CONVERTING VIEWERS TO CUSTOMERS 1. Conversion Rate: Converting Viewers to Customers. Katia A. Gonzalez. University of Houston

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1 CONVERTING VIEWERS TO CUSTOMERS 1 Conversion Rate: Converting Viewers to Customers Katia A. Gonzalez University of Houston

2 CONVERTING VIEWERS TO CUSTOMERS 2 Abstract Research was conducted in order to determine how much a website s graphical interface design affected conversion rate. This research is aimed to help leaders, entrepreneurs, and other e-tail website owners in the e-commerce industry. The data for this study was collected through an online survey, which was distributed on different social media platforms. The survey was created in an A/B style format where participants were asked to browse two websites and then answer the survey questions. Part of the questions included to rate each website according to their experience and indicate whether they took any action on the websites such as create an account or enter a give-away. Data from these responses were collected, analyzed, and put into graphs. Based on the results, Website A had the highest responses and average ratings. This indicates that a website s design does affect conversion rate. This research should help the business owners who still do not know that design does affect their conversion rate. Conversion Rate matters because millions of dollars are spent on websites but there is still a need to measure its effectiveness. The research found in this study is enough to create a method for improving conversion rate. Keywords: Conversion Rate, E-commerce, E-tail, Web Design

3 CONVERTING VIEWERS TO CUSTOMERS 3 Introduction Could redesigning a website into a more graphical interface improve conversion rate? By answering this question, business owners can potentially create a successful method to increase the conversion rate of a website. This information is relevant and useful because it will help managers and business owners review the effectiveness of their e-tail business. To a graphic designer this matters because every web designed is now a piece of accountable content (Gardner, 2014). Their success is always being measured and they want companies to successfully get their full return investment in their websites. Conversion rate is the percentage of visitors who take clear action beyond browsing a website. The types of actions vary from membership registrations, subscriptions, to online purchases and depend on the site being used by the visitor. An e-tail business is the selling of retail goods on the Internet. These businesses use conversion rate to measure an increase or decrease of profit. For marketers this is a powerful tool that they use to convert viewers to customers. The goal is to keep viewers active on the page because they are more likely to make a purchase. However, design elements may affect how long a viewer stays on the website before making an action. Design elements include shape, color, texture, and space. From the inception of e-commerce in the 1970 s there has been an incredible growth of buying and selling products or services through online technologies. Since then, experts have found ways to improve and adapt to this fast growing industry. The e-commerce the industry is expected to grow up to $4.2 trillion in the by 2021,

4 CONVERTING VIEWERS TO CUSTOMERS 4 compared to $1.4 trillion in 2015 (Merchant, 2015). One of the ways they can predict these numbers for an e-tail business is through the conversion rate. The problem that appears is that companies do not recognize how their website design may affect their conversion rate and performance. This is significant in the e-commerce industry because the higher the conversion rate, the higher the potential of increase in profit. A way to increase the conversion rate is by helping visitors navigate easily through the website and help companies transform a message into a visual road map (Sukhraj, 2015) that leads their potential clients to take the right kind of action. It has been proven that color and design play an important role in marketing, Their effects can not only help you make the right first impression with highquality and consistent branding, psychologically, they can also help elicit the desired actions out of your audience (Sukhraj, 2015). It would benefit our purpose to also test this through our e-tail website designs. Showing value in a brand through design can potentially get viewers to convert from just browsing a website to actually buying and obtaining that value through a purchase. Tests have proved that when a person views a website it roughly takes about 90 seconds to convince them to stay on that website. Therefore, communicating the value to the viewer is essential in order to have them convert to customers or possibly see a significant increase in their conversion rate.

5 CONVERTING VIEWERS TO CUSTOMERS 5 Literature Review There are several professionals that are aware of the importance of careful design and planning. Some evidence can be found throughout existing companies and their study cases. MotherNature.com points out that design is essential to get visitors to become customers (Urban, 2004). Companies are already discussing these issues and improving their websites. The following evidence presented in this research paper comes from different media experts on topics relating to Could redesigning a website into a more graphical interface improve conversion rate as stated in the problem statement. In Neuro Web Design by Dr. Susan M. Weinschenk, she says that in order to make the decision to visit a website one must be persuaded to go there. Many of our decisions and actions are based on emotion, and many are based on automatic triggers that we react to from something we see on the website (Weinschenk, 2009). She claims if we want to get and hold someone s attention we must tell a story through our website. It is clear, one must have visuals in their website to be successful, because you realize that stories and pictures at Web sites are the most powerful ways to get and hold our attention and persuade us to take action (Weinschenk, 2009). A dependable website includes beautiful design and meaningful text that can exist harmoniously with effective search engine optimization (Tilley, 2009). Together with search engine optimization (SEO), it will lead the audience to the right website. In Marketing, Advertising, and Publicity by Barry Callen, he explains the placement of media along different stages of the customer engagement cycle

