Web Arts AG is a leading and the world’s largest Conversion Rate Optimisation agency, that combines ‘qualitative, quantitative, and strategic’ methodologies that ‘connect the dots for their clients to help them grow faster’.
Based in Frankfurt, Germany – I met the founder of this agency, André Morys, when he spoke at the Digital Elite camp in Estonia earlier this year run by Peep Laja (who was on episode 15).
André approach to Conversion Rate Optimisation is deep rooted in the social sciences.
André’s and Web Art’s CRO methodology is founded on:
André is also a published author in the subject of CRO.
Turn up the volume 2Xers, because today’s podcast is filled with powerful growth-hacking tips and expert insights that will certainly help grow or 2X your business.
André begins by stating that the organization itself is the biggest growth-killer, largely because ‘you can’t read the label from inside the bottle.’ We talk about data analysis and the importance of combining psychological principles and strategy, before we delve deep into psychological engineering and the power of implicit coding.
Optimizing for growth requires three things:
2. Qualitative analysis, and
3. Quantitative execution.
I call this model the Growth Canvas
How can you prioritize things so you have big growth levers on one hand, and all that little stuff that you could do later maybe on the other side?’
(01:46) Introducing André Morys
(04:30) Analysis and CRO
(11:25) CRO in the Context of eCommerce
(24:21) Psychology, Triggers and Implicit Codes
(41:51) Parting Advice
Analysis is required from the outside because…we say, ‘You’re not able to read the label from inside the bottle.’
I think conversion optimization as a topic still needs maybe 10 more years to really find its way, what kind of skills do people inside this discipline really need.
I think the best optimizers know how to combine all that psychological knowledge with quantitative methods like A/B testing.
The conversion psychology growth hacking way is understand people and their principles. Realize they’re curious, they love little red circles with numbers inside.
And the first thing that is important to learn is that people quickly perceive things on an unconscious level and build their own story into their mind about what’s going on with this company.
The job of optimizers is to change user’s behavior so you need to know how communication works, and that you have to address your message on both levels.
On this episode of the 2X eCommerce Podcast Show I am going to be talking with the founder of Web Arts AG. It is one of the largest and a leading world class Conversion Rate Optimization agency. We’re going to be talking about GROWING & SCALING an ecommerce business with CRO. Do stay tuned!
[Intro clip] Welcome to the 2X eCommerce podcast show where we interview founders of fast growing seven and eight figure eCommerce businesses and eCommerce experts. They’ll tell their stories, share how they 2X’d their businesses and inspire you to take action in your own online retail business today. And now, here he is, the man in the mix, Kunle Campbell.
Kunle: Hi 2Xers, welcome to the 2X Ecommerce Podcasts Show. I’m your host, Kunle Campbell and this is 2x eCommerce, the podcast dedicated to rapid growth in online retail, not of enterprise, neither for micro-retailers, but more in the mid-tier. For ambitious online retailers looking to scale their businesses by 2X, 3X, and even 10X. I hand-pick the guests that come on this show, to share their expertise and experience. And my criteria is based on one question, ‘Can my guest provide valuable information and insights to help you my listeners rapidly grow metrics such as conversions, average order value, repeat customers, traffic, and ultimately sales?’ If the answer is a resounding YES, I try my best to get them on this show.
My guest on today’s show is André Morys. If you have attended any of the major Conversion Rate Optimization conferences, then you will most likely have heard my guest on today speak at these conferences.
I actually met him and his team earlier this year at the Digital Elite camp run by Peep Laja (remember Peep Laja from the earlier episodes?) in Estonia. He spoke about Neuromarketing and how it can be applied to Conversion Rate Optimisation. It was hugely insightful.
André is the Founder and CEO of Web Arts. It’s a leading full-service enterprise Conversion Rate Agency based in Frankfurt, in Germany. They work with leading German and European brands such as C&A, KONICA MINOLTA, SAGE, O2 and MONSOON. These guys are enterprise-level, right, so he has a lot to bring in from what he’s seeing at enterprise, at scale.
André’s approach to Conversion Rate Optimisation is deep rooted in the social sciences. André’s and Web Art’s CRO methodology is founded on behavioral economics, neuromarketing, game theory (gamification), social psychology and consumer psychology. André is also a published author. And it is with great pleasure to welcome André to the show. Welcome to the show, André!
