What is A/B Testing?

A/B testing is a method of website optimisation whereby two different versions of a website or app are tested by participants. The results are then compared and analysed in terms of their performance to decipher which website is most successful in relation to achieving a specific conversion goal, such as increasing lead generation (Armour, 2015). Essentially, A/B Testing removes the element of uncertainty which often lurks during business decisions regarding website renovation, as the results provide a measure of the impact that updates have across specific metrics. As displayed in the infographic below, ‘A’ is usually the current, control version of the page whilst ‘B’ contains the variation for comparison of results.

Why use A/B Testing?

At present, approximately just 52% of online businesses employ testing to improve website conversions. However, when executed correctly, A/B testing can increase conversion rates by up to 300% (Allen, 2015). As such, when considered in combination with the cheap nature of such testing, this is a marketing avenue which should be explored by businesses of all natures to assess the extent of the positive impact that it can have on value creation.

Allen (2015)

Rather than being a one-off test, A/B Testing can be used regularly to assess minor changes to your website in order to achieve a continuum of improvement in customer experiences and Conversion Rate Optimisation (CRO) (Chaffey and Smith, 2012), thus enhancing the appeal of your business to potential clients (Heimes, 2016), as depicted in the infographic below.

Cebeci, 2014.

How to effectively use A/B Testing

In order to ensure that you’re A/B tests are beneficial for your business, there are four imperative steps which will keep you on the path to success. These are buyer persona, goals, hypothesis and document (Baadsgaard, 2016).

Persona – the buyer persona relates to your target demographic; it is essential to have sufficient information on the type of client that you are trying to attract, i.e. age, gender, budget, goals etc.

Goals – prior to testing, it is important to be aware of what you are seeking to achieve or it is unlikely that the results will be beneficial to your business. Once you have clear, specific goals, you will be able to undertake the tests and analyse the metrics which relate to your objective. If you are approaching A/B Testing from a sales perspective (as many are!), try to consider who your ideal customer is, which elements convert a visitor to a paying customer, how the test will help you to achieve your goal, etc.

Hypothesis – Once you’re equipped with your goals and a knowledge of your buyer persona, you are ready to create a hypothesis. Here, you will need to identify points of incongruence between what your business wants, and what your customer wants. Once these points have been identified, incongruences will need to be reduced. Incongruences can be caused by numerous factors, such as your website not evoking the appropriate emotion for the product/service, the call to action not being salient enough, appearing untrustworthy, etc.

Document – Documenting and learning are the most important aspects of A/B Testing; once you have analysed your results, you should be able to see which website alterations were conducive of positive reactions amongst customers and alter your website accordingly. This information can then be used again to focus further and test more changes to achieve the greatest conversion rate.

Potential drawbacks of A/B Testing

Despite the aforementioned benefits that A/B Testing can provide, it can prove to be costly and time consuming when not utilised efficiently.

In order to achieve the best results from A/B testing, it is important to ensure that your website has sufficient visitors for the practice to be worth implementing, as the goal of this method is to increase conversion amongst current website visitors, rather than attracting more visitors to your website. (If you are seeking advice on how to generate more traffic for your webpage, please read the link in ‘further reading’ on SEO).

It is also important to remain conscious of the fact that things change over time. For example, version A may have performed better than version B in 2015, however version B may now be more effective.

Furthermore, A/B testing measures events quantitatively, rather than qualitatively. As such, version B may be deemed to be more successful as it creates more sign-ups or sales, however this does not necessarily mean that it is more valuable than version A, as version B may be attracting the ‘wrong’ type of customer; for example, they may be more willing to sign up for information but less willing to spend money on your website. As well as this, quantitative goals such as improving brand reputation are immeasurable through testing whether or not a customer clicked a particular button or assessing the length of time that they spent on the page.

Summary

Further Reading

http://www.smartinsights.com/search-engine-optimisation-seo/

https://blog.optimizely.com/tag/ab-testing-ideas/

http://www.smartinsights.com/conversion-optimisation/ab-multivariate-testing/popular-ab-testing-tools-chartoftheday/

References

Allen, R. (2015). A newbies guide to AB testing [Infographic]. Available: http://www.smartinsights.com/conversion-optimisation/ab-multivariate-testing/newbies-guide-ab-testing-infographic/. Last accessed 24th Apr 2017.

