Conversion Rate Optimization With PCR CEO Drew Himel

Our latest episode of the Question Authority podcast features Drew Himel, CEO of PCR, talking to us about all things CRO.

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Transcript

Mitch (00:29): Hey Drew, how's it going?

Drew (00:31): Hey Mitch, how are you?

Mitch (00:32): Good, fine and dandy. I got Matt here too.

Drew (00:35): Hey man!

Matt (00:35): What is up? Welcome to our quasi ghetto podcast recording studios.

Mitch (00:43): I'm excited to have you talk about some of this stuff that we've kind of grazed the edges of it in other episodes, but we really haven't dived into CRO, and a lot of the more advanced tactics and strategies in that. So first off, well, just to introduce yourself, you are the CEO and Founder of PCR, which, as you said, for corona purposes is probably better explained as consultpcr.com, just for clarity. But it would be great if you can kind of just walk us through more advanced thinking around what is CRO, beyond just the notion of like, "Oh, I know CRO as I'm going to AB test the color of my purchase button, and if B wins, great, that was CRO." It's like, "Yep. That's not wrong, but there's a broader thinking here, and more strategy to this." So what's your kind of definition and perspective in that sense?

Drew (01:35): Yeah. No, I mean, I first appreciate you guys having me on, and I think to answer the question, I mean, a lot of what we're looking at is how are we driving higher profitability off of all of your marketing channels? And so a lot of that has been increased with the Apple iOS updates, and so everyone's looking a little bit more inward on, "How do we get our CAC in a great place? How do we get conversion rates up?" A lot of it's just reducing the friction in that process and using data and analytics to be able to better inform those decisions.

Drew (02:07): And so, I think a lot of people do put it as simply as like, "Oh, let's change the button and kind of see if more people click on it." But we want to look at it more holistically from the entire user kind of funnel and journey. And then look at those various touch points, and how do we make it a little bit easier, a little bit more intuitive. I mean, the cliche that we always say is everyone's got the intention span of about a second grader online, and so we got to make things very simple and easy to be able to use so that you're getting to do what you want them to do, and that's taking some sort of action. Subscribe to the newsletter, add a product to the cart, kind of do a repeat purchase, and things of that nature.

Mitch (02:45): Right, yeah. So you guys even touched on a lot of this stuff around micro conversions or email segmentation and marketing and stuff like that because it's to your point, reducing friction, if you think about it like a car or something like... There's a lot of components where you need to reduce the friction, can't just be like, "Oh, I greased this one bearing so friction has been reduced." It's like, yeah, you can do that with the purchase button, but do I want to click on this ad? Do I want to keep spending two minutes on this website? Do I want to put this in the cart? Do I actually want to purchase it? Do I want to come back? All of that is friction, so yeah, totally makes sense.

Mitch (03:18): So what are some of the tools or tactics that you guys kind of have in the utility belt there, or if you want to touch on just what are some of the telltale signs when you're looking at a brand or their experience where you're like, "Ah, okay, I see where we need to help them out."

Drew (03:34): Yeah, no, starting with the tools first, I mean, Google Analytics is still a 900 pound gorilla in this space that is free accessible, I think a lot of people get overwhelmed when they start to look at it. So there's just making sure the basics are in place around the e-commerce kind of tracking and funnel visualization is pretty key. And then to the point of each kind of tactic corresponding to a metric, a lot of people come to us and say, "We want to boost conversion rate." Or, "We want to reduce bounce rate." Well, that's a very broad topic, and so for us, we want to isolate every single action that we're recommending, and then what is the corresponding metric that you want to see improve off of that? So it might be as simple as we want to improve people adding this product to their cart on their product page or their PDP, or we want people to spend a little bit more time kind of on the homepage, or we want people to be utilizing the search functionality on the site more prominently.

