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May 8, 2019

4 customer-validated insights that generate business growth in Germany


  • Vantages

Imagine the impact on your bottom line if you knew in advance what customer-journey changes would have the biggest business effect.

“An expert is a person who has found out by his own painful experience all the mistakes that one can make in a very narrow field.”

The quote by the physicist Niels Bohr sums up the international consultancy’s unique approach to using experimentation to drive business growth: vast experience, combined with the practice of championing agile, customer-centric solutions backed by data, can reveal what customer-journey opportunities will have the biggest impact on the bottom line.

“Yes, you can explore every idea to improve the customer journey, but by knowing what changes have the biggest impact, you’re able to not only evolve businesses more quickly but spend more time on higher value opportunities,” said André Morys, Managing Partner, Strategy, Germany.

Key insights shared by GO in this piece

  • The Group mines insights from an international database of experimentation results to identify the most valuable customer-journey changes to unlocking business growth.
  • An analysis of all experimentation data from the German office surfaced four customer-validated insights executives can use to accelerate business growth.
  • Agile, cross-disciplinary teams empowered to understand what motivates their customers and affect the entire customer journey, have a higher chance of leveraging the insights than traditional operators, which tend to remain siloed and bureaucratic.

Based on the academic paper, “A Meta Analysis of A/B Tests,” by Manuel Heeg,1 Morys and his team explored the German office’s experimentation database for trends and patterns that could amplify the likelihood of success in their work in Germany.

It’s far more rewarding and easier to reimagine and optimize the customer experience and journey on mobile than on desktop.

“The insights we harnessed from the German database directly enabled us to quickly cut the time it takes customers to upgrade their corporate mobile plan at a major telco from one to three days to less than five minutes,” said Morys. “It proved that by knowing what changes worked and didn’t, we could confidently optimize a customer journey.”

1 > Marketing teams that employ behavioral science have a higher chance of creating business growth.

Boosting business growth requires understanding and positively changing customer behavior. While much is said about the prompts or triggers that stimulate a customer to take an action, “Buy now and you’ll get…” it is when businesses reimagine the customer experience – considering the psychological mindset of their customer – that delivers the highest chance of business growth.

Specifically, those customer-journey evolutions that aimed to first understand what motivated a customer – pain, pleasure, hope, fear, belonging, rejection – had a better performance than those focused on stimulating an action e.g. a sale, deal, request, etc. or boosting a channel’s UX performance.

“Redesigning a website with the latest UX or steadily amplifying customer offers to gain business traction won’t move the needle as much as taking the time to meet with a customer and map out what they were thinking when considering your product,” said Sibel Cokimre, head of customer research at GO > Germany. “Worse, it may move your business in the wrong direction.

…when it comes to e-commerce, the most customer-validated evolution is offering free two-day shipping.”

When evolutions to the customer journey included both usability, prompt and motivation changes,2 the chance of business growth for the company was much higher, according to the research study. This finding is notable as many companies continue to silo design, development, marketing and brand. Considering that each of these functions has a critical role in boosting channel usability, stimulating customer engagement, and understanding customer motivation, this traditional segmented arrangement is ill-advised. Besides capitalizing on best practices in behavioral science, companies would be better served by creating cross-disciplinary, agile teams empowered to understand and improve entire customer journeys, not one specific function.

“I can’t think of an innovative company that doesn’t leverage behavioral science to power growth,” said Morys.

2 > Businesses that want to dominate must harness the opportunity from mobile.

Often, business leaders will overlook enhancing the mobile experience for their customers because the correlation between direct revenue and mobile conversion is lower than on desktop. Sure, while desktop audiences may play a much larger role in generating revenue compared to those on mobile devices, 3 there’s an untapped opportunity to innovate the customer experience with mobile for your business.

Again, the data from the analysis of experimentation results in Germany is persuasive. Improvements to the customer journey are approximately 35 percent more likely to succeed on mobile than on desktop. It’s far more rewarding and easier to reimagine and optimize the customer experience and journey on mobile than on desktop.

“Think of mobile as a goldmine for customer-journey enhancements,” says Morys. “Few of us will buy a car online, but if the key to the car becomes the mobile, then customers notice.”

