"A guy don't walk on the lot lest he wants to buy. They're sitting out there waiting to give you their money. Are you going to take it?" - Alec Baldwin, Glengarry Glen Ross (1992)
For most retailers, digital conversion involves a customer seeing a confirmation page following a purchase. For others, conversion occurs when a customer makes an in-store appointment, signs up for an event, or creates a registry for their wedding or first child. No matter the objective, eCommerce leaders need to put the end goal first, and think about their business with conversion in mind at all times.
Today, most retailers rely on digital analytics solutions like IBM Digital Analytics, Google Premium Analytics, or Adobe Omniture to track the general health of the business. Digital analytics solutions monitor traffic flows and generate reports that enable merchandisers and marketers to evaluate their performance against their KPIs. While digital analytics solutions provide critical business information, they are often compromised by improper tagging, which results in an incomplete and often inaccurate view of digital performance. Digital analytics also fails to measure customer experience.
To address site challenges, retailers continue to invest in A/B and Multivariate Testing solutions to see what happens to click-through, PDP, and conversion when they change a particular aspect of their site or app. While helpful, testing solutions are restricted by the time required to test and do not always yield desired outcomes. Despite its limitations, A/B Testing is widely accepted as an industry best practice, and is a good starting point for customer experience optimization.
Whereas A/B testing is the often the first step in digital experience optimization, Customer Experience Analytics (CXA) solutions act as more advanced pattern detectors that capture, record, and analyze customer sessions to find sources of customer struggle.
As customers we've all experienced struggle at some point. Think of struggle as repeating the same step of your shopping process multiple times in the same session due to technical or usability obstacle. Struggle causes customers to feel frustrated and results in high abandonment. If you're lucky, customers will leave feedback or call customer support to let you know about the problem and may even come back to complete their purchase. If not, they’ll be on your Facebook page or Twitter; or still worse, they won’t say anything and never come back to your site.
Unlike digital analytics and A/B testing solutions, CXA solutions generate insights in real time. And while there are several niche players in CXA (ClickTale, ForeSee, User Replay, Session Cam), the industry leading solutions offer unique value beyond basic struggle pattern detection. Robust CXA solutions like IBM Tealeaf allow businesses to quantify the impact of specific customer struggles so retailers can answer questions like, "Why did that segment of customers abandon?", "How many customers are impacted by that issue?", "What are the cart values associated with the problem?", "How much revenue are we losing a day?", and "Where should this problem be prioritized?"
Even among companies using CXA solutions, there is great variance in ROI. Some retailers are just looking for bugs, while others are replaying sessions after customers provide feedback via site feedback tools, such as OpinionLab. Others just want heat maps to look at. The key to customer experience maturation lies in data capture and analytics over basic features like replay and heat mapping. The most robust CXA solutions offer 100% data capture of customer activity across web and mobile applications, so you know why click-through and conversion aren't performing as well as expected. Most importantly, you can take actions to remedy the problem and retarget impacted segments.
So you're probably thinking, "This sounds great, but I can't afford that", "No one on my team has time to use a CXA solution, they're already swamped", and on and on... But the cost of not acting may be more problematic and not just in the short term.
Retailers have been and still are training their customers to increasingly rely on one giant technology company for their every need. Last Tuesday, the Huffington post reported that Amazon Prime's retention rate is 73% after the 30 day trial, 91% after the first year and 96% after year two, validating the author’s title choice "Amazon Prime Members Stay Members."
In order to compete in the years ahead, retailers must adopt a new paradigm that includes digital experience optimization. Each customer must matter and every interaction has to count or you will continue to see a 2% conversion rate as the result, or even worse the end goal. The old approach of spending more on marketing to increase site traffic may continue to increase conversion in the near term, but the best way to repeatedly increase conversion across segments is through customer experience optimization. By focusing on digital experience and leveraging solutions and partners who specialize in CXA, retailers can better serve their customers and differentiate their brand from their competitors simultaneously.
I'll conclude with one final line from Glengarry Glen Ross: "A - Always, B - Be, C - Closing. Always Be Closing!" Customers are coming to your site, adding products to their cart, and completing multiple steps in your checkout process because they want to buy, and more importantly, buy from you! Therefore, eCommerce leaders need to ask themselves if they are truly concerned with the ABC’s (earning the sale) or admit that the teams they manage are really more focused on the metrics related to conversion (increasing traffic and channel/promotion performance).
While I strongly believe in the power of CXA solutions, I'm not suggesting investing in one will ameliorate all eCommerce problems. But ignoring the persisting obstacles your customers encounter across your websites and mobile applications is damaging your brand's reputation and reducing marketing ROI. There are customers on your site right now, wanting to convert, but some can't, which makes me have to ask "Do you really want their business?"
I'd like to invite you to the conversation. Whether you agree or disagree, let me know by commenting here. Or if you'd like to speak further about CXA, feel free to reach me via Linkedin (Matt Conrad, IBM) twitter (@mattconradibm) or email (mpconrad@us.ibm.com).
Thank you!
Matt