Jon MacDonald | The Basics of Conversion Rate Optimization

Unstoppable CEOPodcast

People come to your ecommerce website… but they don’t buy. Do you know why? Do you know where along the sales process they fell off?

That’s the type of data Jon MacDonald, founder of The Good, tracks as he helps his clients boost their conversion rate, i.e. the percentage of website visitors that actually buy. But too many entrepreneurs are focusing on the wrong metrics and don’t understand how to turn the data into effective action.

For example, conversion rate isn’t the end of the story when it comes to gauging the health of your business or its bottom line. But that’s just the start…

Jon walks us through that and many other misconceptions around conversion rate, as well as…

  • The Google Analytics dashboard you must be looking at
  • Strategize the process of your funnel until conversion
  • How “rage clicking” should influence your website design
  • The highest converting channel for an ecommerce site
  • Cost-effective and powerful ways to survey your site’s performance and boost conversions by taking pragmatic, data-driven action

Listen now…

Mentioned in this episode:

Transcript

Adam Lean: Welcome to P is for Profit, a podcast that breaks down business concepts into simple and clear language. This season is dedicated to interviewing ecommerce experts that can help you improve your ecommerce business. I recently had the pleasure of interviewing the founder of a conversion rate optimization consulting firm. 

They help online businesses improve their conversion rates. So why does this matter? Let’s say that you had 1000 people visit your website last month, and not one of them bought something. This, of course, is not good because you paid in one way or another for those people to visit your site as compared to the millions of other websites they could have gone to. So you’ve got to not only focus getting people to your site, which is essentially marketing hearing about you, you’ve also got to get them to buy once they visited your site. 

You got to get them to convert from a visitor to a buyer. That’s why it’s important to optimize your website to give more people who visit to convert to a buyer. That’s why it’s called conversion rate optimization. So let’s jump into the interview with Jon and talk about how he helps improve the conversion rates on his clients’ websites. Jon, welcome to the show.

Jon MacDonald: Thanks for having me, Adam. Really appreciate it.

Adam: Yeah, so this, I’m excited about this topic. So Jon, you help online businesses improve their conversion rate, meaning you increase the percentage of visitors that come to the site that actually buy. And, you know, we were talking before the show started, you said that you help people think differently about their sites. So I’m excited. Let’s dive in. So starting off, can you explain exactly what conversion rate optimization means and is?

What Exactly is Conversion Rate Optimization?

Jon: Yeah, of course. So at The Good, which I’m the founder and CEO of, we’re a conversion rate optimization firm. And what that means to us is we help brands to convert more of that existing website traffic into customers. So there’s a ton of firms out there who will drive qualified traffic to a site through search engine optimization, or AdWords and digital marketing of that sort. Most of them end up kind of stopped their process once somebody gets to your site. 

That’s where we pick up the baton and start running with it. True conversion rate optimization is essentially helping brands to understand how people are engaging with their website, and collecting data on every click and movement that people are taking on your site to understand what content is engaging, what content is not engaging, where people dropping off in the funnel, where they deserting. And then helping us those clicks and movements and that data to improve the consumer experience and really to understand what the consumer is looking to do on the website.

Adam: Yeah, that’s so important. I mean, you could spend a lot of money and time getting people to the site. But if they don’t buy or opt-in, or whatever you want them to do, then it’s sort of pointless.

Jon: Right. Yeah. And look, conversion optimization is, you know, as an industry, it’s called conversion rate optimization. So it obviously gets a lot of looks at wanting to increase conversion rates. But there are tons of metrics that are really improved through these processes. And we can dive into the processes a little bit perhaps, but, you know, we want to look at things like increasing your average order value, right? Helping you to look at all of what we call the micro conversions. These are all the things that people do on your site before they buy. What are those leading indicators? 

We really want to focus on those, and help push people further down the funnel, or remove the barriers from them moving themselves further down the funnel, right? And those micro-conversions can be anything from getting somebody to sign up for an email list. For instance, we know that typically, email is going to be the highest converting channel for an econ brand. So having your own email list is really important. 

