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  • Writer's pictureAnn Njuguna

Demystifying CRO: Conversion Rate Optimization & How It Can Help Your Business

Ever wondered if there was something more you could do for your online business to get more conversions while at the same time reducing the marketing costs and getting more quality traffic? Well, this article seeks to give you details on how to answer that question.

Here is a scenario:

A shoe store owner sells a wide variety of shoe types and brands and gets about 1000 visitors to the website in one week. Out of the 1000 visitors, only five get to make a purchase.

This store owner has the following questions, which are just a few of the questions that Conversion Rate Optimization seeks to answer.:

  • My cost of acquisition is already high, why am I not getting more transactions?

  • How can I get more transactions at the same cost of acquisition or even lower?

  • Is there a way to get more than five transactions per 1000 visitors?

What is Conversion Rate Optimization?

Conversion Rate Optimization is the process of increasing the percentage of website visitors to take the desired action. We call these actions conversions, and a website can have more than one conversion type. A few examples of conversions are:

  • Watching a video

  • Requesting a demo

  • Filling in a form

  • Making a purchase

If more than five visitors (say ten visitors) purchase out of 1000 visitors in the shoe store’s case above, the Conversion Rate will increase from 0.5% to 1%.

As we answer the question What is Conversion Rate Optimization, we’ll focus on the following:

  • Examples where Conversion Rate Optimization is applicable

  • Benefits of Conversion Rate Optimization

  • How to tell if your business needs Conversion Rate Optimization

  • How to get started

  • 6 step Conversion Rate Optimization process

Where Conversion Rate Optimization is applicable

Conversion Rate Optimization applies to any online business, be it a marketing website, Software As A Service (SaaS), lead generation website, or even an ecommerce store.

Conversion Rate Optimization is therefore applicable to online businesses seeking to lower their costs of acquisition and target more quality traffic, improve the user experience (UX) on their website and understand their client niche better so that they can provide the best product and services.

Let’s look at an example of a clothes store. We’ll call this shop B.

The owner of shop B has been running her business for about two years now and seeks to find out how she can get more revenue for her clothing store without spending more money on acquisition. She analyzed her sales and shopping funnel data and realized that a good percentage of users add three pieces of the same type of product to the cart and make a purchase. E.g., three t-shirts, three pairs of socks.

With this knowledge, she introduced bundles in her store where users had an option to either buy one item or a bundle of three items. She also introduced in her shopping cart, a way to suggest to visitors what else they can buy that is related to the items in their carts and also what other buyers bought that was related to the products in their cart.

The result was both an increase in the average order value and revenue in her store.

When you discover a pain point in your store that affects your shopping funnel or a potential area of improvement, the best way to start is with Conversion Rate Optimization.

Benefits of Conversion Rate Optimization

So...what is the importance of Conversion Rate Optimization? Before we see a few examples, you can focus on the following three points to guide you:

  • Getting quality leads

  • Communicating in the best way possible to the visitors on the website on the products and services being sold and also making this information readily available to the users on the website

  • Improving the UX on the website so that the visitors can easily get around and complete the intended action e.g. make a purchase

When the above three are met, the benefits of conversion rate optimization include an increase in the ecommerce metrics such as the number of transactions, revenue, average order value, reduction in the cost of acquisition, and even better engagement.

Here are a few examples of conversion rate optimization outcomes:

Online Store A

For this shop, the business owner needed to improve the shopping experience for the visitors. A survey and behavior analysis revealed that visitors:

  • Did not understand the product

  • Didn’t know where to start when making an order

  • They didn’t trust the store because there were no reviews or a case that could prove that others had bought from the store e.g. no testimonials or product reviews

  • Had a poor experience on mobile devices

  • There were so many choices to choose from and the visitors were getting overwhelmed

After optimization, the conversion rate improved from below 1% to over 3%.

Online Store B

For this store, one of the challenges was that the shopping funnel had a higher drop-off rate at the product details page. Upon further analysis, it was discovered that the most affected users were mobile device users. Some of the issues identified were:

  • Lack of proper information above the fold

  • The add to cart button was further down the page and it took several scrolls for a user to reach it

After optimization, the average order value for mobile device users increased from below $900 to over $1,300, with some cases reaching as high as $1,600.

Online Store C

For this store, there were several issues, among them,

  • High cost of acquisition

  • Funnel leaks, where users dropped off at the category pages

  • Lack of proper information flow about the product offered and users had so little to learn from, which prevented them from having the confidence to make a purchase

  • On some important pages like the product details and cart pages, some of the important elements were not above the fold

After optimization, not only did they reduce their cost of acquisition but they also got more quality traffic, and improved ecommerce metrics (transactions, average order value, conversion rate, and revenue).

How do you know if your business needs CRO?

There are three basic areas to focus on when assessing whether your business needs CRO. They are:

  • Does your website have challenges with the UX e.g. how easily can users get around and complete the preferred action?

  • Does your website have a low conversion rate? For instance, the average conversion rate for an ecommerce website is around 2%. However, there are stores with a conversion rate as high as 7% - 10%. Considering that the idea of an online business is to keep making money, the best advice is to keep optimizing the website, until it gets to the desired conversion rate.

