Peep Laja is my special guest for this post, and he is the leading conversion rate optimization expert in our industry with his blog ConversionXL.
And since I’ll be speaking at Peep’s event in Austin on March 28-30th, I wanted to get him on the blog to teach you how to implement a smarter testing strategies for your ecommerce store.
You might not know this about me, but what originally made me famous in this industry was my conversion rate optimization strategies and tactics.
Now I focus more on direct response marketing and paid amplification, but I still love nerding out on data and testing and talking to experts who do that for a living.
In this post, you’ll meet ConversionXL founder Peep Laja and learn his strategy for testing and optimizing ecommerce stores, how to begin identifying the problems on your own site and a few CRO tactics to get you started.
Then I’ll do a shameless pitch for his event, because I’m super excited to speak at it.
And if you already planning on attending, make sure to use the discount code: “ezra-sent-me” to save 20% off your tickets.
The 80/20 Rule of CRO
I think there’s a lot of mystery around how to do A/B testing or multivariate testing for ecommerce business owners. But Peep’s been doing it for seven years, so I asked him where he would start with a new brand that’s never run a CRO test and what his playbook would be:
“As I see it, the conversion optimization in general consists of two things: 80% of conversion optimization is actually research, gathering data, analyzing data. And the other 20% is testing.
…80% of the work is figuring out what is the problem with my site: Why aren’t I selling more? Or smaller details like: What’s the problem with my product page? What are the problems with my card pages? Or my positioning?
Because only when you understand what the problem is, can you decide what might be good solutions to these problems — and even if you know what the problem is, you don’t know what the best solution is. That’s why you need to test.
So, when I work on a brand new site that I’ve never seen before, I always, always, always start with research. I look at Google Analytics to see where people are dropping off.”
Google Analytics: the Nitty-Gritty
As an ecommerce business owner, you would benefit greatly from tracking “goals” in Google Analytics. It will tell you from which pages people leave your website, how many people make it from the product page to the shopping cart — things like that. And Peep can tell you how to look even deeper:
“And you don’t need to stop at goals. You can get more nitty-gritty, where every single click, every single interaction has to be recorded. If you use Google Analytics, you should use events.
For instance in category pages, if they change the sort order from bestselling to cheapest first, you need to record that; or if they use certain filters on your category pages by size or price or whatever. Because you want to look for correlations and which behaviors correlate with higher sales.
People who sort products from least expensive to the most expensive, maybe those people convert more, maybe even spend more money. So we change our sort order from default to cheapest prices first, things like that.
Google Analytics is always the number one thing to view, but Google Analytics only tells you what is happening, how much and where — it doesn’t tell you why.
So, in addition to analytics, you need the qualitative side.”
Qualitative Data: Surveys & In-Cart Polls
For my ecommerce business, Boom By Cindy Joseph, I use post-purchase surveys to directly communicate with my customers and find out ways to improve.
So I asked Peep how exactly he uses customer surveys for CRO:
“You need to talk to your buyers. Figure out what kind of problems they had, hesitations, doubts while they’re still remember their purchasing experience.
You might send a survey a couple hours after they buy when it’s still fresh in their mind. I recommend incentivizing them with a coupon, a free gift or whatever you can afford. You want like 200-250 responses, and you want to only ask open-ended questions like:
‘Specifically what was the one thing that nearly stopped you from purchasing? What kind of doubts and hesitations did you have? What kind of questions did you have about our products that you couldn’t find answers to?’
You want to understand their intent and what problem were they solving for themselves.”
Not Sure What’s Wrong? Ask.
“You can also put polls right on your pages.
I have this case where only 30% of people proceeded to the checkout page when the industry average is like 50%. We could not figure out what was wrong with it. So we put an on-site poll where we asked on that same page:
‘What is holding you back from completing this purchase?’
