Understanding ROPO and how to calculate it in 2019 is crucial to understanding customer behavior and buying trends.
In this article, I will go over what ROPO is, why it’s important to your business, and how to calculate it.
What We’ll Cover:
- What ROPO is
- Why it’s important to marketers
- How to calculate ROPO:
- Strategies to boost your conversion rate and ROPO effect
- ROPO FAQs
ROPO: What Is It?
To put it simply, ROPO is an acronym that stands for research online purchase offline.
You read that correctly.
While some people might think that knowing how many customers are searching online for your products and purchasing in the actual store is impossible to know, it’s actually quite easy using ROPO.
It’s no secret that the vast majority of consumers search for a product online before they visit a store to buy.
In fact, recent studies have shown that up to 88% of consumers do this. They tend to do this for a number of reasons including:
- Price comparison
- Product research
For example, if your company sells coffee makers, consumers may conduct an online search to compare your brand’s price range to others. They may also be looking for demos to see how your coffee maker works and reviews to see if previous buyers were happy with their purchase.
ROPO: Why Is It Important?
By now you’re probably wondering why your ROPO rating is important. If you are not incorporating your ROPO rating into your overall pricing, marketing, advertising, and sales strategies, that means that you’re not looking at your entire customer market.
Let’s look at an example of how ignoring ROPO could negatively impact your sales.
If you have been running an online advertising campaign and you’re not seeing a significant increase in online sales, you will most likely stop running the ad. Consequently, now that you have stopped the online ad campaign, you might see a decline in in-store purchases because your ROPO consumers aren’t seeing your products online anymore. This is because you did not take into account the ROPO effect.
The ROPO effect opens up a whole new world of possibilities when it comes to increasing sales. In fact, some businesses have reported an increase in in-store purchases upwards of 90%.
Here are a few more stats pertaining to the importance of ROPO:
- 97% of consumers search online to find local businesses
- 90% of all sales in the U.S. happen in-person
- 56% of consumers want to physically touch the product before committing to a purchase
- 34% of consumers don’t want to wait for an item to ship
- 25% of consumers don’t want to pay the high price of shipping
ROPO: How To Calculate It
Calculating ROPO for your brand might require a little bit of elbow grease.
Purchases made inside a physical store are often completely invisible to digital marketers. This can make it difficult to accurately measure the ROPO effect in your business.
If you are using Google Ads to advertise your business online, then you will have access to a nifty click-to-call feature. This function will measure how many people phoned your store after seeing your ad.
Consumers will make a call to the store for several reasons, including:
- Store hours
- Product availability
- Product release dates
2. Click For Directions
Another handy feature you can utilize with Google Ads is the click-for-directions function. This specifically pertains to your physical store’s location details.
As a metric, it will show you how many people clicked on the directions to your store. This can directly influence your ROPO rating since these engaged viewers are more likely to make a trip to your physical location.
3. Extension Measuring Distance From Store Location
Staying in Google Ads, you can access another extension that measures the consumer’s distance to your store location.
You can find this information under the Dimensions tab in Google Ads.
From this section, you can select your desired distance from the drop-down menu. This will show you how many people interacted with your ad within that distance.
4. Store Info Metrics
Since you have a website for your business, you should have a page dedicated to your store’s physical location and your operating hours. If you don’t have this page set up, you need to get on that quickly.
The metrics on this page can show you how many people left your website from this page.
This may seem obvious, but surveys are a conventional way to figure out where your customers are coming from. Albeit, they can get pricey.
You can implement surveys during in-store checkouts. Simply ask the customer at the register what made them come into the store to purchase the product. If they answer that it was due to an online ad or research, you can attribute that to purchase to the ROPO effect.
6. Analytics Conversion Rate
If you want to measure your conversion rate by distance to store, you can use Google Analytics.
You can do this by segmenting your data into groups based on distance from your store. Then, you calculate the conversion rates of each distance to see where your in-store customers are coming from.
Let’s break this down.
First, you need to know your online-only rate. That’s the conversion rate coming from people who are too far from your store’s location to visit in-person.
To estimate your ROPO effect, take the online-only conversion rate and subtract it from another distance-related conversion rate.
For example, if your online-only conversion rate is 5.34% and your 5 mile conversion rate is 1.37%, your ROPO rate for consumer within 5 miles of your store would be 3.97%.