6 CONVERTING VIEWERS TO CUSTOMERS 6 through search engine marketing, search engine optimization (Callen, 2010) is also known as Internet marketing, which is part of what our websites do in the web. Tilley points out that the company should not be held responsible though A good designer with an understanding of SEO concepts should be able to solve any design problem without negatively impacting SEO (Tilley, 2009). Looking at a case study done in Digital Marketing Strategy by Glen L. Urban, we see that financial planning is important for the design of the website. We see many examples throughout his research of companies that spend thousands of dollars for their brand, logo, and website designs. For example, MotherNature.com planned to spend the majority of investor money on marketing-related expenses Site design is especially important to the company as means of creating a trusted brand (Urban, 2004). This case study also shows that websites are the primarily source of information, where a customer determines if they would purchase a product from an online company or not. MotherNature.com is considering issues of pricing, site design, and the use of value-added information to convert visitors into shoppers and shoppers into customers (Urban, 2004). This topic of financial planning is especially important to all e-commerce businesses, however, all companies must also consider their brand. Branding relates to a client trusting a company and allowing for their return on investment to flourish because of the conversion rate. In The Art of Digital Branding by Ian Cocoran, he mentions that a well-branded website can do more than that. Indeed, in my opinion it is this dynamic fluidity that gives the Web its

7 CONVERTING VIEWERS TO CUSTOMERS 7 greatest appeal as there is no other single branding platform like it in the world its possibilities are now quite literally endless, as are its abilities to influence a range of human emotions in little more than the blink of an eye (Cocoran, 2011). With the right design elements and strong brand, they will take action either by subscribing or purchasing a product, whichever fits the purpose of your website. An important topic to bring up is content and how this can greatly affect a website. In the book Million Dollar Website by Lori Culwell, she makes a powerful and important statement regarding content. The process of evaluating your site s existing copy and/or developing new copy for your site is cause for another exercise in getting real. In other words: Is the language appropriate for your audience and for your brand (Culwell, 2009). Graphic Design does include text and typography, which enhances the way information, can be presented to an audience. And just like Culwell explains, it is important that the language is appropriate because it reflects your brand. Again, brand is important to gain trust from website visitors in order for them to take action on a website. Bad writing is like a bad apple. A little can spoil the whole lot by failing to effectively deliver your intended message and tarnishing the user s overall impression of your site and, by extension, your business (Culwell, 2009). She perfectly ends with this thought on people s minds, basically saying if a company wants business, they must write killer content. Careful planning and design elements are effective and worth investing in. Content from an audience as feedback is also worth having. This helps to measure the success of a website and how satisfied customers are with the website. Measuring the Success of Your Website by Hurol Inan beautifully describes how this

8 CONVERTING VIEWERS TO CUSTOMERS 8 process looks like. He makes a great point when he says, A website can be used to generate additional content through the participation of its audience this would mean an opportunity to create new editions of the book with richer and more relevant content (Inan, 2002). Although beautiful images can communicate a great message, bad content can ruin it. It is wise to also take time and creativity to lay out great content on a website. Even after reviewing these important elements, employers may be still wondering if it truly matters to them. Research does show that several companies have had to adjust to this fast growing industry. For example, we see in Digital Engagement by Leland Harden that magazines, major advertising agencies, and major advertisers who once fought the tide are being forced now to redefine how they reach consumers and remain relevant (Harden, 2009). Times have rapidly changed and it is important that businesses do stay up to date in order to reduce risk in loosing business. In Electronic Commerce by Tim Ross he talked about how the Internet has enabled businesses to buy and sell millions of consumers through online networks. The electronic trading boom is in full swing, as the Internet and World Wide Web (WWW) offer unlimited opportunities to transform the way business is conducted. Industry analysts predict that by the year 2001, worldwide business over the Web will total between $200-$300bn (Ross, 1998). Even looking at this past prediction, the numbers calculated were extremely high. These facts should matter to business owners because the business is only growing higher with even more opportunities.

9 CONVERTING VIEWERS TO CUSTOMERS 9 Social media is everywhere even if we are not personally on our laptop screen, mobile phone, or desktop. Almost all companies today use social media to promote their companies either on their products, packaging design, and news articles. Turn Clicks Into Customers by Duane Forrester says Social Media and social networking are still relatively new ways to reach customers and draw them to your site you need to have a clearly defined plan around social media or you could make simple mistakes that may negatively impact your brand perception (Forrester, 2010). It is clear that social media can make a great impact on a company s brand and how visitors can easily find their way to their products. By reviewing and researching elements that make an effective website business owners can see how design improves conversion rate. There are several factors that come into play, but they can see through different experts that they all play together in helping companies be successful, get a great return on investment, and improve the number of visitors on their website to take action. Method In order to determine an answer for the problem statement, a method was created based on a step-by-step workflow. For this workflow process, a survey was distributed to participants through social media. The social media platforms include Facebook, Twitter, and GroupMe. The survey was also posted on the University of Houston s Digital Media Facebook page so students could participant in a survey that was relevant to their industry. Using Survey Monkey, the survey was created in an A/B testing format. A replica of the Survey Monkey can be found in Appendix A.