With Hot Jar we triggered a popover after there had been like 15 or 20 seconds of inactivity on the page. And then we we waited…
Depending on the traffic, you get like a 2-4% response rate on average. So you might have to wait a couple of weeks to get 200-250 responses. But what they told us was ‘shipping costs’ …but just by looking at this page you can’t put two and two together.”
Quick Win for Your Store
“If you have forms of any kind, you need form analytics.”
According to Peep, billing and shipping forms are another problem area, so here’s a quick win for eCommerce stores:
Shopify recently added the Google autofill, and everybody can add this technology because that’s a free API that works for everybody.
When NOT to Invest in Split Testing
But what if you don’t have the capital to invest in a CRO agency, and you don’t fully have the skillset yourself, how do you do a good enough job?
Should you set up some real basic tests so you’re in the game — or should you save up capital until you can afford to hire an expert? Here was Pep’s answer:
“First of all, I ask myself can I even run A/B test? Meaning do I have enough volume for statistics to give me accurate answers?
My ballpark is if your store has less than a 1,000 transactions a month — doesn’t matter what the price points — if it’s less than 1,000 purchases a month, it’s too early for A/B testing. You need adequate sample sizes before stats will tell you anything useful or accurate.
However, you can still do optimization, you just can’t do testing and conversion optimization.”
How to Optimize Without Split Tests
“As I said, conversion rate optimization is 80% about research and figuring out the problems. So, let’s say that you do this analysis and you find 50 problems that you know that are there.
You may not have 1,000+ transactions to test and see if your solution worked or how well, so here’s what I suggest that you do now:
Come up with your best idea for a solution to those 50 problems and just implement all 50 solutions at once. Make changes on your product pages, checkout cart, homepage… you name it.
Change everything at the same time, because the more changes you make, the higher the likelihood that all combined they will have an impact that you can detect with your naked eye.
If you look at your conversion rate in Google Analytics, it fluctuates 10% week by week. So if you change something and it gets 7% better, you can’t see it in the data actually — you need to get a 20% improvement or higher.
But, if you had 100 purchases a week and now you get 120 purchases a week or more consistently… It’s probably because of the changes you made and it’s not the normal fluctuation.”
Get 20% Off Your Ticket to ConversionXL Live with Discount Code: “ezra-sent-me”
So this is where I go into the shameless pitch for Peep’s event, because I’m a huge fan of his content and of going to industry events.
A lot of my major leaps forward in my career and a lot of the influential relationships that I have, all came from getting out of my daily routine and putting all my attention on my business during a live event.
Heck, I even send my employees to events. So, let’s say you are someone who’s interested in this subject matter, I asked Peep, “Why should you go to this event?” Here’s what he said:
“The event is three days long, and you should come if you’re interested in one of these three topics:
1. Growth marketing
2. Conversion optimization and testing
3. Digital analytics
All the content of the event is about how to do those three things better, and we have a head of growth for Instagram and Shopify coming. We also have optimization people from Kayak, Airbnb and Google.
And our event is designed to make you meet people. That’s why we booked a full resort. It’s on the outskirts of Austin, Texas and your event ticket includes two hotel nights and all your meals.
Everybody, you and your peers, all stay in the same place for three days. There are long parties, people staying up until like 3-4 am having conversations, connecting, and learning from each other.
Because the problems that you’re having, other people have had those problems too. And maybe they’ve figured out some good solutions that might work for you. So we learn together, connect and have fun.”
And Peep will give you 20% off your ticket when you enter discount code “ezra-sent-me” at checkout.
If you’re interested: Click here for more details on Peep’s event.
P.S. I also asked Peep for a blog post that he felt was most relevant to ecommerce business owners so that you could get a sense of his great content and what he focuses on.
