How the owner of sportowysklep.pl and chmielna20.pl increased revenue generated of these sites by 19% and avoided committing a very costly mistake

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1 How the owner of sportowysklep.pl and chmielna20.pl increased revenue generated of these sites by 19% and avoided committing a very costly mistake Are you looking for a way of generating more e-commerce orders other than another traffic source optimization? Do you have a lot of new ideas about how to develop your shop, but you aren t sure which ones will effectively increase revenue? Łukasz Grajewski, e-commerce director at Szopex and the owner of several sports brands that offers its products in local stores and online, faced those very same questions. Szopex owns brands such as Sportowy Sklep (sportowysklep.pl) and Warsaw Sneaker Store (chmielna20.pl). How can Szopex, or any other internet shop, develop and generate ever increasing revenues? As you probably know, revenue in e-commerce = (the number of users) x (the conversion rate) x (average order value). Therefore, one may try to increase sales by imitating most new online shops and bringing more traffic to the website. This will increase the number of orders proportionally. However, traffic becomes increasingly expensive, which is a well-known fact in e-commerce. Is there a reasonable alternative? Yes. Another way is to make the most of existing traffic. One can achieve this by improving the conversion rate and the average order value. The latter option was chosen by Łukasz Grajewski, e-commerce director at Szopex: The challenge we are facing now is - how to grow when traffic sources are highly optimized? We are really good at traffic acquisition. Therefore, we decided to improve the other two factors in the e-commerce sales equation the conversion rate and the average order value. The effectiveness of this solution would also be advantageous to us, because we could use it in our other shops, which would increase total revenues even more. The Growcode team, led by Paweł Ogonowski, developed a new process for the company that increases the conversion rate and the average order value. Everything starts with data Despite considerable experience in conversion optimization and despite carrying out tests since 2010, we do not want to rely on intuition. Therefore, each test is preceded by an in-depth data analysis for us it is the starting point of every conversion optimization process implemented for our clients Growcode s Paweł Ogonowski said. The continuous conversion optimization process consists of six recurrent steps. The first is an in-depth analysis, which usually starts with the data from Google Analytics and with a qualitative analysis. At this stage, we choose the area with the highest optimization potential and form hypotheses for A/B tests. After choosing the elements for testing, we make wireframes and then, based on them, we prepare graphic designs. The next step is coding the changes, and the final one is carrying out an A/B test. After the completion of the experiment, the influence of every change on the conversion rate is carefully analyzed. These six-steps are repeated and create a continuous optimization process. Thanks to this, the website is continuously changing and meeting customers expectations. SUMMARY The owner of the website sportowysklep.pl and chmielna20.pl is Szopex, a company that has been in business for 25 years. Both websites are ideal places for people who love an active lifestyle and appreciate fashionable and comfortable clothes. Websites: sportowysklep.pl, chmielna20.pl Industry: sportswear Purpose of cooperation: Development of an effective conversion rate optimization process, which will enable an ongoing identification of problematic elements, their correction and measurement of the effectiveness of the corrections by means of A/ B tests. Final results 1. 19% conversion rate and revenue increase in one of the tests. 2. A culture of carrying out effective A/B tests was developed, conversion rate optimization processes were designed, and the knowledge of the team was developed. We now have experienced the effect that conversion optimization can produce. We also know that the true key to success is continuous actions aimed at improvement and a repeatable process. This process should be a part of the work of every self-respecting e-commerce department. Łukasz Grajewski E-COMMERCE DIRECTOR AT SZOPEX

2 In the first process iteration, three hypotheses regarding the conversion rate increase on the websites sportowysklep.pl and chmielna20.pl were chosen The first test included the following hypotheses: HYPOTHESIS 1: Removing a long description in the product descriptions on sportowysklep.pl will have no adverse effect on the conversion rate. This will accelerate the pace of introducing new products BEFORE: In the original version, the product descriptions contained a long description of shoes (on a black background). Creating this description took the e-commerce team a lot of time. AFTER: Check if removing the time-consuming product descriptions affects the conversion rate and the revenues of the shop.

