Matthew Pezzimenti: So you might have a small market, small segment of users, but they might have a very big problem in a certain area of the website. Or you might have a very big segment with multiple little problems throughout the funnel. You get this really unfair advantage against your competitors because you can spend more and still make more at the same time. We've done all the hard work, now we get to do the fun stuff, which is. Let's test it welcome to Add to cart, Australia's leading e commerce podcast that
[Voiceover]: Express delivers all you need to know
Nathan Bush: in the fast moving world world of online retail.
[Voiceover]: Here's your host, Bushy.
Nathan Bush: Welcome to another episode of Add to Cart. I'm Bushie and I'm joining you from the land of the Terrible People, otherwise known as Brisbane, Australia on Add to Cart.
[Voiceover]: We welcome everyone to share and listen
Nathan Bush: to e commerce stories. The more diverse, the better. I want to especially welcome the traditional owners and the original storytellers of the land that we are on, our indigenous and Torres Strait Islander listeners to join us in our E Commerce conversations and our community.
[Voiceover]: Today's guest likens himself to a popular 80s TV character. Didn't we all aspire to be Magnum
Nathan Bush: PI or even Uncle Jesse from Full
[Voiceover]: House at some point? Unfortunately, I ended up more like Norm from Cheers.
Nathan Bush: But I'm really showing my age now. Today we are talking to another smart, resourceful problem solver just like MacGyver.
[Voiceover]: There you go. See what I did.
Nathan Bush: My guest today is Matthew Pezzimenti, founder and Director of conversion kings. Since 2014, they've been working on conversion rate optimization processes for leading Australian and international brands such as Koala Style Tread and Woolworths. Now, Matt may or may not have
[Voiceover]: a highly gelled mullet or a roll of duct tape in his back pocket. You'll have to check out the video for that. But he does know a hell of a lot of about creating conversion rate optimization solutions to fix the problems that your e commerce business might be having. In this chat, he runs through some of the most common conversion issues and how to fix them.
Nathan Bush: He shares tips on ironing out your GA4 implementation and names the top tools that you can use to help build an army of converting customers.
[Voiceover]: And quickly.
Nathan Bush: Before we get into today's episode, if you are a tech provider, a service provider or an agency in E commerce and you want to jump on and sponsor add to cart in 2024, we now have our sponsorship packages open. We are limiting the 2024 sponsorship opportunities to two gold partners and five silver partners. If you want to know what Those sponsorship packages look like reach out to me directly. Nathandecart.com so thanks to our partners, Shopify
[Voiceover]: plus and Signet, here's our conversation with
Nathan Bush: Matthew Pezzimenti from founder and director of Conversion Kings. Matt, welcome to add to cart.
Matthew Pezzimenti: Great to be here. Thank you for inviting me.
Nathan Bush: Thank you for coming on.
[Voiceover]: This has been a long time coming. We caught up after many years of not seeing each other at Imedia on the Gold coast recently, you delivered a stellar presentation and that's what tripped my mind to go, oh, we've got to get Matt on to add to cart. Why haven't we done that yet?
Matthew Pezzimenti: Oh, thank you, sir. We put a lot of effort into them. Just want to be able to give value. So that's great.
[Voiceover]: What stood out to me is that you seem really passionate about genuinely educating the e commerce community about conversion and CRO, not just selling that to me. Stood out amongst all the other presentations you were there to actually educate. Where does that come from?
Matthew Pezzimenti: Well, it really comes down to where we can really help people to understand this tactic. There's so much to learn about it and it's different for everybody. Sometimes people are more. It's more relevant for them to do conversion optimization internally or to do with an agency. But at the forefront of it, it really comes down to education so they can make the best decision. And it's great when you see people, they get that aha moment and the spark goes off and they're like, ah, yes, we get it. Yeah.
[Voiceover]: Now, I'll set you up as a really humble guy, but then you've called your business Conversion Kings. Like, there is no getting around that.
Matthew Pezzimenti: You.
[Voiceover]: You are putting yourself right up there.
Matthew Pezzimenti: Yeah, yeah. Well, actually, that came from the Simpsons, actually, when we were, if you remember, back when, I think it was Homer was trying to be Mr. Plough and then Barney come out as the Plough King. And I'm thinking, wow, he crushed it. And I'm thinking that that sounds like a pretty cool name to jump into. And when we kicked off the business, it was like, there must be Conversion Kings and now we've got to own it, which is. That's fantastic.
[Voiceover]: So you're the Barney of the e commerce industry in Australia.
Matthew Pezzimenti: Well, there we go. Right? There we go. I've been called worse, so that's not too bad.
[Voiceover]: What made you want to double down into the conversion side, E commerce and digital? Because you had played in a broader spectrum before that, right?
Matthew Pezzimenti: Yeah, it wasn't really was actually, when I was on the other side of the fence and just seeing the impact that Crow did for the brand I was working with and wow, this is incredible. And the other side to that is it really sort of merges two of my major passions, which is like creativity and analytics. And it really brings those two together to deliver something. And it was just there was that part to it and the second one was it's so measurable. So when we're doing the work you can see the instant outcome to it and it's a great way to deliver value.
[Voiceover]: Tell us more about the creativity side. Because most people wouldn't associate conversion rate optimization with creativity.
