I’ve never been to confession, but perhaps this is what it feels like?
In 2022, we won a number of awards, with 2 of those being UK CRO agency of the year and Global CRO agency of the year. But here’s the rub, we’re not a CRO agency.
‘Fraud!’ I hear you cry.
Well, let me explain.
What we actually do. Customer Value Optimisation.
Blend follows the principle of Customer Value Optimisation (CVO). What this means is that we understand that Customer Lifetime Value (CLV) is the most important metric for brands to work to, and its relationship with Customer Acquisition Cost (CAC). Rather than simply make decisions on how to improve a Shopify business by looking at ways to hike up conversion rates (CR), CVO uses CR as just ONE of the levers to pull.
So what does this mean on a practical level? Well, to become an idea generation machine for Shopify brands, we combine the use of:
- Best practice for CRO
- Quantitative Research techniques like RFM segmentation and Cohort Analysis
- Qualitative Research techniques like NPS surveys and Jobs To Be Done Surveys
We then implement these ideas onsite and track the impact of these on the metrics that impact CLV.
So, while we’re not total frauds, telling the world that we’re a CRO agency doesn’t truly reflect what we do.
How did we win the CRO awards?
So now you know we’re not total liars, how did we win these awards? Well, here are some highlights of what we shared with the judges.
We shared the results of 5 clients, which included one client:
- Reducing store bounce rate in 4 months by over 12%
- Increasing page views by 11% in 4 months
- Increasing conversion rate from 6.5% to 9.4% in 4 months.
We also shared that for another client, we helped them:
- Increase sales by 731% in 6 months
- Increase total orders by 635% in 6 months
And last but not least, we also shared that we helped a well know client:
- Increase revenue by 144% year on year
- Increase conversion rate by 34% year on year
Now, as this award was for CRO, we didn’t even get to discuss CLV. If you’d like to see these numbers too, book a chat with us here.
Our tools for CRO and our process
Now, while some of the tools below would be used by typical CRO agencies, our experience of talking to clients is that many are not. We shared that we use:
- Recency, Frequency, Monetary (RFM) Segmentation
- The Jobs To Be Done (JTBD) Methodology
- Net Promoter Score (NPS) Tracking
- The eCommerce Growth Formula
- Hotspot & Heatmap Analysis
- Visitor Session Recordings
- Demographic User Testing
- Email & SMS optimisation
- Journey Mapping
- Message Mining
- Review Minding
- Cohort Analysis
- Web Surveys
- A/B testing
The other key item we shared was the use of the PECTI Prioritisation Framework. We shared how this gives clients not only a better understanding of what the impact will be but also why certain tasks should take priority over others. Ultimately, we help clients make better decisions based on the long-term health of the business.
Our agency structure and environment
While the judges were keen to see the impact on our client's CRO, they were also interested in the structure, culture and environment of the agency and how they impacted our work. We shared that:
- We’d positioned ourselves firmly as being focused on Customer Experience experts on-site and in our marketing.
- We recruited team members that had both practical experience and skills, but also strong commercial awareness.
- We have a strong employee retention rate due to our team culture and flexible working policies.
- We’ve won a host of other awards, as well as being shortlisted for many more national and internal awards.
Why did Blend switch to CVO?
Peter and I first became aware of CVO in 2020 through the brilliant work of Valentin Radu and his team at Omniconvert. Coupled with this, we were hearing and seeing these things in conversations with large Shopify brands:
- CLV is becoming more important, but we don’t know how to measure and influence it.
- CAC has gone through the roof, and we can’t seem to bring it down.
- Our agency is very reactive, and we have to come up with the ideas.
- We’re being told that CRO is happening by our agency, but it doesn’t feel like much is really happening.
When we looked at what CVO could offer brands, we knew that we had to make the change. See Valentin and me talking about CVO and why we made the switch as an agency.
Why is CVO better than CRO?
This is a little bit like asking whether petrol is better than an engine. You need both to get anywhere! But leaving the cheesy analogy to one side, CRO needs to be powered by CVO. The whole process of CVO allows those brands and agencies implementing it to have not only a bigger breadth of ideas but also the ability to pull on different levers when they are needed.
For example, as CLV is driven by a set of key metrics, driving overall growth for the business doesn’t have to rely on conversion rate. In many cases, this will be a focus for a short-term period, but focusing on the problem of purchase frequency is often a more long-term and important metric to impact.
One thing that is worth mentioning is the CVO is not for all brands. As data is key here, we find that brands with sales of $3 million or more annually get the best from CVO. That’s not to say that principles do not apply, but the picture from the data may not be as clear.
What do brands think about CVO?
Typically, 7 and 8 figure Shopify based brands approach Blend with 2 requests:
- We need a redesign, or
- We need a new CRO agency.
So how do they react when we tell them that we can’t do either? Well, in all honesty, it’s mixed. Here’s a breakdown of the three different reactions.
Thank God! Let’s go.
So the typical experience from brands that respond in this way is that:
- They’ve recently realised that focusing on retaining customers for the long term needs far more attention than before.
- They’ve been with an agency for a while where the relationship feels flat, and the outputs are not turning the dial.
- They’re looking for a team to give direction, and not direct an agency.
- Their acquisition cost is higher than ever before.
For us, this is our ideal client. They’re also very open, and happy to be vulnerable about what keeps them up at night about the brand.
We like it, BUT…
I’ll be straight here - there are a lot of brands in this camp right now. The background of brands with reservations is:
- They’ve recently realised that focusing on retaining customers for the long term needs far more attention than before, but there is a widely held belief that acquisition must be the key driver to growth
- They’ve worked with a number of agencies that have been reactive, and, even when asking for more proactivity, have been let down.
- They’re looking for a team to provide direction and strategic guidance, but are concerned about paying a more premium price for this type of service.
I get it. The current agency model has been around for a while, and while brands are frustrated with the reactive nature of work, they also know what they’re getting and at a cost to the business that they are used to. Now due to the more labour-intensive nature of CVO, and the wider impact on the business, the cost will be higher.
For those brands that do initially have reservations, but ultimately work with us, the tipping factor is usually that they understand that moving to another agency, working in the same way as before, won’t make a difference to the business and that it’s time to take a different approach.
But can’t you just do this list of things?
I get it. There are some things that brands ‘want’ on-site. Sometimes the data stacks up as to why these should be done, but there are many times that it doesn’t. When we talk with brands about their ‘list’, our team will try to search for evidence and data that support doing these tasks. Although this is the case, it's very difficult to convince a brand that wants to work this way that CVO is for them.
More importantly, it doesn’t make sense for us to ‘convince’ or even ‘hard sell’ on CVO. The thing with CVO is that it’s often a change in mindset towards eCommerce. Like the brands in ‘Thank God! Let’s go’ category, they’ve made that switch in their head as to where they need to be.
What brands can do to see if CVO is right for them?
In all honesty, you need about 15 minutes with us. We’ll just need to ask you 5-6 questions, and off the back of this, we’ll be able to tell you if CVO could be an option for you.
So, ready to find out? Click here to arrange a chat.