But you also don’t want to make it really obtrusive and interruption to the purchasing process to have somebody sign up. For instance, thinking about email pop-ups, right? So you get to a website, you start looking around, you’re trying to orient yourself, and understand if they can help you solve the problem that you’re on their site to solve. And all of a sudden, a pop up comes up and asks you to sign up for their email address. It’s really disruptive, right? So it’s just having empathy for the consumer in those processes and those types of engagements.

Adam: So what, is there a average conversion rate percentage that people should be striving for? Or does it really depend on the site itself?

Jon: That’s a great question. It’s one that I get probably several times a day. And I would say that, you know, the short answer is that the best conversion rate is one that is always improving. And that should really be a brand’s goal, just to continually improve their conversion rate. And the reason looking at an industry average is not very helpful is that, you know, every company is at a different spot in their life cycle, and their profitability, etc. But also, I’ve seen brands that have a 10% conversion rate, but they’re losing money. 

And I’ve seen brands that have a half a percent conversion rate that are doing extremely well in the margins and the revenue. So conversion rate as the only metric is not that helpful. Now, it is a great thing to watch as a trend line and continue to grow. But you know, the other thing to be thinking about here were conversion rates, I’ve you know, I’ve seen conversion rates as low as zero percent, of course. But at Amazon prime, if you’re a Prime customer, you’re converting 78% of the time you visit their site. 

So that range goes from zero to 78%. And so trying to figure out where you fit in there is very, very hard. And you know, even if you’re a 2% conversion rate, and that’s really healthy for you, you see a 78% conversion rate that Amazon Prime gets, and you start to get really concerned and feel bad about yourself and your performance when that’s not really necessary.

Adam: So, you mentioned earlier, there’s a lot of barriers that website owners unintentionally place on their website like these pop-up email pop-ups. What are some common barriers that you seen that are just sort of low hanging fruit that anybody can sort of take away today? 

Conversion Deterrents You Can Easily Remove

Jon: Yeah, a handful of things that we see on a daily basis that we just know create a poor consumer experience. Or on top of that, they just reduce conversion rates and online sales. Email pop-ups is one of them. Again, of course, I understand you want to have people on your email list, and you should. But put that into place on your website, that is part of that conversion flow, instead of making it an interruption that is very dramatic. What I mean by that is, you know, you should have an email signup in the footer of every page. 

People are looking to sign up for your information, they will get that and they will see it and they will they know they can go to your footer to sign up. Another user experience challenge we see quite often and things like auto-rotating banners. How many websites you go to on a daily basis that you hit the homepage and right under the navigation, they have this big image that continually is rotating through with different images, different messages, different features. You see it all the time, right? 

Well, I was just going to say how them that, you know, we find that those really kill conversions on an ecommerce website. Now most people say, Well I get to communicate a lot of different messages there. But we’ve done a lot of research and a lot of testing on these. And yes, you’re communicating messages. But even Notre Dame University has done a research study on this, pretty comprehensive one, that we found that says that the number of clicks that the second item in your auto-routing carousel is going to get is going to be like, one 100th of a percent of all the total clicks on the carousel. 

And then it dramatically decreases for the third, fourth, fifth, etc, items. All the clicks are going to go to the first item, right? But even then, the banner out of total clicks on our homepage that it’s on, it’s going to get less than 1% of the clicks on that page. So you’re really taking something that is not going to get a high level of interaction. But and you’re putting the most emphasis on it by animating it and moving it and getting the most people to look at it. So it’s really obtrusive to the consumer experience. 

And what most people do is they make these auto-rotating banners to please the marketing team at their corporation for the most part, and who has several messages they want to get out. Well, the problem with that is that, you know, really just should use that space to focus on one message. And that is what do you sell? Not just one product and one feature, not a sale about you know, we’re doing 40% off sale right now, whatever that is. It shouldn’t be a promotion, it should be what is your, what are you selling? Is it the benefit of your products you sell overall? Is it a better lifestyle for the visitor? 

Are you solving their needs, if they’re going camping where you provide a range of camping gear, for instance, that’s great. But just having one product really kind of shoehorns that brand in as a consumer comes to your site. It’s almost like, you know, having a retail store, and you want your best sellers upfront as people walk in, because that attracts them to come into the store and continue to move further back to where the maybe there’s other items and add ons for their back in the store. But it’s the same thing where if you only put, you know, one line of items out front, that’s all people are going to think you sell. 