Here is the ConversionXL blog post he picked:
0:14 Pep is the leading conversion rate optimization expert in our industry with his blog conversionxl.com
6:25 80% of conversion optimization is actually research, gathering data, analyzing data and 20% is testing
8:40 You need to talk to your buyers, you know, survey them after they complete that purchase to figure out like what kind of problems they had, hesitations, doubts while they still freshly remembered their purchasing experience
9:38 You want to understand their intent like what problem were they solving for themselves
13:40 You need adequate sample sizes before stats will tell you anything useful or accurate
Click Here For Video Transcript
Ezra: Pep Laja, ladies, and gentlemen. Hey y’all, Ezra here with you and I’ve got a special guest today, Pep Laja and Pep is sort of the leading conversion rate optimization expert in our industry with his blog conversionxl.com and I am a big fan of Pep because what made me famous in this industry. Many of you follow me today don’t know this, what made me famous was my conversation rate optimization strategies and tactics. That’s what was my first course was on and that’s what kind of what brought me my initial exposure in this industry.
And I’ve since sort of moved on to focusing more on direct response marketing and paid amplification but I always love nerding out on data and testing and tweaking and I always love meeting folks who do that for a living. And I got the opportunity to meet Pep down at Andrew Youderian’s eCommerceFuel event and we kinda got on well. It was cool to get to meet you and now I’m actually going to be speaking at Pep’s event in Austin, Texas, I believe on March 28th and 29th, are those the correct dates?
Peep: Twenty eighth to 30.
Ezra: Yeah. March 28th to 30th in Austin, Texas. If you’re interested in testing and optimizing your business and making more from your eCommerce store with the same mode of traffic, it’s a must-attend event and this presentation is to just kind of, you know, get to know Pep a little bit, hear his story, get some tactics and strategies from him and then also talk a little bit about the event.
I apologize for my lack of video. I am working from the road #digitalnomad which is the lingo term in our industry that, by the way, I’m not a huge fan of that lingo term but the reason I don’t have a video is because my laptop’s kinda funky right now. But anyways Pep, you know, thanks for coming on the show.
Peep: Thank you for having me. It’s a pleasure.
Ezra: Yeah man. So, tell us a little bit about yourself, you know how you got started, where you came from, how you fell in this world, what you’re up to, you know, that kind of thing.
Peep: Yeah. Many moons ago, maybe 10 years ago or so, I was actually working with sales. I was a nonprofit fundraiser and then I had the itch to travel the world and to do some digital nomading. So I found this gig through an early internet television company that I was on sales through Skype and stuff and I could live anywhere so I just, “Hey, why not go to Panama?” So I did, but that company lost all its funding and I ran out of money and so I found myself in Panama with no money.
Ezra: Oh no.
Peep: And back then I didn’t speak any Spanish. So, I couldn’t find a job. My skills back then were like SEO, Adwords, things like that and I offered, you know, I tried to find the job and they said, “Well, we don’t need anybody but we need a sale but not anybody full-time and so I put two and two together and started my SEO, PPC agency in Panama. This was in 2007.
Ezra: Wow and there wasn’t a lot of certain marketing services agencies in South America at that time.
Peep: Well, yeah man. I was cold emailing people. I cold email the CEO of a local airline and landed this big company as well by just emailing them out of the blue. And then, you know, things were good and that’s when I first learned that even when I got companies ranking like first page on Google which wasn’t that hard back then, they weren’t necessarily making more money. So, that’s when I first discovered that there’s this thing about called conversion optimization.
Started running my first A/B test and so on and then much like yourself, I got into direct response marketing, affiliate marketing of the, you know, doing more digital nomading and backpacking in South America and then I had a sister startup that failed and so on. But in 2011, I finally decided that I can’t be everything and do all kinds of market, I need to pick. So I just picked quite randomly, to be honest, that I’m gonna be a conversion guy.
Ezra: And by the way, that was a good choice because there’s not a lot of them and I also I’m a real fan of the deep rather than wide strategy. Go deep on one thing, get really good at it instead of being this…
Peep: Yeah. As an agency, like now I have an agency. I’ve had it for seven years now, CRO agent seekers. When you do just one thing, two things happen: A, the perception of your expertise goes up because, you know, you only claim to do one thing and your actual expertise goes up because you just do one thing. And so seven years ago I started this conversion optimization agency which is still around and then growing, a blog conversion Excel which took off very quickly and now a year and a half ago, I also launched CXL Institute which is online courses about conversion optimization, digital analytics, data different marketing.
