Selena Blue

Digital Marketing: 3 test ideas to optimize your incentive offers

June 13th, 2016
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Coupon. Free download. Discount code. Gift card. Complimentary ebook.

These are just a few of the countless types of incentives marketers use to influence customers to say “yes” at the final macro-decision – whether that’s making a purchase, filling out a lead gen form or some other form of conversion.

Incentive can be just what some customers need to commit to an action you want them to take. But how can you ensure your incentive offers are having optimal effect on conversion?

Here are three tests you could use to optimize your incentive offers.

 

dollar-versus-percentage-incentiveIncentive Test #1. Percentage off vs. Dollar amount off

This first test idea is definitely a numbers game.

What do customers see more value in: a percentage discount or a defined dollar amount discount?  One case study from deep within the library of our sister site MarketingSherpa tested this question.

Evo, an online retailer of outdoor gear and fashion apparel, offered a coupon for certain product packages that had an average price of $333, and a minimum price of $250. With these numbers in mind, the team determined that $50 was the ideal discount point.

In addition to a traditional $50 off coupon, the team elected to test a 15% off coupon as well, which roughly equaled $50 off the average price of $333.

The test produced these results:

  • The $50 off coupon produced a 72% higher conversion rate
  • The $50 off coupon generated 170% more revenue than the 15% off coupon

It’s important to measure both conversion and overall revenue with this test. Even if one treatment results in more purchases, it may have lower average order amounts. If the average order amount is lower overall, the treatment with fewer orders of higher amounts could be your best choice moving forward.

  Read more…

Selena Blue

Customer-centric Marketing: How market research and listening to customers informs website optimization

June 8th, 2016
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At the heart of every test or optimization effort should be an informed hypothesis. However, best practices can lead us astray. So where can marketers find inspiration for their next experiment?

The answer often lies with our customers.

This week, our sister company MarketingSherpa has a team of reporters at the Internet Retailer Conference and Exhibition (IRCE) in Chicago, hosting the official Media Center of the ecommerce event.

Courtney Eckerle, Senior Managing Editor, MarketingSherpa, sat down with Matt Clark, Global Head of eCommerce and Digital Marketing, Newark element14, to discuss how marketers can watch and listen to their customers to discover pain points on their sites and in their purchase funnels.

 


Three steps to effective ecommerce sites

To start, Matt outlined three steps marketers should take to ensure their websites effectively serve customers:

  1. Make it easy to find.
  2. Make it compelling to convert.
  3. Make it easy to use.

Matt shared an analogy that highlights the particular importance of that last step:

“It should be like a hotel where when you walk in, you know the light switch is on your right-hand side, the remote is on the table. If it’s not like that, if it’s not that seamless to a customer, you’re going to lose some customers along the way.”

Read more…

Daniel Burstein

Eight Lessons from the Father of Data-obsessed Marketing

June 6th, 2016
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Snapchat. Mobile marketing. Virtual reality. Marketing automation.

As marketers, we have a tendency to focus on the newest, buzziest, most-hyped ideas and look at the giants whose shoulders upon which our industry stands.

Claude Hopkins lived far before any of these buzzy terms. Even before TV commercials. He’s one of the most influential advertising professionals in history, yet many modern marketers have probably never heard of him. After all, his seminal work – Scientific Advertising – was published almost 100 years ago.

Hopkins’ career resided in a sweet spot for influencing our industry. His research pre-dates and informed David Ogilvy and Rosser Reeves (aka Don Draper). In fact, in Ogilvy on Advertising, Ogilvy says, “Nobody should be allowed to have anything to do with advertising until he has read [Scientific Advertising] seven times. It changed the course of my life.”

Yet Hopkins arrived after earlier pioneers like Walter Scott and Daniel Starch, so his teachings were informed by not just opinion, but data. As he says in his book, “Advertising, once a gamble, has thus become, under able direction, one of the safest business ventures.”

Hopkins’ discoveries enabled him to be very tactical and practical with the advice he gave to early advertisers. This is advice successful marketers are still putting into practice today, such as:

 

“We learn the principles and prove them by repeated tests.”