Matthew Pezzimenti: Yeah, well, I mean that's. It comes down to ideation and coming up with a solution to solve a problem. And we need to think of a different way to solve that customer's problem problem than we're already doing. So a lot of it comes down to how else or how might we solve this issue. And then that's where the creativity really comes out. Like you've got different ways of solving it. What's going to be relevant to the customer. And we all get super excited about like this is going to be an absolute winner and a game changer. And that's what's great about optimization because that it can validate whether or not that idea is crazy or actually valuable.
[Voiceover]: So conversion means a lot of different things to different people. Right. I bet you can see this, especially take those initial phone calls from clients. What does it mean to you?
Matthew Pezzimenti: Yeah, well really it's just about making the most of what we've currently got and how we can improve whatever metric or whatever goal we're striving for, whether or not it's like an E commerce, which is a pretty simple one, or it could be about engagement or adding to another sort of mid funnel metric as well, but really just comes down to how we can make the most of what we've really got out of it. And a little bit like my childhood hero, which is MacGyver if you remember. I don't know if you're old enough to remember.
[Voiceover]: I know. MacGyver.
Matthew Pezzimenti: Yeah, yeah, yeah. Cool. Well, he was able to like create the most amazing things out of the most limited resources. Conversion optimization is a little bit like that. You know, we need to what we've got, how can we make the most of it and solve the problem.
[Voiceover]: And are you finding you're getting more and more clients now turning towards conversion now because acquisitions got so expensive?
Matthew Pezzimenti: Yeah, I mean it's definitely a big driver. You see that when people are Struggling to really get that ROI or the roas from their paid search. And they're like, there needs to be a better way of how we can do this. Also, when they sometimes look in to see how much money they're wasting there as well, can we sort of minimize that a little bit as well?
[Voiceover]: Great. So. So let's get into it. Let's get into the details of conversion because we're going to nerd out this episode and really get into it. Let's kind of dispel some of the myths that you go in and you poke around to find these conversion rate optimizations. Can you outline your process at Conversion Kings around what you would go through for a typical client?
Matthew Pezzimenti: Yeah, definitely. A good way to think about from a very high level structure, the first one is we need to identify where the problems are, come up with a solution, and then we need to execute and then decide what we're going to do with it from that perspective. So from a very high level, that's basically the way you would like to think about it. And then when we dig a bit deeper, each one of those areas have their own sort of smaller methodologies or processes as well. So when we get into the auditing phase, it's important to look at it from a technical perspective, which is an interesting one because sometimes it's what people overlook. This goes straight into optimizing. There's no point scrubbing the decks of the Titanic if it's sinking. So we need to make sure that there's no tech errors which are actually stopping you from converting. And also they're making sure your analytics is truthful and correct. Very important, because if your analytics are wrong, you're going to be making the wrong decisions based off the information that makes sense. Yeah.
[Voiceover]: What are the main tech errors that you find?
Matthew Pezzimenti: A lot of it can be around sort of different device or browsers rendering the website. That might be sort of conflicting things. And they might look at it, let's say from Google Chrome, and it looks great, but then they look at it in a different browser and different elements behave differently. And one of the classic ones is where someone might implement a live chat feature and they're like, okay, this is great, but for some reason my mobile conversions are now dropped. Like, why could that be? And there's a lot of hypothesis about, oh, maybe it's because people are now talking to customer service or they're going to store. When we do the tech audit very regularly, we find that actually that live chat feature is actually covering up the checkout Button on mobile. So those little things that if you've been looking at a website your day to day, it just seems normal and natural and may figure out how to get around these bugs and errors. But that's one of the ones we get in there and just clear them out to begin with. So you start, make sure everything's aligned from a tech perspective.
[Voiceover]: Tech and analytics, get them lined up first.
Matthew Pezzimenti: Yeah, yeah. I mean, if the analytics is wrong and then you're going to be making the decision, oh, wow, this is actually a problem, but it's not. Or you might not see the problem and you'd be focusing on the wrong thing and that becomes a bit of a challenge.
[Voiceover]: I can imagine recently the cutover From Universal to GA4 would pose a few challenges with some of the tests and the comparisons that you're working on at the moment.
Matthew Pezzimenti: Yeah, yeah, there's a few big ones on that. So some of the challenges people have got is if they did their GA4 implementation a little bit late, which is less than 12 months ago, it's going to be a little bit difficult for them to do a year on year comparison. Obviously you can merge the data together, but it's just a little bit more difficult. And then when you're setting up your GA4, there's around about six main gotchas that happen that actually process the data differently. So when you're looking at your GA3 data and GA4 data, they may not line up because you've not configured some of those settings correctly as well. And then as GA4 was evolving, so were their metrics. Remember how there was no bounce rate, engagement rate, and they'll bring your bounce rate back. So there's just a little bit of confusion as it's starting to bed in, but it has definitely been an. Call it an interesting experience with a bit of a changeover, but most customers that we're talking to now, they've got it all sorted, maybe with a few little teething errors as well.
[Voiceover]: Yeah, great. Teething errors. I like how you put that. Sounds painless. We will come back to the Google tools because there's a lot to talk about there, I think, and to unpack, but I'm keen to see out the rest of this process. So we've talked tech analytics, make sure all those foundations are in place.