André: Hi Kunle, thanks for having me. Brilliant.
Kunle: Fantastic, fantastic. Could you take a minute or two to tell my listeners a bit about yourself and Web Arts, please?
André: So mostly, I founded Web Arts in 1996 as an interactive agency. I needed to bridge some time before I started studying. Actually I never studied anything directly off the school. We started and I would say in 2000 we crossed the first million, then it was still deutsche marks. (laughs) So, today we’ve realized that we are focused on a method of logical optimization. So we work mostly for big enterprises like top 30, top 50 German retailers, and we do a lot of consulting analysis but also hands-on conversion optimization. So my job mainly is to connect the dots for our clients and to help them grow faster.
Kunle: Great stuff. I love the fact that you connect the dots. You make a good picture. Let’s go into the analysis. What’s the difference between analysis at enterprise and scale as compared to actual CRO work. How do they compare? Are they two different sides of your business?
André: Yeah. I think there is a big growth-killer for every enterprise as it’s growing. And I know the word is often used, but I think it’s good to repeat it on and on. This growth-killer, I would call it silos. So the organization is the biggest growth-killer in my point of view. Analysis is required from the outside because companies are not able…we say, ‘You’re not able to read the label from inside the bottle,’ right? So that’s what’s happening, especially in companies that are growing. They are strong in data analysis, they have their data scientists, but they have so many data they don’t see what really is responsible for their conversion growth rates. On the other hand, they may be make dozens of usability labs, they still don’t see the big picture. So, they end up in tweaking buttons and testing templates, but that’s not effective. So, often we are called to give them a bigger picture and to highlight the big obstacles, and separate them from all this little stuff, they could do. So it’s all… Analysis means, ‘How can you prioritize things so you have big growth levers on one hand, and all that little stuff that you could do later maybe on the other side?’
Kunle: And is this from a user experience standpoint or does it go into other areas of their business?
André: It means, as I said it’s important to connect the dots, so the combined different methods. So for example, a classical user or UX research means people invite their customers to come into their office and say, ‘Hey, let’s have a online shop. Could you please use it, please order some jeans, size XYZ.’ And then they are recorded and people look at their faces and they do eye-tracking and all that stuff. But they don’t get the point because first of all, people are invited so they already know that big corporation is the site that is being tested. So I won’t reply open, I will answer the way where I think they wish me to answer. Or I as a participant, I start to get extremely critical. But anyway, they don’t get the real stuff out of something like this because also, people are not aware about certain things like psychological principles. So you should have another method like expert evaluation people that are really skilled in psychology, behavioral economics, to analyze your business model, to look at your competitors, and to find out are there any psychological things that could help? But actually these experts, they don’t know how real people perceive the website and the brand, and how is the implicit perception of an online shop, for example. So, that’s why I think you always need both. And I could continue with…people should do personas, psychological profiling, user journey mapping…so the more methods you combine, the clearer is the picture you get, like the resolution of the digital image, right? So you need more methods to get to the truth. So, that’s where we help.
Kunle: Gotcha, gotcha. And I can imagine you know at the enterprise, there’s so much data, so much traffic they need to distill to get a clearer picture on how to further optimize their businesses.
André: Yes. Yes. It’s important to separate, let’s say, can I say, the bullshit…or is it a no-explicit…? (laughs)
Kunle: Well, yeah it’s all right. It’s all right. (laughs)
André: …from the real stuff that helps you, you know. And the lists, the backlogs of the company, they’re so big and they wasted time with so much things that are not effective. So one example, everybody is now talking about growth hacking and I’m sure that most of the enterprises, bigger enterprises, they think that, ‘Yeah growth hacking sounds interesting. But maybe it’s more for the Silicon Valley SaaS software startups.’ They don’t know that for example the dominance of Amazon – you could also call it growth hacking, you know. Amazon charges you money to get a Prime Member. So as a user you will be very much more committed to Amazon if you pay it already in advance for their service. And on the other hand, Amazon made it really easy to order so they form a habit. Now consistency and commitment is one very well-known psychological principle. That easiness is important for forming habits is also psychologically well-known. And that leads to, I think Peep Laja, he was talking about 74% conversion rate for Prime Users, Amazon, so that’s what I would call a growth hack. And it’s important for e-commerce companies to learn such principles, to learn what psychological principles exist, ‘How could I apply them to my business model?’ Because if you’re too deep into the business, you won’t see that.
