been good.

That's awesome. That is awesome. Yeah, it's been an interesting year, actually, looking at our clients and how they perform. Looking at Figpi, definitely. FIGPI is in A place that we've been chasing for a long time. So it's fascinating to me. I'm like, oh, finally we are there, you know, so I'm a happy man. And invesp is in a good place as well. So it's interesting. We shall see what the summer brings. Usually the summer are very slow. Just most people are taking vacation on and off. But at least the early indicators, it seems like it's going to be a very busy summer. So when I was talking to Ayat yesterday, we are definitely, God willing, our plan is to bring back Bootstrapped. And I'm like, oh, man, we've missed like a good chunk of the journey that was like, really interesting and where investment fitbi are at this point. So I think it shall come back in the next three to four weeks. So it will be exciting to see that.

Yeah, that's good because like, I was looking at the numbers at some point for Bootstrip. You're actually like doing very well, you know, like, compared to so many podcasts. I think it's actually, it was a good podcast because you were kind of like talking about the journey of how you are running two companies at the same time, the challenges you are facing and how you're overcoming all that. So.

Well, the problem was never in the numbers. The problem was in the time and the fact that there's only 24 hours in a day, that sort of is limiting sometimes. So, you know, but now I think we're like, okay, maybe we can bring it back. You know, I mean, that's the nice thing about the Ciaro Live hour where we're committed. We're gonna do it most 99% of the weeks and it's set and it's on LinkedIn Live, so we like to do that. And maybe that's what I need to do with IATs like in a Bootstrap Live, either on. I don't know if I want to do it on LinkedIn or YouTube. I don't know. Which one do you think will be better?

I think for a dedicated YouTube channel, for a podcast, if, like you have like a podcast channel dedicated to a YouTube channel, I mean, dedicated to a podcast, that'll be great. I see like a lot of people doing that. It works for them. For us, whenever, like we try to create clips from this CRO live our videos and then put them on YouTube, they don't perform that well. I'm not sure why. We're still trying to figure it out. They're trying to learn from those that are Doing it. Yeah, we'll see how it plays out.

Yeah. And by the way, you promised me that we put the Sierra live hour on YouTube with its own channel, but you haven't done that. So I'm going to start chasing you.

Yeah, yeah. I'm still trying to figure out how to do it because like we have done this at some point, I think sometime last year. So we'll see, like maybe in the coming few weeks we just have a YouTube channel just dedicated to the CRO Live Hour and we'll see how it goes.

I like that. I like that. Since yet another experiment. So awesome. So we have questions. Today we're talking metrics. What we track, what we don't track, what people talk about. It's all metrics intensive. Show another episode of the CRO Live hour. So are we going to do kind of first one question like, you know, uninterrupted and then we'll talk metrics or how's that?

Yeah, sure. Cool.

