Today Amy is talking with Nick Disabato about research-driven A/B testing for PPC marketers. Nick runs a CRO agency that specializes in A/B testing for growing businesses, and he’s authored a book about interaction design. He’s got a unique approach and ability to solve expensive problems businesses are facing, and he’ll share his thought process with us today.
Highlights and Takeaways
- Research-driven A/B testing is about a lot more than changing and testing your CTA’s or colors.
- True design research comes from listening to your customers BETTER and in-depth analysis of many factors
- Analysis should include everything from heat maps to what device people are coming to your site from, and everything in between.
- Things like slow mobile page speed can derail your AdWords conversion rates
- Conversion rate optimization touches every aspect of the organization, and getting everyone on board is your best shot at achieving optimal results.
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Amy: All right, Nick. Welcome to the podcast. Thanks so much for being on.
Nick: Thank you so much for having me.
Amy: Well, I’m really excited to have you on the show. I think that I was introduced to your work actually through a newsletter of someone who was raving about the results that they got with A/B testing and working with you on that and I have to say, I was pretty impressed by the results you were able to deliver and looking at your site from there, I clicked through and I got to your actual page and I was a little bit surprised and maybe underwhelmed like, whoa this is just like, there’s a lot of gray and it’s very text heavy, and I was kind of surprised that for doing so much testing that, that’s what you had kind of lead with for your sites.
I was wondering if maybe you could give us a little bit of background on why that choice, why that approach, and how it’s working for you?
Nick: Yeah, it doesn’t look like a typical CRO agency’s website.
Nick: It doesn’t look like a typical designer’s website. It’s very text heavy and there are a couple of reasons for that. One of them is it allows me to focus more on the communication element and the pitch and so it’s something that I need to convey that there is an expensive problem at hand and that I’m capable of solving it. If I strip back everything but the writing, it is easier for me to convey that.
Another thing is people, I think all people are very visually minded. I don’t believe the idea that designers are visually minded. I think that everybody kind of, they focus on like a screenshot or on a specific case study or something like that, and that’s not really the thing with A/B testing.
It’s more like developing a process and that process should probably be custom tailored to your business’ needs – so not having screenshots there and not having specific like, “I changed the call to action to this color and made them $1 million”, the typical things you’d see from an A/B testing agency, I haven’t found it to be useful or even like constructive for us.
I changed the call to action to this color and made them $1 million.
Amy: Well, that makes a lot of sense and I like what you’re saying about getting the right process. It’s not just trying, just testing one layout treatment against another that’s so important and I want to make sure we dig into that a little bit. To kick things off, I was wondering if you could give us a little bit of your story, how you got into this, and what you’ve learned along the way?
Nick’s story & background
Nick: Yeah, sure. I have a UX and interaction design background and wrote a book about that in 2010, and worked for a bunch of clients on research driven, like what if they need more technical projects and sometime in 2013, I was like, well, what is the Venn diagram overlap between UXC things that I feel okay doing and things that I can do on a monthly retainer so I can get some sort of consistent, durable income in, so I don’t just have one-off projects and then I have to continually go through the sales process because I was kind of getting burned down on that.
Nick: I figured A/B testing would be a good place to start and so I just launched the thing that was like, “I run A/B tests for you.” and it was very much like the “I changed your call to action to red” thing.
Nick: It was not quite as sophisticated as it is right now, but I launched it and it did really well, like I sold out all the slots immediately and there was a lot of interest in it and I’ve been doing that since. I’ve kind of doubled down on it with my business and focused on how to build out that process in a way that listens to your customers a little bit better, and comes up with solutions that really meet their needs.
Creating real solutions means listening to your customers BETTER.
Amy: Sure, could you explain a little bit more about what you mean by listening to your customers better?
Nick: Yeah, so it’s effectively, it’s design research but it takes a lot of different forms so it can be everything from looking at Google Analytics to see how they’re actually gaining on the site, and where they’re going and what they’re trying to do and where they’re coming from, both devices and geographically, to heat maps like where they’re clicking on a page, to actually surveying people after they make a purchase.
Asking them maybe a one question survey on the thank you page or a few days after they receive a product in the email if it’s a physical product, that sort of thing. To even running a survey tool to screen people out to run interviews with them so I won’t go so far as to get on the phone with people and ask them very non-leading questions about their experience buying the product. You take all of that information and make a checkout flow that’s a little bit more usable. You make a pitch that is maybe a little bit more attuned to how people actually are using the product and what they need out of it and how it empowers them.