10 CONVERTING VIEWERS TO CUSTOMERS 10 Before taking the survey, participants were asked to visit two websites in order to answer all 10 questions in the survey. A replica of the websites can be found in Appendix B. The purpose of the questions were to collect average ratings on each website based on how visually appealing the website was, and how easy it was navigate on each website. The second purpose was to collect data on how many total conversions each website received such as: signing up for a newsletter, checking out social media, or entering a giveaway. One week after going live with the survey, 47 participant surveys were collected. The results were then converted to a bar graph and series of pie charts. The final results display the average ratings, the total conversions, and the total conversion rate for each website. The final results also includes a formula that was used to calculate the conversion rate of each website. Results The results of this research are based on the data provided by 47 participants. There were no participant requirements that needed to be met in order to qualify for the survey. The participants were from all diverse backgrounds, occupations, and age groups. The data collected was enough to draw conclusions on how design affects the conversion rate of a website. The first set of results show the average ratings of both website A and website B. Website A had an average rating of 8.3 and website B had an average rating of 3.6, based on how visually appealing the websites were presented to the participants. For the average ratings of navigation, website A averaged an 8.5 and website B averaged a 4.7. A bar graph displaying these results can be found in Figure 1.

11 CONVERTING VIEWERS TO CUSTOMERS 11 The second set of results show the total conversions and the conversion rate percentage of each website. Website A had 15 total conversions coming from total participants who created an account, entered a give-away, and checked out social media. By using the formula, website A had a conversion rate of 32%. Website B had 3 total conversions coming from total participants who created an account and entered a giveaway. By using the formula, website B had a conversion rate of 6%. A series of pie charts displaying these results can be found in Figure 2. Figure 1. Average Ratings. The key on the right indicates rating for each website. Figure 2. Conversion Rates. The key on the right shows the type of total conversions.

12 CONVERTING VIEWERS TO CUSTOMERS 12 Conclusions From the results of this research, conclusions can be drawn that redesigning a website into a more graphical interface can improve conversion rate. Participants preferred to take more action on website A, which had the highest ratings in both categories. Comparing both websites, there was improvement of conversion rate by 26%. It is up to the owner of an e-tail website to consider whether this percentage is high or low based on their business goals. But this does answer the question of the conversion rate growth between a website with a good design compared to one that needs improvement. With these results, business owners with an e-tail website can now create a successful method to increase the conversion rate of their website. They will now have data that shows them that investing in their websites is good for their conversion rate, meaning a higher percentage to win profit. The 26% difference may matter more to others, but it all depends on the business goals of the company. Recommendations In order to improve the results of this study, there are a few recommendations that should be taken into consideration for further research. This research should be done using e-tail websites instead of give-away websites because there were trust issues while conducting research with website A and website B. It is also recommended to use the same type of product or service that is being sold on both websites.

13 CONVERTING VIEWERS TO CUSTOMERS 13 Future researchers should also consider conducting the surveys in person in order to have a better tracking method of the total conversions. Since this research was conducted online, the tracking method was weak. There was no way to track what additional action the participants took while browsing the websites. Additional actions may include browsing through different tabs of the websites or clicking on different links within each website. Conducting the survey in person also helps to build credibility of the data collected.

14 CONVERTING VIEWERS TO CUSTOMERS 14 References Culwell, L. (2009). Million Dollar Website. New York, New York: Penguin Group Inc. Tilley, S. (2009). Online Marketing Inside Out. Collingwood, Victoria: SitePoint Ltd. Weinschenk, S. (2009). Neuro Web Design. Berkeley, California: New Riders Urban, G. (2004). Digital Marketing Strategy. Upper Saddle River, New Jersey: Pearson Callen, B. (2010). Marketing, Advertising, & Publicity. Madison, Wisconsin: McGraw-Hill Cocoran, I. (2011). The Art of Digital Branding. New York, New York: Allworth Press Inan, Hurol. (2002). Measuring the Success of Your Website. Forest, Australia: Pearson Harden, L. (2009). Digital Management. Broadway, New York: American Management Ross, T. (1998). Electronic Commerce. Pall Mall, London: Director Publications Ltd. Forrester, D. (2010). Turn Clicks Into Customers. Madison, Wisconsin: McGraw-Hill Merchant, M. (2015). The history of e-commerce. Retrieved October 30, 2015, from Gardner, O. (2014). How to become a conversion-centered designer. Retrieved November 5, 2015, from Sukhraj, R. (2015). How do color and design actually affect inbound conversion rates. Retrieved November 21, 2015, from

15 CONVERTING VIEWERS TO CUSTOMERS 15 APPENDIX Appendix A Survey Monkey Questions

16 CONVERTING VIEWERS TO CUSTOMERS 16 Appendix B Website A: Website B: