Athleisure wear CRO and Experimentation strategies for growth

The athleisure wear sector is predicted to grow 20.9% between 2018 and 2023 to £6.7bn, and there’s an increasing focus for athleisure brands to produce sustainable products.

With the gym industry seeing a decline in 2020 as a result of Covid-19, it meant home-based workouts were the new norm for many gym go-ers. Pair that with athleisure wear being the perfect work-from-home outfit, it’s meant the athleisure wear industry has seen a boom in 2020.

Here’s some of the top athleisure wear brands:

  • Ivy Park
  • P.E Nation
  • Lululemon
  • Sweaty Betty
  • Alo Yoga
  • Varley
  • Unbridled Apparel
  • Alala
  • IVL Collective
  • Cuyana

And it would be wrong to not mention some of the top independent sustainable activewear brands:

  • Girlfriend collective
  • SOS Activewear
  • Silou
  • Contur
  • Scultura
  • Nimble
  • Perff
  • TALA
  • Lagatta
  • BAM

There’s data that suggests that unlike other markets, the athleisure market isn’t slowing, and even after all this time the players both big and small continue to expand. Brands such as Lululemon and Athleta are even looking to attract a more professional audience by designing clothing that can be worn in a formal office environment. This market could keep growing and growing if you can wear athleisure wear both at home and the office.

BAM Case Study: Experimentation

BAM,  or Bamboo Clothing as they are sometimes known, was founded by David Gordon in 2006. David, an outdoor enthusiast, came to realise that clothing made from bamboo is both incredibly soft and a sustainable source. Bamboo absorbs five times more carbon than hardwood trees. It needs half the land cotton needs to produce the same amount of fibre and it doesn’t need irrigation or pesticides.

The business is now 40 strong, and their CEO, Ryan Shannon is a strong advocate for CRO and experimentation. Up until recently they were running just 2-3 tests per quarter.

With a renewed enthusiasm for testing and a high-velocity experimentation programme in place Ryan says “we can see exactly how our customers are responding to the different ways that we tell our BAM story and that’s been really useful across things like tone of voice, imagery and positioning of our core values”.

Ryan has come to realise that both positive and negative test results are valuable to the growth of the business. “We’ve learnt to accept that a failed test is actually not a failure but a positive – in that you can learn quite a lot from it. It can stop you making mistakes in what you would have implemented without testing”

In the last year, BAM has surpassed their sales forecasts and now converted to scientific principles of test-measure-learn.

Athleisure wear – Lululemon

Lululemon is known for designing its highly technical clothing with a touch of fashion, and doubled their revenue in the four years from 2015 to 2019.

Shares of Lululemon Athletica gained 34.7% through the first six months of 2020, and their ecommerce business made up nearly a third of their sales in 2019.

We’ve taken a look at Lululemon’s homepage with our perception mapping tool. The lighter areas are what new visitors see within the first 3 seconds when they visit their site:

Our analysis shows that both the brand name and the model on the home page is pulling a lot of attention but is it converting into sales? Further research is required, and ultimately these findings need to be tested.

So how can you grow your athleisure wear business like BAM and Lululemon?

Perhaps you’re getting large amounts of visitors to your website, but you’re just not converting them?

Or are you wasting time and hindering your growth by spending time debating next steps and the direction for your website?

We may just have the answer… CRO and Experimentation.

CRO and Experimentation

First things first. You may have heard about CRO (Conversion Rate Optimisation) but Experimentation could be a new thing for you. What’s the difference? Let me explain.

In simple terms, experimentation is a mindset, and CRO is an application of this mindset.

Both involve running controlled experiments to identify which variation gives the best outcome, but CRO is often limited to answering conversion questions, e.g. Did page layout A or page layout B result in more account openings?.

Experimentation can help you to answer broader business questions. For example, how can I reduce my returns rate. Although it doesn’t impact conversion rate reducing your returns rate has significant financial benefits. Learn how we reduced Xero Shoes by 35% in this video.