Ezra: I think my good friend Drusen Maki [SP] did a course with you, right?
Peep: Yes exactly, eCommerce growth course, yeah.
Ezra: So you have some real, I mean, beyond yourself legit experts like teaching under your brand.
Peep: Exactly. So that’s what we do, we seek out who is like the best at what they do and say, you know, try to somehow convince them to do a course for us.
Ezra: Awesome. Cool. So you’re kind of like, you know, in it and what’s the other thing about people who have education businesses like I don’t love folks who have education businesses who aren’t actually doing it and you’re obviously actually doing it. So, that’s super cool. So to that end, I think that there’s sort of mystery around how to do A/B testing or multivariate testing conversion optimization for eCommerce business owners.
People find it hard, they don’t know what technology stack to use and sort of we’ve been working on this with our Zipify pages application for Shopify store owners, we’ve built in some testing functionality in there. But, when you’re looking at a new brand, let’s say it’s a brand that’s doing you know $100,000 a year up to $4,000,000 a year right, so six-figure at a low seven-figure brand.
When you’re starting out if you’ve never run tests before, where do you start? How do you approach that? Do you look at a certain set of data ahead of time? Do you always start with a shopping cart? Do you always start with speed optimization, mobile optimization, kind of what’s your sort of playbook there?
Peep: Yeah. As I see, the conversion optimization in general consists of two things, 80% of conversion optimization is actually research, gathering data, analyzing data and 20% is testing because like the 80% of the work is figuring out what is the problem with my site. Why aren’t I selling more and going in like nitty-gritty details like, what’s the problem with my product page? What are the problems with my card pages or my positioning or my, you know, whatever it is.
Because only if you understand what the problem is what might be good solutions to these problems and even if you know what the problem is, you don’t know what the best solution is, that’s why you need to test. So, when I weren’t working on a brand new site that I’ve never seen before, always, always, always start with conversion research which means I look at visual analytics to see where people are dropping off, you know, whether it’s you know…
Ezra: So this is sort of an advocation for having, for example, goals set up where you can see what pages people are dropping off on, right? Like how many people, you know, make it from the product page to the shopping cart, things like that.
Peep: Yeah, absolutely. And not just goal but even like getting more nitty-gritty where every single click, every single interaction has to be recorded like if you use Google Analytics, you should use events. Like for instance in category pages, if they change the sort order from, you know, best selling to cheapest first, you need to record or if they use certain filters on your category pages by size or price or whatever. Because what you wanna understand you wanna look for correlations, which behaviors correlate with higher sales.
So, if people who sort pages by let’s say, sort products from least expensive to the most expensive, maybe those people who do that convert more, maybe even spend more money. So what if we would change our sort order to default to, you know, cheapest prices first, things like that. So Google Analytics, always number one thing to go but in Google Analytics only tells you what is happening, how much and where, doesn’t tell you why. So, in addition to analytics, you need the qualitative side. So you need to talk to your buyers, you know, survey them after they complete that purchase to figure out like what kind of problems they had, hesitations, doubts while they still freshly remembered their purchasing experience, things like that.
Ezra: Do you send them out post-purchase surveys within the first couple of days after a purchase?
Peep: Or even sooner you might also, you know, a couple of hours later when it’s still fresh in their mind. I do recommend incentivizing to get a higher response rate like throw in a coupon, a free gift or whatever you can afford and, you know, you wanna in like 200/250 responses and you wanna only ask open-ended questions like specifically like what was the one thing that nearly stopped you from purchasing? What kind of doubts and hesitations did you have? What kind of questions did you have about our products that you couldn’t find answers to, things like this.
