Conversion rate optimization (CRO) and conversion optimization

Conversion optimization and conversion rate optimization or CRO are two interchangeably used terms in marketing. The practice of conversion optimization exists since the very early days of online marketing, digital marketing, or internet marketing.

Just as (digital) marketing has evolved over time, the practice, tools, and strategies to increase conversions have changed. There is also a more strategic approach to conversion optimization. Moreover, good CRO practitioners dispose of far more skills than they used too in the days when we only had websites, email marketing and search engine marketing with some web analytics on top.

Still, the fundamental definitions and, most of all principles, of conversion rate optimization or conversion optimization have remained largely unchanged. Despite ever more small and big data, ample marketing tools in the so-called marketing technology stack, the channels, devices and types of marketing we ‘invented’ (inbound marketing, content marketing, you name it), in the end marketing is still marketing and people are still people.

CRO concept

We might have changed our ways, but the psychological drivers of what makes us take action haven’t evolved that much.

Quite some tips regarding CRO, landing page optimization and related topics still look very much like they did about a decade – and more – ago, except for the tools, shiny new technologies and impact of our ‘modern’ online behavior (e.g., scrolling). But people, psychology and what makes us tick and act: not that much change. Psychology, persuasion and actions. Let’s start with the latter.

What is CRO? Conversion rate optimization – word per word

Taking actions – or having them taken to be precise – is what CRO is all about. What is converstion rate optimization? There are three words in the term that explain pretty well what it all boils down to. An exploration.

Conversion – the C of CRO

Conversion means a change from one state into another. We convert physical objects and we try to convert people and their beliefs, attitudes or actions.

In the context of marketing, we simply try to persuade them to take action: visit a landing page, click a button, fill in a form, add a product to the shopping basket of an e-commerce platform, you name it.

There is quite a bit of psychology and testing involved in doing so and, as you can imagine, in today’s very digital business world, there can be many conversions that need to happen before you reach the end goal of all conversions.

“A conversion” requires an action from the user (e.g., website visitor) and thus, all elements that help in getting people to take that action play a role. Less easy than it seems indeed. Remember that most actions and decisions people take are not rational but emotional and only explained in a rational way after the act.

Rate – the (indeed) R of CRO

A rate is typically a number that expresses something, for instance, speed, or a percentage. A conversion rate in marketing is always a percentage: the percentage of people that took action out of the total number of people that could have taken that action in a specific circumstance.

An example: if you have a landing page on your website where people are invited to download a white paper your conversion rate would be the number of people who effectively downloaded that white paper, divided by the number of people who visited the page where they could do so, obviously in the same period (so the same people).

Sounds easy enough but again, there are many elements. Moreover, in practice, you can have conversion rates that consist of several smaller conversions since often several steps are involved and you can keep drilling into a series of steps. Or take the process of buying something online: many steps and (thus) many micro-conversions whereby optimization is possible at each of the steps. The rates which executives might want to see could be only ‘higher-level’ ones though.

But let’s keep it simple and even a bit stupid, always a good idea in optimizing conversion rates and CRO overall by the way. The KISS principle does still tend to work and, ‘keep it stupid simple’, for which the KISS in the good old design principle stand is still easier to remember than terms such as ‘frictionless’, to name one.

Optimization – O(h), a mindset

Optimization means improving, as you no doubt know. So, conversion optimization means getting more conversions while ‘conversion rate optimization’ means getting better conversion rates for whatever action that matters.

And that is only possible through optimizing, which in turn is only possible when you know how you’re doing now and that’s where measuring comes in to understand and act upon gathered insights, usually by formulating a hypothesis, and then trying if it’s correct which requires tools and improvements leading to results that in turn, need to be measured. An ongoing job indeed.

But it’s more than a job – it’s a mindset, just as testing and experimenting does require a specific culture in the organization.

Defining CRO – so, what is conversion rate optimization?