You’re doing all of this in the service of obviously, increasing the conversion rate, like you’re doing it in a way that makes it easier for people to place a transaction and also makes them feel better about doing it.
Success with AdWords is about the entire process, not just the ads.
Amy: That’s some really good stuff there. No, I was just thinking, so many times we, especially I’ll say within the paid search industry, we don’t have access to that so I was like I need to understand what my clients or you know, my clients’ customers are thinking for even writing a better headline on a better ad and we just are kind of like, well, here’s the landing page. Your job is to get their IQS and send it there, but that affects every stage of the process, right. From the checkout flow, the pages that they get to, but even before that with just how people are searching in the first place and the types of ads that’s going to appeal to them. When you’re working with people who are doing AdWords, do you ever share that sort of research with them to help them out or is it just kind of, it informs the page so well that at that point, they don’t need it because they can just use the page to create the ads afterwards?
Nick: Yeah, if I’m working with people who are dedicated on AdWords, yeah. I mean I wouldn’t keep the research to myself or anything. I try and publicize as much as humanly possible within the OX so procedurally, I usually have a travel board and that’s the place where we’re vetting test ideas. Then I also have a base camp project where I’m just posting all of the research. Anybody who wants access to those things can get access to them. I don’t think it’s like some sort of secret, like C-level …
Nick: Understand what’s going on with it because it also, it goes both ways, right. If you are on AdWords and you see something performing particularly well, I should know about that, right. You are in customer support even and you get a lot of complaints from customers about one specific thing. I should know about that because it’s something that a potential objection that I can be addressing on the product page or on the home page or marketing page, something like that. I don’t think there’s, I can’t even think of a situation where that sort of communication would benefit the organization if I held back on it because there’s definitely a back and forth, yeah.
Amy: Yeah, yeah. I actually, and this is just a purely anecdotal so hopefully it’s not too much of a tangent, but I have one client where we could never figure out what their customers wanted and all they were willing to say was, “We’re high quality. We’ve been in business for a long time and we value our customers.” That was it, that was supposedly their unique benefits and we’re like, this doesn’t resonate with anyone. You have to get more specific, and we couldn’t access their customer service department. We couldn’t access anyone who would have any sort of knowledge beyond that. We tried and then just nothing works and then they got a new person who kind of oversighted it, hey, what can you tell us that’s going to be useful? He’s like, “Well, I did my research. You need to do yours.”, and it was just like such a withholding and crazy thing. That’s definitely not the norm by any means, but this is the one time where we just could not break into the psychology of what their clients even wanted and they were so withholding about it.
I’m glad to know that, that doesn’t happen everywhere and that you are willing to share because I mean it definitely seems like a collaborative environment is preferable than the one where everyone is just holding their cards really close to the chest there.
Nick: Oh, yeah, yeah. I think this is a good point to be emphasizing actually. It’s conversion research affects every single part of the organization.
Conversion research affects every single part of the organization.
Nick: I’ve experienced, I get fewer gray hairs when it comes from the top and everybody is on board with it so my job is strictly speaking, to run A/B tests for a client, but more broadly, I try and get people onboard if they’re enthusiastic about it, I talk to them about what it is we’re trying to be doing. If you want the business to succeed, right?
Nick: Okay, then ditch your ego and let’s figure out a way to actually try and work with that. That goes for anybody, from designers to marketing to sales to support like you’re all trying to get on the same page and I believe that people operate with the best of intentions in spite of everything, but it’s one of those things where if you’re not, if you’re talking about the organization that you were working with where everybody’s kind of holding their research close to them, I don’t see how that can be valuable and that seems to me like an opportunity to break down that barrier.
Amy: Yeah, yeah, for sure and in some cases, let’s hope that, that person gets fired because there’s no working around it, but absolutely, yeah. A collaborative environment makes that so much easier and especially when we can influence the landing pages too. My experience, just you know, from working with a lot of different clients across a lot of different agencies for well over a decade, is that a lot of people don’t understand what a landing page should be. They will literally think that if a landing page has any sort of contact form on it at all, that’s a lead gen landing page. Even if it is literally a Contact Us form like in the footer of their page, like well, that’s where we collect leads from and that’s as far as they’re usually willing to go because it’s pretty good as far as they’re concerned. I’m wondering if you could maybe tell us a bit about in your experience, like what potential benefits, I guess there’s two things.