Matthew Pezzimenti: Yeah. And the next thing we want to do is go, who's not converting? Like, who is an important segment to your market? Because not everyone's. Like, you might have different customer groups within the population of your website. So you need to see who they are, how big those segments of customers are and then once you know who they are and you're able to track them, how are they traversing through the website and where are they falling out? And you might have different customer segments falling out at different areas of the web, which then creates different levels of opportunity. So you might have a small market, small segment of users, but they might have a very big problem in a certain area of the website. Or you might have a very big segment with multiple little problems throughout the funnel and then analyzing to go which one of these fallout areas is are actually the ones that we should focus on to get the biggest outcome. You might solve a small issue which might feel good to you. Yeah, awesome. I crushed it. But if it doesn't really deliver a sizable lift to the outcome, it's not that helpful the overall project. So the next part of it is really understanding who's going to your website and whereabouts are they actually having the problems when they fall out.
Nathan Bush: Shopify have put together their version of the Australian e commerce avengers. 10e commerce experts, including me. Unfortunately, I think I'm the hawkeye of the group to give you tips on how to set yourself up for success this year. You'll even recognize some of the contributors from past add to cart episodes. Mark Bartzer, Kelly Slessor, Paul Waddy, Lisa Jones and more will share tips from how to create great discounts, how to boost conversion rates, optimize email and sms, even use AI to drive sales. It's all in there. I share how to set up your team for success. I can guarantee you will take at least two to three tips that you can use to optimize your sales this peak season. So put on your Spandex and join the E Commerce Avengers with Shopify's free Peak Season Playbook. Download it at shopify.com/guides peaksalesseason2023 or just follow the links in the episode, show notes from the device you're on.
[Voiceover]: And do you find a lot of clients when they come to you, they know those customer groups straight up? Or is there a big part where you've actually got to dive in and create those?
Matthew Pezzimenti: Yeah, it's definitely the latter. So everyone has an idea of who their Personas are, but this seems to be a bit of a commonality in online where we get these lovely Personas sometimes from marketing that sound really great, but then if we can't track them in a digital world, like there's no digital footprint behind them or digital signals that help Me identify them and how do you actually identify, track and optimize those users? And it becomes a bit hard. So what we would do in that very first step on baseline is validating those segments that, yes, we can actually track them, we can see them, and now we can optimize them as well. So a lot of times customers come to us going, we don't know who our good segments are. So that's a bit of work to actually identify who they are.
[Voiceover]: Gotcha. All right, where do we go from there?
Matthew Pezzimenti: Yep. So once we've done that, then we need to check off all the core customer experience vitals. So, you know, are they able to get into their search and merge? Is that where it needs to be? Because, you know, around about 10% of people, if they're searching online, that's a very solid channel. We need to make sure that that is optimized, delivering great results and then even looking at the website from, and I use quote, unquote, best practice to make sure that there's just no glaring issues which are actually stopping people from converting and also finding out any other insights as well. So we've done technical review to make sure everything is good, analytics is right. We've looked in to know exactly where people are falling out or to find who they are and where they're falling out. We've checked off to make sure there's no other obvious issues. And then the next step is that once we know who and where is falling out, we need to understand why.
[Voiceover]: So this is where the creativity comes in, is it?
Matthew Pezzimenti: Well, the creativity will come out of the solution. But this is when we think about the why, this is where more of the qualitative tactics come into play. And this is like, you know, when you're doing your surveys to your customers, or you're looking at Heat Map, or you're doing usability studies. And these sort of customer research tactics are really helpful when you have a good question to ask. So if I know that this segment is falling out of this area, and then when I'm doing my qualitative research, I can find out precisely why is that happening? And yeah, and so once that's surfaced, then you've got a fighting chance to actually solve the problem because now you know where it is, you know roughly why it's happening, and now we can come up with a solution on how to solve it.
[Voiceover]: Great. And is the solution always around testing and split testing and multiple avenues?
Matthew Pezzimenti: Well, that's actually a really good question because it's. People think that CRO is just about a B test, but it's not, it's just basically about what do we need to do to validate and solve that problem. And that's where depending on the use case test can obviously be very helpful because you're using a big sample size. But sometimes we might use a usability study which will identify whether or not that's positive or negative. Or you might use like an online survey like Loop11 or usertester.com to really validate and find out those insights as well. So once we know where the problems are, we'll come up with a solution and how we validate that solution will really dictate on the use case and what's in the best interest of solving it.
[Voiceover]: Wow, okay, that's great. And then where to from there?
Matthew Pezzimenti: Yeah. So once you've solved, you've got a good understanding of how you're going to solve these issues, then what we need to do is come up with how we're going to prioritize what we're going to do first and last. And what's interesting, when we started 10 years ago, we would be really proud of ourselves because we build out these lovely 12 month strategies. You know, something really proud. Look at all these great conversion issues we've got, we've got the solutions and now we build a 12 month roadmap. And what we found was after about six months it became completely irrelevant because the market had changed, the insights and learnings had changed and now we need to do something a bit different. So where we focus on is actually quarterly strategies. So what we would do is we look at what our opportunity for our backlog of solutions. We would then understand what our priorities from the business this quarter or what our marketing requests are for this quarter. And then we would identify what optimization improvements can do to support that quarterly plan through the business. And that basically will create the quarterly roadmap of what that optimization program will do to support other parts of the business. So once we set that strategy, it's super important because that brings everyone on board and understands exactly what we're going to be optimizing at what time.
[Voiceover]: And do you find that the more you work with clients, that quarterly cycle just becomes part of the business cadence.
Matthew Pezzimenti: Yeah, it's interesting because some brands will just go, oh yes, that's exactly what we do, when maybe it's not. And it's a great way for them to get started on it. And some are just like, oh yeah, we already do it. Or they're like, okay, great, this is a new way of looking at how they can keep themselves fresh and really relevant. But the other part to it, it actually gives the whole teams direction and they start the quarter knowing, okay, what's my goal for this quarter? What, what does good look like? And then we're all shooting to that same outcome and it combines all the teams and we always step forward. So CRO, because it's basically sits in the middle of all the tactics, we need to be also not only support, but also a little bit of a leader in that process of how we help everyone move forward. So. Yeah, so strategy and prioritization is that next step and understanding what we're going to be focusing on in the short term.
[Voiceover]: Great. And then am I assuming we're getting to measurement at the end there?
Matthew Pezzimenti: Well, actually, we're jumping over to execution now.
[Voiceover]: Oh, sorry, I've skipped a step.
Matthew Pezzimenti: This is the fun part. We've done all the hard work, now we get to do the fun stuff, which is, let's test it.
[Voiceover]: Let's actually here I am on the strategy, Strategy guy. I'm like, oh, the hard work's done now.
Matthew Pezzimenti: So you're off to already gone to lunch. And now we're now doing all the hard work. Sweating. Yeah. So then once you've created your, you know what you're testing and you would jump in and start building out those tests and to do that, simply you'd build what's called the test charter, which is all the details and information on the test. It's going to tell you what it's all about. Then you'd move it over to design. So you would actually then go and design that experience, typically in a high fidelity format. So you've got a good understanding of it. That from the design would then go to development, where you would engineer that test in the testing platform, which is exactly like the design. You would UAT it to make sure it's solid and it's all good to go. The important step a lot of people overlook though, is picking up all the reporting and the metrics and making sure that all the metrics that you possibly could be reporting on in that test have been set up, which is part of the launch plan. You launch the test, you monitor it, typically a progressive launch. So you don't just push a button and now it's live. You would do it as like a controlled release over a few days to ensure that everything is smooth. And then you would monitor it over a period of time to then decide on whether or not to close that test. Or keep it going and then you get down to once it's hit significance or a certain threshold, you would then close that test down. Gotcha. Then you go to measurement on how it performed.
[Voiceover]: I was like, I'm not even going to guess what the next step is. I'm going to let you lead the way there.
Matthew Pezzimenti: Yeah, yeah. Then you would actually do the analysis to go what did we learn and what should we do next? Did we learn that this was a better experience for the customer and we either want to move it into an always on experience so we would turn it to 100% using a personalization platform or you would then create what's called developer notes and send it to the engineering team to implement through there production. Or if you, you work someone like Conversion Kings, we can also even dev into prod as well. But if it's not a successful test then there's a learning and it's about why wasn't it and what did that teach me? And then that goes circles back to your backlog and your strategy to enrich the testing program and then it does have a bit of a circular motion and that's it. Yeah.
[Voiceover]: Fantastic. I can see why you're so passionate about learning. If you've got a new client coming into you for the first time, they've signed off on the dotted line, you're off to the races. Typically, how long does it take you to get through that process the first
Matthew Pezzimenti: time and then to start testing or to. Yeah, good question. It takes about, depending on how deep the research is, it's typically anywhere between, let's say five to eight weeks to complete a solid website audit strategy and then building out the plan. But getting my experience. As much as customers and brands want really detailed, quality, insightful research that doesn't leave any stone unturned, they also want results like yesterday as well. They want it to be faster. So what we do is we actually run a concurrent methodology where we will do the research which is really, you know, finding out the main motivators. But the other side to it is because we have quite a bit of experience and typically the customers come to us with a whole bunch of things they want to understand and solve. We would start executing tests in line with doing the research as well. So typically by the time the research is concluded, you've already got some wins and some potential uplift in your revenue straight away and then you're off to the races as you said. Yeah.
[Voiceover]: So just a little treat along the way just to keep everyone interested and moving along until they get to dinner.
Matthew Pezzimenti: Yeah, exactly right. And sometimes like we get to the end of that two months and we've already given them a return on investment which would cover a CRO program for the next five years after those first two months. So it's always a great experience for everyone involved when we get love to do that.
[Voiceover]: Is there a bit of a pattern that you're starting to recognize now, especially for E commerce clients when they come on board for the first time, the obvious places to look, where you go, there's definite conversion uplift to be had in area abc.