What I want to do because I get asked this question quite a bit. How can you double your E commerce conversion rate using one simple method? Does such a thing exist? Yes, it does. And it's our ace in the hole. Anybody can do it. It is not complicated yet. It requires time. And I think that's the secret there. You will always have to invest the time. So if I have to choose the one method to double my E commerce conversion rate in the next 60 days, here is what I will do. It's what I call the grandma test. Now, not to offend anybody old or anything like that. And let me explain. If you think about your e commerce website and people coming to your e commerce website, typically there are certain tasks that they want to perform. They are coming looking for a particular product, maybe looking for a collection of products. They click on the category pages, they see all your products, then they'll use the filtration on the category pages. I assume that you have filtration. If you don't, you have bigger problems. And then based on that, that filtration will give them the right products that match the filtration criteria. From there they will click through, they will look at the product, evaluate it and if it makes sense, you have the right size, if you have the right product options, they will click on the add to cart and finish the checkout. Now that is the theory. Let's compare that to the reality. People struggle. People struggle gaining, saying, well, is this trustworthy website? They struggle with usability issues on the collection pages. They struggle with conversion and USABILITY issues on the product pages and then they struggle throughout the checkouts. The problem that most e commerce companies face is they do not know where their visitors are struggling. So how do I find this out? I always say design for your weakest, least educated user. And for that I'm talking about grandmas and grandpas, not to offend anybody because I think I'm getting closer and closer to that age. But if you think about your older users and if you make the buying journey very easy for them, the purchase funnel very easy for them, then most likely you'll be able to persuade and convince them more sophisticated users. So your first task is to come up with a list of scenarios. Here are some of the most common scenarios that people perform on our website. Let's say you're an apparel company. Well, you know, selling clothes to females. Well, you know, we're trying to sell red skirts or we're trying to sell, you know, particular apparel category that has a discount on it. Let's define three to five of those common scenarios. That's the very first task. Second task is to find people who are maybe older and ask them to perform that scenario on your website. Now people always struggle and they tell me, well, how do I find those people? You need to be a little bit adventurous. Let's forget about some of those usability sites, user testing sites out there. I don't like them. Most people who work on improving conversion rates don't like them. The reason for that, most of these websites have users who are spending all of their time making money on those sites, so they become usability experts. I'm not looking for a usability expert. I am looking for an actual user. Now, for me, and I've mentioned this before, my favorite method to find people who I can actually use to do the usability testing on my website to perform those scenarios is by going to either a Dunkin Donuts or a Panera. Usually you'll have somebody who is retired who likes to come there around 6:30am, 7am yes. Okay. So you have to wake up early to catch those people. And I would actually run there and I'll see them and I'll tell them, hey, do you mind if I buy you breakfast? If you help me with this simple thing, you will be amazed how many of those people are willing to say, you know, yeah, sure, you know, buy them a donut. You know, buy them a pastry and a cup of coffee and tell them, here's my laptop and here's what I want you to do on this side. I Want you to go ahead and find a skirt size, medium red color and click on the add to cart and start the checkout process. They'll look at you a little bit strange. Like, really, I don't want to buy it. No, no, I'm not asking you to buy it. All I'm asking you is just to perform the scenario. Because this is actually my website. I want to see where people are struggling. You either give them a laptop or you ask them to pull up their phone and actually walk through the process and watch them intently. Have a pen and paper in hand and watch them as they go from one webpage to the next. Now you can do it in one of two ways. You can either tell them, hey, as you're going from one webpage to the next, can you just kind of say, what are you thinking? What you're thinking really loud? Or you can just watch them and let them finish the whole scenario and then go back and ask them questions. This whole process would not take more than 10 to 20 minutes altogether. I usually like to do it with two to three different people. They're not sitting next to each other. Correct. So I'm just kind of gathering insights. Hey, why didn't you like, you know, notice that this product is over here? Why did you use this menu? Why did you struggle? Why didn't you click on the add to cart on the product page? I mean, isn't that the product that you're looking for? And just listen to where they are struggling now. Finding the right people, creating the scenario is a challenge, not complicated challenge. Finding people perhaps a little bit more difficult. But guess what's, where most people fail. After you collected all these insights of where people are struggling now the real work happens. You need to go back to the office and you say, you know what? Okay, so we have identified through this session that cost me maybe 20, $30. I've identified so many different issues on my website. Let's go ahead and find fixes to them if your site gets enough traffic. This is basically an amazing opportunity to conduct experimentation, to conduct AB testing. If you don't guess what, you have problems that you can fix on your website. You do this once a month, Once a month, consistently. I can guarantee that a year later from doing this 12 times a year, once a month, you will see amazing increases in your newer conversion rate. So if you're willing to commit to doing this regularly, why don't you go ahead and leave us a comment and let's follow you on this journey. That's my video for the day. What do you think, Simba?

Yeah, that's a good one. But as you were explaining, I know like this is not like part of the plan and I would just like maybe deviate just for a second.

How about it, man? Ask away.

Yeah, yeah, I was having like some kind of questions. Like I was thinking of a lot of things. So talking. I just want us to dig in a little bit on the grandma test that you just explained. Is it something that can be done on every e commerce website? That question number one, number two is what if like my site, my e commerce site sells? I'm selling like stuff maybe just for teenagers, right. And those old people that I reach out to and ask to just go through my website, I look like really my ideal audience, you know. So is it still effective?