So, bringing the three words of the acronym CRO together, conversion rate optimization can be defined as follows: “Conversion optimization, or conversion rate optimization (CRO) is a system for increasing the percentage of visitors to a website that convert into customers, or more generally, take any desired action on a webpage. It is commonly referred to as CRO”.

And that is how Wikipedia defines it, based upon two books most CRO people have read or, at the very least, know. It’s a very fine definition that could be fine-tuned a bit in the following sense:

  • The term ‘system’ might be vague. Let’s say it’s an umbrella term for the practice of CRO, a mix of approaches, a combination of potential frameworks and strategies, a broad range of possible enhancements, a bunch of tools enabling to optimize, a mindset as mentioned and so on and so forth. But let’s KISS.
  • You can expand website and webpage and speak about more online and digital properties although most conversion optimization still concerns the website and its components such as landing pages, the shopping process elements and so forth. However, in reality conversion optimization starts before that (even before a website visit, for instance in search engine result pages) and it’s also a continuous process of optimization. Still, most people reserve the term conversion optimization for the website or let’s say your online pages and properties where visitors come and you hope they take an action. The various means to get more ‘traffic’ often have their own names and can be work for other specialists. Search is again a good example.

Another definition? Conversion optimization is the consistent, structured, ongoing process
of improving your website over time.

CRO in a more holistic perspective

If you don’t have a holistic view on the whole journey it’s hard to see the overall picture from the user perspective. User experience is key in CRO.

One person can’t be an expert in everything (though you can be very good in many things at the same time) so optimization is teamwork whereby different people can have different areas of expertise to increase both traffic and conversion.

Normally a good email marketing and search engine marketing expert, for instance, don’t just know how to increase things like open rates, click rates and so forth but they also understand landing page optimization.

A simple example of why a holistic perspective matters: how people get on your website (channels, campaigns, search engines and used queries, etc. is one of many ways to know about their intent and enables a degree of optimization if done properly).

But there’s more. Obviously, not all websites sell something online and not all actions which visitors on your website can take are related to selling. What you want to do is turn website visitors into leads, prospects and ultimately customers, which is about more than the linear simple conversion paths which we knew in the early days in digital marketing.

It’s among others in this bigger picture that you find marketing technology applications such as marketing automation platforms and where typical parts of CRO processes such as conversion paths come in where the real work starts with setting the goals, charting the course and asking lots of questions enabling you to increase the percentage of visitors taking the action you would like them to take across various paths in your funnel and potential actions, stages and goals.

The ultimate reason why CRO requires a holistic perspective? Because you’re dealing with people, not with rates, micro-conversions and little isolated steps. Yet, all these steps and components are key. So, if conversion rate optimization is new starting by deconstructing the bits and pieces that matter, measure them, do an audit and gradually start optimizing enables to reconstruct what you have and do better than before.

CRO isn’t new but still burning hot

“So, in a nutshell, conversion rate optimization is really getting more out of people who potentially could be interested in buying something in the end,” you might think. That is indeed what it ultimately boils down to and indeed what we’ve been doing for ages.

We do it in direct marketing, in cold calling and internal sales, and, heck, in business and sales and marketing, for ages, using many persuasion principles, behavioral psychology hacks and ways to get more from an interaction with a potential customer since long before the internet existed.

Yet, with CRO, we’re in a field that more or less popped up at the same time as the first commercial websites and web analytics tools. It also uses a lot of the testing methods, such as A/B testing and multivariate testing, which we’ve been using since the early days of email marketing, landing page optimization, e-commerce and search engine optimization.

However, regardless of how long we’ve been ‘doing’ conversion optimization, CRO is burning hot. It is also closely related to things like user experience and even customer experience optimization. Some also like to use the principles of design thinking, another hot topic these days, for CRO purposes. And there are new means to enhance conversions across an increasingly complex digital ecosystem. No wonder that CRO experts – good ones certainly – make lots of money.