Digital marketing has made A/B testing much easier, quicker, and cheaper. And you can see this dedication to testing and learning rolled out across the web today, as in the landing page tests shown below.

experiments-landing-page-results

Source: Landing Page Optimization: 6 common traits of a template that works

However, it’s easy for digital marketers to forget that testing did not begin with the invention of the internet, as Claude Hopkins discussed the importance of testing way back in 1923.

 

“The most common way is by use of the coupon. We offer a sample, a book, a free package, or something to induce direct replies. Thus we learn the amount of action which each ad engenders.”

Measuring marketing tests is much easier thanks to the tracking and measurement inherent to digital marketing, something Hopkins didn’t have the luxury of back in 1923.

However, marketers today are still challenged with measuring the impact of offline advertising, like print ads. And coupons or other incentives are still a good way to measure that ROI.

It works in reverse, as well. Some companies, like this small sporting goods store, use online coupons to track brick-and-mortar store purchases, helping to measure the impact of their online channels.

hesselsons-coupon

Source: Social Media Marketing: Small sporting goods store sees 1,100% ROI increase with Facebook coupon

 

“The best ads ask no one to buy. That is useless. Often they do not quote a price. They do not say that dealers handle the product. The ads are based entirely on service. They offer wanted information.”

This quote from Claude Hopkins sounds almost like a very prescient call for content marketing, like the following blog post.

superoffice-webpage

Source: Content Marketing: Multi-channel approach increases organic traffic 97%

 

“One must be able to express himself briefly, clearly and convincingly, just as a salesman must.”

Unlike other forms of creativity (movies or books) or information (newspapers or magazines), the vast majority of people are not actively searching for ads to read or watch, so the successful marketer must grab attention and convey a message in a very short time.

For example, the classic “Think Small” ad produced by Doyle Dane Bernbach for Volkswagen, which provides a brief, clear, and convincing proposition for a previously unheard of ask for 1959 – buy a small car.

volkswagen_think_small

Source: Wikipedia

 

“Practically all merchandise sold by mail is sent subject to return.”

This was a classic direct mail technique, and Zappos helped bring it into the Internet era.

zappos-shipping-returns

Source: Zappos

 

“Fine talkers are rarely good salesman. They inspire buyers with the fear of over-influence. They cater the suspicion that an effort is made to sell them on other lines than merit.”

Instead of a slick-talking spokesperson, Monster.com’s legendary Super Bowl ad used children reading lines that poked fun at real-world challenges—challenges that resonated with the ideal customer.

“When I grow up … I want to be underappreciated. Be paid less for doing the same job.”

monster-commercial

Source: Monster.com – “When I Grow Up” (YouTube)

 

“Remember the people you address are selfish, as we all are. They care nothing about your interests or profit. They seek service for themselves.”

When you read this quote, it seems like obvious advice, right? But does your company live it? I mean, really live it?

Since you’re also a customer, you know that so many companies don’t. I recently wrote 10 banks asking them the pre-payment penalty for their CDs. Only two actually answered my question. The other eight linked to a long page of terms and conditions and told me I could find my answer there.

Hardly a frictionless experience. Hardly providing service to a selfish customer who could care less about reading their T&Cs.

This experience is true in advertising, as well. Ads can be filled with friction and talk about things that matter more to the company than the customer. Perhaps they grab attention, but do they inspire the customer to act? Does the customer understand what’s in it for her?

“One product that does a great job of explaining its purpose in a straightforward way is Zzzquil,” said Emily Rogers, Senior Marketing Research Manager, MECLABS Institute. “Its TV ad sticks out to me because it explains the benefit of the product from the customer perspective in about 20 words or less.”

zzzquil-ad

 

“Don’t boast, for all people resent it. Don’t try to show off.”

This is my favorite piece of advice from Hopkins. And we all see ridiculous boasting every day in countless ads.

Copywriters and agencies feel they must sing the praise of the product. After all, they’re getting paid to do it.

Brand-side marketers feel like they need to made huge claims. After all, they’re spending a lot on media, and only have a few seconds of the prospects’ attention to shout louder and bolder than the ad before and after.