Kunle: Absolutely. So this is more like social engineering into the business.
André: Yeah I would, it’s a cool word, I like it. I would call it psychological engineering. And it’s important that you get really a radical user-centric perspective when you analyze things. And that’s what I mean with a bottle. You can’t have that perspective when you’re so deep into your stuff.
Kunle: Okay, so I have a question. From the interactions I’ve had with various conversion rate experts, I can split them into two camps. One are people like yourself that are deep rooted into these principles: into psychology and social sciences basically, neuromarketing, behavioral economics, game theory, gamification and social psychology. And on the other camp, you have people quite obsessed with A/B split test and and MVT test and more about the technical aspects of CRO. Now my question is, say I’m a midtier retailer and you know, I’m turning over and selling perhaps you know a men’s essentials like underwear and all that kind of stuff. Just underwear, let’s hypothetically say we’re selling men’s underwear online. And I’m looking to scale from $5 million to my target is next year I want to scale to $10 or $15 million. How do I identify a CRO expert that would look beyond just you know the technicalities of optimization and interfaces and kind of have a deep dive into my business, my competitors business, see what’s ticking, and offer a little tweak similar to as you alluded to earlier, Amazon Prime. Would I need to speak to a range of experts or would a CRO expert in this other camp where you’re coming from be essential, be just necessary really?
André: I would first… I give the advice that when you’re talking about these camps of optimizes, again were talking about silos. I would not talk to somebody who’s a specialist in just one of these areas because you will miss a lot of this picture. I think the best optimizers know how to combine all that psychological knowledge with quantitative methods like A/B testing. Because, I recently published a model, it’s called the Growth Canvas. It’s actually just in German sorry, when you Google it you maybe get a German blog post. But you can translate it with Google. But it says you need these qualitative skills and ability to develop powerful hypotheses. Then you need skills to prioritize your hypotheses as well, and separate the good stuff from the bad stuff. And then, next means use quantitative methods as A/B testing, personalization, CRM, email marketing, all that kind of stuff, to execute your growth. So all the time you’re speaking to somebody who’s just able to overview one of these areas, you don’t use the real potential. And additionally, I would add a third layer. And the third layer is strategy and that was also in my talk in Estonia. If you don’t have a program, a process, a systematic approach to optimization that contains a business plan where you set your goals like how many tests, with what uplift, how can I get a better optimize the next year?… If you don’t have that strategic level, then you will also lose a lot of potential. And that’s why I think optimizing for growth needs all three things: strategy, qualitative analysis, and then quantitative execution.
Kunle: Gotcha. Gotcha. It all makes sense. Makes a lot of sense. Okay, question. So from a mid tier standpoint, online retail standpoint, what portion of time should e-tailers listening to this spend on acquisition versus CRO optimization?
André: Yeah, there is a old rule saying, not measured in time that measured in budget, that companies should spend like 15% of their budget, of their traffic acquisition budget, that they should spend it for optimization. And it does not sound a lot but if you know the numbers for Google AdWords budget and so on, and let’s take social media and whatever also into that, then you would realize that most of the companies spend maybe one or two or three percent. And that’s way too few. It’s just beginning you know. There are some people testing around, I call it testing around because they have the ability to use an A/B testing tool. They set up whatever comes to their mind. And there you waste potential. You only have a number of testing slots a year, so use them for proper things that work well. And yeah, if you do that, you would see it’s maybe much more expensive and much more time-consuming then we thought. It’s maybe much more than we actually do, but the ROI is a multiple times higher. And that’s what we call growth, right?
Kunle: Yeah, that’s exactly where I was going to lead to. My next question really had to do with the uplift in sales and how that would align with someone who wanted to double their business. Is a CRO enough as a channel to double the business? Obviously a smaller business is likely to grow to double, than a very established business with significant market share. But from what you’ve seen in the front line, do you have any kind of case studies or examples of sort of midtier companies, really agile midtier companies, that have used CRO to significantly scale and grow their business, and what did they do?