Also, you wanna understand their intent like what problem were they solving for themselves? I mean, depending what you sell, it might be also obvious. And then you also wanna put poles on your pages like I have this case where this is a cart page and only 30% of people proceeded to the checkout page and typical on an average eCommerce site is like 50%. So a massive drop and just by looking at the page, we could not figure out what was wrong with it. So we put like an on-site poll or actually like a survey. So basically, we ask on that very page what is holding you back from completing this purchase?
Ezra: Like as a popover or something?
Peep: Yeah. We triggered it after there had been like 15 or 20 seconds of like inactivity on the page. So, like it popped out in the lower right corner. I think we used [inaudible 00:10:29] in that case. And then we, you know, we waited depending on the traffic, you get like a two to four percent response rate on average. So then, you know, depending on your traffic, you might have to wait a couple of weeks to a month to get enough responses in like 200/250. And then what they told us was shipping costs and this company was selling cooking stuff like pots, pans, forks or things like that and it was actually the shipping costs were ridiculous. Like buying a $2 fork and knife pair, shipping was like 20 bucks and just by looking at this page you just don’t put two and two together and then, you know, we told the client that this is your biggest business problem. Of course, we can’t A/B test a solution to it, you just need to fix this business problem like you’re…
Ezra: Like stop charging for shipping or don’t show the shipping price on the cart page?
Peep: Yeah, like I guess they had very high shipping costs. So, they needed to figure out a different way to ship products and they did. So, everybody was happy. But, so sometimes, you know, you can test ideas for solutions, sometimes you can’t. If you have forums on your page and most, you know, eCommerce sites have forums like billing and shipping forums, like which specific forum fields are causing problems, which specific forum fields are causing hesitation? Like people don’t know what to enter or they enter something that causes an error message, like err [SP] you did it incorrectly or something.
Ezra: Quick wind for eCommerce stores and Shopify recently added the Google autofill, that’s been helping.
Peep: Yeah. And everybody could add that because that’s a free API that provides everybody, everybody should do that. But, like if you have forums of any kind, you need forum analytics, separate set of tools. You could, of course, set up tracking with Google time manager as well but…
Ezra: So let’s say, for example, you don’t have…this is gonna be a hard question, you don’t have the capital to invest in a CRO agency and you don’t probably fully have the skill set yourself, how do you do a good enough job? Do you just set up some real basic simple tests just so you’re in the game? Do you save up capital until you can afford to hire an expert, how do you handle that?
Peep: So, first of all, I ask myself can I even run A/B test, meaning like, do I have enough volume for statistics to give me accurate answers? So, my ballpark is if your store has less than a thousand transactions a month, doesn’t matter what the price points are whether it’s like five bucks a pop or 5,000 bucks a purchase. But, like if it’s less than 1,000 purchases a month, it’s too early for you to even think about A/B testing, work on other stuff.
Ezra: So, you kinda think of A/B testing really as an enterprise level store. I mean, if you figured the average price point for an eCommerce offer to be somewhere around 20 bucks, you’re looking at people who are $20,000 a month or more in revenue to even begin considering this, your quarter million dollar business.
Peep: Well because, you know math, you can’t change the way math or statistics work so you need adequate sample sizes before stats will tell you anything useful or accurate.
Ezra: I mean that’s kind of a good baseline, it’s like, “Hey listen, once you get to a quarter million dollars in revenue per year on average, let’s say that’s a good time to consider this.” I mean, obviously, if you have really high price points you won’t have a thousand transactions a month.
Peep: Yeah. I don’t think it’s about the revenue numbers, it’s about exactly the transaction volume because we need to track the number of conversions per variation. And so I mean when you go, of course, for revenue per visitor, you need even bigger sample sizes because, you know, it’s variable…
Ezra: What do you think about this as just throwing us out there, an event that is further up the purchase cycle such as like an add to cart event.