One is, the potential benefits of testing like the upside of that, but then also of just the outcome of having a more optimized page in terms of what can, what’s kind of the promise of testing and optimizing and getting everything ready for, getting everything going with conversion rate optimization so they can really see the other side of that.
Nick: Yes, I mean very broadly, the goal is to make more money than you put in it, right, so if you hire an expert like me for it, you’re going to be spending a fair amount of money. If you want to get your entire team on board with it, well, they have to learn a lot of new skills and a lot of, they might have to cross pollinate a lot and that takes time and effort and that effectively cost the organization money and so you know there’s a kind of, for a lot of organizations, it can be high risk, high reward.
Paid search optimization and conversion opportunities can come from unexpected places.
Nick: There are a lot of quick wins that you can be doing around it. I can speak just some of my own case studies with it. One client hired me, oh gosh, like four or five weeks ago now, we’ve been working together and I came into their site and you would think that this would not be part of A/B testing or conversion rate optimizations. This might be a little bit surprising, but I came in and I looked at their analytics and I’m like, okay, well, 85% are on smartphones. That’s really cool, that’s more than I usually see, you know, at this present time. The average load time for a page is 16.8 seconds.
Amy: Oh, wow.
Nick: You’re still an $8 million business and so I’m like, okay, well, you’re succeeding in spite of yourself.
Nick: I go into your page and I look, it took going into analytics to be surprised about this because I have fast internet at home and I don’t think about that stuff. I’m just looking on my desktop all the time. I go in and I see that two things have happened. Number one, they have not compressed any of their images and they are just serving full sized images that are downsized and number two, they had 12 different video previews and they were all calling the same 1.2 megabyte java script file over and over and over again with the video’s hosting framework. This was like just neck beardy, we’re going to reduce the page wait time.
Nick: That was the first two weeks of our engagement together, and I know that sounds crazy to think about, but I’m like, “Okay, well, we’re going to reduce your page wait from 19 megabytes to 6 megabytes and we’re going to see what that does to the conversion rate because frankly, it’s probably hurting your bandwidth bills and this is stuff you should be doing anyway, and they’re like, “Okay, we’ll go along with it.” I spent all of my capital at the very beginning on this without running a single A/B test. I made them five times the amount that they spent on me upfront and we still haven’t run a test yet in the first month. I bumped their conversion rate but I think it was like 9%, something like that.
Nick: There are raw transaction volume by something like 8% and that was just by going in and being like you’re leaking money here, fix it and do that if you haven’t, don’t even have the statistically significant traffic necessary to run A/B tests. I don’t know why it took them hiring a fancy consultant to come in and do that, but here we are. I fixed the problem. I made back more than they spent on it. That’s one such example. I can cite more examples but I think that’s a good kind of jumping off point.
Google’s journey with mobile speed within the paid search community
Amy: Yeah, that’s a great example and it’s funny you mentioned mobile. This is such a hot thing right now, just for everyone. Just to give a little bit of context especially for people who are listening who maybe aren’t as familiar with Google’s journey with mobile speed. The situation we’ve had for quite a while, I’ll say within paid search, is that most people have had a really they’ve had, they’re designing for desktop, right and so usually they’ll ignore mobile or smartphone experiences and that hasn’t been really tragic for them necessarily because most people are more comfortable making a purchase on their desktop than mobile so even if they had a mobile optimized site, people would still, the theory was mobile moments where someone’s researching on their smartphone and then purchasing on their desktops so it wasn’t a big loss if you didn’t really have everything optimized up front, but particularly, I think and kind of a play to get some of the, to get more clicks right.
To justify paying for clicks on mobile, you have to have something, a nice conversion rate and a nice CPL or ROI there and so to really encourage that, Google has been pushing very heavy handed to get people to optimize for the mobile experience and so, all of a sudden last year, having a landing page that wasn’t optimized for mobile, was a hit against your quality score and how much you are paying.
Nick: I saw that, yeah.