Matthew Pezzimenti: You know, it's dangerous to think like that and because if we think about the tyranny of averages which really don't mean much in the sense where if we look at a conversion rate, people think oh my conversion rate is 2%. But that might mean that you've got a conversion rate on desktop of 0.5% but a conversion rate of something a lot higher on mobile or around the other way. So looking at a problem as an average on a website or even from a category potentially could send you down the wrong path. The area we would typically, if we had to jump in straight away to find where the main issues were, we'd be looking at where in your funnel do you have the problems. Do you have a bounce issue, meaning that people are landing on your website? It's not relevant, it's not what they're after and they're leaving. Is it an add to CART issue? You know, is it about they're not finding the right product, they're not persuaded, they don't understand it and they're not adding it. Is that they're not even adding to maybe adding to cart. They're not even starting that checkout process. There's no incentive for them to go forward or is to check out. The issue is that on mobile is a different traffic source and different Persona types. So without overcomplicating it, it really just comes down to we need to understand the segment the area and then that's typically where they would jump in. And every business is different even when you've got the same website running in different markets. And we might find that we might be running a client that's got a website in Australia and one in the US same potential web experiences, but because we have a different market with a different expectation, they've got different problems as well.
[Voiceover]: Makes sense.
Matthew Pezzimenti: I felt like a politician answering that question.
[Voiceover]: Well, I've got another question which you might not like, but I can hear people in their Cars or in the gym listening to this going, you can't let that go without asking this question. You're going to hate it. What does a good conversion rate look like?
Matthew Pezzimenti: Yeah, I mean a good conversion rate is great. That is giving you a positive return on investment from your traffic sources, whatever that could be. We've got some lead gen clients that need to be hitting around a 15% conversion rate to make that viable for them. And we've got some brands that they've got. Conversion rates of 0.5 are still great as well. And then comes to the big question is like, what is even a conversion? There's two things to really consider is firstly, when we're defining conversion rate, are we doing it based off qualified traffic? So an interesting one is like we had a client now saying that we're driving a lot of traffic, our search is going super well, but our conversion is tanked through the floor. And okay, so what's going on? What's happened? Looking into their analytics, you can see that. And this is for a dental company and they were in Sydney and I said, look, unless you figured out how to do your dental work from people in India, that traffic that's coming through is probably not relevant. So when we're looking at conversions, we need to make sure we're looking at relevant traffic. Or if you've got a really solid or large community area to your website, like a lot of blogs, a lot of community interaction who have no intention of purchasing, you wouldn't include that traffic either as well. So it really comes down to making sure you've got the relevant traffic within the buy flow. And then what's that particular conversion rate is the right way to look at it. And then the other second gotcha that a lot of people have is are we tracking it off of sessions or users and then what's that metric? Because one user can have multiple sessions and multiple sessions divided by the same meta transactions will give a different conversion rate. So there's a few things in there to consider, but the biggest one metric to think about is are we converting our traffic into our goals that are actually profitable for the business is the way that we like to look at it from a number. But if you're looking for an average, actually looking for a number.
[Voiceover]: Yeah, give us a number.
Matthew Pezzimenti: Actually, I can bring up the number if you'd like. With one second, I'll bring up my averages.
[Voiceover]: I love that you gave the sensible
Nathan Bush: considered answer and I go, yes, that
[Voiceover]: makes a lot of sense. But what's the number?
Matthew Pezzimenti: What's the number. Yeah. So we've done quite a bit of research actually on this and we've got a bit over 100 retailer data that's fed into understanding these averages of all approved data. But if we're looking at as an average across all categories, if we're looking down here. Sorry mate, I'm just jumping into my other screen to tell me the exact number.
[Voiceover]: It's okay. We've got live data going on. This is the first for add to cart. It's fantastic.
Matthew Pezzimenti: There you are. So what we've got currently from all industries, we're looking at 1.39% as an average conversion rate across it.
[Voiceover]: And that's beyond retail.
Matthew Pezzimenti: That's beyond retail as well. And then we can break down to the different categories as well. So if you look at furniture is different to jewelry, which is different to fast fashion. But the interesting other metric to think about here for everybody is your non bounce conversion rate. So what that does is when you remove bounce out of your numbers for conversion, you start removing a lot of that brand traffic, which is really about awareness. Top of funnel, it's not really bottom of funnel traffic. And when we remove bounce out of the data set, we're getting to an average of 2.17% conversion rate to get a bit of a bit of reference on it as well.
[Voiceover]: And in terms of typical categories that you see, say a higher conversion rate, is it typically FMCG fashion at a higher level and then larger items like furniture at a lower conversion rate?
Matthew Pezzimenti: Yes, I'm just looking at the data now. Yeah, Homewares is typically lower. Definitely on the lower spectrum. Things on the higher spectrum. Apparel and beauty would be some of the higher categories in conversion rate. And there's a range, you know, if you look at beauty, I mean our average conversion rate on Beauty is 4.9%. It's a lot higher. And we've got some brands in there, you know, kicking on close to the 10% mark in there as well. So it's definitely a range of what you've got, but again it just comes down to your acquisition costs.
[Voiceover]: Yeah, you've mentioned some great metrics to look at beyond just that conversion rate, percentage figure. Talked about qualified traffic, bounce rate. Any other metrics that you think retailers should really keep a close eye on if they are worried about the conversion on their website?