3 HYPOTHESIS 2A: Adding information about the product availability and the sizes will act as an additional incentive and convince more users to purchase the product, which will increase the conversion rate. BEFORE: In the original version there was no information about the availability neither generally for the product, nor for specific sizes. AFTER (Alternative version A): In this version, we added a notice about the general availability of the product before the choice of the size (under the product price). Additionally, after the choice of the size, there was the information about the availability of that particular size. If the availability was low ( 3 pieces), a notice about the number of pieces in stock was displayed. If the availability was high (> 3 pieces) the notice said, Your product is available.

4 HYPOTHESIS 2B: The information about the availability must be highlighted enough to draw the attention of the user and work as a purchase incentive. AFTER (Alternative version B): In version B, the same messages appeared as in version A, but the colours were more vivid. HYPOTHESIS 3: Decreasing the importance of the decision to purchase the product by changing the text of the call to action in the basket from Order to Proceed will encourage more users to move on to the ordering process, and thus increase the conversion rate. BEFORE: In the original version of the basket, there is a rather obliging call to action that says Order.

5 AFTER: The call to action in the basket was changed to a less obliging, Proceed to checkout. Two hypotheses proved correct and one proved false. Guess which one! After running the tests, we verified the hypotheses. Here are the results: HYPOTHESIS 1 (removing the description) proved to be correct. The versions with and without the description did equally well. It seems that the users of sportowysklep.pl pay attention mainly to the graphic presentation, while long descriptions of shoes do not increase the conversion rate considerably. HYPOTHESIS 2 (adding the information on availability) also gave very interesting results. Version A did not produce any statistically significant results. Does that mean the information on availability does not influence the decisions made by the users? On the contrary! The correct hypothesis was 2B the information about the availability influences conversion, but it must be highlighted. The version with altered color increased the conversion rate by 19 percent. This shows that users previously did not notice the information in the black (which blended in with the dominant colours of the page). The Szopex team also learnt something interesting you should ensure that additional messages are highlighted graphically and eye-catching. HYPOTHESIS 3 proved to be false. The change to the call to action caused a conversion rate decrease. Testing this change enabled us to avoid a considerable drop in revenues. How did the above-mentioned increases influence the financial results? Do you find it difficult to imagine how the above-mentioned increases convert into the real results of the store? Assume that you have an online shop whose monthly revenue is USD 2 million. Now remember that adding distinct information about the availability resulted in a 19 percent conversion rate increase. For a moment come back to the equation mentioned at the beginning: e-commerce revenue = (number of sessions) x (conversion rate) x (average order value). With an unchanged number of sessions and an average order value, you get a revenue increase of 19%. For a shop that generates USD 2 million revenue, this totals an additional USD 380,000 monthly. And do not forget the additional business advantages. Removing product descriptions does not convert directly into higher revenues, but it will enable you to introduce new products faster. This will make the shop more attractive to customers and the e-commerce department will have more time for other tasks. Each test also provides useful knowledge. For us, the most important thing is that we learnt a lot of new things about our users, said Łukasz Grajewski with satisfaction.

6 The notices on the product availability tested on the website chmielna20.pl were implemented permanently. But this is not the end. We now have experienced the effect that conversion optimization can produce. We also know that the true key to success is continuous actions aimed at improvement and a repeatable process. This process should be a part of the work of every self-respecting e-commerce department - says Łukasz Grajewski. This opinion is confirmed by Paweł Ogonowski from Growcode: In each online shop, there are things that can be improved. It pays to continuously work to increase the conversion rate, because even single-figure increases convert into notable profits. And do not forget that even hypotheses that prove false are of value, because they enable you to avoid expensive mistakes and provide knowledge on the users. Increase the revenue of your e-commerce store with Growcode Growcode is the first solution for e-commerce optimization that guarantees revenue growth without involving your IT department. Growcode follows a different pattern than the current development of e-commerce websites and ensures rapid growth of online shops based on data and a proven process, using our proprietary technology. Without involving your IT team and design teams. From ideas to effects. Contact us to arrange a 30-minute teleconference without obligations during which you will learn how Growcode will help your business. hello@growcode.com +1 (646)