1. Loyalty Cards
One of the easiest ways to track your customers across multiple channels is to provide them with loyalty cards. Loyalty cards will enable you to gather critical information about your customers such as names, phone numbers, emails, and even birthdays.
If you are worried that people will not want to provide you with this information, give them an incentive to do so.
Take Sephora’s Beauty Insider loyalty program, for example. This beauty giant offers reward incentives and birthday gifts to their loyal customers. The company even takes it a step further by allowing customers to earn better rewards based on a points system. The more points a customer racks up, the cooler the reward is.
With your loyalty program in place, you can customize the consumer’s online experience based on their in-store purchases.
For example, Sephora’s Beauty Insider program will provide customers with a personalized experience on their website. It will show the user recommended products based off of previous purchases. It can even show them products based on the data they have provided such as skin type, foundation shade, hair texture, and so much more.
2. Facebook Ads
Facebook understands the importance of ROPO. That’s why the social media company recently unveiled a feature that allows marketers to measure ROPO from Facebook ads.
It does this by comparing customer data to Facebook accounts to see if those people engaged with your ad within the last 24 hours, week, or month.
3. Build Positive Reviews
This tactic is crucial in boosting your ROPO rate. Positive reviews online are very important to increasing brand trust among your target audience.
To build a lot of positive online reviews, you need to provide your customers with exceptional customer service. That means that you need to answer their questions, address their concerns, provide high-quality products, and keep the online user experience as easy as possible.
If you have no reviews yet, you can incorporate the following practices to build them up:
- Give your customers cards that remind them to leave a review.
- Send customers a post-purchase email thanking them for their business and asking them to leave a review.
- Follow up with your customers to show that you care about their experience with your brand.
If you happen to get a bad review (it happens to the best of us), don’t let it derail you. Always respond to negative reviews in a professional manner. To do this, you should respond to the unhappy customer in your brand’s voice, clarify the issue, and attempt to make it right by them.
Even in the worst-case scenario, if you can’t satisfy the customer, other potential customers will see that you tried. This will go a long way in building a loyal customer base that trusts you. It gives the impression that you will always try to remedy the situation if the customer is unsatisfied.
1. What types of businesses benefit the most from the ROPO effect?
There are many different types of businesses that can benefit from ROPO. Here are a few of the top industries:
- Fashion – Consumers like to compare pricing online and look at reviews for fashion companies. However, most people also want to try the clothing on before committing to a purchase. Consumers want to be sure they like the fit and feel of the clothing, and many don’t want to go through the hassle of returning items through the mail system. This is why fashion companies should take ROPO very seriously.
- Beauty – Similarly, the beauty industry also benefits from ROPO. This is because many people may wish to speak in-person to a beauty expert about specific questions or concerns. Consumers may also want to see what certain makeup colors look like on their faces or get a sample of a skincare product that they aren’t sure about yet.
- Athletics – There is a recurring theme here. People want to try out that new bicycle before buying it. That’s why sporting good companies can also benefit from ROPO.
- Furniture – Another industry that relies on high ROPO ratings is the household and furniture industry. Consumers want to sit in the recliner before they buy it. They want to see the difference between a warm lightbulb and an LED lightbulb. They want to touch the bathroom towels.
2. What are soft conversions?
Soft conversions play a role in determining your company’s ROPO effect. Place a button on your website’s product page that enables the potential customer to see your store’s location and inventory.
If the visitor clicks on this button, you can count it as a soft conversion. Essentially, it tells you if a customer is interested in visiting your store.
You can use soft conversions to adjust your product price points. For example, if a specific item is getting a high rate of soft conversions, you can consider running an in-store-only sale to encourage customers to take the final step and come in.
3. Should I adjust my online marketing strategy to include ROPO?
In order to do this successfully, your marketing team and pricing team need to be on the same page as far as brand goals are concerned. They will need to find the perfect balance between high market spend and low price point to hit that sweet spot.
These two teams also need to continuously monitor the competition to see if they are running any sales or dropping their prices. This will help you stay on top of the game by keeping your product price points competitive and your online ad spend appropriate.
Wrapping Up ROPO
Now that you know what ROPO is and why it’s so important to your business if you have a physical store, you can start to incorporate some of these tactics to boost your sales. Remember that your ROPO rating is an estimate.