Drew (04:30): So we're doing a big project right now where they have, it's a fine wine for wineries within their portfolio. And there's about 72 different recommendations that we made from a UX, that's a lot and can become overwhelming if you just say, "Oh, this will broadly help improve conversion." Each action that we're recommending has a corresponding metric that we want to see either improvement or a decrease and bounce, or things of that nature. So Google Analytics can help really inform a lot of that. The next one that we use that we see a lot of DTC brands kind of utilizing as well is Hotjar, which does kind of the user recordings and the heat map tracking.

Mitch (05:11): Love me some Hotjar. Yeah.

Drew (05:13): It's great, I mean, I think we were joking before I came on, my head of UX just geeks out on those user recordings, but you can actually see it on that same winery client where they're trying to go to the hamburger nav, and then they were kind of going back, they just got lost and then they exited the page. And so it's just really neat to see that we're not just using it as like a click, or some anonymous data, it's actually users trying to navigate your site, and that can all be providing incredible insights to be able to inform a lot of the decisions that were recommending.

Matt (05:44): You mentioned bounce rate, and I'm really just looking for an anecdotal answer here, but how often is the bounce rate a component of bad targeted traffic versus a large UX problem? Because often, I'd when I'm diving into someone's GA account, I'm usually looking for kind of source medium page, looking at bounce rate, trying to see, "Okay, what channels... What's the average, A, and then what channels are very high?" So obviously you'll see top of funnel, Facebook awareness campaigns have bounce rates. And to me, if it's higher than, call it, 65%, 70%, I'm typically like, "Okay, there's probably a targeting problem here, less of a UX problem."

Drew (06:21): I mean all the time. And I think it's always interesting too when things are going really well, every agency partner wants to pat themselves on the back, but when it's going bad, there's the blame game. And so, that's why you do have to look at it holistically and start to isolate a little bit more. So even looking at the traffic's force, looking at new versus returning, mobile versus desktop, and then you start adding on the scroll analysis as part of that with like a Hotjar or something too is really important.

Drew (06:46): But we had a client that was ranking number one for a lot of their main keywords, but we noticed the bounce rate was 75% or higher for their organic. And we dug into it a little bit more, and ultimately, it came out a site speed issue. 12 seconds for them to load their homepage, and a lot of the traffic was going to the homepage. So our recommendations like, "Hey, let's start optimizing some of these interior pages." And then two, "What are the things that we can do to increase the site speed and load?" And there's a lot of like easy fixes with that of compressed imagery, lazy load, maybe not having as much video content and images on the homepage itself.

Drew (07:23): And so, it's not always the first metric, unfortunately, if you look at it, you really do need to start diving deeper. But a lot of times we want to know what the paid media strategy is, what are they doing if it's a brand awareness campaign, then obviously that's going to affect kind of bounce rate and ultimately conversion too so you have to kind of look at those things holistically as much as possible.

Matt (07:46): Yeah. You've mentioned site speed a few times, and I'm sure you've been asked this, and I'm almost hesitant to ask it, but the biggest advantage that I've heard to building a headless site, especially for the Shopify stores' speed, I would argue it introduces another level of complexity from the engineering side. There's definitely arguments to counter that, but I'm curious if you have kind of your... It might just be like, "Hey, every case is different. It really depends if you have the resources and you want to kind of lean more into engineering to build this headless site and manage it." I'm just kind of curious, have you seen anything that's like, "Okay, I do recommend headless if the resources are there." It's like, "Hey, it might not be worth it."

Drew (08:25): Yeah. And ultimately we're not a dev shop so there's a technical kind of analysis that we'll bring in with even partners and things of that nature. But with headless, so we have a client that was running about 60 scripts because of all the Shopify apps and obviously more kind of apps being kind of rolled out continuously, and that is going to negatively impact conversion and site speed. So that's where there are scenarios where Shopify out of the gate and their app ecosystem might not be able to do it, where headless makes a lot of sense. And then with site speed I think it does, but you are looking at a larger lift on the front end from both a cost and time standpoint. And then to be able to make changes, headless can be very iterative and it can adapt, but I think you have to have competent developers to be able to do that.