Experimentation can be used to help a number of business units – Finance, Operations as well as marketing and product development.

 Business Question

 Suggested success metrics

How can I increase the number of people who start and finish the checkout process? number of checkouts started, completion rate, abandoned basket email open and CTR rate
 How can I reduce my Cost Per Acquisition? CPA, landing page conversion rate, cost per click, volume of orders
What is the impact of a new feature e.g. virtual fitting room? Conversion rate, usage of feature, Average Order Value
How well-ranged is my merchandise across multiple categories? Products per category, category abandonment rate, usage of on-site search, product views
How can I reduce my returns rates? Visits to size guide information, returns and exchanges sections, and returns rate
How can I reduce the number of calls and emails to the contact centre? Volume of queries, cost savings, visitor satisfaction

We recently ran an experiment where we tested reducing the product range – using the hypothesis that too much choice can paralyse customers. It increased revenue by 6% , but it also allowed the business to simplify logistics with less SKUs to manage, have greater purchasing power with suppliers and reduce complexity.

Experimentation can also help you to develop new products or services in a way that reduces the chance of an embarrassing and costly failure. Since you’re testing your new service – and it might be just a mock-up of a new service page – with paying customers you are reducing the risk of launching that no one wants.

CRO and Experimentation have a number of benefits for both you, your customers and your business. For example,

  1. Increase the speed that you launch new product, services or features
  2. Improve user experience to get more people to add a item to their basket, several ideally , return to the website often as well as tell their friends about their great experience
  3. Reduce costly calls and emails to contact centres and get users to the information they need faster
  4. Increase the ROI of your marketing spend and reduce the risk of wasting advertising expenditure
  5. Dominate your market – the more you test the more you learn allowing you to out-experiment your competitors.
  6. Create an experimentation mindset in your business, moving away from deploy-and-pray to step-by-progress progress based on real results

So to grow your athleisure wear business you need to adopt an ‘experimentation’ mindset, but most important of all, is a structured approach.

According to Econsultancy almost two-thirds (63%) of companies surveyed in their most recent Conversion Optimisation Report, don’t have a structured approach to optimisation, despite acknowledging the importance of this to their success.

A Structured Approach to CRO and Experimentation

One of our core values is ‘evidence over opinion’. Our adherence to facts and data – rather than guesses, hunches and well-meaning opinions – is fundamental to the successes and sales uplifts we have delivered our clients.

Our unique approach to CRO and Experimentation puts Research and Analysis at the nexus between the user and the business.

Research and Analysis

Our aim is to get inside the head of your customers and website users. This will help you to understand the ‘sales conversation’ going on in the head of your users. Focusing on the webpage, rather than this conversation, is like looking at conversion through the wrong end of the telescope.

Our research is a variety of approaches. Simply put, the more insight you have about your users the more powerful your hypothesis will be. Insight-driven hypotheses are a key component of a high-performing CRO and Experimentation programme

Research is divided into qualitative and quantitative, behavioural (what people do) and attitudinal (what people say).

Some of the research methods below require you to add tools to your website. Some tools like Qualaroo which is a survey tool can be added to your website via a tag management system, like Google Tag Manager.

A/B testing and personalisation platforms – like Optimizely, Convert, VWO, Monetate, Qubit and Adobe’s Test and Target – need to be added directly into the website code.

To get inside the heads of your users you need multiple research methods. We use over 32.

This body of knowledge is supplemented by the valuable research you may already have done on your customers, e.g. personas, market research, interviews etc. It is also useful to review your marketing plan and development queue in light of what you discover about your customers. For example, it may be that you are planning to roll out a new feature – and this will take dev team months of hard work to build and launch – but is there evidence that your users will find this new feature? Is there a way of testing this before the build stage starts?