Armour, H. (2015). What is A/B Testing? Available: http://digitalmarketingmagazine.co.uk/articles/what-is-a-b-testing/2597. Last accessed 26th Apr 2017.

Baadsgaard, J. (2016). How to Create a Winning A/B Testing Strategy. Available: https://blog.kissmetrics.com/create-a-winning-ab-testing-strategy/. Last accessed 25th Apr 2017.

Cebeci, U. (2014). The A/B Advantage [Infographic] . Available: https://blog.optimizely.com/2014/01/08/ab-testing-advantage-infographic/. Last accessed 26th Apr 2017.

Chaffey, D. and Smith, P.R., (2012). eMarketing eXcellence: Planning and optimizing your digital marketing. Routledge.

Heimes, S. (2016). Everything you need to know for successful email A/B testing. Available: http://marketingland.com/everything-need-know-email-ab-testing-167692. Last accessed 26th Apr 2017.

Why blog – we’re an IFA!?

Despite the Financial Service Industry’s general reluctance in embracing social media (Veenswyk, 2013), digital marketing and industry experts alike suggest blogging as a successful means of acquiring new customers online (McDermott, 2015); when done properly! Efficient blogging was found to increase traffic, inbound links and indexed pages simultaneously (Advisor Websites, 2011). (In the ever-changing environment of digital marketing, this research is somewhat dated. However, the principles are still applicable). Furthermore, if your content is hosted through your company website, a well-constructed blog which follows the principals of SEO such as linking to reputable sources can improve your business’ search engine ranking (Feairheller, 2016).

If your content becomes popular enough over time, there is also the potential to build an online community of regular readers comprised of your target demographic (Faraj et al., 2011); a recurring opportunity to acquire clients, so long as the content is of high quality. One method of building a visible online community would be to encourage readers to post their opinions, as research suggests that up to 90% of online community participants are ‘lurkers’; those who read content but do not post themselves (Hartmann, Wiertz and Arnould, 2015).

Additionally, digital content marketing is an inbound marketing technique which can be utilised as a useful tool for achieving and sustaining trusted brand status (Holliman and Rowley, 2014); this is imperative within the financial service industry whereby trust is key to long-term success (Garrett-Cox, 2014 and Nilsson, 2013). However, it is important to bear in mind that content must be consistently accurate when applying this theory to the financial services industry, as a lack of diligence when creating and distributing content could cause unnecessary reputational damage if the information is found to be incorrect.

Sharing such knowledge can also be beneficial to both the industry and society at large, as people who seek this information will become more knowledgeable of the services on offer.

What should we blog about?

Bosomworth (2014)

This matrix displays the suggested types of content that businesses can create in order to cater for different audiences. Due to the fact that financial service clients tend to be financially rational and in need of sound information regarding investments, trends etc., it is likely that creating content based on the bottom-left quadrant is a good place to start your blog and generate leads. However, it is important to remain open minded and merely employ this infographic as a guideline rather than limiting your ideas to its components. As many financial advisors offer an introductory meeting whereby questions are explained to prospective clients, a blog which is informative and authoritative can encourage readers to ask for an initial meeting whereby their personal queries can be discussed; leading to more potential to earn all-important trust and customer acquisition.

When creating digital content with the goal of acquiring customers, it is important to ensure that is it useful, relevant, compelling and timely (Holliman and Rowley, 2014). In a fast paced industry such as financial services where laws, regulations and fluctuations can have a large impact on clients, these elements can be exploited even further to create truly valuable content. For example, if a new regulation was implemented which affected investments within a particular industry, a blog post explaining the nature of the regulation and the effects that it may have on investments could prove particularly popular. This can be used to drive visitors to your site if you combine the effective communication of benefits to potential clients with a salient call to action to link them to your website. However, marketers stress the importance of projecting yourself as a ‘helper’ through your blog rather than a salesperson if customers are to be acquired through digital content creation (Pulizzi, 2012).

Advisor Websites (2011)

Drawbacks for consideration

Despite the numerous potential customer acquisition benefits of running a successful blog, there are also drawbacks which need to be carefully considered.

• Time – writing content which is consistently engaging requires time. A blog which has not been updated in a long time can have the opposite of the desired effect and deter customers from contacting your business. Prior to blogging, ensure that you are able to commit the required time.
• Measurement of value/cost – due to the intangible nature of some of the components that make up a blog, many companies struggle to calculate the value of content marketing, as is shown in the chart below. Bateman (2017) breaks down the costs of blogging into calculable segments in order to evaluate ROI (Return on Investments), and explains that content marketing can be very costly with all elements considered; particularly if it is not expediting client acquisition.