André: Yes, I see them. And I know that it’s repetitive talking about Amazon or maybe Booking.com but these are the companies. In Germany, Amazon doubled their revenue in 3 point something years. They’re the only ones that have a really let’s say disruptive growth-curve. And again, it’s all about this stuff that we’re talking about: psychology, quantitative analysis. The difference between Amazon and the other retailers is that they don’t build the resources or allocate the resources, they don’t build the program on the systematic approach. Of course it is possible. And the problem we have with the term ‘conversion rate optimization’ is that for most strategic decision makers, the C – level, the C suite, they think conversion optimization means, ‘Yeah, let’s test red button versus a green button,’ so that’s a topic not strategically relevant for growth. It’s somewhere in the online marketing department. And that’s a big mistake. I think Booking.com and Amazon – they got it, they realize what ‘conversion optimization’ really means.
Kunle: It seems like it’s driven by leadership, it’s a top-down approach really. Once the CEO or the COO actually has that growth focus and looks at it very strategically and then works it down as you alluded to earlier, quantitative and qualitatively, there would be significant growth results. Okay, that makes a lot of sense.
André: Yeah. It starts with a job title. Does the company have a CMO or a Vice President of Marketing, or is he called a Vice President of Growth or Gowth Marketing. Is there anybody really responsible for growth? And that’s what I say, a systematic approach contains a goal. If nobody sets a goal for the CRO people, they will test around. So it needs both. It needs a deeper understanding for the C-level and setting strategic growth. But CRO is still a bottom-up topic, not a top-down. We are testing based from the consumer’s perspective. So maybe there’s still also some let’s say cultural frictions you know, like C-level has to accept that he is not the decision-maker when it’s up to A/B testing and so on. That’s sometimes not so easy. It’s always the engineering guys, you know, Geoff Bisson (sp?), he’s a software engineer, right? He’s not a marketing guy. Maybe some people get the difference.
Kunle: And then there’s this issue with decision by committee where the highest person highest-paid person in the room actually makes a decision when you should let the data actually tell you.
André: Yeah. I mean it’s not that these people should not make decisions. They should make decisions about optimization programs and their budget and how to be more agile than they were last year and how to optimize their average uplift or test success rate. Those are the important decisions. Not decide about should the design be like this or that, or which ad agency should we hire. These are 90’s decisions you know.
Kunle: (laughs) Okay, so we’ve got the methodology, we’ve got the steps from a strategy, quantitative and qualitative standpoint. The question has got to do with who should you hire – consultants, agency – as a midtier, and how should you go about hiring a CRO consultant or expert that would drive significant growth in ecommerc?
André: I think that’s what I said earlier about find somebody that combines all these different abilities. The qualitative, the quantitative, and the strategic. And we know how hard it is to find companies like that. Because our discipline is actually kind of new. And let’s say if you go for the big consulting companies, you maybe have the strategic part, you maybe have the quantitative part, you’re missing the qualitative. You could go to a UX agency, they are maybe very skilled with personas and psychology and all that stuff but what we found out, a lot of UX companies are missing the A/B testing part, the quantitative, and the strategic. So what I want to say is it’s like a puzzle and there’s always one piece missing so when we build our network of international companies, so we’re working together with a couple of companies like WiderFunnel in the US or PRWD in the UK, so we focus on finding companies that have all of these skills. And I can tell you, because I needed to find them, it’s not very easy to find them, it’s only a few.
Kunle: I’ll link to PRWD, Paul’s ex and Paul Rouke, and WiderFunnel I can’t quite remember the name of the guy but WiderFunnel keeps on popping up in my radar.
André: Yeah. Because I think the discipline’s very early, it’s just starting, emerging, so I think conversion optimization as a topic still needs maybe 10 more years to really find its way, what kind of skills do people inside this discipline really need.
Kunle: Okay. Okay. Could we talk a bit about psychology and triggers please?
André: Of course.
Kunle: What in your opinion are the most important psychological triggers in the context of conversion rate optimization?
André: That’s a good question. It depends on the business model. First I think it’s a difference if you have a software company where you’re on-boarding people and activating people and fighting against churn. You would maybe use different models or different principles than when you’re in e-commerce. So one principle I like very much is about reactancy and about curiosity. So people are always curious. So Booking.com does that excellent. If you go on booking.com you’ll see there’s a little red circle with a ‘1’ inside and you know that symbol from your smartphone or whatever and for you it’s an implicit code that means ‘there’s something and I need to click it so it gets away’. In Facebook you learn that every single little ‘1’ means you’ve got a positive feedback, a ‘Like’, whatever, so dopamine, your brain will say, ‘Yeah great, I received something.’ Booking.com is using that principle together with curiosity. If you click on the website and you’re not logged in, it says please login so you can find our secret details. How cool is that?