Matthew Pezzimenti: Yeah. So the first thing I just, I can't stress it enough is segmentation. And the two segments that I would urge all retailers to really focus in on is what's the conversion rate of a first time customer. So they've never purchased from the website before. And what's the conversion rate of a returning customer? Because that's going to give us our cost of acquisition of a new user where we can have a lifetime value and understand is that actually a good investment or not? And then we go back to a returning customer, what's their conversion rate? Because the interesting thing about a returning customer you might need to think about are they on a loyalty program like now they're, you know, you might have a list price or a member price. So that's going to change the profitability of that sale. How did that person purchase? Did they go through a buy now pay later? Which means that I'm also now going to lose maybe 5 to 7% of my ticket because I'm now having to pay additional fee through that buy now pay later as well too. And this all contributes to the actual profitability of bringing those segments in. So firstly I think it's important to segment those two audiences.
[Voiceover]: And do you typically find return customers convert at a higher rate than new customers?
Matthew Pezzimenti: Yeah, by a long shot on that one. But and this is what's super exciting about Crow is because there's a different team that looks after that and you've got, you've got your acquisition team and they're all about how we can maximize our rollouts. The other one when we're looking at our CRM team, they're about how I can really deliver a personalized experience to this particular customer, giving them relevant offers and information and how can we support that online. So that's a super important part and
[Voiceover]: I can assume that also your version of conversion might be different for each. So if you're a new customer getting them to leave an email address or add something to basket is actually a really good conversion. Like that's, that's job done for instance for a new customer in a lot of instances.
Matthew Pezzimenti: In theory, yes. In practicality brands are like well how much money did we make? You know, like this is great. We wanted, we got them on the database, it's fantastic. But at the end of the day how much money did you make? So I agree there's definitely mid funnel metrics which are super helpful and important on the cold face of it in the actual rough and tumble of the day to day it really does come down to that roas as we actually improve that return on advertising spend and what's beneficial for that also is when we start converting customers at a higher rate for new acquisition. It means that in my bidding strategy I can outbid my competitors because I can pay more per click because I'm converting them better on the other end. Which just means you get this really unfair advantage against your competitors because you can spend more and still make more at the same time.
[Voiceover]: I'd love to dive into tools. You gave us some really great examples of some tools when you talked about some of the surveys that you do. What are the main tools that you're using day in, day out at Conversion Kings?
Nathan Bush: What do you get when you combine the spirit of Christian Dior and Coco Chanel and Ian from the warehouse you get Signet's brand new capsule collection. They've said non to boring packaging and released a brand new range for their inaugural capsule collection. It's packaging but classy and as always it comes with Signet's usual quality, competitive pricing and the only non French edition. Amazing customer service coming to a warehouse Runway near you. Visit signet.net au to browse the range and contact the team to find out how their packaging solutions can help your e commerce business.
Matthew Pezzimenti: Yes, some of the main tools obviously Google Analytics absolutely is really important. But then enriching that Google Analytic data with like CDP data to know those different customers and segments and how they behave through experiences, super important, especially for segmentation. Then we need to jump into qualitative feedback as in understanding that information from customers. So surveying tools are super helpful in pulling that information out. Other tools that a lot of people use and we use a lot of as well. So session recording tools. So that's looking at people live on the website, understanding what they're doing and where they've got some friction and frustration as well.
[Voiceover]: Great.
Nathan Bush: Any particular tools you want to call
[Voiceover]: out for a mention?
Matthew Pezzimenti: Yeah, look, it all comes down to use case because a lot of people even ask us, you need a testing platform as well obviously. Yeah, a lot of people ask what's the right testing platform? What's the right session reporting tool that we should be using? And it really comes down to the use case of what you're using it for. So I can use session recording tools as a great example. We've got hotjar. I love Hotjar. It's affordable, it's easy. Most people have got it, most people understand it. You can get the base amount of information from it nice and easy as well, but it's only going to take you so far and then other types of tools in that spectrum. You've got the full stories of the world and full story right intel, really deep, deep focus I have on security and making sure that the data there is really protected and the ability to service insights and stuff super helpful and easy. Then you've got the likes of Tea Leaf. The customer service on Tea Leaf is just second to none. And the other one would be sessioncam. The UI and feature set is fantastic. So it really just comes down to what are you using, how you're using it. But then it gets a little bit more interesting when you jump into testing platforms because in testing platforms there's different types of testing platforms and some testing platforms have the inclusion of session recording tools and other bits and bobs in there as well. So it does get a little bit involved when trying to choose what's the right tech for them. Because then it all comes down to money. Right? So it's about. I'd love to have clients always want to have everything, but sometimes the budgets don't sort of allow for that.
[Voiceover]: And then also who's going to use it and keep an eye on it because the more you add to it, the more time it takes to analyze and get the actual actions out of.
Matthew Pezzimenti: You know, that is such an overlooked area in tech. A lot of times people see the shiny, shiny and they think, okay, great, this is going to solve all my problems. But they don't maybe appreciate the level of effort you need to put into these tools to get the value back out of it. It doesn't just do it for you. So having people to understand them and get the most out of it, yeah, it's great pickup. Because that's a big misconception that people have thinking they just put it in, give them all the outcomes.
[Voiceover]: Yeah, awesome. Now, Matt, we have just launched our add to Cart Slack community. So it's really new for us and we've opened it up pretty softly to our newsletter subscribers. And I've opened it up and I said, look, we've got Matt coming on the show who wants to ask Matt a question. And I've got a few in there. But the one that I think that's really relevant for us now is from Ilan Hurwitz. And Elon asks, what is the most cost effective tool that you've come across to replace Google Optimize? Because we saw that sunset. How have you gone with that transition? What are we going to.