Yeah. So we work with two companies. One company that we work with is a large e commerce company. They sell very advanced technology. They sell advanced technology for people who travel around the country, specific modems. Their ideal clients are actually males, probably in their 30s who are traveling in RVs. And we're like, you know what if we can simplify the journey for people who are older, maybe that will help. And the big question mark for us was are we going after the wrong markets? Is their target's audience very well educated and they don't read the amount of information that we are providing by trying to make the life easier for people who are older? A couple things that we found out. One is their assumption that their target audience is very well educated was not well founded. Most of their target audience have a need and what they end up doing to fulfill that need is they will actually go on YouTube, they will read blogs. Thus most of those people were doing the education outside of the e commerce site. By bringing that information to the e commerce website, it was very, very powerful. That's number one. Number two, there are a few instances where we say, you know what, this site is really targeting young adults, maybe age 18 to 22. And going for the older audience did not necessarily make sense because they didn't understand the lingo. So we want to keep that in mind. Correct. There's always context whenever we're doing this research. However, here's the thing about using somebody who's older to do this usability test. What you're trying to identify is major usability issues on your website. It's not necessarily evaluating the copy. It's not necessarily evaluating the marketing side of the site and how it positions itself as against its competitors. My goal here and the fundamental Assumption that I'm making is that most websites lose or can increase their conversion rates by 30 to 50, maybe even 70% by fixing all the usability issues on their website. Now imagine a website that is at a 1% conversion rate. By fixing the usability issues, you probably can go easily to 1.3, 1.5, even 2%. That's not the same as going to 8%. Correct. Going from 1% to 8% is different animal. It's not going to be one method. It's going to be a combination of many, many different things that you'll need to do.

Yeah, that's a good answer. That's a proper one. So besides the grandma test, is there like any other method that you can do, maybe to just try to fix usability? In your first explanation, you mentioned that maybe there are too many websites that focus on usability, but are there any other thing that you can do, maybe any other principles or heuristics or something like that that you can use?

So there are multiple ways that you can identify usability issues on your website and they vary in their effectiveness. Usability testing with the right audience is one of them. Hiring somebody to conduct what we call a heuristic analysis and expert review is number two. Now, the mileage that you get out of an expert review will vary tremendously based on the person that you hire. You cannot imagine how many times we work with companies and they say, hey, I've conducted a usability study. I've hired this SEO agency not to offend any of our SEO friends, and they gave us an SEO analysis and they also added a usability analysis. Usability studies are not only an art, but also a science. And there are companies and there are people who spend years upon years of their lives studying and analyzing usability. There is an art to it. There is science to it. The problem is, if you don't hire the right person, what you are getting is probably somebody who just read general blogs and he's giving you or she's giving you very generic information that may or may not help. Not every advice is correct for every site. So you have to be careful whenever you are hiring a usability expert to do a heuristic or an expert review of your website. Here's a third method that I absolutely love that can help you pinpoint there are problems on your website. Now, it doesn't tell you what the problem is, but it can tell you there is a potential problem area on your website and that is using your analytics. Analytics can point to you pages where Visitors are leaking from your website. Again, analytics is not going to tell you what the exact problem is, but will tell you, hey, you know, some, like a page on the website is raising its flag. Now you can. Most companies that we work with are using Google Analytics. Previously, it used to be universal. Now most and most people are migrating to GA4. And if you're watching this video after July of 2023, you are on GA4. What you can do in Google Analytics is you can segment the different technologies that people are using to come to your website, desktop and mobile. Okay, so that is very clear. But even for people who are coming to your website using desktop, they're coming using different browsers. Chrome, Safari, Firefox, Microsoft Edge. Let's take each one of those browsers and let's see what is the conversion rate for visitors who are coming to our site on Chrome? What is the conversion rate for visitors coming to our website on Safari or Firefox? What you'll notice is that the site average conversion rate might be 1%. And then you look at Chrome and it's like, hey, people who are coming on Chrome, they're converting at 1.2%. People who are coming on Safari are converting at 0.6%. What is going on? Why such a huge drop in conversion rates between Safari and Chrome? Now, this might pinpoint to specific problems where you have JavaScript issues or your browser was not developed for a specific, specific browser. So just by developers not paying attention to a specific browser, they've created issues for your website. This trick of looking at analytics and evaluating the performance of different browsers and different versions within each browser can really generate anywhere between 10 to 20% lift in conversions without actually having to talk to a user. You're just looking at the numbers and you're saying, hmm, we have a particular browser and it's the conversion rate for people who are coming on that browser is a lot lower than we anticipate or than the site average. The only caveat to this, if you're evaluating different browsers and how the visitors are performing who are using those browsers, make sure that there are enough people coming to the site using that browser. If you get 100,000 visitors a month and you look at one browser version and it's like, oh, man, the conversion rate for that browser version is absolutely horrible. But there's only, I don't know, 200 people coming to the site using that browser. It's probably not worth fixing that you know that particular browser and you say, you know what it is? What it is. Because if your site conversion rate, let's say, is. We'll just give an example. Let's say your site conversion rate is 2%. I have 200 people coming. None of them are converting. So I fix this browser, and now the conversion rate for those 200 people goes to 2%. What is that? That's not even one person. It is not worth the effort. So when you're evaluating different technologies, make sure that there's enough people using them coming to your website to say, okay, is it worth to make that cut? Is it worth us asking our developers to make fixes around the website? That's kind of the third approach to figuring out usability issues on your website.