Kunle: I want it now. (laughs)
André: (laughs) And that’s a growth hack, you know. And you could use it in e-commerce. What do most retailers do? They throw this layer in your way. I just want to enter their market online virtually and what they do? They will stand in my way and say, ‘Stop, please opt in for our newsletter, you will get maybe five dollars or whatever.’ That’s the wrong way.
Kunle: Because someone told you so.
André: Yeah. And that’s like the old-school push marketing approach, interrupting people, don’t understand them, give away money because you don’t know what they really care about. The new… The conversion psychology growth hacking way is understand people and their principles. Realize they’re curious, they love little red circles with numbers inside.
Kunle: The Notification Age, where in a age of notifications and all. Nir Eyal’s book in ‘Hooked’, he was talking about that. Okay.
André: Yeah, that’s an example. But to be honest there are more than 200 principles. We call them behavior patterns, so like design patterns you use them or reuse them. And you can collect them like in a library. We call them behavior patterns at Web Arts. But you find a lot of them in Wikipedia if you search for ‘list of cognitive biases.’ There you will see there are so much. You just have to ask yourself, ‘Which of these could I use and make a cool A/B test out of it?’ To increase sign-in rate, optin rate, add-to-cart rate, whatever.
Kunle: Besides Booking.com and Amazon.com, which other companies do you think are at the cutting edge in e-commerce with regards to driving these behavioral patterns, in your opinion?
André:I think it’s not actually a number or certain companies, it’s… for e-commerce or classical retailers I would encourage to have a look on what’s going on in growth hacking and SaaS software companies and what principles do they use to do an on-boarding, to establish a communication. For example, a positive example, what I really liked, John Ekman from Conversionista, another partner in our little group of optimizers, he had a brilliant presentation in Estonia about on-boarding. And he showed HotJar, the software, where when you log in, it’s also about notifications, you get a little messaging window and it’s a message from the Founder and CEO. And this is very personal and it means, you could say the principle is to establish a personal communication. It’s what a lot of retailers are completely missing. So if you look into other disciplines and areas and industries, that’s what Steve Jobs always says, you’ll find the innovation somewhere else, outside your industry.
André: So I would say the hottest thing to look at is a SaaS software and how they built their experiences and how they establish real communication with their users.
Kunle: Your little, I like… your little consortium is a global conversion alliance, is that correct?
Kunle: Yeah, I will definitely link onto it. Yeah it’s an industry, an internal industry consortium. Okay, all right, good stuff here. Right, following through on that, do you have any other, besides the… what about triggers? What about emotional triggers? Positive triggers and negative. What do we have? What kind of emotional triggers to have at our disposal? What are the core triggers in your opinion for testing, for running the split test?
André: Yeah. So with triggers, I would translate ‘triggers’ to ‘factors that users perceive when they’re on the website.’ And the first thing that is important to learn is that people quickly perceive things on an unconscious level and build their own story into their mind about what’s going on with this company. Are they big or not? Are they experienced? Are they consumer-centric or not? Are they cheap? Do they have a big assortment? All those questions, users can answer in a couple of milli-seconds. Make the test, that’s what every retailer or head of conversion could do in a couple minutes, print out your most important landing page, show it to people for a couple of seconds that don’t know what you’re doing, and you will see how far the fantasy is taking the people, the users. And I would say when it’s about A/B testing, first you can test psychological principles like a growth hack. And second I would test these factors, we call them a trigger of implicit perception. It’s all about price, quality, assortment. If you test this stuff you will get big results.
Kunle: Every time I talk to you experts like yourself, there’s so much going on, there’s so much terminology and so many principles. I would have to read the transcripts to get my head around it to be honest.
André: I know. There’s so much. (laughs)
Kunle: Well there you go, someone who started in 1996… (laughs)
André: You’re right. So should I explain implicit perception now?
Kunle: Yes please. Laughs.
Kunle: I got Peep Laja the other time and he just breezed through… I just, you know I need to find out more.
