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  • Conversion Rate Optimization 101 – Part II: Multivariate Testing

    24 February, 2009 | Author: zagano | My profile on Hiconversion

    According to FireClick 97% or more of your hard earned web traffic is wasted. Such poor online marketing performance is not acceptable or sustainable. A solution for this problem can be relatively simple and affordable. This three-part blog post is designed as your hands on guide into the world of Conversion Rate Optimization (CRO) and dramatic increases in the online marketing ROI.

    What is Multivariate Testing?

    In Internet marketing, a/b or split testing is a process of measuring the performance of a few different versions of a web page to determine which one has the highest conversion rate. Split testing is very useful for determining which page layout performs the best, but it is very limited in its ability to find a version of the page that fully maximizes a conversion rate potential.

    Multivariate testing, on the other hand, can be viewed as a process of a deep page testing where you are measuring the impact of simultaneous changes of several page components on the overall page conversion rate. The number of possible page combinations that can be created by changing multiple page components can quickly escalate into the thousands and sometimes even into the millions. Testing such a large number of page combinations is a science that requires automation and effective multivariate testing technology.


    About Multivariate Testing Methods

    In the not so distant past, multivariate testing solutions were available exclusively to those who had deep pockets, technical resources, and high volume of web traffic. In last year or two the situation has dramatically changed making it possible for companies of any size to use multivariate testing.

    Multivariate testing technology is still evolving and it is critical to recognize that not all multivariate testing methods are the same. On a high level one can identify three main product categories:

    Full Factorial Testing Tools

    The full factorial method is a fancy name for testing of all possible page variations.

    Since every page variation is tested until statistical reliability is achieved, a large amount of visitors (time) is necessary to complete the test. This type of testing is so slow that for a great majority of websites a multivariate test with more than a dozen page variations can be very impractical.

    In this product group we recommend use of free Google Website Optimizer. This is a great entry level multivariate testing solution that will give you an insight into the value of split and multivariate testing.

    Fractional Factorial Testing

    The more sophisticated (and much more expensive approach) is so called the fractional factorial method. Instead of testing all possible page variations, only an array (i.e. subset) is tested and mathematical modeling is used to predict the overall winner. This method can produce a 10x improvement to the full factorial method but still requires high volume of traffic.

    The best known products in this product group include:

    Adaptive Multivariate Testing

    Hiconversion, Inc. has invented a patent pending adaptive multivariate testing methodology that moves performance needle for another factor of 10 in comparison to the fractional factorial method. As a result, it is now possible to run a reasonably sized multivariate test for web pages with only 100-200 visitors per day.



    How To Select a Tool That Fits Your Needs

    Although the multivariate testing methodology is a very critical element of any multivariate testing solution, it is not the only criteria that you should use in making a tool selection. The table below summarizes other product features that can impact effectiveness of your test in significant way:



    Experiment Setup

    The following are the practical steps that you should follow during the experiment setup.

    Step 1. Determine If You Need a New Page Design

    Sometimes your existing landing page is so poorly designed that ‘perfuming the pig’ will not be the best use of your time and resources. We suggest that you take a critical look at a page you want to test, and conduct a simple ’smoke test’. All you have to do is to verify that all three critical page elements exist and that they are all placed above the fold (see below).

    If you page is not satisfying these basic requirements we would recommend that you create a new layout.

    Step 2: Determine Duration of Your Test

    Different multivariate testing methods will perform at different speeds, but you will still have to create an optimization experiment that can be completed within a reasonable period of time.

    First, let us help you calculate the total number of page combinations that you may need to create during your multivariate test. The math is very simple, the total number of page combinations is equal to: the consecutive multiplication of the number of variations in section one, the consecutive multiplication of the number of variations in section two, and so on…

    For example, if you design an experiment with 4 sections and 5 variations each, a total number of page combinations is 5 x 5 x 5 x 5 = 625. When we say 5 variations, we mean control (the existing element) and 4 new variations.

    Second, based on your current web traffic you have to estimate how long it will take to complete the test. Ideally, we recommend no more than 2-4 weeks of testing.

