3 Optimisation Steps To Drive ROI
Brands that rely on gut instinct without listening and acting upon consumer data will ultimately fail as they fall behind competitors and are unable to meet consumer demands.
- Brands looking for rapid business and market share growth can no longer ‘fall short’ when it comes to testing and optimisation.
- In the case of experimentation and optimisation, when a brand does not have the correct team members leading the way, things can go wrong.
- This can be down to a number of reasons, including lack of persistence, lack of understanding concerning the continuity of experiments needed, and the failure to recognise when bringing in an external agency would help.
In general, companies fail to put experimentation first when considering their marketing strategy. They first look to web page development, content creation, and distribution, without giving much thought to scaling experimentation. Mature companies will look ahead and build experimentation into their content creation and development process prior to the launch as many companies fail to capitalise on essential data due to obstacles faced in the early stages of optimisation.
According to Forrester, companies that actively invested time and effort to harness the power of optimisation were found to be growing, on average, 30% more each year and are forecast to earn $1.8 trillion by 2021.
In order to achieve a successful optimisation and digital experimentation, brands require extensive knowledge, a unique skill set, and many years of practice.
Optimisation and Experimentation, what’s the difference?
Throughout the optimisation phase, brands need to be analysing the performance and results that their current content and marketing strategies are achieving as this will help demonstrate the areas that need to be improved. This can include testing and experimenting, but not through a completely new approach or medium. Following this, if a team cannot improve on the problems found through current strategies, this is the point where a brand can move to the experimental phase.
The experimental phase is where marketers will integrate a new method, channel, or type of content. However, this phase can present issues when marketers are quick to disregard old strategies due to one-off experiment results. This needs to be avoided at all costs as it lacks cohesive purpose and high-quality multi-channel execution.
So, while brands need to be constantly analysing results, revitalising approaches to creative messaging, and channel distribution, it is not always necessary to implement new strategies for the sake of it.
Virgin Atlantic innovating and experimenting to provide the best customer experience.
Some companies believe running a couple of experiments per month is sufficient. However, this is not the case, as two experiments per month will only provide few and negligible results. Compare optimisation like working out at the gym, it needs consistent work in order to gain, improve, and keep muscle. Attending the gym once a month won’t achieve any results, and this is mirrored in experimentation - consistency is essential in order to see growth and avoid stagnation.
Optimizely, an experimentation platform that conducts one to 20 experiments per month sees results of a 1-4% revenue increase. However, it was found that if a company were to run a minimum of 21 experiments, their revenue would increase to 14% or more. Therefore, companies that only manage to complete one or two tests per month will lack the sufficient, structured data to meet increasing demand and provide ROI to shareholders.
Jeff Holden, who has held leadership roles at three hyper-growth companies (Amazon, Groupon, and now Uber) states,
“[Amazon’s] success is a function of how many experiments we do per year, per month, per week, per day.”
2. The Right Team:
Unless a company has highly skilled specialists in their internal team, they will need to look to an agency to successfully execute experimentation. In order to have a strong optimisation programme, internal teams need to be in a position to interpret data, and from this, make educated but fast decisions based on the data collected so that they can keep up with a very volatile market.
Working with agencies dedicated to optimisation means brands will have the resources and expertise needed in order to carry out a valuable analysis. Brands must consider a common goal when working with optimisation agencies so that both parties are satisfied and benefiting.
Jeff Holden comments,
“Build a team inside your organisation that has an experimental ethos, and make sure that the experiment value proposition, and hypothesis are really thought through before you invest the time and energy to actually do them.”
3. The Right Strategy:
Agencies and brands that are working effectively together will, when necessary, adjust their optimisation strategy to suit the technology, resources, and stage they have at their disposal. An optimisation strategy is not one-size-fits-all, like any strategy, it needs to be adapted to play to the strengths of each party involved.
Businesses at the inception of their optimisation journey might not have the committed conversion rate optimisation (CRO) team or testing technology needed, therefore it is worth considering working alongside an agency who will be able to run a testing tool evaluation process to figure out which is the best platform to achieve optimum results. Making use of an agency will help develop, implement, and interpret tests and personalisation campaigns right from the get-go. But this must be implemented from day one because the only constant for brands is change, and the rate of change is always increasing.
The only way to stay ahead of the game is to constantly experiment and innovate, as stated by Jeff Holden,
“The philosophy is you have to build your company to be a big experimental engine and it has to start right at the beginning.”
As with any business opportunity, without the dedicated and skilled experts in place, brands run the risk of missing out on significant growth opportunities. If a brand wants to build an internal team or hire an external agency, or both, they must identify the skills and team needed to carry out experiments successfully, as this is crucial for the execution of optimisation.
Optimisation and experimentation are not about the tools behind the strategy, it is how a brand uses them to best suit their needs and in this market, the most successful brands will run as many high-quality experiments as possible so that they no longer have to guess, they will know.