So I like the idea of using analytics to kind of like, maybe figure out, like, any usability issues on the website. So you spoke about, like, looking at certain browsers and trying to see how they perform. Also within that analytics, are there, like, any sort of, like, metrics that can tell you that, oh, there might be, like, a usability issue here.

That's a tough one. I don't know if there's specific metrics that tell you that there are usability issues on a particular website. Definitely the conversion. Yeah, go ahead.

Yeah, I'm asking this because, like, I'm thinking of sometimes when you see like, a page that is like, maybe a higher or an abnormal bounce rate, that may tell you something. Right?

Yeah. I don't know if bounce rate or exit rate. I know people love bounce rate and exit rate. And by the way, it's funny because GA4 removed bounce rates from the standard report, so you actually have to go in and add it. So Google at some point pushed bounce rate really hard, and now they've decided, oh, we want to do away with it. But they introduce a new rate, which is called engagement rate, which is 1 minus bounce rate. So it's just kind of a different way. You know, if your bounce rate is 60%, then your engagement rate is 40%. Okay, so we're looking at the same thing. Tomato, tomato. I think these metrics measure something else. Bounce rate specifically is measuring the particular page ability to persuade visitors that they are in the right place, that they can trust the site. And basically is the page's ability to tell visitors, yes, stay on our website. We are the right place for you. Yes, continue navigating. That's what bounce rate measures. Now, the minute somebody interacts with the page, the minutes they start spending time with the page. Is bounce rate meaningful? I'm not sure. Bounce rate, for example, think about this bounce rate on blogs is close to 90%. I search for a topic, Google gives me a whole bunch of results. I click one of them. I read, oh, it's the most amazing topic. Oh, this is the best article. I'm done. I exit. I bounced. That doesn't mean that there is a usability issue. So you have to look at bounce rates in the context of the website. That's number one. Number two, you have to understand what bounce rate is measuring. It is measuring the page's ability to persuade visitors to interact with it. Exit rate, for example, another metric that we like to take a look at, somebody who visited one page or multiple pages, they come to this page and they say, you know what? Mm, I'm done. Now, if somebody did not bounce and they continued in the navigation and we get to the page and then they decide to exit, that might be a good thing. Correct. An exit on the order confirmation page for an ecommerce website makes perfect sense. Everybody's going to exit eventually. That's number one. Number two, sometimes exit rate tells you that there is issues in the navigation. You've already convinced me to stay on your website. You've already convinced me that you're at the right place. But now as I'm navigating, maybe it's the store layout, maybe it's the pricing. Exit rate is a lot more complex. Correct. We've already bypassed most of the trust issues, but there's other issues that exitrate can pinpoint to. Yeah.