  • Shopping funnel leaks - this refers to where there is a high drop-off rate along the shopping funnel.

Here are a few questions you can ask yourself to get clues from the three ideas above;

  • Which steps of the shopping funnel have the highest drop-off rate?

  • Are there landing pages with a high bounce rate, exit rate, and few conversions compared to the rest (poorly performing landing pages)?

  • Are there poorly performing pages that are not necessarily landing pages?

  • What about the traffic sources, are there some that are underperforming?

  • Is my website receiving quality traffic? Are there underperforming traffic sources?

  • Are there user segments who hardly convert or have a very low conversion rate compared to others?

How does one get started?

Now that we know how to tell if the online store needs optimization, the next step is how to get started with optimization.

The Conversion Rate Optimization process consists of six steps: They are:

  1. Analytics Configuration

  2. Analytics Audit

  3. Website Audit

  4. Data Analysis

  5. User Behavior Analysis

  6. A/B Testing (Experiments)

Just like we have an action plan for email marketing, we also have one for Conversion Rate Optimization. Let’s go through each of the steps above in summary.

Analytics Configuration

This step applies to websites that are yet to set up tracking to collect user data. In this case, tracking needs to be set up to collect data that will be used for optimization. This tracking also needs to be in line with the website’s key performance indicators. This way, you can both optimize the website and measure progress.

Once tracking set up is complete for a new website, we need to allow time for data to collect and this is dependent on traffic to the website. At this point, you can also set up user behavior tracking tools like Hotjar to record heat maps and video recordings.

Analytics Audit

This step is for online businesses that have already set up analytics. You might wonder why you need to audit the analytics account that has been collecting data. The reason for this is that you need to ensure that all the settings work as they should, the data you are collecting is credible and that you are tracking everything you need in line with your website’s key performance indicators.

In some cases, there are issues to do with the timezone the data is being reported in. In this case, it needs to be set to the timezone of the person who will be in charge of monitoring the progress of the store. In other cases, there could be double tracking where there are more transactions than reported in the store’s back end or even missing transactions. The audit reveals all this information.

Website Audit

In this step, the main focus is making sure that your website follows all the recommended guidelines of an ecommerce store and also helps in hypothesis creation for the A/B testing. A hypothesis is a suggested explanation that can be both tested and falsified. In this case, you must be able to test your hypothesis and prove it true or false.

Here, you also focus on the “low-hanging fruits”, which are areas of optimization you can focus on that are simple to implement and test.

Data Analysis

The data analysis step is the 4th step in the conversion rate optimization process and it mainly focuses on using data to explain the issues discovered at the website audit process. By making the observations and experiments data-driven, you stand a chance at better understanding what the problem is, and you can run better experiments as a result.

This step also reveals other technical issues like performance per device, page load speeds, and channel performance among other things. At this step, you can also analyze the shopping funnel and find leaks.

User Behavior Analysis

The 5th step is the behavior analysis step, where user behavior data is collected through heatmaps, video recordings, surveys, and user testing. All this information is used in improving the experience of the user when they get to the website. This section looks to answer questions like:

  • Are users getting the information they need to help them make a purchase decision?

  • Are they able to navigate the website and complete the desired actions easily?

  • Do users understand the product or service being offered?

A/ B testing

This is the step where the hypothesis you came up with at the website audit, data analysis, and user behavior steps is tested. In this case, there are three outcomes:

  • The original page (control) wins the experiment. If this happens, the best thing to do is go back to the data analysis step, review the data and come up with another hypothesis to test.

  • The difference between the original page (control) and the variant is too small to be used to make a decision. In this case, the advice is to still go back to the data analysis step and come up with a new hypothesis.

  • The 3rd case is when the variant wins the experiment. Here, go ahead and deploy the variant.

It is always better to analyze the data collected during the experiments because even when the variant loses, there is a lot to learn from the failed experiment that can be used to improve the experiment. Therefore, a failed experiment is not a total loss.


Can you identify potential optimization areas on your website from the examples of Conversion Rate Optimization shared above?

Run video recordings when running an experiment since this is important in giving you information on user behavior on both the control and variant pages.

The Conversion Rate Optimization process is a continuous process and does not need to end with the first experiment. Always iterate and keep improving the website.

In the next article, we’ll focus on the six-step process in more detail, where I’ll also recommend a few tools to use at each step.

Most common Q&A in the introduction to Conversion Rate Optimization

What is conversion rate optimization?

Conversion Rate Optimization is the process of increasing the percentage of website visitors to take the desired action

Why is Conversion Rate Optimization important?

Conversion Rate Optimization is important because it helps your online business reduce the cost of acquisition and increase the percentage of visitors who take a desired action on the website.

How do I improve my website’s Conversion Rate?

You can improve the Conversion Rate by following the 6 step Conversion Rate Optimization process which includes analytics configuration, analytics audit, website audit, data analysis, behavior analysis, and A/B testing.

How does Conversion Rate Optimization work?

Conversion Rate Optimization works by using data and user behavior metrics to get quality traffic, improve the user experience on the website, and also reducing “leaks” along the shopping funnel

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