André: (laughs) So when we’re talking about perception, we should be aware that people are consciously perceiving things, they’re reading the words, and you can show website to people for two minutes and ask them, ‘What did you perceive?’ And then maybe after two minutes they’re able to repeat what was written on the website. So that’s what we call explicit level of communication, so it’s really standing there explicitly. It’s written there, so people can perceive it on that level. And there’s the other level, what we call implicit level, where it’s not really written there, but it’s effectively communicating to you. So you see a website and it makes a difference which color it has, what’s the picture, what kind of people around the picture, how many products are on your category page, makes a difference. It’s an implicit way of communicating how big is your assortment. So for example, that’s what Amazon does, very well again. It’s aesthetically not looking very good, but it implicitly shows you with every pixel, square pixel, it says ‘We have everything. Our filters are so big, they don’t fit on one page. We have so many articles and so many offers and products and everything.’ So that’s the implicit level. And that’s a big mistake for a lot of retailers, marketing people or design people want to aesthetically cool and fancy and say, ‘Oh, look at Airbnb, isn’t that great how the background image moves. And look at Spotify, they have just one big hero image.’ What happens? They don’t care about these implicit codes. They changed them from cheap too expensive, from big assortment to small, so that’s a…
Kunle: Sounds really interesting. Now I’ve got two questions off the back of it. One question has got to do with, so from an A/B split test standpoint, what do you test first? Do you test the explicit or do you test the implicit? Second question please, if you don’t mind me giving you a double barrel, has got to do with in regards to the implicit, it sounds like it’s very strategy driven. So with the Amazon example, it’s more or less in my opinion like a ‘stack them high – sell them low’ psychology and that’s playing out on the user interface. Yes it’s ugly, but it feels like you’re going into a Costco. And so that reflects in design. Yeah, just your opinion on how such subtleties can be reflected in an A/B test, so circling back to the first question, what do you test in A/B split test: an explicit or an implicit?
André: I mean it depends like for example, an often tested hypothesis is if you communicate value propositions properly you get a higher conversion rate. Because you give a reason why they should buy. And so what you could do is do it as everybody is doing it. You write down your value proposition in the header of your shop, and you say free shipping, free return, hotline, whatever. And you would see it will work, if you’re testing properly you may be get 4, 5, or if you’re happy 8% uplift. But you miss a lot of potential because you can only measure in effect in A/B testing if the behavior of the people changes. And how can the behavior change? People have to perceive it. And if you communicate your message only on the explicit level, it’s maybe not the best you can do. So for example in that case, we just have published a case study where we could double the uplift by repeating value propositions in the footer. Client said, ‘Why should we do that? Nobody is following their scrolling there, that’s what we learned.’ We said, ‘Yeah but the people that are not buying, that did not find anything, they scrolled way down.’ And there we repeat the value proposition but we put them into an emotional context: pictures, more text, icons. Because in the footer we have masses of space and pixels we can use. So when we did that and communicated it on both levels it was much more effective. So I can’t tell you only go for this and that one. Always take both levels into account. The job of optimizers is to change user’s behavior so you need to know how communication works, and that you have to address your message on both levels.
Kunle: Love that. The job of an optimizer is to change user’s behavior… to get them to buy! (laughs)
André: Exactly! And now I forgot your second question. (laughs)
Kunle: The second question had to do with the more or less the implicit part of it, which has to do with how that communicated in design. So you know you gave the example of Amazon, how to utilize every pixel and I kind of drew a parallel with that to Costco. Now Costco, or in UK, Tesco, everything’s just, there’s no sort of care put into how things look. It’s different from a Louis Vuitton store. And that’s reflected in design. And I was just thinking, my question had to do with split test, how that’s communicated with user experience and how retailers can use their value proposition or where they’re coming from, the kind of store, what their strategy is and how that can be reflected in design and if they could see huge uplifts if they create that parallel so to speak in terms of what their business is about and how it looks and how it’s communicated.