Now that you have explained it, you have convinced me that maybe bounce rate might not be like the right metric. But how about. I think you can make a case for cat abandonment rate, because I think technical issues are one of the issues that might cause people to kind of like abandon their cart.

Yeah. So if you look at two metrics, cart abandonment and checkout abandonment. Correct. Cart. I've added items to the cart. And then I said, you know what? I'm not even going to start the checkout. Goodbye and good luck. And checkout abandoned. I've started the checkout, but I'm not going to finish the checkout process. Sorry, guys, I'm not going to give you my credit card information today. The reasons for that could be a mix. Some of them could be usability issues. Correct. Very simple, stupid usability issues that you really should identify. And you can identify those by the way, through doing usability tests. Sometimes you can identify them through session recording and watching different sessions, through heat maps, through an expert review. So usability could be one of the reasons for cart abandonment. But it's not necessarily the only reason for cart abandonment. Sometimes cart abandonment happens because of things that you do not control, you know, because the economy. And maybe you're selling something that's for $2,000 and people are worried about paying for $2,000. Did you see the new Apple goggles thing that they. They will have very high abandonment rate, my friend. 3, $500 for goggles? I don't know. I mean, like, when I paid like $2,000 for a laptop, I'm like, really? You actually want me to put something on my face, you know, for 3, 500? Yeah. And I'm sure, by the way, there are people out there who are gonna kill themselves to buy it. And it's like, oh, my God, I'm just waiting for it. Go ahead, tell me.

I actually think that's where, like, we are going. Things are kind of like changing in that bit by bit. Like a computer as you know it. Like a PC as you know it. Like, maybe in 2000 is kind of like different from what it is now. And I feel like the app will dominate maybe around 2012, 2030. Everyone will be using, like, those kind of VR computing or I don't know what they call those, but yeah, that's how I see it. Because, like, if, like, I think of a car, for instance, it's evolving. A car is a new. Like in 2000, 1998, up to now, things are kind of, like, getting different. So I'm sure, like, at some point that will be the norm.

It's fascinating. I don't know, to be honest with you. Well, let's talk about cars. Cars have been probably made. Been made the same way since the 1900s. Correct. Until, I think, the electric car. But fundamentally, the cars look the same. Okay, so we've changed and improved on components, and it's still the same thing. Computers. You had computers and then you had laptops. And I think the kind of. The evolution, you know, we all have to agree, the iPhones definitely changed the industry.

Correct.

And impacted computing and how we understand it. Those virtual reality, if they take off. And I might eat my words. It's a fundamental shift in how people do, and Apple has been successful in doing that. So they've introduced many products that actually they understood the consumer and they introduced something that the consumer could not think about. Because if you had asked us about phones back in 2000 and 1999, wouldn't have thought about the phone and how it looks and all that. So they've understood sometimes the consumer doesn't understand the problem, doesn't even recognize that they have a need for the problem until you introduce the new solution to them. So maybe this is going to solve a problem and maybe not. I'm not seeing it. But again, I'm not running Apple and I don't have all the research that they do. So yeah, it will be fascinating to see how that works out.

Okay, yeah, sure. Cool. We have spoken about metrics, but I want to ask you like a few questions about e commerce metrics. So the first one is how do you differentiate between vanity metrics and meaningful metrics when it comes to e commerce?

