- Chew On This
- 🥗 Are Your Metrics On Fire?
🥗 Are Your Metrics On Fire?
Welcome back for another bite to chew on.
We hope you’re having a great week thus far and crushed Cyber Monday as well.
In today’s newsletter, we will be diving into the world of CRO.
In case you don’t know Ned yet…
He’s the founder of a CRO boutique firm - Endrock and has worked with multiple 8 and 9-figure brands like SNOW, Halo Top, and Touchland.
Besides that - he’s also the biggest CRO and Statistics nerd we’ve ever seen (… and we’ve seen many of them)
CRO isn’t what you think…
Many people who are new to DTC and just starting to play around with CRO think that CRO is just optimizing for conversion rate.
This is partly correct…
Now, conversion rate is of course one of the metrics you optimize for - but CRO is just much more than that.
There are many other metrics at play like AOV, subscription rate, repeat purchase rate etc.
If you think about it - it’s basically an exercise in business optimization.
So you might wonder, “What am I supposed to do then?”
That’s a good question and Ned addresses that really well in the podcast.
He suggests breaking down the entire customer journey into a funnel and then optimizing for the weakest intra-funnel conversion rates.
Let us explain…
Each page on your website has a specific conversion rate (not based on a sale) but to the next step of the funnel.
For example, the sole job of the home page is to get someone to the PDP.
So its conversion rate would be based on the rate of people going to the PDP and NOT directly a sale.
The same goes for the PDP - which in this case would be an “add to cart”.
So, in this way you’re able to find the weakest link in the funnel and centralize your efforts around that metric which indirectly impact your conversion rate.
What most brand owners do is keep floundering around conversion rate and never actually realize what their weak link is.
This happened to us at Obvi as well…
A while back our conversion rate and LTV had dropped and we realized it was due to our push to increase the AOV of a first-time buyer.
So we took a deep look at it, and crafted an A/B test to solve the “metric on fire” - i.e the weakest link in our funnel instead of floundering and revamping the entire PDP.
The key takeaway here is to have your decision-making be grounded in data.
You can’t just come up with random ideas on the fly and implement them on your website - it just WON’T work.
This brings us to the next point…
Why don’t you test more…
One of the things we’ve been working A LOT on this year is also becoming much more structured in our approach to testing.
What most DTC founders do is go about a haywired way of testing new things and then they don’t know what seemed to cause an increase in conversion rate.
That’s why Ned suggests that the best way to do A/B testing is to attack one metric at a time and optimize that.
And for every idea that you want to test you need to have a null hypothesis and an alternate hypothesis that challenges the null with both being backed in data.
We apologize for going too much down the statistics route but this is the structured way of A/B testing.
We are emphasizing it so much because we ourselves made this mistake…
A while back we wanted to redesign our home page and basically change its branding.
… what we didn’t do was have empirical data to support that hypothesis.
So we went down this rabbit hole of spending 3 months revamping the entire home page and when we launched it - it turned out to be a sh** show.
Our conversion rate on the home page declined and guess what… we didn’t know what caused that.
Of course, now everything is fixed and functioning well but it was a brutal slog for us to get that conversion rate up again.
Instead of revamping what we should have done was…
Dug deep into data and see for what customer demographic our home page conversion rate is low.
Then tried to get some qualitative data about why the conversion rate was low for that demographic - by calling customers who represent that demographic.
Once you know the reasons that must have held them back, start implementing them into your design and then launch it only for that demographic.
This way we have a more structured way of implementing an idea and not disrupting what’s already working.
If you think about it - this method is also less resource-heavy and easier to execute both in terms of time and money.
Tool of the week
2024 is approaching…
CPM’s continue to rise…
… and last but not least, feeds have gotten completely fed up with inauthentic content from UGC Creators.
Our projection is that brands need to really innovate the marketing playbook they’re running if they want to get a piece of the consumers pocket in 2024.
Over the last couple of months we’ve really tried to double down on our influencer and affiliate program - and going into 2024, we’ll be tripling down here.
The answer is simple;
You can acquire customers profitably (if done right)
If you’re in a big industry, it can definitely scale.
Authentic social proof and endorsements will be one of the biggest differentiators in content next year. And one of the best ways to get this, is by turning your best customers into your best affiliates.
The bottom line is;
If you’re sleeping on affiliate in 2024 - you’re doing it wrong. Or - to use Twitter Terminology, you’re NGMI.
A) Their platform gives you basically every thing you need to succeed in affiliate marketing. Like - just plug in Social Snowball and you’ll be seeing success in your program within a week.
B) They offer a tremendous level of service, in relation to the strategy piece of building a successful affiliate program. This is something you don’t find with any other affiliate marketing provider.
So - if you wan’t to level up your game in 2024, you should definitely speak to Social Snowball about getting a 🔥 (or maybe rather 🥶) affiliate marketing setup up and running
Thanks for reading along
As always, we appreciate you taking the time to read this. We hope we were able to provide some value to you and look forward to serving you again on Sunday.
All the best,
Ron and Ash