And so you really need to be thinking about your ecommerce website, like a retail store. And you know a lot of these user experience challenges that I’m talking about with email pop-ups and auto routine carousels and things of that sort. You really need to think about your website as if it’s a retail store. And if you would not do it in your retail store, you shouldn’t do it on your website. So consider this Adam, if I walk into a retail store, and a sales associate immediately pops out with a clipboard and says, Jon, sign up for my email list. What’s your reaction going to be?

Adam: This is weird.

Jon: Yeah, pretty negative, probably at least right? You might even leave. Right? So why would you do that on a website? It really doesn’t make any sense.

Adam: The way you explained it makes complete sense. I totally agree. What are some other examples of things that people do on their online store that they probably would do if they had a retail store?

Jon: Well, I think you know, you should be thinking about any interruptions that you’re providing to a consumer. You know, one of the big things is you think about how consumers are walking through a retail store. And there can be a sales associate who is helpful and checks in quickly, and then let you browse. Right? And you know, they’re there. Or you can have a sales associate who’s following you around and continually bugging you. Right? So think about that with your website. How are you available for them? And are you making it easy to get in touch if they have questions, but you’re not being obtrusive in really just bugging them at all times? 

Now, a good example of this, a lot of folks are using chatbots are chat widgets. We’re all for chatbots. They work really well. But there’s something about the ones that continually pop up all the time down in the bottom right-hand corner and just say things like you have any questions, let me know. Here’s our latest sales. Things of that sort that people think they’re being helpful. But in reality, the best way to think about this Adam is consumers are only at your website for one of two reasons. The first reason is, is that they have a pain or a need that they want to get solved. 

And for some reason, they ended up on your site, because they thought your site can help solve that pain or need. So maybe they were led there by a friend who sent them a link or social post they saw or even clicking on AdWords or you’re, you know, they found you through a Google search or YouTube video. Whatever it might be something led them there with an intent in their mind, right? Of something they were going to get from your website. And that’s all tied around solving a pain or a need. 

If you can help them get to your site and understand if you can help solve that pain or need very, very quickly, then they’re going to have a great brand association and move forward, and move further down the funnel. The second reason people would be at your website is that they want to convert. They want to buy that product as quickly and easily as possible. So anything that you do to get in their way, is only going to help to increase the desertions from your site. Now I have a two and a half year old at home. And good example of this, I was just trying to buy a flight on Delta the other day. 

And I was searching through flights, had an itinerary booked out that I really wanted, and it all lined with everything I needed. And I needed to go get my credit card, so I could complete the purchase. Right? And in that Meantime, my two and a half year old came up and was pulling on my arm saying Dad come play with me, wanted some attention. So I took a moment and I went over and I helped him play for a few minutes and interacted with him. And then I came back. And Delta had logged me out, cleared out my search. 

And I had to start all over again. And it was just such a painful consumer experience that I all I wanted to do was I had a need, and I was trying to convert. And they made it very difficult to do because I stepped away. And so it’s you know, one of those things where you want to make sure you only have a couple of minutes to help people complete that conversion before you know that life’s daily interruptions are going to happen. So you want to try to convert as quickly as you can. But after, you know, if they do get interrupted something of that sort, you still want to make it as easy as possible.

Adam: Yeah, that makes sense. What is your approach to optimizing the conversion rate of a website?

Jon’s Approach to Optimizing Conversions

Jon: Well, I think that the first thing that brands should do is gain some empathy for the consumer. And a lot of the things I’ve talked about today have been centered around how the consumer thinks and feels, right? There are so many brands that we interact with on a daily basis that are doing what they feel is best on their site and as they should. But there’s, you know, they’re so close to their website, their products, to what they sell, that it becomes really hard to understand what that new to file customers. Somebody who’s just visiting your website for the first time, what their impression is. 