The problem that I see is that most companies are in one of two camps. They either track way too many metrics or and those are a mixed bag between vanity and actual meaningful metrics and companies who do not track. You'll be amazed how many times I talk to a CEO or a CMO or a VP of marketing at an E commerce site and I ask simple questions. Hey, what's the average monthly visitors that you have? What's your conversion rate? And they struggle. Now, if your only business is E commerce, you really should know your numbers in and out. There are metrics that really matter. I'm not asking you about the average time on page or bounce rate or exit rate or how the traffic breaks by channel, but you probably should know the visitors correctly. You should know the conversion rate and you should know the sales. And you don't need to look in analytics or ask somebody to give you those metrics. At least that's what I think. But I might be wrong. To me, the metrics that matter are, or the KPIs that matter are the ones that there are business impact based on those. If I change them, my business is impacted. If the number of visitors drop or increases, there's an impact on my business. If my conversion rate goes up or down, there's an impact on my business. If the average order value goes up or down, there's an impact on my business. And then there are vanity metrics. There are metrics that are not even accurate altogether. You cannot imagine how many times people talk to me about, hey, well you know, our average time on page is this. And I'm like, okay, you know, I don't know what that means. I don't know if that's good or bad, that the average time on page is like two and a half minutes over here. But last minute, month, it was like, you know, three minutes. Is that reasonable? If I read the article that you have published on your website, maybe it will take me seven minutes, maybe it's 12 minutes. So there are metrics that I can relate a solid business decision based upon. And then there are metrics that I'm like, okay. I just shrug my head and I'm like okay, I don't want those. The one thing that I want to avoid is way too many metrics that it gets a little confusing for me to track. I want to focus on those metrics that have direct business impact. Those are the levers that I can play with and I can control and I will see a business as a result of those. Now mind you, some of those are not easy to track. Correct? We would love to think that it's easy to track every metric. Marketing is very complicated. We do one thing in one channel that impacts another channel. So you always have to have that full vision for marketing. With E commerce it's easier. With lead gen, it's a lot more complicated. We work with a company, they specialize in selling blinds shades for different houses. The sales cycle is lengthy. The sales cycle is anywhere between three to six months. We can just change a couple of things and just see an impact right away. How we do with E commerce, this is a lot more complicated. It requires a lot more thoughts to really know what metrics to track.

So just to recap what you said, you're saying that meaningful metrics are those kind of metrics that impact the bottom line. Maybe it could be like revenue per visitor or average order value or something like that. Right? And then vanity metrics are those metrics that don't impact anyhow, like maybe the bottom line. But what do you say about those people who then launch a B test without enough traffic but measuring those kind of vanish metrics, I'm not sure. But what do you think about that?

So in case, if you do not have enough traffic, you can still launch a B experiments. Don't forget about AB experimentations. You just have to change your standards. In a typical e commerce website, let's say I'm running a test on the homepage. I have a new design for the homepage, I'm going to run an a B test against the old design. And typically I'm measuring between those two different designs the impact on order confirmation, how many more orders I'm getting. But because I'm not getting enough traffic, I cannot run the test for six months. This is. I'm going to hate AB testing and AB testing is going to hate me. So in this case, I am going to be still measuring order Confirmation. But I'm not making the decision of which version I'm going to go with based on order confirmation. I will measure other metrics. I'm going to maybe measure how many people that whom I show version A, the control or version B are actually getting to my collection pages, how many people are getting to my product pages, how many people who saw either the control or the variation are actually clicking more on the add to cart, starting the checkout. There are many, many micro conversions that you can measure. Now the philosophy is very important over here. Since I don't have enough conversions, macro conversions, orders to run solid A B testing. I'm not going to drop a B testing completely. Instead I'm going to work on the funnel. I'm going to increase the flow from one part to the next, keeping my eye on the ball, knowing that in maybe 8 months and 12 months I will have enough orders because I fixed the visitors flow across my websites and now I can focus on order confirmation as the way to measure the success of my experiments.

So if I were to ask you, like how many e commerce websites or companies have you worked with? Just throw a number.

Oh, probably close to a thousand at this point.

Thousand. Okay. I had to ask you this because like it kind of ties into the question that I want to ask you next, which is in working with those, when you're working like with those companies, what are some of the key metrics that you see them overlooking?