    Few multivariate testing tools offer a test duration calculator:

    Just to give you a feel for test duration, let’s use the two calculators from above and apply it to a few typical real world situations

    As numbers indicate, the bigger the number of test combinations the bigger the difference in test duration between two multivariate testing methodologies.

    Step 3: Design Sections and Variation

    Often website owners are paralyzed by a luck of ideas about what elements of the web page they should be testing and how to test them. Let us share with you few resources that will help you jumpstart your experimental design.

    Marketing framework

    The most complete method for designing a multivariate test can be described by the Conversion Sequence formula developed by MarketingExperiments.com.

    Where c = Conversion, the other sequence elements refer to:
    m – the match between the offer and visitor Motivation.
    v – the clarity of the Value Proposition.
    i – Incentives used to counter Friction.
    f – the level of Friction in the sales process.
    a – Anxiety caused by the process.

    While Motivation has the highest coefficient in this formula, it also represents an external factor in the marketing cycle that is beyond your control. That makes the clarity of your Value Proposition the most important internal factor.

    However, many marketers try to improve results by changing page elements like font colors and sizes, button shapes, images, incentives, and so on, when the first step should really be focusing on strengthening their value propositions.

    Practical Tips

    There are many tips that you can find yourself on the Internet. Few of our favorites are:

    Pitfalls

    According to many analysts, the most common errors in testing and analysis include:

    • Bias: Approaching a test with a clear predisposition toward a particular outcome
    • Impatience: stopping a test too soon based on early results
    • Extrapolation: Drawing overreaching conclusions from limited test data
    • Follow-through: Failing to prepare follow-up tests

    Step 4: Define Conversion Goals

    Defining your conversion goals is usually a simple task of identifying the most desirable action that should be taken by the test page visitor.

    Some tools will allow selection of multiple actions on the same test page. This can be very convenient for landing pages that offer multiple calls for action leading to different pages in the sales funnel.

    Others will force you into defining conversion goal as tracking of visitors who reach a pre-defined conversion page after visiting the test page. This is quite straightforward but can limit your ability to measure multi-call conversion actions.

    Step 5: Optimization Enable Your Test Page

    Enabling your test to participate in the multivariate test is a technical step that can be more or less complicated.

    For example, if you decide to use Google’s Website Optimizer you will need to insert few different types of scripts into your test page and tracking scripts into conversion page, as shown below:

    The scripts above are test and section specific so each time you decide to make a change in your test, or to run a new test you have to update scripts into your test and conversion pages. This can be a complicated error prone process that fully depends on the availability or IT resources.

    Hiconversion’s transparent enabling method simplifies enabling process by requiring you to insert script into a generic page locations only one time in the life of the web page.

    After that you can make changes in your test or run a whole different test without any need to touch your web page source code.

    The third method of optimization enabling is called reverse proxy method. Here you have to deploy a proxy server in front of your existing web server. Although this approach can provide the highest optimization speed, many companies are very reluctant to make changes in the website hosting setup.



    Running a multivariate test

    If you are using Google’s Website Optimizer or Hiconversion Pro, all you have to do is to start your test by pressing a ‘play button‘.

    Taguchi factorial design

    Some Taguchi based solution will require an addition step of factorial design. Namely, before beginning of the test you will need to identify which subset, called an array, of page combinations will participate in the first wave of testing. To learn more about Taguchi method please visit Jonathan Menendez’s blog.

    For example L8 arrays are used for 7×2 (7 elements and two variations) and L9 for 4×3 (4 elements and 3 variations) MVT.

    Know when to stop your test

    One of the pitfalls of multivariate testing is that marketers get excited about results too early. Often they immediately stop the test and apply unreliable winning page combination.

    For those of you who overwhelmed by statistics, here are few rules of thumb:

    • 25 to 50 conversions will put you in 80% confidence range
    • 50 to 100 conversions will put you in 80%-95% confidence range
    • 100+ conversions are required to achieve 95% or higher confidence

    If you desire to learn more about how to calculate statistical confidence of your results, please visit an excellent writup produced by Marketo.com.



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