Customer Value Optimization: A proven process for growing your online business using funnel sales and conversion rate optimization
When a business is serious about growth they have two major components of their business. Driving Traffic and Making Sales. The driving traffic part is easy. The hard part is the sales. There’s no such thing as a “Traffic Problem”. You have an offer problem if your not making alot of sales!
Step 1: The Rules of the Game (and how to win at it): Coming up with your strategy, defining your long-term goals, and deciding how you’ll measure success
Many marketers start out by creating a list of things to test. We advise you to resist the urge at this stage. Here are a few reasons why:
You need to find out (not guess) which parts of your business are underperforming and why.
There are 5 key elements to your complete customer sales funnel
Most clients come to us with a preconceived idea of what should be worked on. Ironically, the opportunities usually lie elsewhere—in their blind spots. First, we insist on discussing the client’s strategy and vision for the business. You need to define the key performance indicators (KPIs) that will ensure you meet your goals.
You don’t yet know why people aren’t converting
At this point, you also don’t know why your visitors aren’t converting, so any suggestions you make would be theoretical rather than based on evidence. From our experience, evidence-based recommendations are much more likely to give breakthrough results than glib “best practice” ones.
You need to experience your business as a customer with a “fresh pair of eyes”
It is important to have customer empathy and to understand the thought processes your visitors are going through. If you look at your website from a marketer’s perspective, you’ll act like a marketer. So, if you aren’t already, you need to become a customer of your own site. (You’d be amazed how many people have never done this.)
Step 2: Understanding (and tuning) existing traffic sources
It’s impossible to critique a website without knowing from where its visitors are coming, on which landing pages they arrive, and how they navigate around the site.
Take a bird’s-eye view of your business, identifying the areas that appear to hold the greatest opportunity.
Seek to understand your entire conversion funnel, starting with the initial ad impression where someone first encounters your business and finishing with the thank-you page and beyond (there’s often a lot of opportunity in optimizing post-sale events such as referral programs, up-sells, and email marketing). To sketch your conversion funnel, map out every action that a prospect has to take to become your customer. Use whatever works best for you: Scribble on a whiteboard (tip: you can create huge whiteboards using adhesive film or this paint) or use software (Omnigraffle for Mac is particularly good because it has a physics engine that does the layout automatically).
Aim to work on the areas of your business that will have the biggest impact on your goals. Also prioritize your efforts on parts of your business that are easiest to make changes to.
The best way to visualize this process is by thinking about blocked arteries and missing links. Just as an artery in your body is the highway that carries large volumes of blood, an artery in your business is a high-volume pathway that leads to sales. Once you have identified your business’s arteries, search for blockages in them—that is, aspects of them that are under performing.
Missing links are parts of your conversion funnel that have not been created yet, such as these:
- Turning a one-step sale into a multi-step sale.
- Adding a well-placed “Refer-a-Friend” program.
- Adding an effective email autoresponder sequence.
- Adding a series of post-sale offers.
- Growing a customer community.
- Rolling out successes into other media (online and offline).
Step 3: Understanding your visitors (particularly the non-converting ones)
Don’t guess what the blockages are. Find out. This usually requires some research aimed at understanding your visitors and their intentions. The key question is “Why aren’t visitors converting?” The answer typically comes from research in the following core areas. It may sound like a lot of work, but with the right workflows it doesn’t take long.
1. Understanding different visitor types and intentions.
It doesn’t matter how good your website or product is if you’re asking the wrong people to do the wrong thing at the wrong time—which is why you need to start with an understanding of your different visitor types and visitor intentions. The process typically revolves around your web analytics platform and customer database.
Seek to understand your different traffic sources, and how they behave. Here are a few things you should consider:
- New visitors vs. repeat visitors.
- Which referring sources of traffic convert best?
- Do you have distinct visitor types based on the visitors’ situations, their past experiences, or their intentions?
- Branded keywords vs. generic keywords.
Understanding these different visitors will give you clarity about how to organize your conversion funnel so you’re showing the right content, with the right call-to-action, to the right visitors, at the right time in their buying journey.
2. Identifying user-experience problems.
All websites have some visitors who don’t convert simply because something prevents them from doing so; they’re willing but unable:
- Does the site load correctly in the browsers your visitors use?
- Do the pages load fast enough?
- Is it easy for users to navigate through the site and know what they need to do?
- Is the copy clear or confusing?
- Are forms easy to use?
- Do users encounter error messages that confuse or deter them?
There are many tools and techniques for identifying user experience issues. Once you’ve identified the problems, you can design tests to overcome them.
3. Gathering and understanding visitors’ objections.
Next, seek to understand why most of your visitors aren’t persuaded. Those people, however, come and go without a trace! How do you know what they wanted? How do you know what would have persuaded them to take action?
If you owned a real-life bricks-and-mortar store, it would be easy: You’d hear their objections. You’d be able to ask questions. You’d hear what they muttered as they headed for the door.