Amy: Yeah, and having, we’d have to start going to the, I think with Google site and be able to say, “Hey, look. Your mobile speed is 55.”, like these are really bad. We need to start taking action on this in order to get a better quality score, you know all this stuff and people were really resistant even though it’s completely 100% in their best interest to do so. They’re like, well, that’s more of dev thing and you’re more PPC so we don’t really think you should be telling us what to do. It was like so weird because it was like, yeah, but it’s going to help you and you’re going to pay less so that makes it a paid search thing, and really it would’ve been either way and you know Google is just trying to fast track that a little bit, but I think everyone, it’s going to be, there’s no need to silo it out like getting conversion rate, getting conversion lifts where we can is in everyone’s best interest.
Nick: Yeah, and you know I’m not the first, I’m not the person in the world to like take everything, Google says the most seriously all the time I don’t think they always have everybody’s interests in mind because they’re a giant monolithic corporation, but I actually trust them on the mobile thing. They are, the mobile thing being them wanting to develop mobile first, them wanting to create a decent mobile experience for people, them wanting to reduce page wait and all that. It’s not even just because they own Android, it’s because they see the numbers go up when mobile experience is improved of considerable amount of my tests are targeted exclusively to smartphone users to make it so like things aren’t preloading in the background that shouldn’t be so that you can get to the first page refresh really quickly, so that the navigation isn’t busted.
I mean there are some one-off tweaks that I recommend where just to get your keyboards in order so you have your form field setup so when you tap the email address field, it gives you the little @ sign at the bottom of the keyboards so that you can enter an email address easier. Just basic, basic stuff like that and they, I personally, I buy things easier on mobile when I’m in that situation, more people are moving into cities where they’re going to be on their smartphones more frequently in really low bandwidth areas, like if I’m on the subway or something, I live in Chicago and I can’t tell you how many times I’ve had 10 megabyte pages trying to come down the pipeline and I can’t be alone when I’m experiencing that.
Nick: There’s 3 million other people in Chicago at least so, and most of them use the subway.
Nick: It’s a weird, I do not understand why the resistance on the part of everybody because then, the search people send you off to the developers then the developers are resistant because they don’t see conversion rate, it becomes the chicken and the egg argument. Even though you look at anything Luke Wroblewski says or that you see Jonathan Stark talking about, who are big fancy mobile consultants and they’re just kidding you over the head with statistic after statistic saying, if you’ve designed your site for mobile, you won’t make more money than you spend on it. Maybe you should do that.
Amy: Yeah, I’m wondering if it’s a little boy who cried wolf sort of thing because I remember in 2006, this is going to be the year for mobile and we’re all kind of gearing up for it and it never really came and so maybe now it’s just like, yeah, you say that every year, no one, and maybe people are just a bit removed from that because I don’t really understand why you wouldn’t want a good experience like other than the fact that it’s more work, right. It’s more work initially to get everything going. It’s like, okay, one more thing to do, but in terms of making sure your customers are happy, that’s priority number one for conversion and retention and everything else so why would in knowing, if you can walk in and say, hey, this percent of your clients are using this sort of device, like why would you not make that effort?
Nick: Yeah, and I’ll tell you, I’ve worked with about 50 clients where I’ve gotten access to their Google Analytics in the past two or three years, and I have not once even for the crazy enterprise SaaS once, seen anything but a year over year substantial increase in mobile engagement.
Amy: Yeah, yeah and everything that I’m seeing is the same sort of thing. If we look year over year, well, last year, it was less valuable than this year. It continues to be an even better opportunity so.
Nick: Some day it’ll become unignorable and we won’t have to have this conversation like in 10 years or so.
Amy: Yeah, and then we’ll talk about, remember when people didn’t use to optimize from mobile and no one will believe us. They’ll be like, yeah. That’s not true. That’s just a myth that people say.
Nick: Remember when people’s websites were just flash apps?
Amy: That’s exactly what I was thinking like that used to be the thing, right, is saying, hey, don’t just design and flash, like oh, you don’t understand design. This is the way to go and now no one even remembers that.
Nick: Yeah, yeah, it’s going to be that.
How to get started with your own A/B testing
Amy: Well, I hope so. I would be very happy if no one remembers that headache. In terms of people getting started with testing, if I’m like, okay, I want to start making some test on my site. I know that just changing the button color, isn’t that right way to go?
Amy: You mentioned earlier, the process of testing and then process for your clients. What are some recommendations you would have around that?
Nick: Well, the first thing that you should do is research and people, they’re similarly squeamish about the word research so just hitting all the buttons just to.
