For companies in today’s digital marketplace, every customer interaction is high stakes. If a prospective customer doesn’t enter the sales funnel during their initial interactions, the odds of them returning to take action are fairly low. These missed conversions represent lost opportunities, and too many of them can be devastating.
Conversion rate optimization is a technique used to improve the chances of potential customers taking action, such as making individual purchases or signing up for a subscription.
An effective conversion rate optimization strategy saves time, money, effort, and other types of investment. It can also allow a company to explore various growth strategies by understanding how potential customers interact with public-facing aspects of the company. For example, conversion rate optimization can help a company better understand interactions with marketing emails and how to adjust content to appeal to a broader customer base.
How to Get Started with Conversion Rate Optimization
Many companies incorporate software as part of their conversion rate optimization efforts. This software analyzes the different ways potential customers interact with a company’s official website, e-commerce platform, marketing emails, customer service representatives, smartphone applications, and other assets. While conversion rate optimization software is designed to track customer purchases, this isn’t the only meaningful metric. Other KPIs measured by typical conversion rate optimization software include mailing list opt-in, application downloads, and sign-ups for free trials.
Many companies use conversion rate optimization software to get the most out of their marketing budget. For example, the typical platform has search engine optimization (SEO) features designed to boost organic search rankings, particularly page authority and domain authority. This functionality allows users to track competitors’ search rankings and profitable long-tail keywords. This information can be used to address SEO gaps and optimize visibility in search results.
When a company better understands where traffic is coming from and how it can make beneficial changes, it can use these insights to apply the 70-20-10 rule. That rule says that 70 percent of marketing investments should go to proven channels, 20 percent of investments should go to promising channels, and 10 percent of investments should go toriskier prospects with the potential for high returns.
Increasingly, companies are incorporating predictive analytics to complement their conversion rate optimization software. This emerging area of analytics is proving to be a powerful way for companies to take a proactive approach to sales and marketing. For example, predictive analytics can be used to boost conversion rates by evolving offline methods like direct phone calls to sales prospects.
How Does Predictive Analytics Boost Conversion Rate Optimization?
Predictive analytics can significantly enhance conversion rate optimization efforts, particularly in the areas of upselling and cross-selling. Pecan AI’s platform can be used to increase both types of selling through propensity modeling. This predictive modeling process involves examining customer data on an individual basis and assigning each customer to one of two classes based on whether or not they are likely to convert.
Pecan AI’s predictive analytics for cross-selling and upselling expands on propensity modeling by assigning each individual a numerical propensity score that indicates their likelihood to convert. Companies that use our platform can use this precise score to segment customers and prioritize them accordingly. They can even use this information to individually target potential customers with specific offers.
It’s important to note that done right, predictive modeling can offer even greater insight beyond the scores. When Pecan AI creates a model, it also analyzes the impact of different historical customer data points on a potential conversion. For potential customers who have yet to convert, the platform can predict their behavior by comparing their previous interactions to those who have already converted. The platform provides transparency by displaying all of the factors behind each prediction, allowing users to see which factors most influenced an individual customer’s score.
Conversion rate optimization should be an ongoing process. Predictive analytics models must be regularly updated to ensure a company’s predictions are based on the latest data. Pecan AI automates this updating process to ensure the ongoing accuracy of models’ predictions. Using up-to-date predictions, a retailer can target their efforts toward individuals most likely to convert and realize myriad benefits in the process.
Understanding the Benefits of Conversion Rate Optimization Software
Conversion rate optimization requires a significant investment of finances and other resources. Understandably, companies want to see a significant return on their investment. Conversion rate optimization software can provide major benefits.
By analyzing different types of traffic, a software platform can help a company better understand customers’ needs. The software can help identify which types of customers engage the most and which types are making purchases. Companies can use the software to study market segments based on various factors, gaining more audience insights. This information can also be used to target various segments to increase lifetime value and reduce customer churn.
Conversion rate optimization software can also help a company identify new opportunities. For example, a spike in sales from a certain region or on a specific day can reveal a previously untapped market segment.
When augmented with predictive analytics, conversion rate optimization software can help anticipate customer needs, helping companies generate repeat business. This is a very effective way to generate more revenue with minimal investment.
This combination of software can also help a company build stronger connections with its existing customer base. When a company can anticipate future needs and then meet those needs in a way that feels unintrusive, customers feel personally looked after. Customers who expect and appreciate a personalized touch will be more likely to reciprocate with additional business. Additionally, loyal customers are more likely to advocate for a business and its products.
Optimizing Conversion Rate with Predictive Analytics from Pecan AI
Predictive analytics from Pecan AI can supplement conversion rate optimization software used by retailers and e-commerce companies. Our platform helps companies optimize customer lifetime value while minimizing customer churn. Perhaps best of all, Pecan AI can transform raw customer data into cutting-edge predictions in just a few days. Our clients quickly begin to see higher conversion rates and a fast return on their investment. A short demo of our technology can help you understand how this is possible.
Ready to see what AI can do with your business’s data? Get in touch! And watch for more articles in this blog series to learn more about predictive analytics, how it works, and how it can benefit your business.
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