What’s up guys, Tanner Larsson here from Build Grow Scale. And today, we’re going to talk about bounce rate. All right, not the most fun of topics, but it’s something that kind of gets pushed around people know that bounce rate means the amount of people that leave their site without actually sticking right. We all know that.

But what doesn’t get discussed about bounce rate other than, have a low bounce rate, everybody’s like, “Yeah, get your bounce rate lower.”

Nobody talks about what the adverse effects of bounce rate really are when it comes to your business. So sales go down with a high bounce rate. The other thing that’s affected is your actual traffic cost. So this is where a lot of people realize that their campaigns should be profitable, but they’re actually not and they don’t understand why. And that can come down to nothing more than what you’re actually paying for your traffic because bounce rate, believe it or not, actually affects the real cost of your traffic.

So we’re going to do a little worksheet type of exercise on the board here and I’m going to walk you through a thousand visitor examples and how bounce rate can adversely affect, and it does to everybody, how it can adversely affect your business, your traffic cost, your ROI. And then also, I’m going to show you how a 10% reduction can just make all the difference.

All right, so let’s go ahead and hop over here. So let’s take this example, we’ve got reported actual, and then the magic of 10%. This is my favorite side. But right here, we’re gonna start with the test. So, let’s say you bought a Facebook ad or AdWords or whatever else you bought, it did a campaign and you generated 1000 visitors, the cost of that campaign was $500.

So your cost per click on those thousand visitors was 50 cents a visitor, right? Nothing fancy there. That’s pretty straightforward. And this is the math we’re all using. Because this is what’s reported and delivered to us from Facebook or, AdWords or any other traffic sources that we’re using. This is what we’re given. This is a number that we try to calculate our actual ROI on. This is a problem. This is reported. It’s not actual.

So let’s move over to the next category. This is the actual so let’s do a heavy bad case scenario type thing, and say your bounce rate is 90%. Okay, now is everybody’s bounce rate that high? No, but industry-wide, the average bounce rate is over 80% for most ecommerce stores. Okay, so let’s just do a 90% example here because there are a lot of, especially beginner stores, people who just throw up a store on Shopify, or big commerce, or, lemonade stand or whatever the other ones. These stores are not optimized, they usually use a generic theme, and they’re not very well dialed into their demographic. So their bounce rates are usually significantly higher. So this is not unrealistic. All right.

So if your bounce rate is 90%, and you had 1000 visitors, what does that mean? Well, that means that 900 people bounced. People did not even stay around to seriously consider or check out your offer. So the actual visitors to your offer are only 100. Okay, so big difference. The cost remained the same, so it’s still $500 but now what’s your cost per click? Your cost per click went from 50 cents of visitor to $5. Okay, so now you pay your back, actually paying $5 per visitor that actually sees your offer and your conversions, your sales, let’s say you get one sale, that’s a 1% conversion. Okay, well 1% should have been 10 sales. Okay, but you wonder what’s wrong? Well, because 1% of your actual visitors is what you got. So this is not very good, right?

If you’re thinking you’re budgeting for a 50 cent per cost per acquisition, to get 1000 people to actually see and consider your offer and your metrics all back out of this cost. But in reality your cost is this. No wonder your campaigns aren’t successful. No wonder you’re going negative on a campaign and not one not understanding why? Because you’re doing the math wrong using numbers that are not accurate.

Okay. Basically, on this type of thing, we’re looking at these numbers are 900% wrong. It’s crazy. Now, nobody looks at it like this, but this is the reality of what you’re paying. So whenever you start doing your math, don’t take the reported value until you also factor in what your existing bounce rate is.

Now, if your existing bounce rate is lower, then obviously this number will be lower too, but whatever it is, let’s try to lower it a little bit more. So we got the report, we’ve got the actual now. Let’s hop over here and look at the magic of 10%. This is where math gets fun. I don’t even like math, but I love this kind of math because small, little incremental changes have exponential results in your business. So bounce rate, let’s say we reduced our bounce rate 10%. So our bounce rate is now 80%. 

So, a 10% reduction incremental increase. A 10% reduction in your bounce rate is as easy as resizing all the images on your website so they load faster. I mean, it’s nothing crazy to do. So you get a 10% incremental reduction, but that results in a massive doubling of your visitors. Okay, now your 200 visitors, the cost has not changed, the same $500 cost. And guess what? Our cost per visitor cost per click has now got cut in half. Now, we’re down to $2 and 50 cents. All right, so a 10% reduction in your bounce rate, cut your traffic costs in half. All right, so we’re still not over here where we work, but it’s a heck of a lot better than $5. Right, and you’re getting 100 more people to see your offer. So if you have a 10% conversion rate on your store, here you made 10 sales would you make here, 20. 