Most companies, especially after we start working with, start focusing on conversion rates, they start focusing on revenue per visitor, they start focusing on aov. But that's not enough. I always tell them, and that's one of the things that we do at the very beginning of the project. Even before somebody signs up with us, I tell them, listen, I know you're coming to us to help you improve your conversion rates. But one thing that you will learn from us as we start working together is we forget about the site conversion rates. We're actually going to start breaking it down. We're going to break it down between mobile and desktop and we're going to forget about the mobile conversion rate for the site and the desktop conversion rate. We're going to start looking at the conversion rate for your homepage, for your collection pages, for your pdp, for your cart, for your checkouts. That breakdown, that granular level of breaking down is very powerful. Most companies don't track it. Most companies, after working with us for three to six months, they start paying very close attention to you want to get even fancier. We Start breaking those metrics. Correct. So we're looking at mobile PDP conversion rates by different source and medium. So how is Google paid traffic performing really, on mobile PDPs? How is my paid traffic from Facebook performing on desktop collection pages? We start segmenting that traffic and we can come back to a company that we're working with and we tell them, hey, what have you done for your Facebook traffic? The conversion rates or even the flow from the collection page to the PDP really dropped tremendously. The conversion rates dropped as well. Oh, yeah. We've launched new campaigns on Facebook and we're still kind of in the learning phase. So we're not sending very good quality traffic. It's important to track all those metrics. It's almost like you go to a doctor. Correct. And one of the things that the doctor will say before he starts prescribing different solutions for you and giving you a prescription like, hey, so what's going on with you? Why do you come here? And then he might ask for different X rays. Correct. And we need an mri. And we need. And I think that's what we do when we're trying to help a site not improve its conversion rate, but increase its revenue. Correct. I need to have a full picture of what's happening in your body. And then I'll start tinkering, if I want to use that word, making changes and measuring the impact of those changes on your visitors and your bottom line.

So is conversion rate a meaningless metric? What do you think about that?

I don't know if conversion rate is a meaningless metric, but it's one of those metrics. Is conversion rate a meaningless metric? I don't know if it is. It may be or it might not be. It's a metric that is driven by a couple things. It's driven by your visitors and by the number of orders that they put through. For us, as a company that works on conversion rate optimization, we focus a lot on conversion rates, but we also fully understand that our work is impacted by the quality of the traffic. I always give the story. Company hires us Thursday or Friday. We haven't even started working for them. And this is back in 2009, 2010, Monday. I get really angry email. And usually our customers, clients that we work with know us really well, so they're really nice. But this angry email from the CEO is like, what have you guys done to my conversion rates? And I'm like, nothing yet. You know, we didn't even have a kickoff. He's like, oh, our conversion rate, like you know, dropped. It's horrible. I'm like, okay, well, let me see what's happening here. Now. Again, this is from 13, 14 years ago. There was a social traffic site, Dig D I G G. I don't know even if they still exist or not. I'm not sure. They ran a campaign for a blog post. They got it to the first page of Digg. They got a ton of traffic, over 100,000 visitors. Saturday, Sunday, they typically get about 50,000 visitors. So they got 100,000 visitors. Correct. But none of those guys placed an order. So guess what happened to their site conversion rate? It shot down. They thought, oh, what have we done? What happened to our conversion rates? Nothing happened to your conversion rates because if you exclude that useless traffic that you brought and useless will put that between two parentheses, your conversion rate remains the same. So is conversion rate a useful or useless metric? No, but it's not. Or it may or may not be. It depends on how you use it. You have to look at the full context. You want to look at the quality of the traffic. Not a single marketing activity will make or break the company. Everybody needs to work together in sync to achieve the final goal. And really our work, I mean, imagine us as an experimentation company and we do something that just blocks people from placing an order. It doesn't matter how good of traffic you're bringing me. Correct. I've heard the work of the SEO and the PPC company. So it's vice versa. You have to always kind of look at things now. Smaller companies, by the way, struggle with that concept. The larger the company is, the more they understand how marketing is. Not everything works. You're experimenting. Everybody impacts everybody else.

Yep. I hate to ask you that question because when we started like this CIO live hour session, I think, like in the first few weeks, I once asked you the same question. So I wanted to see, like, if you have changed your mind on that or not.

Did I change my mind? You have to tell me.

Yeah, it's kind of like you said the same thing. It's more of the same thing that you said. So. Yeah, yeah.