Nick: It’s not even that. It’s a matter of looking at things that you often already have in front of you like Google Analytics and trying to assess what is motivating people to do this thing and trying to make hunches based on that. You might be already doing this to a degree, right, like you might be looking at your analytics and being like, well, the conversion rate is low or our bounce rate is high or people are going to this page and not taking action. Okay, well, that’s the thing that’s happening. The next thing you do is figure out at least a hunch. Take a stab at it, why are people doing this, right? Look at the page, look at people’s motivations, try and dig into it a little bit more. The instant you get to at least the briefest explanation of why, you can start to come up with testable ideas, right. If you have a landing page and you’re driving search traffic to it and it has a really high bounce rate, people aren’t like signing up for a free email course or something like that.
Well, maybe the pitch is off, maybe the type of search traffic that’s coming in, you’re not speaking to their needs well enough so one of two things is probably going to be the case here, you either have an idea of how to solve that or you have more questions. It’s probably the case that you have more questions when it comes to something like a pitch so then you put up a little banner that’s like, “Would you like to take a five-minute survey? We’ll give you a free gift card or free month of the service or something like that erf, erf, erf”, and then you send people along the survey that ask more questions. Qualitative insight is probably good in that situation and so you have a playbook that gets more information in and then you have, oh, now I have all these survey responses. How do I try and act on that? That’s a new problem in front of you and then you’re trying, you’re basically sleuthing out what the issue is that’s causing you to have a high bounce rate or weak conversions or whatever have you.
This is a playbook that I don’t think it comes intuitively to people. It’s something that like I’m citing all these things, but how do you know what to do with survey in the first place, right. The answer is read a couple of books about design research because they will teach you all of those things. Probably the best resources for that is just enough research by Erika Hall. You can read that in an hour and a half on a plane flight like it’s super [inaudible 00:23:33]. If you want something that’s going to take weeks, Designing for the Digital Age by Kim Goodwin is amazing, but also a thousand pages.
Amy: Oh, wow.
Nick: That’s the deep dive where if you want cover walls with post-it notes and think for a while, that’s the resource for that, but take a look at those things. They offer the playbook and understand, okay, well, what is motivating these people? Putting up a survey tool, Google forms is $0. Google Analytics is $0. Do you want to run a heat map and see where people are clicking and aren’t clicking? I use hot jar for that, that is I think 29 a month is the cheapest plan for that and you frankly, don’t need a more expensive plan. You can throw all of this on the petty cash card if you’ve got one. You can do it on an, extremely limited budget or use a free trial if you absolutely have to and you’re just doing that to say, “Okay, well, hear the problems.” I find with my clients they know what the problems are but they don’t really have a process together for trying to solve the problems. The most common situation that happens is I define the process, they start to learn from me, they start to do it themselves.
I know that I’ve won as an A/B tester when I log into my A/B testing framework and I see other people have created heat maps. You know, it takes two minutes to do that. You type in the URL and you hit go so anybody can do it, but once they do that, they’ve gotten empowered they’re like, “I was curious about this thing.” I’m like “great.” You’re going to, we’re probably going to part ways in three months because you have learned everything you need to know and that is fantastic, like please learn how to fish and then fire me. I don’t want to have to be there forever.
Nick lays out his process
Nick: Overall, the process is you lay out the problems, that’s the number one, right. You have a high bounce rate on this page. Your conversion rate is low. Number two is try and assess why that might be. Do you need to do more research for it? Okay, great. Figure out what the research is. Do you have a beginning of hunches and some answers? How confident are you about those answers? Okay, if you’re pretty confident, move to the next step. Now you come up with testable ideas, rework the pitch, sweeten the deal by adding a freebie for an email course or something like that. There are a lot of different ways to skin the proverbial cat of a high bounce rate but you end up coming up with specific tactics and then you test them.
Lay out the problems
Assess why you’re experiencing this problem
What research do you need to find answers?