Drew (09:14): And so we're seeing it more and more where even two years ago people were like throwing it about, but no one really understood the implications. And I think there's a lot of really neat tools available. We work with kind of a Builder or Swell that have built kind of the ecosystem and the stack on top of it where it does make sense to be able to help. But yeah, I would have a lot of due diligence from a technical and development standpoint before we make that decision.

Mitch (09:39): Yeah.

Matt (09:39): Cool. One thing... Mitch this was after Drew was intro'd, was gonna to talk about like looking inward.

Mitch (09:48): Okay. Wow. That sounds deep.

Matt (09:50): Drew used it, not me, I wrote it down because I thought...

Mitch (09:53): Okay.

Matt (09:56): I'm curious, kind of, we're seeing it with Fairing, just more of these DTC brands wanting more first party data through surveys, through kind of other methodologies that allow them to reduce some of their, call it, Facebook dependency. But you use the phrase, "Looking word." I thought that was a really good way to put it because everyone, call it a year ago, there was not too much looking inward, it was very much just spend, spend, spend and lower my CAC or CPA and go from there. So are you guys getting a ton of kind of inbound business now with this happening?

Drew (10:31): Look, there was a heyday for a long time with Facebook, which has so much data available as a marketer, it was pretty unbelievable, where you could get very advanced in terms of the targeting and the segmentation that you're able to do, one. Two, there was a ton of capital flooding into the market. And then I think, three, there really is a lot of importance placed on growth in terms of top line, but not necessarily, "Is this a profitable, sustainable kind of business?" But you would think that should come out of the gate with every model, but unfortunately it wasn't the case.

Drew (11:03): And so I think with a lot of these updates here recently, it is making companies look inward in terms of what's going on for a lifetime value repeat purchaser. We have a pretty large beverage brand that we're working with that is doing just that, it's a subscription base, and they're noticing a really substantial drop-off months two and months three of the subscription, and so we're doing a complete kind of retention analysis across all the relevant flows, kind of messaging communication. And what I love about it is there's so much data available and the more advanced, and the more segmented you get, they've done the hard part, they've figured out the product market, they're able to get kind of the customer into the funnel, but how do you get that stickiness and that retention factor? You figure that out, it becomes that much easier to continue to add more into the funnel because you know it's going to be optimized, not only just for conversion to checkout our purchase, but repeat purchase, which is really, really kind of important.

Drew (12:01): And so luckily for us, yeah, the inbound has been pretty kind of incredible, and it ranges from, "We have to figure these things out. We're going for our latest raise." To, "What the hell, what do we do? We're contemplating shutting this business down, it's not sustainable at these current kind of metrics and we're not going to be able to raise again." We do think that, and we're obviously very, very biased, but being able to figure these things out foundationally is going to positively impact, every aspect of your marketing and the overall business. But it just doesn't really get talked about a lot, I think everyone's more of like, "What's the sexy creative you're doing? What influencer are you partnering with?" And things of that nature. And we want to take a step back and say, "Hey, how do we figure these things out?" But I think it can be overwhelming.

Matt (12:46): Yeah.

Mitch (12:46): Right, yeah.

Matt (12:47): Just interesting how much time was spent on, I don't even remember what the URL was, business.facebook.com versus even your own GA, I feel that's reversed or 180'd.

Mitch (12:58): Moving to working off of your owned audience instead of your rented audience. Exactly.

Drew (13:03): Even to that point, I mean, I can't tell you how many Google Analytics kind of dashboards are just not even properly tracking. And that's what a lot of brands are seeing now is just really gross inconsistency from what Facebook's telling their CAC is to what Google Analytics is, and how do you kind of look at that? And so I think more and more these roles, and we're hiring for a few right now around data analytics, data analyst, are going to be so important for brands. And for us, we kind of serve as that kind of interim until they're able to find that.