Peep: I mean, it’s better than nothing. The problem is that this type of things, there’s no causal or like you cannot say that if we get more people at check ups at number one or two that this equals more purchases. So, you might be spending a lot of time building experiments and thinking about it. Well, but you can’t measure whether anything actually got better.
Ezra: For sure. So, if you’re not at a thousand transactions a month, then it’s good to know that that’s kind of your mark that when you can embark on this journey of testing.
Peep: Yes. However, it is also important to note that you can still do optimization, you just can’t do testing and conversion optimization. As I said, it’s 80% about research and figuring out the problems. Now, let’s say that you do this analysis and, I mean, I can drop you a link that goes into in depth, you know, like how to do it but let’s say you find 50 problems that you know that are there. So, you can’t test and see if your solution worked or how well.
But what you can do or should do now is that you just come up with your best idea for a solution and just implement all 50 solutions at once. So you change everything at once, make changes on your product pages, check out cart, homepage, you know, you name it. Because the more changes you make, the higher the likelihood that all combined they will have an impact that you can detect with your naked eye so to speak. Because you know in Google Analytics, if you look at your conversion rate it’s always up and down like 10% up and down week by week.
So if you just change something and it gets 7% better, you won’t see it in the data actually. So, you need to get a 20% improvement or higher. So, if you got like 100 purchases a week and now you get 120 purchases a week or more consistently…
Ezra: Then you did something right.
Peep: It’s probably because of the changes you made and it’s not the, you know, the normal fluctuation.
Ezra: Yeah, right on, super cool. Well, so let’s say you are someone who’s interested in this subject matter, this is now why we go into the shameless pitch for your event because one of the things that I’m a huge fan of is events. I think that like a lot of my major leaps forward in my career, a lot of the major and influential relationships that I have, have come from getting out of my daily routine and putting all my attention on my business through the form of a live event.
So I’m a huge fan of these things, I send my actual employees, I send them out to events, I go to events, I speak at events, I’m speaking at your event. So, why should someone come to your event? Who should come? Because look, the people listening to this are gonna be eCommerce business owners because that’s my community. Give us a little bit on like why they should come to this thing.
Peep: Right. So, the event is three days and you should come if you’re interested in one of these three topics or all of them which is growth, growing your business, growth marketing, optimization, conversion optimization and testing and three, digital analytics. So, the content of the event is about those three things, how to do it better and we have like growth leaders from impressive companies, you know…
Ezra: People like Ezra Firestone.
Peep: Ezra Firestone. The Ezra is there and we have a head of growth for off Instagram, Shopify…
Ezra: Okay. So, those people have me outmatched.
Peep: We have like optimization people from like Kayak and Airbnb and Google and you name it so…
Ezra: Yeah. I hear rave reviews about your event man, you know, so I’m super excited about it.
Peep: Yeah. And exactly what you said about meeting people, our event is designed to make you meet people because the whole event…we booked the full resort. A fancy resort for our event, it’s on the outskirts of Austin, Texas and your event ticket includes two hotel nights, all meals. So you basically just show up and everybody, you and your peers they all stay in the same place for three days and you know there’s long parties, you know, people are staying up until like 03:00 a.m., 04:00 a.m.
And having conversations, connecting, learning from your peers because the problems that you’re having, other people have had those problems, they’ve maybe figured out some good solutions that might work for you as well. So you learn, you connect, we have fun.
Ezra: One hundred percent and I’m gonna include a link under this video so you can check out all the details on Pep’s event and I will be there with my team. So, if you wanna hang out with me, come on out, its gonna be a great event. Pep, thank you so much for taking the time. I also asked you for some blog posts that you felt were relevant to eCommerce business owners so that folks on in my community could get a sense of your content and what you focus on and so you have sent those over to me, thank you for that.
I’ll put those under this video as well so you guys can get a sense of Pep’s content. The event’s gonna be amazing. I hope to see you there and Pep, thank you for the time.
Peep: Thank you Ezra.