Create ideas that can be tested and tweaked to ultimately find a solution to the problem
Amy: That’s a really good framework to take away so thank you so much for showing that. I think that those are really good and actionable tips. I wanted to ask you about something that you were saying with respect to people logging on to say Hot Jar or really anywhere and making changes and that’s to you, a sign of success. Just because from my perspective, someone’s logging into AdWords, that’s a sign of failure, like do not touch my account, right, under any circumstances, do not get in there and be like, “Hey, I thought of some keywords.”, or I thought of some change to make or some test because that could really ruin the success of the account. It’s going to mess with budget, it could you know, there’s all sorts of problems that can happen and so I just want to make sure that we’ve got a clear delineation. If you have clients, do you want them to be, like there’s no risk that they’re in a testing tool? There’s nothing like if they create another heat map or survey question, that’s not going to throw off what you’re trying to learn, is that accurate?
Nick: Yeah, if you’re, let me make the distinction. If you’re doing things to edit a page be it in A/B test or you’re logging to get repo in editing. It’s a page, a task or something like that. Those are very bad. Don’t touch those. If you’re just trying to gather more data like a heat map is basically just I’m listening. If you get to the process of wanting to listen more where your like create a report in Google Analytics or something like that. If you’re not messing with my install or you know you might have questions about or something like that, that’s fine. Go off and do your thing, but yeah, that was kind of what I meant by that. It’s like passive data collection rather than like actively mucking with the customers, that’s not okay, I won’t be okay with that.
Amy: Right, right so I just want to get a little more clarity because it is such an interesting phenomenon, right, with people didn’t care about something and they suddenly care about it and so when those are our clients, how do we best harness that, that energy and enthusiasm but also make sure we’re not messing anything up so I just want to make sure that I’m really clear, given a hot jar scenario where you can have unlimited survey questions but every time you ask a different survey question, if you’re only serving these questions, so say 20% of your population, then you’re not going to get, you might lose the ability to get the certain questions you wanted answered shown enough because you have limited traffic and someone else is asking a question that frankly, is not as useful even if they’re excited about it.
Nick: Yeah, yeah and I mean we should all be grateful that other people are getting enthusiastic about what it is we’re doing, right. The opposite is you’re operating with no support and no interest from other people and I found people to be a little bit more frustrated in those situations like why are you coming into work every day, right?
Nick: I feel the same way. If I come in and your team is not enthusiastic about optimization, I have my work cut out for me and get a lot more gray hairs. I don’t like that at all, but I would rather have an opportunity to set some clear boundaries about exactly how we’re going to be running A/B tests. That seems to be like the more interesting, it’s a challenge but it’s still, it’s a more fulfilling one.
How to offer well-rounded advice when you’re just a paid search contractor
Amy: Yeah, yeah that makes a lot of sense. I think that question kind of leads into this next area that I wanted to tackle with you where, as someone in paid search whether, and I think this probably is less true if it’s in-house. I thought there’s intensity, more collaboration if you’re working on paid search in-house, but if you are an agency or in some sort of contracting situation with a client. There is a real tendency to just, someone who is very compartmentalized like well, your job is paid search and they just think of paid search as sort of a pre-click scenario like how what’s happening within the Google search engine results page and are not realizing that our ability to get results for them is really based on everything that’s happening afterwards. We are going to have a lot of suggestions like well, maybe you should optimize this page’s value in doing that and we can drive better results if we increase the conversion rate, but given that, I don’t have access to my clients, even to say let’s spend $29 a month on Hot Jar.
I can’t make that decision on behalf of the client. I’m not scoped for that. I would have to convince them to do it so it’s very much a backseat driver situation and if there’s something I’ve had a lot of experience in, then it’s pretty easy to come in and say, “Hey, guys. I’ve done this for a million clients. This is how it works.”, and just kind of lead that discussion, but if I’m just trying to break into, which I know a lot of people are. They’re like, okay, I see the value in this but I’ve never actually done it before. What are some, either tactics or tools that you would recommend for how it could kind of get our client on board with that even if we don’t have the experience to say, and I’m the one to lead you here, but just this is an action you need to take.
Nick: That’s a great question so often, usually I start by working with what we already have so I don’t know a single person that doesn’t have Google Analytics installed and so if I have access to that, I can actually do a lot to build a strong case for future optimization efforts and say, okay, here are some problems that we’re experiencing, because that’s pretty easy to source out in Google Analytics, and here are some things that we can possibly do to try and address that, but I need the resources to understand that better so if you’re going to the next level of research, you don’t have that, you don’t have that informed guess yet. You would need to be like, okay, well, I’m thinking about it this way, I would like to try this out here. If they’re stonewalling you for some reason and they’re unwilling to try new things, then it might be a motivation behind that so then you try and ask, that is there.
