One of my clients, Hardee’s, approached me last month with those questions and wondered if we can help with an answer. By coincidence, I happened to be engaged in an online course which is part of our holding company MCN’s Development and Education program in partnership with Coursera. The course is called ‘Critical Thinking for the Digital Age’, where some of the topics discussed are correlations and experiments. Those two concepts may be perceived as similar, yet they are quite different. Unlike correlations where there are many variables, and the aim is to identify a specific trend or regression between them; experiments necessitate having all the variables as constant except one. This gives a better representation of the outcome that can aid in taking more coherent decisions.
So, the first thing that came to mind when my client asked those questions was, let’s run an experiment! Sure, we have proposed A/B testing and few experiments in the past, yet time, budget and creative constraints were always in the way. However, this time my determination, the client’s pursuit of insights, and the support they extended made the experiment come to life.
We decided to run this in KSA where a specific meal offer always stood out, this sharing meal was usually priced around SAR 39 – it gives both good value and the needed indulgence to customers! Given the various market conditions, the client was skeptical if a meal priced at SAR 39 would attract all customers, as many are still value shoppers with a lower average basket size. So, the course of action was to add free delivery to this meal and create a parallel campaign at a lower-price point which for SAR 19 price with no free delivery. So now we have 2 campaigns with different messages and price points – and we needed to decide which one will generate better results in terms of conversion rates and online transactions. We had a tight deadline as immediate ROI is always a prerequisite, so we decided to run the experiment for 2 weeks then decide on the ‘winner’ by then. The lower-priced meal got more than double the clicks of the higher-priced one, yet at half the conversion rate. Although customers were persuaded to click by the lower price point, yet the final conversion was mainly influenced by the free delivery offered. When we then compared the performance of the SAR 39 meal with Free delivery to the same offer ran few months before yet without free delivery, the conversion rates and amount of orders were nearly half of that with free delivery. Based on this experiment, we are now more empowered to make data-driven decisions that can maximize ROI in a future campaign.
So, what are you still waiting for? Go ahead and start rolling these experiments out!