Jerry Seinfeld and Acura do a great job of product placement in “Comedians in Cars Getting Coffee” specifically because they don’t boast.

acura-seinfeld-commercial

Source: Acura Product Placement with Jerry Seinfeld (YouTube)

Fred Armisen: What’s this?
Jerry Seinfeld: Oh this is just some Acura parts. They told me my product placement was getting a little too heavy handed. So I thought, instead of the whole car…

(Acura drives up and honks)

Acura driver:
C’mon man, I’ve got a hot yoga!

(Tires screech, Acura quickly peels out with smoking tires, and anyone in product discovery mode with the intention of buying a sporty car just made a subtle mental note to possibly consider the Acura)

 

You might also like

Earn a graduate certificate in: Communicating Value and Web Conversion (I came across these lessons from Hopkins because I’m enrolled in this graduate program, a partnership between MarketingExperiments’ parent research organization MECLABS Institute and the University of Florida)

Marketing Research Chart: 75% of strategic marketers use A/B testing to learn about customer behavior

Optimizing Copy: The 7 most common copywriting mistakes we see marketers make

Liva LaMontagne

Exploring Online Shopping Behavior: How website characteristics affect likelihood of purchase and basket value on ecommerce sites

May 26th, 2016
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Traditionally, brick-and-mortar stores have displayed their products in their windows, enticing passers-by to come in and learn more, perhaps meet and talk with the owner and other shoppers, and, ultimately, fill their shopping baskets and purchase the goods.

Today’s digital stores (ecommerce websites) are striving to achieve the same goals as their brick-and-mortar counterpbrick-and-mortararts, with varying scopes of products ranging from unprecedented breadth (e.g., Amazon) to narrow specialization (e.g., your local cupcake bakery).

Though ecommerce stores come in a myriad of types, and specific factors influence how customers shop at different websites, they all share one thing in common: Store owners are always on the outlook for some generalizable principles and ideas to test in their specific conditions in hopes of maximizing revenue.

Which website characteristics increase the likelihood that a visitor will make a purchase? And, since shipping costs are a considerable expense, how do you increase the likelihood that a customer will spend more money per shopping session?

Let’s look at a recent study exploring the effects of website characteristics on online shopping behavior and basket value, and how those effects depend on product characteristics.

 

The study

In March 2016, professors Girish Mallapragada of Indiana University, Sandeep R. Chandukala of Singapore Management University and Qing Liu of University of Wisconsin published the results of a study exploring the effects of product and website characteristics on customer shopping behavior and basket value.

The authors analyzed the shopping behaviors of 2,000 consumers over one year, collected from the ComScore Web Behavior Panel. The data encompassed 773,262 browsing sessions and 9,662 purchase transactions at 385 online retailers across 43 product categories.

 

Method

The researchers scored all websites on product variety offered and on two types of functionality: navigation and communication.

Navigation functionality captured the extent to which a website facilitated browsing through content, site maps, layout and updates.

Communication functionality captured the extent to which a website offered communication features such as email, chat rooms and message boards.

They also scored the products on their hedonic and utilitarian characteristics using a previously developed scale.

Hedonic products (e.g., jewelry) would be rated highly on items like “fun,” “exciting” and “delightful.”

Utilitarian products (e.g., office supplies) would be rated highly on characteristics like “effective,” “functional” and “necessary.”

 

Results

Which factors predict likelihood of purchase?

In the browsing stage, the researchers found that the following factors are significantly related to purchase:

  • Previous purchase (previous customers are more likely to buy again)
  • Session duration and page views (more engagement leads to increased likelihood to purchase)
  • Broad scope of products (more variety leads to increased likelihood to purchase)
  • Communication functionality (more communication features lead to decreased likelihood to purchase)

 

Which factors predict higher basket value?