• Poor blogging – As Holliman and Rowley (2014) suggested, an insightful, engrossing and well thought-out blog can produce numerous reputational benefits for a brand. Conversely, a blog which appears to have been rushed, ill-considered and/or poorly written can give participants a negative view of both your brand and personal expertise; thus having the opposite of the desired effect of acquiring clientele and fostering relationships with them.

All things considered, it is important for businesses to carefully assess the pros, cons and costs of blogging prior to engaging so as to ensure that you are not proverbially ‘biting off more than you can chew’ and risking your business’ reputation.

For those interested in delving deeper into the concept of blogging for customer acquisition, I have compiled a few links below. As always, comments and opinions are appreciated. @SpeirsTom1994.

https://blog.hubspot.com/insiders/how-blogging-gets-you-customers

https://www.tintup.com/blog/how-to-blog-and-acquire-more-customers-with-it/

https://blog.kissmetrics.com/master-social-customer-acquisition/

https://blog.hubspot.com/marketing/blogging-for-seo#sm.00001tzi4gmp5jflwx81cs9nace4

References

Advisor Websites. (2011). The Impact of Blogging for Financial Advisors on Their Website Traffic. Available: http://advisorwebsites.com/blog/social-media/the-impact-of-blogging-for-financial-advisors-on-their-website-traffic/ Last accessed 5th Apr 2017.

Bateman, S. (2017). A blueprint for evaluating content marketing ROI. Available: http://www.smartinsights.com/content-management/content-marketing-strategy/blueprint-evaluating-content-marketing-roi/. Last accessed 9th Apr 2017.

Bosomworth, D. (2014). The Content Marketing Matrix. Available: http://www.smartinsights.com/content-management/content-marketing-strategy/the-content-marketing-matrix-new-infographic/ Last accessed 8th Apr 2017.

Faraj, S., Jarvenpaa, S.L. and Majchrzak, A., (2011). Knowledge collaboration in online communities. Organization science, 22(5), pp.1224-1239.

Feairheller, C. (2016). Blogging for SEO: How to Write Blogs that Rank on Page One. Available: https://blog.hubspot.com/marketing/blogging-for-seo#sm.00001tzi4gmp5jflwx81cs9nace4i. Last accessed 7th Apr 2017.

Garrett-Cox, K. (2014). Trust: an essential word in financial services. Available: http://www.telegraph.co.uk/sponsored/finance/investments/10624799/trust-financial-services.html. Last accessed 8th Apr 2017.

Hartmann, B.J., Wiertz, C. and Arnould, E.J., (2015). Exploring Consumptive Moments of Value‐Creating Practice in Online Community. Psychology & Marketing, 32(3), pp.319-340.

Holliman, G. and Rowley, J., (2014). Business to business digital content marketing: marketers’ perceptions of best practice. Journal of Research in Interactive Marketing, 8(4), pp.269-293.

McDermott, P. (2015). 3 Customer Acquisition Strategies for Financial Planners. Available: https://www.linkedin.com/pulse/3-customer-acquisition-strategies-financial-planners-peg-mcdermott. Last accessed 5th Apr 2017.

Nilsson, J. (2013). The Importance of Trust in the Financial Services Sector. Available: https://www.brandwatch.com/blog/the-importance-of-trust-in-the-financial-services/ Last accessed 8th Apr 2017.

Pulizzi, J., (2012). The rise of storytelling as the new marketing. Publishing research quarterly, 28(2), pp.116-123.

Veenswyk, M. (2013). Why has the financial services sector been slow to adopt social?. Available: https://econsultancy.com/blog/62215-why-has-the-financial-services-sector-been-slow-to-adopt-social/ Last accessed 5th Apr 2017.

What is CRO?

Conversion Rate (CR) is a key metric within online businesses, revealing the percentage of your site’s total traffic completing a specific task (Ratcliffe, 2015). Thus, CRO is the process of optimising your website to increase the likelihood of the task being completed by page visitors. Within the context of financial service providers, this task usually relates to lead generation through the scheduling of an explanatory meeting (see image below from Strategic IFA, 2017). Lead generation has been an area in which financial service providers have been struggling (Epictenet, 2016), and could be your reason for reading this blog!