Often, CRO and  Experimentation programmes help you to identify ways to avoid making investments in new features that no-one wants. Testing allows you to check your assumptions before spending huge sums on development.

Triage / Prioritisation

The research and analysis phase will generate dozens of possible hypotheses you will want to test. Triage is the name we give to our systemic approach to ranking and prioritizing these testing opportunities.

It’s important to get this prioritisation right. Building and launching tests have an opportunity cost. This means you want to run tests that have a good chance of a positive outcome.

There are a number of frameworks for prioritizing which tests to run firsts.

Some include factors like Potential, Importance and Ease, others use Evidence and Impact. See below for a framework we regularly use.

The most  important factor in the success of your programme  is that you have – and use – a prioritization framework. Without one you might be at the mercy of ‘those  who shout the loudest’.

We sometimes call  this approach the HIPPO way. HIPPO stands for “Highest Paid  Person’s Opinion”. Letting opinion determine which test to run is to put it mildly, ‘sub-optimal’.

Your CRO and Experimentation Roadmap

After completing the Triage (Priorisation) step, you are now in a position to create your roadmap; which hypotheses you want to test first and in which part of the website.

There are a number of ‘slots’ on your website – key pages in the online conversion journey. An effective roadmap ensures that you are running tests on this simultaneously. This approach gives your programme high-velocity. As soon as you have declared a test in one ‘slot’ you need to be ready to run another test in that now empty slot.

However, until you have run a test you’re not sure of the results. That’s why you’re testing after all. If you get a positive outcome it might be worth  running further tests to see if you can ‘beat’ that initial result. Conversely,  if you don’t get a positive outcome you should proceed to the next test in your plan.

Your test results will help to steer the direction of your programme, and  this means you are continuously updating your roadmap.

Creative Work and Testing

Testing is not delayed until the Optimisation Plan is completed. We start the testing cycle as early as possible in the programme, in parallel with research and analysis.

The first stage of this process is to create a wireframe, incorporating revised copy, if necessary. This wireframe is then reviewed and amended based on comments from customer-facing colleagues, AWA’s whole optimisation team and results of eye-tracking studies.

Once the wireframe is approved, it is developed on your testing platform in line with the brand tone and design style of your site. The test, or experiment, is then QA’d and launched.

Finally, an important part of the optimisation process, is to, where possible, hard code the winning variation into the native website code. Some testing platforms, such as Google Optimize, allow you to deploy your winning variations at a click of a button, thereby reducing the demand on developer resources.

Measuring your CRO and Experimentation Programme

The three most important numbers to monitor are

1. Velocity – how many tests you have launched per month.

This is the only number you have direct control over. According to Econsultancy, only 10% of those surveyed are running  more than 50 tests per year, that’s just over 4 per month. There is a positive correlation between test velocity and performance.

2. Win rate – what proportion of your tests result in a positive outcome.

A win rate of 90% indicates you are not being particularly innovative in your testing. A win rate of 5% may point to you needing better quality research in order to develop more relevant hypotheses.

3. Effect – this is the uplift you observe in your chosen metric

Your chosen metric might be Conversion Rate or Revenue Per User, but you should ensure you are capturing this metric, along with a range of user-based metrics that will help you understand the performance of the main metric. It’s important to decide and agree on stopping rules in advance; this will form part of your experimentation manifesto. Declare a test too early and you could easily have a false positive.

Every industry, including athleisure wear and fashion, is making a shift towards CRO and Experimentation, including Amazon in retail, Booking.com in travel and the Wall Street Journal in media.

And the gap is opening up between those companies who are using CRO and Experimentation to grow their business. See the difference below in the share prices of those experimenting and those who aren’t.

Need some help?

AWA is an experienced CRO and experimentation agency, with a track record of  helping athleisure wear businesses innovate and grow their business.

If you’d like to find out more about how we could help you with your CRO or experimentation programme, contact us today.

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Posted in: Conversion Rate Optimisation, Experimentation

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