You doubled your sales, you cut your traffic cost in half, you lowered your bounce rate. All right, now what if you lowered it another 10% or another 10%. Okay, we’ve taken sites from at 80-85% bounce rate and got them down into the 30s. All right, so now our traffic costs are dramatically dropping. Alright, so the reason I wanted to show you this exercise guys is because I don’t want you to lose your ass on your traffic campaigns. When you already have a physical product, which cuts down your costs. If you have an information product, you could probably absorb this because your profit margins are 95 to 100%. With physical products, your gross profit margin, maybe 60%, your net profit margin is probably 30% your working profits probably in that 30-40%. So, it’s harder to eat that and then still live right? It’s hard to eat that kind of a cost on traffic.

So the reason again, was just to get this make this visual, so it’s ingrained in your head to realize that; “Number one, it’s important to reduce my bounce rate not just because of — people say it is, but also because it hits me in the pocketbook and it can double my sales, but also because you need to be using these real numbers when you do your metric calculations when you try to back out from – How much can I afford to spend per click all the way back to how many impressions do I need? Or how many kinds of campaigns am I going to run? You need to be able to do that using actual numbers that take into consideration your bounce rate.

All right, so I’ve got a cool little calculator that the Build Grow Scale team whipped up for you guys. We’re going to jump over here to the computer. And I’m going to take you through how to use the calculator, and how to plug the data in and kind of what the different fields mean. So that you can do all of this on the fly just by punching in a couple of numbers on the screen. So with that, let’s hop over here. Okay, so we just went through the whole workflow on how your bounce rate actually affects your ad cost, your traffic costs, your conversions, all those things. And we broke it down to where you’re actually, potentially spending 900% more on your traffic than you think you are. So, to help you guys do this because nobody likes to do the math and figure out what the formulas are to get the actual calculations. We’ve put this together for you in a nice little calculator. So what you see here is the bounce rate effect calculator.

So all you have to do is fill in these blue fields, okay? Everything else will take care of itself. Now you can skip the impressions if you don’t want to because it’s not calculating all the impressions right now. But I like to put it in there just so you get it because what I do is I’ll usually take a screenshot of this or save the completed field as a PDF, so I put a date on it. So then we always know, we can look back and say, “Well, what was it before we change this, now it’s this, now it’s this,” and we can see a global snapshot all the way through. So I like to have all the data so you put your impressions you enter your clicks, actions if you want to track your actions, like sales or leads or whatever the action is that you’re actually tracking, and then your total ad cost. So if your ad costs were 4000 clicks and was 400 bucks, then you enter 400 bucks.

Okay, or if it was 1400 bucks, you enter 1400 bucks. Okay, then enter your website bounce rate. So what is your existing bounce rate? You can find that from your hosting data, from Google Analytics and find what your actual existing bounce rate is on your site. Okay, and specifically your store and your landing pages, you can do this on a site-wide effort. Or you can also do this on a landing page by landing page basis, which is how we do it.

To see what, we obviously want the overall site speed on our stores to go down, but also for our funnels. With our landing page for our funnels, we need to make sure the bounce rate on those pages is as low as possible. So you plug that in and then all the rest of it. So if we make this let’s just say 70%. Everything else will calculate. So the total visitors that you paid for how many bounced how many actually showed up? And then over here, this traffic analysis, this first one is conversion rate.

Okay, so you’re saying you’re based on your numbers of clicks to actions, your reported conversion rate is 17%. Now your actual conversion rate is much higher. Don’t get married or excited or romantic about this number. It’s just here to show you the change. You’re converting at 58%. If you look at it from 1200 actual visitors and 700 actions.

But it’s nothing to be like, “Oh my God, my site converts at 58% all the time.”

Let’s just show you the difference, okay? But over here, the visitor costs, this is what you want to pay attention to. And that’s why it’s in a different shade. Okay, I want you to see the conversion rate difference, but I want you to really care about the visitor cost difference. So the report is what you thought you’re paying. So 4000 clicks for 1400 bucks gives you 34 cents a click, but you’re actually paying $1.15, which is a 233% difference.

So you’re actually paying 233% more for your traffic in this scenario, then we go down to the potential gain section, and we look at how we can increase our performance by reducing our bounce rate and it goes from 10 to 25% of reduction. So you can see the incremental and then massive increase, you can start to incremental in then it starts to get exponential in terms of the difference that happens when you keep going down on your bounce rate.