Mitch (13:38): I was going to ask, just because I know from my days doing UX, the temptation to look at a Hotjar, or let's just call it heat maps, or user recordings, and jump to conclusions, or just kind of more comically, watch that among a group of marketers or a group of designers and have them all come to different conclusions about what it means. It's kind of interesting. So I don't know if you touched on the survey aspect, or just whether it's exit surveys, post-purchase, or whatever, or even if you're just doing kind of focus groups or anything like that after the fact to get some of that grounding and that context around, "Why was the behavior this way?"

Drew (14:16): Yeah. I mean, to me that's where it needs to be multi-pronged where you have the qualitative aspects. So for us, that is a lot of the Hotjar and everything that we've talked about. There's the exit surveys, and then there's also the what is the brand ownership telling you? And then there's other aspects too, even combing through some of the customer support kind of tickets and looking at what's happening in Zendesk, or Gorgias live chat as well to be able to better quantify what's going on. And so, that says we get kind of deeper and deeper, especially if it's a really buggy site where there's a lot of friction and it's hard to isolate exactly where the drop-off is occurring, you want to substantiate it with other kind of points of feedback. And so that's where customer kind of surveys and research, or pulling the tickets and things of that nature can really come into play and help.

Mitch (15:11): Well, to your point too earlier about the different kind of goals that you're solving for, it's nice and easy and too good to be true to say the only goal of your web property or your user experience is to get to that conversion, but there's discovery, there's brand building, there's all that kind of stuff. And so, it pays obviously to have experts like you guys in the room to look at the stuff and say, "We need to get some better context around this." Or like, "Sure, this isn't helping conversion directly, but we have to understand it from the other perspectives." And yeah, there's a lot of ways to skin it and just being able to have that different perspective on it, or engage multiple perspectives on it is kind of key, I think.

Drew (15:53): Yeah, and they all intersect too. There's the merchandising strategy too that we don't obviously touch that much, but we are seeing different things coming through. And if you're doing the surveying and the research, I think there's some really great brands that are using that to inform product development.

Matt (16:10): Yeah.

Mitch (16:10): Yeah.

Matt (16:11): Mitch and I mentioned I'd talk about DFC very often, which is direct from consumer, it's this whole concept of direct to consumer, if you're selling products directly to the consumer, but that only becomes a benefit once you actually get feedback back and you create this flywheel of like, "Who are these people, I continue to market them?" If you're not doing that then you kind of just turn into a legacy CPG brand that's just spending money on Facebook.

Drew (16:34): That's where you see too a lot of these DTC brands are trying to pivot to subscription, and how do they think about community and getting kind of this flywheel working where there's product development, and then there's kind of stickiness, and there's rewards, and experiences, and things like that that they're able to offer. And I think thinking of the direct from consumer is super interesting because you're not just trying to sell them something and then be done, you can't, it's not a sustainable business practice for a lot of these brands. And so you have to think about retention strategies and things that you can offer that surprise, delight, where they do feel kind of involved from the very beginning. And so you're seeing the rise of private Slack groups, Facebook groups, and kind of development so they can build a subscription model that's not just trying to please the investors or the VCs, but something that is built for kind of the consumer in mind.

Matt (17:27): Yeah.

Mitch (17:28): Preach. Speaking of insights, I know you guys obviously have a lot to share, I believe you mentioned that there's a convenient way for people to access those so if you want to just a plug that for everyone's benefit.

Drew (17:40): So I've been doing this as kind of an experiment, a weekly newsletter, and a lot of it's our kind of e-com, CRO insights that we're sending out. And we talk about an experiment that we've run, we talk about a brand that we admire, or are experimenting with. And then just some other kind of high-level things. And we try and keep it... I think total read might take you 30 seconds or two minutes out of your day. And honestly, the response has been pretty phenomenal in terms of just people kind of getting some value out of it, short and to the point. So yeah, if you just go to our site at Consult PCR, and then you'll have a little pop-up to be able to subscribe. And I'd love the feedback and kind of getting some of the interactions. It's actually been really fun.

Mitch (18:28): Nice. Well, Matt, if we're going to title this pod Looking Inward then I think someone has to whisper it sensually.

Matt (18:38): I'm not doing that.