André: Yeah, and you will realize that it has to do with branding and positioning of a brand. I mean, that’s why I think the word ‘conversion optimization’ is a little bit narrow, because what are we testing? In the end we’re testing value proposition, implicit codes, all that stuff. But to answer your question, yeah, I don’t want to say that everybody should look like Amazon or Cosco or Asda or, now what did you say, Tesco. But of course, the Costco or Tesco value proposition is you get everything, you get loads of stuff here and it’s a lot and it’s cheap, so come here and you’ll find everything in one place. That is a value proposition and if you want to communicate that, then you should realize, you’re not Louis Vuitton or Burberry, so it’s not about looking fancy. The designer’s job is to transport that value proposition into the mind. So it should not look like Lings Cars but maybe a little bit more like Lings Cars than Burberry. On the other hand if you’re selling luxury goods, of course you can’t afford to look like Tesco. That’s again value proposition, communication of value propositions through implicit codes. I love the Louis Vuitton website. There are little videos like on Airbnb, and the background with people finishing a little part of a bag with handcrafted thing, it’s really filled with love and passion and you think, oh my god that’s… So, but it’s a complete different value proposition, completely different code. The problem is that of course every designer, every decision-maker, they love the world of emotional big pictures and Burberry and so on, they love it much more than the cluttery, ugly world of discount. But at the end it’s like, we saw so many redesign projects where a new CEO came and said, ‘Woah, your website looks like it’s out of the 90s, let’s redesign it.’ At the end it looks nicer but it also looked more expensive. So they had a big loss, 25% less conversion rate. Expensive, wrong decision. (laughs) That’s the power of implicit codes.
Kunle: Interesting. Interesting, interesting. With utmost respect for your time, I would just quickly ask we just move into the final set of questions. Let’s talk about tools, your preferred tools. These are more just real quick questions, really. So what tools, what are your preferred tools, platforms, from a conversion rate optimization standpoint?
André: So from an analytical point of view, you need a lot of input from analytics, mouse tracking, and so on. So we love tools like KissMetrics or HotJar. I think especially HotJar, incredibly new tool with a lot of power. Why do we need them? To get insight to the way people browse through websites and perceive them. And then we have our qualitative area, where it has not so much to do with tools. Inside our company we build our own tools for example to collect the psychological principles, but they don’t exist on the market. So when we come to the quantitative methods, like A/B testing and so on, then again we need tools and yeah, when it’s up to A/B testing tools, I always tell people we’re technology agnostic. So you can use self-service tools very well and they will take you very far, tools like Optimizely, VWO, and so on. When you reach a certain point, you will probably need personalization and stuff like that so there are a lot of really expensive enterprise tools. I think Optimizely is getting into that as well. But again, there are also a lot of different tools you can use and it depends on the needs of a company which tool is the right one, so I can’t give any recommendation. And then you have personalization which I think is a very interesting new way of thinking. When you combine again, qualitative UX people think in types of users, and personalization, it’s a powerful combination.
Kunle: And from a personalization standpoint, where are you seeing the biggest gains and where should retailers be most excited about?
André: They should not be excited about displaying weather information or name of the customer, that’s… First of all what I think a lot of people talking about big data and personalization and they just display data. That’s not what we do. They should be excited about knowing ‘I have these five different types of customers and if I want to move my experience towards this type, what does it mean?’ So it means you’re changing the wording, you’re changing maybe some background images, in the end you’re changing implicit codes so you have a better fit to that type. For example the fast decision maker and a lot of typology models is, ‘The right one!’ So he will need another arrangement on a category page than the slow decision-maker, the logical guy who’s reading everything. If retailers find out what their clients are, which types and with what data I can identify them, then personalization makes sense and starts to make sense. So that’s what I would care about.
Kunle: So I have a question. So what platforms would you recommend, or what platforms do you think are going in the right direction with regards to personalization, and what’s your experience?
André: To be honest we did not find one yet, so if any of the listeners can recommend something, I am thankful for a hint. We built these systems by our own. We have scoring systems. It’s not complicated, it’s a small piece of software that collects data and has some algorithms to find out are you user type A, B, C. You could do that in a Excel sheet, it’s not witchcraft. (laughs) So it’s not complicated, we even use testing tools to do that, to inject the code for personalization into the website.
Kunle: I had Ivan Mazour from Ometria on the show, a couple show shows back, and they’re really into data driven personalization in e-commerce. But the challenge is they use the data they get for messaging rather than user experience. Which is interesting. So it would be interesting to find out a platform that kind of marries what they’re doing from a messaging standpoint to user experience and conversion rate optimization. That would be like a few years away from here. (laughs)
André: Yeah, and imagine if you identify that a certain customer is a certain type, what does it mean for your fulfillment? Would you may be put in another message card in his package? What does it mean for customer service? Could there be a notification saying, ‘Take care! This guy is a fast decision maker so you speak in another way.’ That’s what the classical sales guy is doing in a real store. He realizes what kind of type are you, and he will adapt his behavior towards you.