Now, you can get your bounce rate super low, okay, and I’m actually going to give you a couple of ideas now and how you can get your bounce rate down. So let’s hop over here. So the big thing with bounce rate is your site speed, okay? Because we’re going to exclude for a second that you and just assume that you have your site designed to match your audience, your site colors. Everything looks good, it fits the profile of the customer that’s going to buy. You have a good layout, you got a good theme, whatever you’re using a good direct response landing page, we’re going to assume all of that.

So what I’m going to do is show you how to get those quick wins on the technical side. Okay, so the first thing we did was, you want to increase your speed load of your page, how fast is your page load?

Alright, so the first thing we did is we resized every single image on the store, okay, or on a funnel, we do this all the time. This is actually the slides are actually a piece of one of the trainings that we did call optimized ecommerce, where we actually do all the conversion rate optimization training on exactly how we fix our stores and everything and how we got to got like a 400% profit boost, but that’s beside the point.

Back to this, I like to go on tangents. So this resized every image on the site, including things like the logos, the trust badges, product, images, testimonial, images, everything. Alright, resize them all smaller, okay, we basically compressed them. To do that we used image optimizer dot net. It’s a Windows-based software, I don’t even know if they have a Mac version, but I’m sure they do. or something similar. You have to use the pro version. It’s a paid tool, I think it was 30 or 40 bucks. If you use the free version, what’s going to happen is they’re going to watermark all your images, we did that by mistake the first time. And then we had to go back and redo it and remove all that watermark images and bring up the new ones, but it’s great compression. And it’s actually better compression than what you would normally get if you even try to compress them using, you know, Photoshop and resizing them manually by adjusting the DPI down. So this was a big thing to compress them.

We also removed any apps that were making calls to the site. They’re slowing it down. This is especially important for Shopify stores. A lot of people try a lot of apps on their Shopify stores, and then all they do is disconnect them, they don’t actually remove them from their store. Well, the reality there is if you have apps on your store that are just deactivated, they’re still making calls a lot of the time to an outside server, which in that means every time your website loads, those calls get made, and before your page can actually load, it has to make those calls and get a return.

So removing any kind of apps that you’re not using is a huge, huge, huge thing. The next thing was, you know, mainly with the apps that we had quit using got rid of those but the other big thing that was important was commenting out a hot jar or any analytic stuff that we were not using when running the test. So we’re big fans of a hot jar, there are all kinds of other heat map software out there and screen recorders that track the customer. So hot jar basically allows us to track every single customer makes a video recording of the customer’s path through their sales cycle. We can watch it and see how they interact with the site, what they do where the problems are. So we would turn hot jar off when we’re not making it or not when we’re not running the test, however, we didn’t realize that it was still affecting page load significantly.

So we actually got into the code and we commented the code or the hot jar code out, which means you put some special brackets around it, and some code that tells your webpage when it loads to ignore the code in between those brackets. And it speeded up our page load time immensely. We had no idea and we tell all of our students, hey, use a hot jar, it’s so awesome. And we just thought once you turned it off, it was off, but that’s not the case. So if you’re using one of those things, make sure you totally turn it off and comment out or absolutely remove the code from your site when it’s not being used to run a test. also reduce the DPI on all images from 96 to 72.

Most times you will never see a noticeable difference and your customers won’t see a noticeable difference. If you really want to have the hot the high-resolution files have them as well. hotwire as a hyperlink where they can click and then manually load the high res files, but all your auto loading images should be at 72 dpi. So the final results when we implemented everything I just told you about on one Shopify store at 10 am, we tested that site at 16.2 seconds or two seconds load time, with 167 requests, meaning 167 call-outs that were happening before the site would load and hit a 24-megabyte load wait. Seven hours later, we tested the site after making these changes that I just told you about, and gave it a 2.08 second load time.

And once the cache started dropping the next morning, Google Analytics gave us a 1.87 second load time, which is huge on a store. Okay, now it’s loading super fast. Our bounce rate from that store went from the high 80s to low 30s. And now it’s even lower than that on this is just on one specific Shopify store. Now everything that I told you are the same things we apply to our funnels to any other Shopify stores. If I do any consulting on third party sites, Magento, big commerce, whatever, we do these exact same things to their sites as well, because it’s such an easy win, that can have massive, massive increases. So, use this stuff. Come over here, use the calculator and start paying attention to your bounce rate and stop paying more for your traffic than you absolutely have to see you later.