There’s a common UX research technique that I use on clients all the time called the five Ys where you ask, okay, well, why are we interested in doing this right now? Well, because we don’t think it’ll help. Okay, well, why don’t you think it’ll help? You go with this, and by the fifth why, you get to the actual truth which is like this person over here, tried it once and it was a miserable failure and we never speak about it anymore.
Nick: The CEO doesn’t believe in heat maps because question mark. Then you have an actual problem in front of you, right, and not just somebody like hedging on it. That is much more easy for me to address. In that situation, I might talk to the CEO and state my case for it or talk to this other person or try and understand why it broke down for that other person in that situation. I think the answer is work with the like work place political situation you’ve been presented with and hope that it’s not a trash fire, but I think that’s the case in any organization. I don’t know. It’s something that I, you know a lot of the time I’ll come in and half the team will be interested in optimization or half the team won’t be communicating.
It’s very common that I will be in a SaaS business and the support team will be simultaneously sequestered over to the side here and utterly hairy because nobody listens to them and then I have to come in and be like a very empathetic listener on the support team and get on a really long Skype call where I just sit and nod really gravely for a long period of time and then I go over to the CEO and I’m like, did you know that this happens? There’s a terrific post by Dan Luu that I’ll send along to you about the normalization of broken practices.
He focuses on software engineering but I see this happen all the time where a new employee comes in and they’re like, “Oh, my God, this is horrible. Why are we doing it this way?”, and everybody else around them is like, “Oh, yeah we know about it. We’ve just chosen not to look at it.” Then eventually, they become acclimated to the fact that it’s a broken horrible practice and then the next new person comes in and like, “This is broken.”, and then the second newest person is like, “Oh, yeah, we’ve always done it that way.”
Amy: Right, right.
Nick: This is probably resonant among any industry if knowledge were a crime. I would [inaudible 00:34:52] that, I was like, oh, my God. That’s 10 years of my career.
Nick: If you’re coming in and you’re not proverbially woke to optimization, that’s the kind of challenge and understanding that and performing that labor is it’s part of the role. It’s something that you know, and if you don’t, if you do it and it falls on deaf ears and you’ve tried every single route, I mean my friend, Cennydd Bowles wrote a book about, it’s called, Undercover User Experience Design. That’s another really good one to read about doing research on the fly with no support, but the last page is basically like, if you’ve tried all of this and no one is listening to you, quit.
Nick: That’s kind of what it comes down to sometimes. You wonder why you’re there and it doesn’t happen, thankfully it does not happen terribly often with my line of work because usually you’re paying for a consultant for a reason and it’s usually coming in from the top, but I can easily imagine somebody hired by the growth team who doesn’t have full CEO support. I’ve seen a lot of stories about the growth team being not connected to the design team, which is a no no, or connected to other teams like sales or marketing, they are also no-no’s. Your job is to isolate that, that is a problem and do it. You tend to try and fix it and it’s not easy.
How do you set your prices as a contractor?
Amy: Yeah, well, one of the things that I think and I know we’ve got to wrap up here in just a minute, but I think that this touches on a broader either discussion or even just some thought questions, just in terms of research and effort and probably pricing because a lot of what you’re describing, you’re going to go to this team, you’re going to solve these problems, you’re going to hop on these calls, a lot of that is frankly out of scope with how most people are pricing their paid search work, right.
Amy: It’s usually it’s either a percentage of spend, which isn’t necessarily the best model or it’s a certain number of hours a month and there’s different pricing models that paid search uses, but very few of them include like interviewing hours and solving these bigger problem hours and so it’s kind of like well, it has to come from somewhere and so if we’re busy or we’re maybe priced too low, it stops being an option if we want to stay competitive in terms of our rates. I understand that you kind of came into a similar situation with design, right. You’re definitely not low-end design price and you’re pricing yourself for those results and for the time it takes to get those results. Is that accurate?
Nick: Yeah, I mean if you apply for draft revise, and maybe you could today. The application page, there are two different questions. One at the very beginning of it that said, “This is a high touch serious business consulting service. It is less like hiring somebody on Upwork and more like buying a brand new Honda Civic. Are you okay with that? Yes, no. No is default.” If you go to no, I never even see the application and then the next, then like four fifths of the way down the application, there’s a question that says, “I wasn’t kidding about the Honda Civic bit.”, with a really long list of multiple choice answers and one of them is like, “I know, I know we’re good.”, and then one is like, “I didn’t read the Honda Civic. What are you talking about?”, et cetera, et cetera, et cetera and then a bunch of joke responses because I need to lighten the mood somehow by conveying to you that, “Yes, you are spending nearly five figures on this.”
