On Building an Optimization Agency: The Inception & The Future

This epiphany drove him to start a digital agency that helps some of the largest retail brands in the world make smart decisions. Through many experiences at large corporations, he realized that most businesses didn’t really employ data or testing to drive their decisions. Any testing they did was unrelated to big decisions around product design and development.

“It was almost just like something that somebody had to check off on a checklist, all the analysis was postmortem; everything was still driven by gut,” Matt told me.

In 2012, Matt paired up with former co-worker Ryan Garner and founded a digital optimization agency. “I just got really excited about filling what I thought was a massive hole in the market—not the software, because the software was becoming more usable—but just really the people and process side of it,” Matt said.

Matt and Ryan called the company Clearhead, inspired by the phrase they would use in their previous roles at Warner Music Group when balancing many differing opinions. Today, some of Clearhead’s clients include Adidas, Fresh Direct, Blu Dot, Sephora, Keurig and Patagonia.

I spoke with Matt and Brian Cahak, Clearhead’s VP of Business Development and Marketing, about how they approach client engagements, how they’ve seen the optimization landscape change over the years, and advice for agencies starting to offer optimization.

What do you think that the market for A/B testing consulting services will look like over the next five years?

Matt Wishnow is the co-founder and CEO of Clearhead.

Matt Wishnow: I think increasingly companies will realize that testing and targeting are both more foundational and supportable than ever before and less of a “nice to have.” I think a lot of companies still think, “Oh, build feature and then test it,” or, “Test a few things but not everything.” The product roadmap is still this gorilla in the room that has some bare relations to A/B testing or hypothesis validation but not necessarily one-to-one core relation.

Once businesses start saying nothing gets designed or built unless the hypothesis has been validated, then I think, what Clearhead does as a business is unleashed to maximum value. Because then the budgets and resources that people are currently applying to design and build, are really rationalized against testing and validation.

I don’t have a crystal ball but in five years it seems reasonable that most data-driven businesses would operate that way. And if that is true, then what we are doing at Clearhead, in my estimation, is the future model for what a digital agency is.

Are there any surprises in the impact that you’ve seen optimization have on your clients’ business beyond increasing conversion rates or driving more revenue?

Wishnow: At Clearhead, we don’t call ourselves a conversion rate optimization agency. I think that’s a term that tends to come from the legacy of landing page optimization. I always remind our clients that if you’re looking to improve conversion rate, you can put everything on sale tomorrow and you will improve conversion rate.We’re in the business of finding the most efficient path to profitability through design and build using data.

For us it’s always about business profitability. Some of the surprising benefits come up when a client is certain that a new feature they’re contemplating is going to move the needle. They’ll say, “As a courtesy, we’ll do some quick testing to validate it.” And then they find that what they thought, was absolutely not true. Now there might be good reasons for the feature and hypotheses worth testing, but the big surprising benefit is not that we improved conversion rate, but we saved the client a lot of money and opportunity cost of building something that wasn’t going to move the needle. That’s one really big one.

“Testing is absolutely a gateway drug to a data-driven business in general because you get the data so quickly and it’s such high confidence data when done properly.”

-Matt Wishnow

Once our clients, both the stakeholders and executives feel what it’s like to be data-driven in their approach, they can’t get enough of it. What we’re absolutely seeing is their priorities and intention shifting from more traditional product road mapping approaches to a much more iterative approach.

How do you sell an optimization engagement or project? Who is the typical buyer?

Brian Cahak is the VP of Business Development and Marketing at Clearhead.