Shifting Financial Marketing into Gear
A/B Testing: Evidence-Based Financial Marketing
At the core of financial marketing lie concrete numbers: monthly performance, percentages, P/L, fees, ratios, minimums, margins, and returns, to name a few. And while marketing is often referred to as an art, when a scientific method such as A/B testing is applied (resulting in concrete numbers), financial marketing can become an even more powerful medium.
A/B testing is a way for financial marketers to pinpoint the most effective components of a promotional marketing strategy. It can be used to test various aspects of a campaign: from emails to website copy and forms, to online ads.
A well-planned and well-executed A/B test will reveal which elements of a promotion are the most effective and impactful; Which one resulted in the most conversions, click-throughs, and engagements, for example. A/B testing reveals empirical data that can be used by financial marketers to ensure that the next campaign is positioned for success and optimum ROI.
What is A/B Testing?
Also known as split testing or bucket testing, A/B testing is a method of comparing two versions of a marketing component over a given period of time — such as a webpage, app, or email, for example – to see which of the two variants performs better.
Two versions (A and B) are compared, which are identical except for one variation that might influence a user’s behavior. Version A might be the current version being used (control), while version B has a single aspect that has been modified (treatment).
A/B testing pits just one element against another to see which element performs the best. Testing several elements at a time to see which combinations best work together is called Multivariate Testing (which we’ll cover in a later post.)
What Should Be Tested?
Almost any aspect of a financial marketing campaign can be tested: subject lines of emails, headlines, website copy, calls to action, forms, graphics, ads, etc. However, it should be noted that what should be given focus on are the elements that are likely to have the most impact.
For example, on your website, testing one element against another could include:
- A landing page headline
- A call to action (such as completing a form)
- Product or Service descriptions
- Graphics used in ads
Testing different offers is also important. For a successful test, a marketer will need to ensure that each person is always offered the same promotion. For example, if an eBook on managed futures is offered to group A, and the same content on managed futures is offered in a video to group B, then group A should always contain the same visitors, as does group B.
How to Plan an A/B Test
Aside from using A/B testing to uncover data that can positively impact a financial firm’s bottom line via marketing, it is also common to use A/B testing prior to implementing business changes such as refreshing a brand or creating a new service offering.
No A/B test can be successful without the creation of a well-thought-out plan. Here are 4 key steps to take in planning you’re A/B test:
- Define Business Objectives – For example, a business objective for a retail futures brokerage could be: “Increase our trading platform demo requests”.
- Define Website Goals – Goals are priorities tied to the business objective are strategic.
1) Do X – Add better platform feature descriptions
2) Increase Y – Increase demo form conversion rates
3) Reduce Z – Reduce demo request abandonment rates
- Define Key Performance Indicators (KPIs) – KPIs are numbers that help marketers to understand performance in relation to their set objectives. Example, the retail futures brokerage wants to issue trading demos. The KPI could be the number of leads requesting demos through a special landing page form on the website.
- Define Target Metrics – The retail futures brokerage issues 199 demos last month. Is that good? Or bad? For a KPI to mean something, it needs a target metric. For every KPI, a monthly target should be defined.
How Long Should an A/B Test Run?
A successful A/B test requires sufficient time to collect enough data to be statistically accurate. Inversely, running an A/B test for too long can also mean skewed results, since over a longer period of time numerous variables can surface.
A/B testing can run from a few days to a month. We would recommend taking a few weeks to run one test variable at a time, and make sure to note any variables that may affect test results. If anomalies surface, be sure to retest.
Among the benefits of A/B testing, it can be performed continuously on almost anything. The good news is that most marketing automation software such as HubSpot (and many email marketing systems such as Campaign Monitor) come with built-in tools to not only run A/B tests, but that automatically adjust to show the version that performs the best once it has collected a threshold of data. Additionally, agencies like Gate 39 Media can help take the guesswork out of planning, testing, and interpreting results so that you can uncover data to support the success of future marketing efforts.