And the reason? Well, there is the essential good old rationale which we cover below. But, among other things, there is also this fact that CRO has been evolving and, as tends to be the case with all things ‘digital’ and ‘metrics’ and ‘testing’ there are quite some changes on the level of, for instance, tools and platforms and technologies and whatnot. You know what we mean: artificial intelligence, algorithms, that marketing stack, the list goes on. Moreover, we live in a so-called data age, right? So, marketeers these days do like those dashboards as well, even if data and visualization alone doesn’t cut it. It’s still a very real world out there and you can’t do it all with data.

Why is CRO important?

CRO is important because it doesn’t make much sense to invest a lot of money, time and resources in doing all kinds of things online and across numerous channels and devices if 1) it’s crap for users/visitors and 2) it doesn’t result in value for your business as it could.

Traditionally, brands and organizations have been investing much more in generating traffic, for instance, to their websites, than in actually making sure that all these visitors also DO something that benefits the business and the bottom line. A bit too much focus on generating traffic – or the traffic mindset – isn’t new, nor is the risk of short-termism.

Obviously you need a good mix of both from your marketing budget perspective. But it’s clear that certainly, when online channels and your website(s) are vital for your business, you want to increase conversion rates as much as possible. About every e-commerce company and company that generates leads or sells online does CRO or hires some CRO experts.

Here’s the thing: if you don’t invest in conversion optimization, you’re not just leaving opportunities on the table but you also don’t care too much about your website visitors and all those people you ‘reach.’ One of the fun parts of CRO is that people only take action if a little voice inside them says it’s worth taking action – and they do.

And, in the end, regardless of the traffic and thus visitors (again, which are important); if people don’t take action and there is no conversion, there is no revenue, while the other way around, the higher conversion rates for existing traffic, the higher revenue, it’s that simple. So, to increase conversion rates, you need to understand what people want and make what you do worth the while. Sure, there are all kinds of psychological hacks and persuasion techniques and that’s OK but alone, they aren’t enough and there certainly not enough for long-term business success.

Imagine that you can make people buy something because you have a close to perfect (which is impossible) website, marketing and conversion optimization strategy. It will only result in short-term gains for a while if the product is bad or your customer service is worthless. True business growth is about the long term so optimizing is an ongoing mission and about more than conversion optimization too.

Moreover, getting people to visit your website or a specific page where they can take an action, isn’t a free lunch. For starters, it takes time and effort. Secondly, normally you’ll use quite some paid media and ads which aren’t always cheap. With digital marketing and online advertising you always have the ‘click’, the hyperlink, so there’s always a component of more or less immediate action which makes it different from pure branding campaigns on other media where you go for the long term growth (which doesn’t mean that internet marketing has no branding component of course; sales activation and branding are the extremes of a spectrum).

What can you do next if you need more CRO advice?

So, what to do next? Well, if you’ve read this far, you might want to look a bit deeper into conversion optimization and see whether it’s useful for you and where you can find a good CRO expert.

Perhaps you want to become a CRO expert yourself but do know it takes far more skills and especially dedication and experience than the best training can provide you. However, you can always try if you are happy with small, incremental improvements (never a bad idea) around some smart goals and quick gains, especially if they also make the experiences of your visitors better.

You can also look at some of the tools out there that enable you to assess where you stand (for instance doing some visitor research, conducting some surveys, looking at some heatmaps (how people use your website) or you can ask us if we know some good sources and practitioners out there (the answer is “you bet”) but that’s up to you of course.

By the way: it’s not our priority business because otherwise, this page and text would look completely different and be much shorter to begin with. But always happy to help if you need some. Get in touch on LinkedIn if you do.

And of course, you can also read some articles and posts on CRO and what matters. In the end, for customer-centric people that’s always the user/customer/visitor, their goals/intent and tasks (see, for instance on customer top tasks below), and of course the return of optimization efforts.