The more you remain to why that is and why that pricing exists, I sell based on an outcome. The goal is to have an increased conversion rate. If that is worth it to you, there we go. I try and accomplish that by any means necessary including reducing the page wait of your site before I run a single A/B test or trying to reduce costs on your side. There’s another case study I ran where I had an e-commerce store where we pared back all but one of their product lines and saved him, I think 33% of their operating expenses on manufacturing and shipping costs.
Amy: Oh, wow.
Nick: That was one of the only successful A/B tests I ran for this client, but it made them like hundreds of thousands of dollars so they didn’t care, you know and it wasn’t even, and their conversion rate never went up as a result of that test. It’s your, what I would recommend in this space is what is the outcome of improved paid search, right? What are you trying to get to as a result of that and what is the economic impact for the business, because then you can price as a percentage of that and understand, okay, well, it’s not just the keyword spend because that seems, but it’s more the like outcome, right, or the predicted outcome because what I’ve tried to do is decouple my pricing from the actual outcome. The goal is to make back more than you spent on me otherwise fire me, and that could be 50 cents or $500,000 right.
You’re focusing on the one problem and I think that the tactical business thing in this situation for your industry and those listening to this would be try and decouple the pricing from the outcome while also focusing hell bent on outcome and that seems a little bit counterintuitive but it allows you to say, “You’re hiring me? My time is worth something. This is a premium service.” It is meant to accomplish a lot of different things because I don’t think that the, and correct me if I’m wrong on this, but the things that we’re talking about in this podcast are not necessarily out of scope for an engagement like this. People find themselves doing it in some fashion. At least the internal political things that end up occurring, and so I think that is valuable to be considering when you’re pricing out your offerings. Is that fair?
Amy: Yeah, I think so. I mean I would say that along with pricing out is setting those expectations as well, right. There’s one aspect of like, “Well, I know this is the work I’m going to be doing so how am I going to charge for it?” There’s frankly, a different aspect of helping someone understand that paid search is not just specific to “managing” spend in the interface because it’s just one of those things people don’t really understand the entire scope of what’s happening and I, most of my clients do not understand that they need to have good landing pages in order to have a successful paid search campaign.
They think that successful paid search is keywords and everything else is just how well did you do on those keywords, which is, they just don’t understand it and to some extent, they have the right to understand that, to not understand because that’s what they’re paying us for but there needs to be a little bit of education at least to say, hey, you know what, there’s this other thing and once we fix that other thing, everything else is a hot knife through butter and it’ll work so much better so let us help you with that because we can see what’s wrong with this. We have all this data to let us know, here’s the interest, here’s the demand and then people are not getting what they expected once they get to that page.
That’s something we need to fix so we have a lot of insight for that and potentially a lot of ideas and this is figuring out how to position ourselves to be the ones to take the next step and then also be able to charge for it that it might be, there are some agencies that definitely include conversion rate optimization with their paid search but right now I would say most do not. There’s a few specialized places that do but it’s not standard yet.
Amy: I think it is going to be a step for most people doing paid search today.
Nick: Yeah, and I think that’s kind of the key difference between being a contractor and being a consultant right, and you’re doing materially the same activity but you’re doing it in a way that is closer to the C-level and also you’re charging accordingly for it. I think that’s kind of what we’re talking about here.
Amy: Yeah. That sounds really good. Well, thank you so much. I know there’s a lot more that’s so interesting that we didn’t even have a chance to talk about, but if someone wants to work with you, they want to learn more about what you do or what you could do for them or for their companies, what would, or clients I guess that maybe they own multiple companies, but how can someone get in touch with you and learn more about your process and your work?
Amy: All right. Well, thank you so much, Nick. I really appreciate you being on the podcast and thank you so much for sharing all of your experience. I think there’s a lot of value in this. I just really appreciate it.
Nick: Okay, thank you so much for having me.
Amy: All right, thanks, bye.
References and Resources
Cadence & Slang, a small book about interaction design