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User Experience Guide

Site-search: the missing piece of the CRO puzzle

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Introduction

Attempting to increase revenue requires that eCommerce managers and marketers pay close attention to three key performance indicators (KPIs). Namely, Conversion Rate (CR), Average Order Value (AOV) and Revenue Per Visitor (RPV).

Measuring your KPIs

Although each of these KPIs is important, none should be measured in isolation. Doing so often leads to unwanted blind spots; situations where an increase in one metric is accompanied by a decrease in another, leading to an overall decrease in revenue. That's what makes RPV great, it merges both CR and AOV into one measurable metric without leaving any blind spots (i.e. RPV = AOV * CR).

While all eCommerce businesses need to drive revenue, only newly established retailers (i.e. those with no revenue or customers) should put 100% of their time and effort into traffic acquisition as a means of driving revenue. However, after initial traction (i.e. after the first million in sales), marginal returns from an acquisition-only strategy diminish. Once passed the one million in revenue line, more work is required to achieve the same results.

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Unfortunately, most established eCommerce marketers today focus all of their energy and budgets on increasing traffic when it would make much more sense to increase AOV, CR and retention.

Once visitors are acquired and transactions begin to roll in, increasing revenue should include two additional dimensions: converting more visitors into paying customers (CR) and increasing customer spend per conversion (AOV).

Driving traffic to a website costs money, but finding ways to increase AOV and CR generally does not (or costs very little comparatively). And since there is a cost associated with each order, increasing AOV is a direct way to gain revenue at little extra cost.

The problem with an acquisition focused marketing strategy

There are several problems with focusing all your marketing efforts and budget on traffic acquisition. And this problem is amplified the longer the company has been in business.

Simply put, if visitors don't convert, basket size doesn't grow over time and customers don't return, then a great deal of acquisition spend is wasted. Worse yet, there is an opportunity cost since converting a greater proportion of visitors into customers, up-selling customers and retaining loyal customers are more efficient and effective methods of driving revenue than acquisition tactics.

In this situation, the pursuit of a bigger market share is akin to filling a leaky bucket with water. Since some customer churn is inevitable, companies looking to maintain their market share need to be at least as good at acquiring customers as they are bad at losing them.

But to grow market share, they must be either super-human at acquisition or exceptional at retention. The best strategy existing somewhere in the middle - combining traffic acquisition with conversion rate optimization, cross-selling/up-selling and customer loyalty.

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While there are numerous proven ways of increasing CR and AOV, including:

  • Product recommendations
  • Shipping and return policies
  • Point-of-sale promotions and limited-time offers
  • Package and volume deals
  • Better User Experience (UX) and category navigation
  • Marketing automation and retargeting
  • Checkout optimization and site speed

But the vast majority of eCommerce businesses miss the opportunity to drastically improve CR and AOV with more relevant site-search.

Reasons why site-search is often neglected

  1. Most eCommerce retailers don't know how poor their site-search is. A good rule of thumb to judge if your site-search needs improvement is if the exit rate on search result pages is close to or on par with your website's average bounce rate. Your search result pages should have some of the lowest exit rates on your site since those searching have intent and often only exit search pages if results are irrelevant or no results were actually presented.

    Another measure is your null-result rate (i.e. the percentage of total searches executed that return zero results). If that rate is above 5%, there is likely room for improvement.

  2. Most eCommerce retailers don't appreciate the criticality of site-search, especially on mobile. Site-search is a critical customer touchpoint - an average of 30% of consumers use on-site search, but only 50% find what they're looking for (Econsultancy).

    Visitors who buy are 91% more likely to use site-search than those merely browsing (Findwise).

    4 out of 5 smartphone users use retailer apps. With 47% of them using retailer apps for product search (ComScore).

    Users with successful site searches are nearly twice as likely to convert compared to those who don't search - since they are shopping with specific intent (Econsultancy).

  3. Most eCommerce retailers believe they've done all they can to improve their site-search. It's incredibly common to hear eCommerce managers and marketers say:

    "Our text-matching search should find a match because we regularly tag all our products with synonyms and keywords"

    or

    "We know what's most important to our customers, so we sort our results according to what we know are top-selling items"

    or

    "Pushing high margin and sale items in search works fine, we see a lift when we manually insert our business logic into search".

    There are several problems with those statements. First, there are infinite ways and words your customers may use to describe your products. It's impossible, and arrogant, to assume one person or team can anticipate and tag all of them. And tagging products with synonyms rarely takes into account pluralizations and misspellings.

    Secondly, are your top-selling items top-selling because they’re what visitors actually wish to buy or because you constantly push them to the top of results?

    And lastly, is pushing high margin or sale items really in the best interest of your customers? Wouldn't it make more sense to try and help visitors find what they're looking for first, before pushing your business agenda? Maybe your agendas overlap, but you'll never know if you continue to manually manipulate a process that should be guided by consumer intent and relevance.

Why site-search should be a key part of any Conversion Rate Optimisation (CRO) plan

Improving eCommerce site-search is one of the most direct ways of increasing CR and AOV. Basically, visitors who search have purchase intent and know what they want. Not giving them accurate and relevant search results not only leads to poor customer experience, it almost always means lost sales.

On the other hand, having highly relevant site-search that actually attempts to capture customer intent can lead to conversion rate and revenue growth unmatched by most other CR initiatives.

We're talking top-line revenue growth of 10-20%, search conversion rate growth (i.e. conversion rate among visitors who search) of 30-50%, AOV growth of 75% and search page exit rate reductions of 70%.

Here are some examples:

Another one of our customers - Kontorsmagasinet - did an extensive of A/B test to measure the CR and AOV impact of having more relevant site-search. After a 35 day 50/50 split test, Kontorsmagasinet realised the following results:

  Control Optimised search Difference
Search conversion rate 6.27% 8.12% +29.5%
Total eCommerce revenue 100% 112.98% +12.98%

 

Loop54 offers true personalised on-site product search

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Shoppers expect the same level of relevance and personalisation online as they experience in-store. Powered by Machine Learning and built exclusively for eCommerce, Loop54 delivers that exceptional online shopping experience.

  • Automated: Automatically learns words and merchandises search and category listing
  • Relevant: Interprets search intent to deliver truly relevant results
  • Personalised: Sorts results according to popularity and personal taste

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