Capturing the voice of the customer is more difficult with the web, but it can be done. Start by implementing appropriate feedback mechanisms for capturing the most common objections. Then gather, record, and analyze the feedback.
We call this the Objection/Counter-Objection (O/CO) approach; identify (not guess) your customers’ objections and then present them with strong counter-objections.
Step 4: Advanced market intelligence
No business exists in a vacuum. Study your marketplace—for example, your competitors, any expert commentators, and what your customers are saying in social media and on review sites—and then explore possibilities for improving your positioning by building upon your company’s core strengths.
You can get a wealth of information about your marketplace using tools like Google Alerts, Moz PRO, Twitter Search, and Yahoo! Answers.
Step 5: Spotting the hidden wealth in your business
Each of our clients has had elements within its business that would have been highly persuasive to its prospects but that the prospects never saw. The key is to identify all of these persuasion assets, and then present them to the prospect at the right time in the buying process.
Sometimes, the challenge lies in creating a wish list of persuasive assets that your company needs to acquire.
Step 6: Creating your experimental strategy
It’s a myth that you can transform a business by making what we call “meek tweaks.” Extraordinary improvements come from extraordinary ideas. Take all of the ideas you’ve generated from the research and prioritize those big, bold, targeted ones that will grow your business in the shortest time. Bold changes give you more profit, and you get quicker, larger returns (it’s a statistics thing). And they’re usually more fun. If you carry out “meek tweaking,” on the other hand, your tests seldom reach significance, you get disheartened, and, most upsetting of all, you lose the commitment of your colleagues.
After collating all the ideas, prioritize them based on three simple metrics:
1. How likely is it to double your conversion rate?
Asking this question helps to ensure that you’re prioritizing the big opportunities. Bigger, bolder tests should be given a higher priority; meek tweaks need to be demoted.
2. How easy is it to implement the test?
Look for the quick wins with the biggest financial impact, so changes that are easy to implement are given a higher priority.
3. Has this idea worked before?
Once you’re testing, you’ll quickly start learning what your visitors respond to. Every test we develop is documented so that we can review and prioritize ideas that are inspired by winning tests.
Step 7: Designing your experimental web pages (your “challengers”)
This is the point at which you’ll create the content you’ll be testing.
Note that novices usually begin at this stage. They base their designs on guesswork and so-called “best practices,” and then they get disheartened when their tests fail. Our experience has shown that the significant wins come from basing the new content upon insights that were gleaned from the previous six steps.
First, create a wireframe of the new page (or page element). The wireframe must be designed to be more persuasive, more believable, and more user-friendly than the existing version. Pay particular attention to critical copy elements such as the headline, introductory paragraphs, and calls-to-action. Carry out several usability tests on the wireframe and discuss them with anyone who has an empathic understanding of your customers.
Step 8: Carrying out experiments on your website
There are many software platforms for tracking and testing, each of which has its own benefits. The following platforms tend to be popular with our clients: Visual Website Optimizer, Optimizely, Adobe Test&Target, Sitespect, and Google Analytics Content Experiments (which is free).
Once the split testing platform is in place, run through and verify that everything is set up properly. Then, for each split test, follow a procedure that ensures that all team members understand what the test is:
- Why you’re running it.
- How it fits into the site.
- How it aligns with the business goals.
- How you’ll measure success.
These experiment plans create a valuable archive of your business’s evolution.
Once a test is started, the software takes over. All split testing software automatically calculates when one version of the page has generated significantly more conversions, from a statistics perspective, than the others. At this point, you can end the test and promote the winning version to be your new “control.”
Step 9: Transferring your winning campaigns into other media
Diversifying your customer acquisition channels gives your business more stability. Your increased conversion rate will mean you can profitably invest more in advertising channels such as SEO, PPC, social media, affiliate marketing, and offline media.
Also, explore how you can implement the insights from your winning experiments in other parts of your marketing funnel; e.g.:
- A winning appeal in a landing page test can provide a winning headline for your AdWords campaigns (or vice versa).
- A winning landing page can be adapted for space advertising in offline media.
- If a particular offer performs well in your own marketing materials, your affiliates may benefit from using it too.
Each win often reveals new opportunities
Sales Funnel Optimization is iterative; subsequent experimental plans will be based on the outcome of the previous experiments. Each improvement builds upon the success of the previous ones. Each time your conversion rate is increased, it becomes increasingly difficult for competitors to compete. Also, as your conversion rate grows, more opportunities present themselves. After each split test, it’s important to “zoom out” and look at the whole conversion funnel again, to determine which part of the business you should focus on next.
As this overview has shown, The CRE Methodology™ is not about best-practice page elements; it’s a process of activities that encompass a wide range of disciplines. Although it sounds less appealing than applying “magic buttons,” we don’t know of an easier, more reliable way to grow an online business.
What you should do next
If you’d like to learn more about conversion
If you’d rather find out right away how we might help your company increase its conversion rate and profits, just get in touch with us for a friendly chat with one of our consultants. We’ll identify the biggest opportunities for you to grow your business using conversion rate optimization.