What they’re thinking. How they’re going to interact with your site. I say this all the time but I think it’s really helpful. I think that it’s really hard for an ecommerce site, you know, owner or VP of ecom and a brand, I think that it’s really hard for them to read the label from inside the jar. They’re close to it that they can’t really understand what it’s like for someone else coming in. And the problem there really is that they’re not tracking every clicking movement that people are taking on their site to help gain some of that empathy. 

So there’s really four pieces of data that every ecommerce site should be tracking. And it doesn’t matter what size you are, you can collect these four pieces of data pretty easily. Now the technology is there, the cost has come way down. So this used to be for the big brands only. But now it really has become more democratized. The first one is analytics. Now, Google Analytics is the one most people think of and that’s great. It’s a good tool, it’s free. Let’s be honest, Google makes it free because they want you to buy more ads, right? So a lot of the metrics in there are all around helping you drive traffic. 

So to be thinking about conversions, you have to dig a little bit deeper than just the generic dashboards that they provide. But it’s all in there. And it’s all free. There’s a great view in Google Analytics that shows you the paths people are taking through your site. And it really shows you all the drop off points. Now those are great breadcrumbs for you to go and follow and say, Okay, why are people dropping off on each of these pages? What is causing them to desert? How can we prevent that? How can we keep them going further down the funnel until they convert? 

So that’s, that’s a great little tip about Google Analytics. The second data point is heat maps. Now, the idea here is you can look at heat maps based on cursor movements, where people’s mouse is moving. You can do eye-tracking heat maps, so where people are looking on your pages of your site. You can do click tracking. This is where everyone is clicking on your site. I like to look at something we call rage clicking. 

This is when people start clicking an area of the site, maybe it’s an image or a logo or something like that, that they think is going to take an action if they click on that area, but it’s not actually a link. Those are great breadcrumbs right there to help you understand what you should make clickable, right? 

The consumers telling you, I’m trying to click here, and it’s not working, and I’m getting frustrated. So you can take that and alter your site based on that information. Just some of those little things that make it easier for the consumer are going to drive big results is a great place to start. You can also do something called scroll tracking, excuse me. This is how far down the page are people scrolling. Where do they stop? Where they drop off and either go to the next page or just desert? And then you can help prioritize what content goes higher up on the page. Now all of this can be done pretty easily. 

There’s a tool called Hotjar, HOJAR, it’s about $9 a month, I believe. Amazing toolset. Something, everybody should be running on their site. They’ve done a really great job with it. A third piece of data is user testing. Now, there’s some great tool sets out there to help you with this. But we’ll talk about how you can even just do it for free. User testing is where you would send people to your website who match your ideal customer profile and ask them to complete some tasks while they talk out loud about what they’re thinking. 

Now, the idea here is we have all of this type of quantitative data, analytics, heat mapping, etc. where we’re understanding what people are doing. Now we want some of that qualitative data, why are they doing that? What are they thinking as they go through that? Right? So we can combine that qualitative and quantitative and get some really great insights when you look at them together. And so you know, there’s some great tools that you can do this, where it will record their screen and their audio and, you know, can help you to recruit these folks. 

And that can add up. And it’s something that we do offer for brands that are a little bit larger. But for smaller brands, it’s really easy to just take a laptop, go to your local mall or your park, or anything of that sort, and just walk up to people and say, Hey, you know, I run an ecommerce website, would you spend five minutes and I can I ask you to look at this and give me your feedback? And maybe you give them a discount code for your site, or you give them $5 for their time or a cup of coffee, whatever it might be. It’s pretty simple. 

You’d be surprised that Yeah, you know, you’re going to get some people who say no, but you will get a surprisingly large number of people who would be willing to help you through that. So you can get it that great information for fairly inexpensive.

Adam: Are there any services that offer that?

Jon: This there are some technical services we use, and partner with one called usertesting.com. Now, it’s a great service. It does what we call remote unmoderated testing. What this means is we’re not looking over their shoulders. These people do it in the comfort of their own home or location. And it’s a piece of software that runs on their computer. It lets us record their screen and their audio while we’re walking them through the tasks we want them to do. But we’re not doing it live. We’re not doing it while we’re looking over their shoulder. And it allows us to scale this up and do it fairly quickly and get lots and lots of folks. 