The notion of CRO can be daunting for financial service providers who lack experience but seek to increase their website’s conversion rate. As such, the most effective CRO techniques are discussed in this blog from both academic and practical perspectives to provide a brief outline of the reccommended methods for successful CRO implementation.

Why CRO?

CRO is appealing to many businesses as it does not incur much extra cost in comparison with other techniques (Cave, 2016), as CRO focusses on the conversion of current site visitors rather than generating more traffic (Venture Stream, 2016). In short, the leverage impact of effective CRO can increase your business’s revenue whilst simultaneously decreasing percentage marketing costs and bounce rate due to the increased efficiency in converting page visitors (Chaffey and Smith, 2012 and Hisham, 2016). Therefore, those in the financial service industry can benefit from CRO implementation and employ it to achieve a number of financial gains.

Although many small financial service providers perceive marketing language to be overwhelming and the concepts unsuitable for their company, continued loyalty to old fashioned, outbound marketing techniques is proving costly and inefficient for lead generation within the industry (Gallagher, 2013). Furthermore, experts emphasise the applicability of CRO to all online business types (Chuang, 2015) and the image below depicts the trend of small businesses becoming increasingly involved with digital marketing. As such, implementing a relatively new concept such as CRO can gain you a competitive advantage amongst other small financial advisers, as many of them are yet to employ it.

Patrick, 2017.

The Steps

The ‘Conversion Architecture Cycle’ provides a layman’s breakdown of the imperative steps within prosperous CRO campaigns, briefly explained below. This method is centred around the creation of a new webpage and continuously comparing it with the original in order to achieve improvements in CR.

Analyse – The examination of current performance and discussion of future targets. Kissmetrics.com (Kissmetrics, 2017) is a popular website for this type of analysis, providing insightful information regarding your website’s current conversions.

Talk – Having outsiders test the original site and collecting their opinions regarding the website’s attractiveness, functionality etc. in order to incorporate relevant ideas into future versions.

Plan – Consideration of the website basics through Wireframing and discussion of the methods used to convert visitors, etc.

Design – Taking time to procure the creative ideology, branding and design underpinning the second website.

Test – A/B testing whereby the original website is assessed for its CR in comparison with the second version. This is usually undertaken numerous times with various alterations in an attempt to achieve a continuum of CR improvement. As displayed below, an Econsultancy (2016) survey shows that A/B testing is considered to be the most effective method for assessing the conversion success of a new website.

Market – Selecting appropriate methods to spread the new content to suitable audiences, such as SEO, blogs, etc.

Once these steps have been undertaken, you should have a strong idea of which version of your website is likely to facilitate the best conversion rate. If this remains unclear, feel free to carry on altering the different versions and carrying out more tests in accordance with feedback until a clearly successful style becomes prominent. For an in depth explanation of the conversion architecture concept, feel free to read this insightful post from Smart Insights (Cave, 2016).

Points for consideration 

The aforementioned lack of capital required will increase CRO’s appeal to many businesses, however this does not equate to CRO being an easy method of increasing lead generation, as successful CRO requires human resources rather than financial capital. Therefore, CRO involves a significant investment of time, whereby combinations of all factors (including headlines, call to action text, layout and design, colour, etc.) are thoroughly tested in order to achieve the required improvement (King, 2008 and Crook et al., 2009). If sufficient tests are not completed in a continuous search for improvement, the concept of CRO will not work.

CRO is not a quick fix to achieve marketing prowess amongst your competitors; if your company’s individual page visits are low, it may be beneficial to focus on attracting more traffic through methods such as Search Engine Optimisation (SEO), and then concentrate on conversion once the page generates sufficient traffic. SEO and CRO should be employed simultaneously for the best results (Florian, 2015).

Remember, it is imperative that any public version of your website is compliant with FCA (Financial Conduct Authority) regulations (FCA, 2017).

To conclude, CRO can be a hugely beneficial tool for your financial service business when employed in conjunction with SEO and sufficient testing of variants.

Please be aware that this blog has been written by a University of Brighton student and the content is solely representative of my perspective; however, I have experience within the provision of financial services. All queries, opinions and feedback are appreciated, so please feel free to comment below or tweet @SpeirsTom1994!

Sources

Cave, P. (2016). Managing Conversion Rate Optimisation (CRO). Available: http://www.smartinsights.com/conversion-optimisation/conversion-optimisation-strategy/managing-conversion-rate-optimisation-cro/. Last accessed 14th Feb 2017.