3 > Executive leadership can prioritize and set resources for growth if they know conversion rate benchmarks.

There are conversion rate performance ceilings for business models and industries that can help executives set smarter business goals. Knowing these ceilings enables leadership to competitively assess the performance of an overall business or a single line. “Once we help a partner in e-commerce boost checkout conversion by 25 percent, we look at exploring how changes in marketing, inventory, pricing, and distribution could deliver the next round of growth,” said Dirk Franssens, Managing Director, Strategy, Germany.

In addition to business models, the data from the German office also found a similar ceiling when looking at different industries. A total of 85 experiments from the fashion industry were examined. Thirty-nine of these experiments were rated as successful and therefore showed a significant uplift in the conversion rate. However, while changes to the customer journey were successful, they delivered a significantly lower average revenue uplift. Considering the highly competitive nature of online sales in the fashion industry, this data insight makes sense. Even successful changes to the digital experience that reward customer behavior have a harder time impacting the bottom line when it comes to fashion.

…it’s not easy to win a customer at checkout, but it sure is easy to lose them.

Once business leaders reach the performance ceiling for conversion rate optimization in their industry or business model, then they should look at other areas where boosting customer satisfaction could have a much larger impact. At GO, the strategists are fond of saying that when it comes to e-commerce, the most customer-validated solution is offering free two-day shipping.

4 > Business growth wins are likely found in the middle of the funnel, not the end.

One insight clearly stood out in the research by GO > Germany: it’s not easy to win a customer at checkout, but it sure is easy to lose them. While late funnel changes often capture most experimentation attention, the research demonstrated that it’s higher up the funnel, where customer motivation is a powerful factor, that most business growth opportunities exist.

Consider this: only 13 out of 52 experiments on check-out or product-basket page types found an uplift in business growth potential. This is almost 60 percent below the average found on other page types. Why so low?

“If the customer is motivated to move to the check out stage, then there’s relatively very little opportunity from a usability or trigger perspective to change their mind,” said Mirko Melcher, Senior Manager, Optimization & Personalization, Germany. “They’ll either buy or not. “Where we should be spending more energy is at the top and middle of the funnel, ensuring that we’ve understood what is motivating the customer to explore our partner’s services and inventory,” said Melcher.

Of course, if the data shows a high loss of customers on an individual checkout page, the problem should be carefully investigated. But the German office demonstrated that experimenting with the customer journey at this late stage was not as promising as understanding a customer’s motivation to reach the funnel channel in the first place.

Knowing is half the battle.

Every business that seeks a market edge should embrace a program that puts the customer at the forefront. Experimentation, which looks at qualitative and quantitive customer-behavior data to create a customer-rewarding business hypothesis does just this. By knowing what areas of experimentation have the strongest impact on the customer journey, executives can intelligently apply resources to evolve their business.

“Testing for testing sake won’t transform a business,” said Chris Goward, GO Group Digital, Managing Partner, North America. “What Germany validated reinforces how important it is to zero in on the areas that we know reward the customer, which in turn, generate business growth for our partners.”

Contact us to learn more about how GO connected customer-validated data to business growth in Germany. We can share how our international database of customer-validated insights is helping fuel business growth programs there and on a global level.

This article was developed from “Mustererkennung in der Optimierung: Meta-Analyse von A/B-Split-Tests in Deutschland” by:

  • Collin Crowell, GO > Global Activities, Director
  • Manuel Heeg, GO > Germany, Senior Consultant
  • Michael St. Laurent, GO > North America, Optimization & Personalization, Director
  1. GO > Germany (April 2018) “Meta-Analysis of A/B Tests in Germany”
  2. BJ Fogg, Ph.D. (2018) Behavior Design Lab, Stanford University, BJ Fogg’s Behavior Model
  3. Statista (2018) “Prognose der umsaetze durch desktop pc und mobile e-commerce in Deutschland 2016”

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The world’s leading experimentation experts build global experimentation programs and solutions for the GO Group. Contact the Group to learn how its experience and international setup can build or revitalize your experimentation program. The GO Group operates at the intersection of consultancy and conversion, enabling its enterprise clients to unlock business growth and value through the power of experimentation.

Learn more about the GO Group at www.gogroupdigital.com

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