Matthew Pezzimenti: Well, the transition's been pretty full on. It's been absolutely crazy. But again really comes down to how much traffic you've got. So if you're a small business and you're moving off Google, optimize vwo, vwo free plans. You know, it's gone from free to free to a certain level and that's, that's really where it's going to be ideal for them. If you're moving up into more of the enterprise level space, then we need to start thinking about what types of tests you're doing to then see which one's actually relevant for you as well. And there's over about 21 different testing platforms that are really active in the market at the moment that people can choose from. So it's difficult to give that recommendation of which is the most cost effective, because the most expensive tool is one that you don't use that's really expensive, like a gym membership. Gym membership is only expensive. Don't go to the gym. And the other one to think about this is a thing that a lot of people overlook is that the quality testing platforms, they've got a very solid server infrastructure. And what that means is that when they're serving up the tests and they're delivering, presenting those different variations to customers, it's fast and it doesn't affect the site speed very much at all. It might have very, very small, but sometimes when you're looking at maybe the non mainstream technologies that are free, they can sometimes slow the website down. And we know also that site speed impacts conversions. So while we might think that we're saving a bit of money over here going, oh hey, we're saving up $2 by getting a cheaper or free testing platform, it actually costs you more because it's now slowed down the site. You're not getting the conversions you would have expected. So it's free isn't cheap. One thing I learned very early in my career is that the most expensive legal advice you can get is cheap legal advice, because that's typically wrong. And the same goes with testing platforms. It's a matter of making sure you've got something that is going to work really well with your tech. Stack integrations are going to work, it's not going to be costly to put those together and it's going to be easy to use. So you will actually end up using
[Voiceover]: it makes a lot of sense. Have you seen the emergence of AI have an impact on the tools or the functionality in conversion tools? Is there anything that stands out to you to go. It's really made an impact in this part of the conversion journey?
Matthew Pezzimenti: Not yet. Not yet. We are hoping, fingers crossed, that we can get some great value from AI that we can really scale with. And if we think about like where we would love to start using AI would be firstly around identifying valuable segments in people's data. You've got your customers coming in there and it's like, okay, which one of my valuable segments? At the moment it takes quite a bit of time and a process, manual process to identify and find those, those segments. And we've been searching high and wide and bit of development ourselves to try and can we create an AI engine that will help identify all those using all that data, find the patterns and find the segments yet to really nail that at the moment. And if anyone knows of something that we don't know, please let us know because we're looking for it. But in saying that though we are using AI quite a bit already. So you think in search and merch there's a lot of AI tools that we're using currently deliver that better for the customer. Product recommendations is another big one as well. Where we use AI effectively in the agency though is also helping us with information architecture. So if you've got like, you know, normally card sorting is quite a full on process of, you know, categorizing and moving things around, but you can push a lot of information into AI, it'll re categorize it based on what it believes and then you can validate that against what you're doing and even test it. So yeah, there's quite a bit in there and then the last one there would be around analysis. How do we identify what did that test mean and what should we do as a result? But again, it's all very much grassroots at the moment and nothing yet is absolutely solid where we go? Yeah, totally AI for that one.
[Voiceover]: Yeah, it seems like such an area that's ripe for an AI opportunity. But on the other side of that,
Nathan Bush: I can imagine now that you've been
[Voiceover]: doing this for so many years that do you ever get surprised anymore by test results? Are there any recent results that come to mind that you were like, oh wow, that was surprising.
Matthew Pezzimenti: You know what, when I first started the agency I always thought like I was really smart and I thought, yeah, I got this and people would ask me their opinion of what's going to convert, what's not going to convert. And I was always, oh yeah, totally, I'll tell you. But it was that bit of the effect of really not understanding the depth of it. So now at the moment, at my point, it's very humbling optimization because we have these hypotheses that we're trying to prove or disprove and at the end of the day it's that customer, that customer segment which is going to give us that direct information. So as I've sort of progressed in my career of optimization, I've sort of moved further and further away from having an expectation of what this test is going to go. It's about what can we learn? And every learning can be, is super, super interesting and doesn't always go the way you're expecting. Hence why we test.
[Voiceover]: Do you ever have any, like, side bets in the agency?
Matthew Pezzimenti: Absolutely. Especially with clients. Sometimes clients are like, look, Matty, that is just too creative. That ain't not going to work. Oh, really now? And I recently had one from a retailer and we started throwing a few bets on there as well. And I'm pretty proud to say that my creative solution did definitely in that scenario. So that was a bit of a
[Voiceover]: double or nothing, the quarterly invoice.
Matthew Pezzimenti: That would be good.