Chaffey, D. and Smith, P.R. (2012). eMarketing eXcellence: Planning and optimizing your digital marketing. Routledge.

Chuang, E. (2015). The Importance of Conversion Rate Optimisation for Businesses Online Growth. Available: http://digitalmarketingmagazine.co.uk/e-commerce-digital-marketing/the-importance-of-conversion-rate-optimisation-for-businesses-online-growth/1976. Last accessed 20th Feb 2017.

Crook, T., Frasca, B., Kohavi, R. and Longbotham, R. (2009). June. Seven pitfalls to avoid when running controlled experiments on the web. InProceedings of the 15th ACM SIGKDD international conference on Knowledge discovery and data mining (pp. 1105-1114). ACM.

Epictenet. (2016). Lead Generation in the Financial Services Industry. Available: http://www.epictenet.com/lead-generation-financial-services-industry/. Last accessed 19th Feb 2017.

FCA. (2017). Financial Conduct Authority. Available: https://www.fca.org.uk/. Last accessed 20th Feb 2017.

Florian, L. (2015). Why SEO Has No Value Without Conversion Optimization. Available: https://www.fldtrace.com/why-seo-has-no-value-without-conversion-optimization. Last accessed 20th Feb 2017.

Gallagher, K. (2013). 4 Financial Leads Generation Mistakes You Don’t Know You’re Making. Available: https://www.stargazerdigital.co.uk/financial-leads-generation-mistakes/. Last accessed 22nd Feb 2017.

Hisham, A. (2016). 9 Immediate Benefits of Conversion Rate Optimization (CRO) You Might’ve Overlooked. Available: http://seopressor.com/blog/benefits-of-conversion-rate-optimization-cro/. Last accessed 19th Feb 2017.

King, A. (2008). Website optimization. O’Reilly Media, Inc.

Kissmetrics. (2017). Kissmetrics. Available: Kissmetrics.com. Last accessed 19th Feb 2017.

Patrick, S. (2016). Small Business Digital Marketing and Social Media Habits in 2016: A Survey. Available: https://clutch.co/agencies/resources/small-business-digital-marketing-and-social-media-habits-survey-2016. Last accessed 20th Feb 2017.

Ratcliffe, C. (2015). What is CRO and why do You Need It. Available: https://econsultancy.com/blog/64210-what-is-conversion-rate-optimisation-cro-and-why-do-you-need-it/. Last accessed 19th Feb 2017.

Strategic IFA. (2017). Strategic. Available: http://www.strategicifa.co.uk/. Last accessed 20th Feb 2017.

Venture Stream. (2016). Conversion Rate Optimisation. Available: http://www.venturestream.co.uk/marketing/conversion-rate-optimisation/. Last accessed 19th Feb 2017.

The author chose to read the Ikea case study.

Ikea’s goals were to forge deeper relationships with customers through the use of social media. As an extension of this, Ikea sought to use the big data available through social media to connect different departments and regions by detecting insights and sharing them with the relevant department so that they can act on them. Ikea has achieved global success via traditional business techniques. It is often more difficult to implement changes to practice in a successful company than an unsuccessful one as many employees do not see the need for improvement. Once Ikea started to use social media in an analytical way, they found that lots of the findings were not facilitating improvements in the business as they were not reaching the right people due to the size of the company and lack of integration. To solve this issue, Ikea installed a ‘Listening Hub’ at their HQ. The Listening Hub is essentially a social media command centre for distributing, detecting and sharing insights across the organisation. Staff and teams can also meet at the Hub to discuss their findings. As a result of the Hub, Ikea found that customers had different perceptions of their customer service in different regions. Their in depth report on this issue found that general US and UK online Ikea discussions were more positive than negative. However, they also found that US and UK discussions focussed on Customer Satisfaction were more negative than positive.

Main points of the case study:

• The conservative notion of ‘if it’s not broken, don’t fix it’ can hinder improvement, even in successful multinational companies
• Social Media/Big Data can be employed by businesses to gain a greater understanding of their successes and/or failures by a particular market or region and implement measures for improvement

T-Mobile use big data to aid the reduction of their customer turnover rate. They do this by analysing the data and extracting the core reasons behind customer turnover. Once they had obtained this information, they were able to introduce effective measures for keeping customers on board.

In conclusion, Business Analytics have a large role to play in E-Commerce and Market Intelligence.