But it is fairly expensive. It’s 10s of thousands of dollars. So you have to be thinking about that is somewhere to maybe aspire to or if you’re a larger brand would be great. But if you’re smaller brand, just recruiting folks, you know, off the street or your local park, etc. can be really, really eye-opening. Nordstrom does this with their consumers. nordstrom.com has a great website, very, they have a whole team focused on optimizing their website. 

And what they do is their team out of Seattle, they’re based out of Seattle, what they do is they actually you go to their flagship store in Seattle, and they set up camp there for a day. And they just recruit people walking by and say, Hey, you know, you’re shopping here at Nordstrom, do you ever shop on the website? And you know, Yes, I do. Okay, great. Would you mind giving us five minutes of your time? We want to show you something new and ask for your feedback. And you’d be surprised how many people are more than willing to do that.

Adam: It sounds like from everything you’ve said that it is really data that should be driving your decision making on the way you design and merchandise your website.

A Data-Driven Approach

Jon: 100%. Yes, yes, very much so. Data-backed decisions about your specific site visitors. And I think that’s an important point too their Adam. Yes, it is all about having the right data, all those clicks and movements. But it’s also about your site visitors. Not just going and looking at your competitors and saying, well, five of my competitors do this, it must be working. It’s really about focusing on does that work for your visitors? And that’s a really important point. You know, we’ve worked with several companies that compete over the years, and what works for one does not work for the other.

Adam: Totally. And you’re absolutely right about some of the websites that are sort of self-serving. I call them narcissistic websites, where they seek to pump up the employees or the business owner or whatnot and tell it you know, they give you 2000 words on the history of the business. Nobody cares. I mean, it’s all about what’s in it for the visitor. That’s what a visitor is tuned into. What’s in it for me?

Jon: Well, and that goes back to the retail store. If I walked into a retail store, and the very front of the store was all just about the history of the company and about them and everything else, but it didn’t do anything to help me solve the pain or need that I had with which brought me to the store in the first place, I’m going to turn around and leave, right? So many brands do that on their homepage. They just talk about themselves and you know what their products are, as opposed to the benefit that they’re providing to that consumer and how they can help them solve a pain or need.

Adam: What, so, I mean, this is all good info. And you know, I have, you know, a lot of questions. We could be on here for three hours. But what is the most important thing that a business owner that has an online website, what is the number one next step that you recommend them take that you know, today to just help do anything that you’ve been talking about?

Jon: Well, I think the number one thing they should do is start tracking this data we talked about. Most brands, you’d be surprised. I’ve talked to over course of a week, hundreds of econ brands. And those brands I am shocked at the small majority, or small minority who are actually doing this tracking. The vast majority are not. And they’re not making data-backed decisions. And that’s where it starts to become a big problem. So really focusing on collecting that data. Go to Hotjar, sign up for $9. So you get access to so much great data. And then I would highly recommend that you have that data pushed to you. 

Here’s why I’m suggesting that. Most brands, even if they do get the data, the second step is they stopped paying attention to it after a few weeks. Right? So really want you to keep it in front of you. So all of these sites will push that data on whatever basis you want. A daily basis, a weekly basis to your inbox. You can set up Google Analytics to send reports as a PDF to your inbox every morning if you’d like. And it’s all part of the free toolset. So thinking about how can I push that data is going to be really, really important, just so it’s always in front of you. 

Then I highly recommend just taking an hour a week to digest the data. You know, it doesn’t need to be more than a couple of minutes a day just to look at that data and you start, you will start noticing trends in the long term. But then take one hour a week where you sit down and do nothing but dive into the data. Just look and see if you can fight to figure out what’s happening. What’s the data telling you? Once you become familiar with that I promise you by a month, you’ll start seeing some trend lines of things you notice over and over and you say that’s a problem. 

Why is that happening? And you start thinking critically about why it’s happening, then you start thinking about why it’s happening because the consumers taking that action. And what is happening to the consumer experience that’s causing them to do that, then you really can start having some meaningful impact on your site.

Adam: And then I’m assuming the next poll, then the next step is to make the change based on the data and then test the change.

