Conversion Rates: Judy, Jennifer, Jasmine

You remember our lovely ladies:

The first lady is Judy.  She's around 59 years old, and her behaviors tend to be "old-school" ... she buys via catalogs, and while she embraces new technology, she primarily shops via habits derived in the 1980s and 1990s.

The second lady is Jennifer.  She's around 43 years old, and her behaviors are hard to "attribute".  She hunts online for the best products at the best prices, touching many marketing channels.

The third lady is Jasmine.  She's around 27 years old.  Her behaviors are not consistent with Judy and Jennifer.  Social and Mobile are part of her entire adult experience.

We can analyze online customer behavior via each persona.  Here's a query I recently ran ... segmenting customers as of June 30, 2012, measuring online visit behavior from July 1, 2012 to July 31, 2012.  Each persona represents weighted life-to-date transactions for twelve month buyers.

Judy:

• 38,498 customers.
• 18.9% Re-Visit Rate.
• 3.568 monthly visits per visitor.
• 0.674 purchases per visitor.
• 7.3% conversion rate.
• 0.049 purchases per customer.

Jennifer:

• 143,984 customers.
• 24.3% Re-Visit Rate.
• 4.387 monthly visits per visitor.
• 1.066 purchases per visitor.
• 5.9% conversion rate.
• 0.063 purchases per customer.

Jasmine:

• 88,430 customers.
• 28.8% Re-Visit Rate.
• 5.220 monthly visits per visitor.
• 1.503 purchases per visitor.
• 5.2% conversion rate.
• 0.078 purchases per customer.

Notice that Jasmine is far more "engaged" than Judy or Jennifer.  Judy is much less likely to visit the website, and if she visits, she only visited 3.6 times in July.  Jasmine, meanwhile, is 50% more likely to visit than Judy, and will visit every 5-6 days.  Judy is more "purpose driven" than Jasmine, converting at a much higher rate.  Jasmine, however, because of her high likelihood of visit regularity, buys much more often online.

This is something the conversion optimization gurus sometimes miss ... we want Jasmine's behavior, but we optimize for Judy's behavior.  This is exactly opposite of what we should do.  We want more visits at a lower conversion rate, if the net result is a significant increase in total purchases, as it is in this example with Jasmine.

Catalogers Utilize Micro-Channels, Social Media, And Community

Take a peek at the ways catalogers are utilizing what I call "micro-channels" to communicate with consumers.

Stork Avenue offers a series of lifestyle e-mail newsletters called Stork Avenue News, keeping you up to date on Pregnancy News, Parenting News, Featured Products, and offers an RSS feed.

At the Posh Cravings community page, one can join the "Mamma's With Mojo" community. There appear to be four personas that can be subscribed to via RSS, including Eventually Eliza, Syd Says, Allie's Aboard, and It's Isabelle!

The Alternative Energy Store hosts a community page for loyal customers and prospects, featuring customer stories, a customer gallery, and a series of forums. They even feature a series of classes and webinars.

The Mepps Fishing Guide catalog utilizes RSS to communicate news about fishing new lakes, new lodges and guides, and redfishing.

The Academic Superstore archives newsletters that offer helpful tips to different audiences.

Personas and Pressure

Personas are becoming a popular way to bring data to life, to make data actionable.

In the late 1990s, we were looking for ways to reinvigorate the Eddie Bauer "brand". One way management chose to do this was to hire a team of brand marketing experts. There's no better way to generate new ideas than to hire a dozen brand marketing experts.

This team created personas of the Eddie Bauer customer --- Ken and Karen, if I remember correctly. These folks were mid 40s but felt like they were in their mid 30s, $75,000+ annual household salary, sitting in the ski lodge next to a fire watching folks ski, after arriving in an Eddie Bauer Ford Explorer.

Because these folks felt like they were younger than their mid 40s age, the brand marketing team felt our creative should skew younger, to reflect how these personas felt about themselves.

Within a few months, a new creative approach appeared in our catalogs. The 46 year old graying male wearing jeans while walking along a raging river in Alberta was replaced with a 31 year old, muscle-bound set of men carrying a canoe over their heads.

Instantly, mens pages in catalogs that were missing expectations by 10% became mens pages in catalogs that were missing expectations by 20%.

In other words, the new way of presenting men in the catalog, based on the personas created by our brand marketing team, caused a ten percent reduction in demand of mens merchandise.

There's nothing that strikes terror in the hearts of an Executive team than a ten percent decrease in sales volume, a decrease that is quite possibly self-inflicted.

The brand marketing folks fought back, suggesting that it would take Eddie Bauer customers six months, a year, or two years to get used to the new creative. They were probably correct in their assessment of the situation.

Meanwhile, inventory managers were frustrated, because they had to liquidate merchandise that used to sell better. Merchants were frustrated, because merchandise they believed in was not selling as well due to the implementation of a vision endorsed by the brand marketing experts.

I recall sitting in a conference room on a Friday afternoon, watching this brand marketing team get chewed out like you wouldn't believe. Folks left the room crying. Within a year, most of the brand marketing team either lost their jobs, or chose to leave the company. The brand marketing experiment of 1998-1999 was over.

Pressure causes leaders to make decisions that may not be in the best interest of the long-term health of the business. It is entirely possible that the brand marketing folks were doing the exact right thing for the "brand". It is also possible they unintentionally damaged the "brand".

We still have to meet short-term sales expectations, regardless of the long-term vision of brand marketing experts. This conflict causes pressure.

Personas may be the right thing for your business. It is how personas are implemented within your culture, how that implementation impacts short-term sales, and how short-term expectations are communicated to all employees, that determines how successful the business strategy will be.

NEMOA Friday

Breakfast was a lot of fun, this morning. All of the speakers hosted a table, my table was filled with really nice people, folks willing to share details about their business. Thanks so much to everybody who spent an hour with me this morning. Pete --- sorry we didn't have more of a chance to compare notes, it was nice to meet you, in person!

There was a fun session this morning, hosted by Colin Hynes, the Director of Usability at Staples. We don't always consider the fact that Staples moved $4.9 billion of merchandise via its website during 2006. Wow. After Amazon.com, can you think of anybody doing more volume than that?

Colin brought a woman up to the stage, to join him in a brief usability test of the Geerlings & Wade website. The point of Colin's presentation was not to judge the Geerlings & Wade website, but rather, to show seasoned e-commerce leaders what an e-commerce experience is like for the average customer.

The presentation included a discussion of the use of Personas to improve the website experience (including a before/after conversion rate graph --- where conversion briefly dipped after implementing changes to the site suggested by research and Persona use, then improved nicely, up to 28% more than the prior version of the website).


P.S.: DMNews covered a few of the comments I made during my presentation on Thursday.