I mean, I think, yeah, sticking to your guns. I think the only insight, because we kicked off like, you know, lately, like, you know, we're working with larger companies and I see the mentality of the CEOs and the CMOs and how different they are and how sophisticated. Sophisticated somebody in their understanding of marketing. And it's not necessarily large or small. I've worked with a CMO from a company that does $1.5 billion. And we did optimization for them and the KPI, he or she, we're going to leave. It's very, you know, generic wanted to track is product page views. I can justify the logic, but probably there's more KPIs more important than that that we want to look at. But that's what they wanted to to track. It is what it is. Correct. And you know, we've worked with a company, they've been a client now for what, close to three years. And I've seen them grow from $4 million, actually two years, two and a half years to they're doing over $25 million. Not because of us only. We're definitely one of their secrets to success. But they're a CEO company and their PPC company. Everybody is working together and their understanding of marketing and what it takes is absolutely fascinating.

So, so I have one more question for you before I let you go. When it comes to multi channel E commerce, what metrics should businesses focus on to understand the performance and impact of different marketing channels?

When it comes to different channels, you have to start with the understanding that not all channels are created equal. Not all channels serve the same purpose. Traffic coming to your website direct is a lot different than traffic that's coming through email. It's a lot different than traffic that's coming through social or paid, paid search or paid social. Start with that understanding. Not all of it costs the same and not all of it is created the same and not all of it is going to interact with your website at the same level and going to have the same conversion rate. Because sometimes I see companies that invest tremendously, for example, in SEO. SEO is a major initiative for them. And guess what is the biggest question that I hear from SEO companies, other agencies. Oh, I've ranked this website for so many different keywords, but there are no sales. You know, we're getting 100, we're getting 200,000. A year ago I talked to a company, they were driving about 1 1/2 million visitors to their site. They sell appliances, they're driving 1.5 million visitors through SEO to their site. And they're like, that traffic is not converting. I'm like, well, I even asked a simpler question. Can you actually service that traffic? I mean, you're located in the northeast. If somebody comes to you from Chicago or California, are you shipping the fridge or the dishwasher to them? They're like, no, we don't want to. Okay, SEO traffic is really amazing as top of funnel traffic. Right? It helps your brand don't expect that traffic to convert. And I'm unfortunately, some SEO companies, because they're trying to sign up the client and a prospective client, they'll tell them, yeah, we'll drive traffic and you'll get sales. Not always. And by making the wrong promise, you end up losing the client maybe in six months or nine months or 12 months. So start by understanding that not all channels are equal. Then I start breaking down the funnel and how the funnel performs for these different channels. I understand, for example, that paid, paid social doesn't always convert very well, but it depends on the brand. With some brand, paid social is absolutely amazing. With other brands, paid social is okay, but you can justify it with the cost. I was talking to a couple of CEOs that run their platform on Shopify plus, and they were discussing kind of Q1 and Q2 and how those shaped up. One of them said, Facebook has been absolutely horrendous for him this year, and Google Maps campaigns are absolutely amazing. The other gentleman had the complete opposite view. He's like, oh, really? Facebook is working for us. We can't make Google Maps work. Different size, different target audience. But it's important that you understand the right mix of channels for your site, and you experiment and you test and you run meaningful tests. Sometimes people run a test for too short and they're like, yeah, this is not good. We've ran experiments on Google Ads where we spent 25, $30,000, and then we said, this is huge. But every two to three years, we go back and we run some of those experiments, and I'm always willing to learn. I'm like, maybe we didn't do it right. Maybe we didn't have the right budget. So you always have to experiment and you always have to have conversations with other colleagues in the industry to see what's working for them and what's not working for them.

Yep, that's a good point. Those are the questions that I had for you today. Unless you have maybe something.

No, I have nothing more insightful. I'm excited. Next week for those listeners, would love for you to share the podcast. If you like it, you know, share it, comment wherever you listen to the podcast, we always appreciate feedback. And if you have any questions, me and Simba are always on LinkedIn. And until next week, happy testing.

Ciao. Bye.