Kunle: And I suppose if you could then get the machines to make some decisions for you, so you could add a gift from a delivery standpoint or as you alluded to earlier, make a decision with regards to how the customer service representative actually handles them, or just upgrade their delivery from two days to next day, it’s fascinating really. Fascinating, fascinating. Okay so, moving on from tools, what about books and resources? Blogs and books e-commerce managers should… I kind of like what Derek Halpern said, he said before he gets into anything he’ll read three or five books about the subject before he talks to any expert. You know, he’ll just read books. And once he reads the books from the top books on there, he’s able to filter through any rubbish, basically. So from your perspective, what books should e-commerce retailers actually just read, find the time to read to get an understanding of it. Not necessary to execute, but to be able to make the right decisions on partners, tools, platforms, and approach really, strategy.
André: That’s again a good question, because all the books they come out of the silos. So, I don’t know any book that connects the dots so maybe I should write it.
Kunle: You should. (laughs)
André: When it’s about psychology, neuromarketing for example to get a good understanding about the power of implicit codes, you could read the book from Natalie Nahai from the UK, it’s called Webs Of Influence. I like it. It gives you a great overview about psychological principles. If you want to take it further to behavioral economics and stuff like this, of course there you have the classical books like Dan Ariely, Cialdini his Influence book, I don’t know how it’s called exactly. That gives you a great overview about all this what we call behavioral patterns. If you really want to dig deep into it, read Kahneman, Thinking Fast And Slow. Six hundred pages, you have everything inside that. So that could give you a good overview on psychology and that stuff.
Kunle: Sorry, what’s the name of the book?
André: Kahneman? Kahneman, his book is called Thinking Fast And Slow. That’s a classic, he received, he’s the first psychologist that ever received a Nobel Prize because there is no Nobel Prize for psychology. So he received it in economics.
André: He received it in economics as a psychologist, so that’s amazing. And I can recommend that, if you have loads of time. (laughs)
Kunle: Six hundred pages? That’s all right. (laughs)
André: When it’s about e-commerce strategy, I’m sorry I don’t know books in English to recommend. But I recommend all the blogs about growth hacking, like GrowthHackers.com by Sean Ellis. That gives you a good overview about what’s happening as I said in the other parts of the world, in the other industries. Read blogs like ConversionXL, like the WiderFunnel blog for example. There’s a lot of testing and also the deeper stuff like statistics. When is an A/B test really valid and stuff like that. So I could recommend that as well.
Kunle: Yeah, and then you connect the dots basically from a CRO standpoint. Fantastic, okay.
André: In the end, that’s experience.
Kunle: Expert’s experience. Absolutely. Absolutely. Okay, now let me just count the number of pages I have notes on, five pages, right.
Kunle: (laughs) Okay, before you say your goodbye, what is the best way listeners can follow you, get in touch with you and just follow your work?
André: (laughs) The best way as maybe Google Translate (laughs) because I publish my stuff in German. So I’m lazy, you know I’m a lazy guy, I’m too lazy to write in English. So we have a blog called konversionsKRAFT.de. You can read it with Google Translate or you can follow me on Twitter.. I tweet around 50% in English. Twitter handle is MORYS so I think these are the two most interesting ways.
Kunle: And what conferences should we expect to see you in the next six to nine months?
André: I have no idea to be honest. It will take me now to Lithuania next week. And I think for the next year I did not plan it yet. This year I was in the US and most of the European countries and of course in Germany, Scandinavia, and the UK. But for next time I don’t know.
Kunle: You seem to be more active in Europe, in the EU, than in the States.
André: Yeah, when it’s about speaking, the thing is as a speaker to be honest I get paid for my speeches so that’s very good for me. But in Germany, nobody’s paying me. They want me to be a sponsor, so I’m not talking that much in Germany.
Kunle: You talk about the profitted in this country. (laughs) It’s been an absolute absolute pleasure, very hugely insightful, André. Thank you for coming on to 2X eCommerce.
André: You’re welcome. Yeah, you’re welcome. Thank you for having me.
Kunle: Cheers buddy.
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