Walter Reade .net

Almost all online campaigns need to be optimized. While there are a number of software packages available to assist you with this, most beginning internet marketers do it manually.

One of the most common questions is, “When do you know whether a test was successful or not?”

The precise answer is, “It depends.”

Obviously, the more data you collect, the more information you’ll have and the better decisions you can make.

But this is expensive.

You can run very short tests to save money, but the chances you’ll make bad decisions increases considerably.

There is a free online tool you can use to get a better feel for the statistical significance of a test you run. In other words, it will estimate the range of your result, allowing you to decide if it makes sense to continue a test.

The website is the Exact Binomial and Poisson Confidence Intervals page. (Don’t let the title scare you. It’s easy to use.)

Here is how you can use the page to determine whether you should stop or continue a test.

First, scroll to the bottom of the page and change the confidence interval from 95 to 90%. While 95% might be good for scientific research, it is just too expensive for most of the internet marketing you’ll be doing. (A 90% confidence interval means you’ll only be wrong about your decision 1 time out of 10.)

The actual calculation is easy. Go to the Binomial Confidence Interval section of the page. Enter the number of conversions you got from your landing pages in the top box, and the number of visitors to your page in the bottom box. Then click compute.

You’ll get back the exact ratio (in this case, 0.030, or 30%). The important numbers are below that. They represent the upper and lower estimate of how your page actually converts.

In this case, if you get 3 conversions after 100 visitors, your actual conversion may be as low as 0.8% and as high as 7.6%.

So, should you continue your test? It depends!

If you’ve calculated an acceptable ROI at 4% conversion, it totally makes sense to continue the test. On the other hand, if you need a 7% conversion for an acceptable ROI, it probably makes sense to stop the test.

Have any questions? Leave them in the comments and I’ll get back to you!