Targeted Testing Boosts Online Conversion Rates
Sheplers has been synonymous with western wear and cowboy boots since 1899. The retailer carries the world’s best-known western wear brands as well as over 2,000 pairs of cowboy boots in its 16 stores across the U.S. and through its extensive catalog offering. With so many products, Sheplers added its e-commerce channel early on, in 1998. Since then, the retailer has been a pioneer in agile e-commerce.
To have an efficient and profitable website, Sheplers needed to offer customers promotions that were effective. To know which offers did and didn’t work, the company performed tests on its website, but testing in-house was proving to be more of a hassle than a best practice.
“We would actually create two different versions of the website,” explains Mark Hampton, COO of Sheplers. “I would create an ‘A’ version of the website and a ‘B’ version, and then measure those variables based on those versions of the website.”
The extra work was taking away from other operations Sheplers’ IT staff could focus on. So the retailer set out to find a solution that would be able to consistently and efficiently run tests on its website to obtain accurate statistics in order to improve conversion.
Sheplers began working with Monetate, a provider of testing, targeting and personalization services for websites, to test and analyze promotions on its website. With Monetate, Sheplers is performing multivariate testing, which allows Sheplers to test multiple factors simultaneously.
One promotion Sheplers tested is free shipping. Using geo-targeting capabilities Sheplers saw website sales were lower in states where the retailer had more competition. Using the multivariate testing tool, Sheplers tested free shipping in under-performing states. The goal was to see if the offers produced a significant lift in conversion and top-line revenue while tracking net contribution to the bottom line.
Sheplers was able to test a wide range of shipping promotions, including dropping the shipping charges based on distance from the warehouse or competitors’ stores and offering free shipping on orders over $75 and $99 dollars. The test allowed some shoppers to get free shipping while showing different messages to shoppers in other areas.
Sheplers was able to see the effects of targeting immediately. After four days of testing the various offers, the Monetate dashboard showed a 57% increase to the top line and 48% increase in new customer acquisition within these tests. Since using the testing tool, Sheplers has seen a 3.33% increase in overall conversion rate.
“The way a company gets a 20% increase is 2% to 3% at a time,” explains Hampton. “If everything on your website is well-conceived and well-executed, you’re in a situation where you have to move the needle with these 2% and 3% earnings, and multivariate testing is really the only way to keep pushing that needle forward.”
In addition to making tests faster and more efficient, the testing tool gives Sheplers rich analysis of each test. It measures the percent of visitors to the site who make a purchase, the number of customer acquisitions, the rate of average order and other key performance indicators.
“Internally we were already doing a lot of these key performance indicators,” explains Hampton. “What Monetate brought to the table was statistical validity.”
According to Hampton, the key performance indicators help the company frame future tests. “One test worked very well to get items in the cart, but this test got things in the cart to convert better, so maybe I can take elements of both and put them together for this third test.
“Statistical validity tells you which key performance indicators you should really pay attention to on a test,” continues Hampton. “Otherwise, you just look at the average performance and you don’t know whether or not that is statistically valid and you might make the wrong assumption.”
Not only has the testing tool allowed Sheplers to perform tests more quickly and with rich analysis, but the company can redeploy the time and money spent on having its IT staff perform tests to execute what it learned from the testing.
“The amount of internal work to do these kinds of tests is greatly reduced, which means you do more tests,” says Hampton. “You learn faster and therefore you progress faster. Now we can take the dollars we were spending on testing and redeploy it to execute on our learnables.”
Sheplers continues to test and analyze promotions to present the best experience possible to its customers.
“We were a company who was already testing and analyzing our business in many ways,” says Hampton. “Monetate allows us to do more and do it faster.”