Jon: Exactly. And that’s the last data point that we really didn’t even talk about out of the four. I mentioned there were four. We talked about analytics and heat mapping, and user testing. The fourth is called AB testing or split testing. So this is happening to you all over the internet. And out of the top, like probably 10,000 ecommerce sites. I bet you 99.9% are doing this. And you have no idea it’s happening to you as you’re traveling around the internet all day. But what’s happening is you’re getting bucketed and segmented into a test. So let’s talk about what AB testing and split testing is. 

Say you have 100 people come to your website. You can use AB testing to send 50 of those people to a small variant of a change on your website. It can be small or large, but it could be anything from changing the headlines and copy to change in photography, something as big as completely reordering all the content on a page or changing the navigation experience. Right? And then the other 50, you would just show your static site as it is today without any of those changes. And then you statistically compare what changes are having the biggest impact? 

And are they having a meaningful impact over the current site? And so you’re able, again, to use data to make an informed decision about what should permanently be changed on your site. And that’s what the fourth data point is, is AB testing. It’s really crucial. But I do list it forth because if you don’t have all the other data about what to think about, then you really can’t form what test should be run. Right? It’s really important to understand what people are doing on your site and where you need to impact some change before you would run a test.

Adam: Yeah that makes sense. I’ve been on amazon.com several times and noticed it has been served an AB test on one particular product page. And then I’ll click and go to another product page in the, you know, the buy box, for instance, is a different layout.

Jon: Yeah, and that’s a toolset that, AB testing used to be a tool that was several 10s of thousands of dollars a month to do, right? And you had to have a whole dedicated team, etc. Google actually has a great tool. It’s free. It integrates well with Google Analytics. It’s called Google Optimize. It’s fairly new. And it works extremely well. It has a what you see is what you get an editor. So you can go in and without a ton of technical knowledge, you can run some tests on your site. 

And it will tell you, it does the math for you and tells you what tests are winning. It does take some effort to set up and run but it’s not something that’s an insurmountable barrier for most brands. So they’re, you know, really trying to help also democratize that conversion optimization and using data.

Adam: Yeah and that makes sense that Google is putting this out because that in order to serve more ads, people have to continue to trust Google with serving the best search results. 

Jon: Yeah, Google loves when you do AB testing. They really do because they’re providing a better experience for folks who are clicking through their ads, as you mentioned. 

Adam: So Jon, your website is thegood.com. By the way, why did you name it The Good?

Jon: Great question. So our mission here is to remove all of the bad online experiences until only the good ones remain. So the Genesis was part of the mission statement.

Adam: Yeah, I love it. So the website is thegood.com, is there anywhere else that people can find you? Or what’s the best next step if they want to learn more about seeing if you can help them? 

Jon: Yeah, so on our website at thegood.com you can sign up for our weekly insights. This is free, wonderful learning content. If you liked what you heard today, there’s tons of articles. 10 years of great content up there. It’s searchable, for any pain point that your consumers might be having, or even to help you understand how to find those pain points. It’s published every Tuesday morning. There’s no sales pitches in it. It’s all just helpful content, educational content. So feel free to go and join that email list. 

And then there’s if you want to learn more about what we do, how we help brands both large and small, you can easily find that information up on our site, including what we call our Conversion Growth Lab. The Conversion Growth Lab is an online community that is based around Slack. We have a Slack community with helpful resources. And it’s really meant to help smaller brands who probably can’t afford, don’t have the resources to work with an agency, like The Good, to do their conversion optimization for them. But they need some resources and they’re very interested. 

And we recognize, again, going back to trying to democratize CRO that, you know, these folks need some help too. And so we’re providing a community where they can engage and have helpful resources, watch teardowns of the top 100 ecommerce sites to gain some knowledge about what they’re doing right and wrong and how they can apply those things to their site. And then discuss with peers and office hours with our team here at The Good

Adam: Wow. Okay. So that’s Conversion Growth Lab, and you can find it on thegood.com. Perfect. We’ll put that in the show notes. Man, Jon, thank you so much for coming on and sharing this very important information. I really appreciate it.

Jon: Well, thank you so much for having me, Adam. It was a great conversation.