Nathan Bush: All right, Matt, if we've got retailers
[Voiceover]: listening to this and going, oh, it is an area I've been interested in but probably haven't pulled the trigger on, done a lot on it to date, what's the best way for them to get started? Whether they are doing it in house or through an agency like Conversion Kings,
Matthew Pezzimenti: the first thing to look at is going to do I have a conversion problem and where is my conversion problem? That would be the very first place I'd start. Because sometimes when we jump into helping with a client, we've got a lot of stakeholders in there. Everyone wants to play on the homepage, like, oh, we've got to change the homepage. And that's typically what is what some of the talk track that happens. But when we look at a conversion, most conversions don't start on the homepage. Most conversions will start by we're actually getting people landing on a product display page. So we're over here focusing, trying to update our homepage because that's what everyone thinks is excited about. But actually it's not going to move the dial. And this is important to get right because if you get in there and you just say you do this big test on the homepage, effort and energy and it becomes inconsistent, meaning that it hasn't hit cynical significance. You're going to start losing a little bit of like, oh, hang on, that didn't go the way I thought it was going to play out. The most important thing to start with is identify where your problem is and then once you know where your problem is, then you would jump into it. Otherwise it's just going to be doing something that feels like you're doing something but you're not really moving the business forward.
[Voiceover]: Makes total sense. So what's got you excited for the next 12 months? What's on the radar for yourself and the Conversion Kings team?
Matthew Pezzimenti: Yeah, well, look, for us it's all about education. You know, 10 years ago, maybe one of a very handful of CRO agencies in Australia. Even in the globe it wasn't that many. And now there's a lot of people offering services and which is fantastic. The more people in the industry talking about, it's great. The other challenge to that is you've got people at different levels of maturity and understanding what CRO is. And there's a very known digital marketer out there that sometimes is incorrectly positioning people where they say, look, you know, you change the color of a button and you're going to make like a million dollars.
[Voiceover]: Come on, name names,
Matthew Pezzimenti: not nice. Everyone's just trying to put food on the table. I get it. But I think we just need to be careful, like of these sorts of claims pushing people down that. Because then what happens is people listen to that and they go, oh, okay, so I just need to change the color of my button. A, it means it just completely doesn't position you correctly for what the tactic is, and second of all, it's not going to give you the outcome that you're, you're needing. So I think for us it's all about education. How can we share with people what is optimization, what's the gold standard of optimization and how to do it and how to do it really well. And then once you've got that understanding of how to do it and how to do it well, then you've got the information to know should I do this internally or should I do it externally or should it be a hybrid of both? So for us, it's like our favorite customers are the ones that are knowledgeable in what we do to make an appreciate how well it goes and how smooth it happens as well.
[Voiceover]: Great. It's great advice. So you mentioned there that you're passionate around delivering more education, educating the market on CRO. This is the time for the plug. Where can people go to get some of the amazing resources that you've already created and potentially get in touch with you on the team.
Matthew Pezzimenti: Yeah, we're all about give before you take and how we can show value. It's all about showing value through education. So if you jump onto the Conversionkeems.com website up there, we've actually got a free audit. So you can go There request a free audit. And what we'll do from that, it's not a computer generated audit because we haven't figured out how to do that, but what we do. Come on, AI. I know, I know. Come on, come on, dev team. But no, what we'll do is you request a pre order, have a quick chat to understand where some of your main challenges are and then we'll do a review of your high level review of your website to identify these are some of the areas that you can improve. And it's a great way for a lot of people to get started. Think about, you know, do I even have a conversion issue? And where exactly are my main problems that I've got?
[Voiceover]: How good's that? Matt, thank you so much for joining us on Add to cart. I've learned a hell of a lot today.
Nathan Bush: Everything from the process that you use
[Voiceover]: through to the tools that you recommend and your tips to get started. Been so good. Thank you so much for sharing your knowledge with us.
Matthew Pezzimenti: Oh, you're welcome. Nathan, thank you so much for inviting me onto the podcast. It's a real honor and you guys did amazing work. So, yeah, really proud to be part of it. Thank you.
[Voiceover]: Thank you, mate.
Nathan Bush: I call those episodes the notebook fillers because even as I'm discussing it, I'm like, I've got to take a note of that.
[Voiceover]: I've got to take a note of that.
Nathan Bush: There is so much actionable stuff that Matt shared around improving conversion rates for your website. I hope you got a lot out of it. I certainly did. Here are the top three things looking back on the episode that I took away from that conversation with Matt. Number one, don't overlook auditing. It's a very important part of the process. Don't skip it. Make sure there are no technical errors on your website before you can start optimizing. Make sure you have truthful and correct analytics and give it the time and attention it needs. Number two, don't set a yearly strategy
[Voiceover]: and then walk away.
Nathan Bush: Make sure you have actionable quarterly strategies. Whether you do all of this in house or you have an army of partners supporting you, make sure you revisit your strategies regularly, at least quarterly, to tick off what you've done, where you're struggling, and what you might want to build on in the following quarter, strategy shouldn't sit still. And number three, testing is about being open to learning. You may have expectations, but like Matt has learned over the course of his career, things often don't turn out as expected. Even when you are a master of your domain. After all, if you knew the answer, you wouldn't be testing. Thanks for joining us today on Add to Cart to listen to all our e commerce conversations, now in the hundreds. You can head over to addtocart.com au there you can also join up to our free private Slack community to share e commerce ideas, tips and questions with other listeners. You can also subscribe to the Add to Cart weekly newsletter and browse some of the video highlights from our chats. There is a lot there. That's addtocart.com and if I can ask you one thing before you go. If you enjoyed today's episode, make sure you share it with a friend or a colleague who could benefit or leave us a review. It really makes a difference. Thanks again for listening. And until next time, keep those customers. Adding to Cart.
