Learn How to Build an Optimization Framework With the Experts at Cro Metrics
Many companies struggle when trying to accelerate growth, especially when they have cross-functional teams. Inertia to keep business moving forward might be difficult and yet it’s impossible to ignore. Building a high-performance business optimization program is the answer—and it all starts with experimentation.
Building and scaling an experimentation program comes with transformative benefits. The numbers don’t lie:
5%
Three-quarters of companies surveyed by Optimizely say experimentation improved digital revenues by over 5%.
10-25%
Microsoft’s Bing has used online experiments to boost revenue over time by 10% to 25% a year.
20%
Amazon released a new version of an app which resulted in a 30% decrease in revenue. They then ran a test with four new versions and increased revenue by 20% overall.
These examples are only a few of the successes that illustrate the importance of optimization. Yet, simple testing here and there won’t result in these types of successes. For example, Booking.com performs approximately 25,000 tests a year. And while only 10% of those tests generate positive results, those wins have caused the company to go from start-up to leading travel company.
True optimization takes building a culture of experimentation, where testing is a critical component of every decision you make.
To support you as you start transforming your business through optimization, the experts at Cro Metrics created this guide to help you:
Table of Contents
This guide was created for those who are ready to take advantage of business optimization but are experiencing internal barriers or a lack of resources for testing. It’s also for those who require a deeper understanding of the principles and how-to behind it.
This isn’t about learning to conduct a simple A/B test to increase conversions. Although important, a true optimization strategy is about using data-based insights to grow your business.
Part I: The Principles of Optimization
Part II: The Barriers to Optimization Success
Part III: The Ideal Optimization Process
Part I: The Principles of a Successful Optimization Strategy
Through an optimization growth strategy, you can turn customer insights and data into a competitive advantage. How? Business optimization results in many benefits such as increased ROI, improved customer experiences and risk mitigation.
Yet, before you can jump into optimization, there are some principles you need to learn and accept for success:
- Decisions Must Be Made Based on Data
Don’t make the mistake of overlooking data that points you in the right direction simply based on your own thoughts. Optimization should remove human-based opinion and replace it with data. It’s the only way to find potential solutions for optimization concerns. - There’s More Than One Potential Solution
Building a culture of experimentation means looking at several solutions and testing to see which one works best. Deciding which path to take based on one solution gathered during a one-off meeting will be detrimental to your efforts. - Great Improvement Ideas May Come From Anywhere
Expertise gathered from what’s worked before. Identifying areas of opportunity. These are just two examples of where great improvement ideas can come from. It’s important to not silo your efforts and always keep your eyes and ears open. - Tests Require Quick Prioritization
With a list of testing ideas and recommendations ready to go, it can feel overwhelming to decide which ones to run first. You can’t test everything at once. At Cro Metrics, we prioritize based on objective factors such as user analytics and technical complexity.
It’s also important to not let prioritization slow you down. Move on your testing ideas, learn and iterate as you go. - Effective Experiments Require Proper Test Design
Design often goes wrong. Some businesses may choose metrics that don’t fit which can result in a lack of detectable change. Take the guesswork out of experimentation by designing tests to gather specific customer insights. Gather customer data, formulate a hypothesis and then build your test.
Part II: 8 Barriers to Business Optimization & How to Break Them Down
Any type of business improvement will result in some growing pains. Optimization is no exception. For example, you may struggle with a lack of expertise or your business might be relying heavily on the “this is how we’ve always done it” mindset.
Whether you’re a beginner in optimization or in the trenches of trying to scale your program, there are barriers during building and scaling you must overcome.
- Lack of Expertise & Knowledge of the Benefits
Optimization isn’t easy, and it takes a specialized skill set for success. Plus, obtaining buy-in for such a specialized skill can be challenging too. It might be best to hire an internal expert or ask for help from an external team. - Lack of Time & Resources
Optimization takes time and dedication. It also takes financial investment for software, tools and additions to your team. To obtain the resources you need, start small by running simple tests to build a case for optimization within your organization. - Reliance on an Old Mindset
The old mindset of “this is how we’ve always done it” will inevitably get in the way of optimization. Organizational change requires a culture change. This can take some time. Stay focused on the benefits of optimization and champion those benefits across your organization. - Inability to Identify the Best Experimentation Ideas
Which experiments are the most important? It’s easy to feel bogged down by analysis paralysis. To combat this barrier, create a prioritization process to determine which tests are more likely to move the needle. - A Need for More People & an Increased Budget
As you gain speed, you’ll need more people and a bigger budget to keep up. Although you have the buy-in to keep moving, it’s important to show positive results to stakeholders to showcase the success of your program thus far. - Subpar Team Communication & Documentation
Lack of communication and documentation are often sources of confusion in any program. You must remove siloes and enable all internal teams to work together for the sake of transformation. Create a written optimization plan that includes responsibilities and a shared repository of your program’s impact. - Friction & HIPPO
As you scale, you may have to deal with HIPPO—the “highest-paid person’s opinion”—when making decisions. Opinions have no place in data-driven optimization. As a leader, you must take on the responsibility of spreading that message. Ignoring data for the sake of opinion will result in conversion loss and decreased growth. - Confusion Regarding Metrics
It’s time to go beyond vanity metrics such as win rate. Building a culture of experimentation means testing often, iterating on results and driving greater impact. You must design tests based on your specific customer insights instead of the metrics everyone else seems to go after.
Part III: The Optimization Process: Insights for Program Success
Control, variation, outcome and repeat. That’s essentially what you’ll need to do to optimize. And, after running 20k+ experiments for hundreds of companies, we’ve further refined the process into five specific steps:
- Build a Foundation
Set KPIs that align to business goals, identify opportunities - Validate with Data
Deploy tools to understand user mindset, issues, motivation & biases - Ideate & Prioritize
Develop hypotheses for testing and prioritize a roadmap of tests using domain knowledge - Design, Build, Launch
Execute roadmap to generate actionable insights. Results and test details accessible in proprietary dashboard - Analyze, Codify & Iterate
Quantify business impact per channel; develop ROI analysis. Review program and make future recommendations quarterly
Program success requires the cooperation of all departments, including marketing, sales, product development, customer experience, engineering and analytics. Allow us to show you how to develop and scale a strong optimization program using our expertise.