Among the customers who made a purchase, the researchers found that the following factors are significantly related to basket value:

  • Page views (more page views were associated with higher basket value)
  • Session duration (longer sessions were associated with lower basket value)
  • Broad scope of products (more variety associated with higher basket value)
  • Communication functionality (more features associated with lower basket value)
  • Navigational functionality (more features associated with higher basket value)

 

However, the effects of navigational and communication functionality depended on the characteristics of the products consumers were shopping for. Namely:

 

  • Communication functionality lowered basket value for utilitarian products, but not for hedonic products
  • Navigational functionality lowered basket value for hedonic products, but increased basket value for utilitarian products

 

The authors suggest that people buying utilitarian products might be looking for relevant information about the product on the page instead of communication functions, which might be perceived as clutter and add to friction. On the other hand, people buying hedonic products might be looking for self-affirmation through engaging in a dialogue with others and find communication features helpful.

 

Key takeaway

If you are selling utilitarian products, your page might benefit from rich navigational functionality, while if you are selling hedonic products, your page might benefit from rich communication functionality.

In both cases, you want to entice your customers to engage with your pages and check back often, which would ultimately lead to more purchases and higher basket value. Having a variety of products to choose from, and earning the loyalty of returning customers also helps increase the likelihood of purchase and basket value.

 

You might also like

Exploring the Effects of “What” (Product) and “Where” (Website) Characteristics on Online Shopping Behavior [Executive summary from the Journal of Marketing]

Ecommerce Chart: How a low conversion rate can be a good thing [From MarketingSherpa Chart]

B2B Marketing: Customer-focused site design for book ecommerce drives order volume up 211% in three years [From MarketingSherpa Case Study]

Ecommerce Marketing: Time spent on site boosted by 50% with transition from flash sale to retail for fashion site [From MarketingSherpa Case Study]

 

Daniel Burstein

The Difference Between Marketing and Advertising (and Why It Matters)

May 23rd, 2016
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Marketing and advertising are distinct majors in college. Most agencies are advertising agencies, and most departments inside companies that promote the sale of product are marketing departments.

Why the distinction? Are these two words synonyms, or is there a real difference?

A high-level, ephemeral topic like this isn’t something marketers spend most of their time thinking about. They’re too heads down, focused on budgets and marketing automation and copywriting. I know I am.

But I recently started taking MMC 5435: Messaging Strategy and the Centrality of the Value Proposition, part of the Communicating Value and Web Conversion graduate certificate created by MECLABS Institute (parent research organization of MarketingExperiments) in partnership with the University of Florida.

And so lately I’ve been pondering the bigger, more existential copies of marketing, such as this one. Marketing philosophy, if you will.

 

More than just nomenclature

To me, marketing is strategy and advertising is (but one) execution of that strategy. Marketing is the strategy of educating customers about a company’s choices in the marketplace, who their product or service will be a good fit for, and who it won’t. Advertising is then used to take that strategy and communicate it to an audience. This is part of the reason that many universities, UF included, place marketing programs in the College of Business and advertising in the College of Journalism and Communications.

So both advertising and marketing have the same goal. They both are, essentially, helping enable a choice. Usually in the company’s favor to enable reaching a conversion objective, but hopefully to enable the best decision for the customer — even if that best choice is not to purchase the company’s products.

But there is a key difference. Advertising is not holistic of the customer experience with a product. Even intelligent, multi-channel campaigns are impacting just a fraction of customer touchpoints with a brand.

And this is one of the biggest mistakes marketers make today. At least traditional marketers. They are too focused on getting in front of the customer with a conversion objective. But the real question should not be, “what is my objective as a marketer?”

Read more…

Paul Cheney

Setting the Right Tone: Two key principles to build positive customer momentum

May 19th, 2016
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During last week’s Web clinic, “Does Fear-based Marketing Work?,” we looked at a recent Twitter test run by MarketingExperiments’ parent company MECLABS Institute in promotion of the latest issue of the Executive Series.

Which tweet do you think achieved a higher clickthrough rate?

 

Here’s some context in case you need help choosing …

In Tweet Version A, the message is straightforward.

  • “Customers are more willing to engage with newspapers than you might think.”

In Tweet Version B, the message taps into an implicit fear that a marketer may have — that poor design is negatively impacting performance.

  • “Poor UI design and user experience may be negatively impacting the perception of your digital subscription.”

OK. Now make your choice. You can say it out loud if it will help you.

Whatever you do, don’t look directly below this line of text.

Read more…