Traffic v. Conversion: The Big Debate

A question came up from a friend the other day when a company they reached out to asked, “How are you going to drive traffic?”

It’s a valid question but it got me thinking, does this person understand the relationship between Traffic and Conversion. Probably not because then their question would have been, “How will you convert at a higher rate?”

This is the more appropriate question, here’s why:

In finance and stock trading, we view the price of the stock and the ability or room for its overall value to increase. We search for a winner, so we can profit. But for ages upon ages, many people focus on the wrong metrics to gauge success.

Example:

A $1.00 stock rises to $1.02 is equivalent to a 2% increase.

A $100.00 stock rises to $102.00 is still equivalent to a 2% increase.

The notion here is whether it is easier for the cheaper stock to raise to $1.02 or the more expensive stock to get to $102.00. Arguments can be made for both sides and a lot is dependent on the brand, but most uninformed people would bet that the smaller stock had a greater chance of reaching $1.02 over the larger stock to reach $102.00 simply because 2 cents is less than 2 dollars.

Also, there are a good number of people that would rather invest in the smaller one to increase the number of shares they could purchase and net out a larger return looking for a moonshot.

The fallacy that exists though is it doesn’t matter, the return percentage wise, is the exact same, the return in monetary gains with $100 invested is also the exact same.

So what does all this have to do with Traffic v. Conversion?

Driving lots of traffic to your website, the cheap stock, has the exact same return as driving tailored, the more expensive stock, to your website. At the end of the day, all that matters is the conversion rate, the percentage that the stock grows.

Cheap traffic rarely leads to long standing customers. Additionally, depending on your product or service and it’s price point, your pool of investors are arguably smaller than you think. Like any calculation, remember, those that are willing to invest hope to see a return, ROI works not only for businesses but also for those that purchase goods as well.

At the end of the day, depending on your product, invest in the stock or audience, you believe will find the most value in your product and be willing to invest long term.

I’ve heard countless times from VPs of Sales, “Everyone with X is our market.”

Maybe they need a lesson in statistics and the stock market because they’re betting on the cheap stock that caters to sucker investors riddled with fallacies, and those don’t make for good long-term investors.

Instead, cater to an audience that can afford your product and ask them upfront what percentage returns they are hoping to see on their investment. You’ll find out really quickly whether they are looking for a moonshot or a product with steady growth gains they hope to stick with long term.

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Dissecting a Cold Email

I don’t believe in shaming, but I do believe in educating.

Sometimes they look similar.

Every once in a while, I get an email from someone that is just terrible. Having spent a fair amount of my career writing and involved in sales, I cringe at some of what comes across my desk.

Sometimes, I’m compelled to respond because I really do believe it teaching people to improve.

The original email was as follows:

Hey Team LIFX,

I noticed your awesome campaign on Kickstarter. As we work with many crowdfunding campaigns, we know how important it is to get your product strategy, marketing, and product development right. Moreover, I know that you finished the delivery of your product and you now need to move forward. Why not with us?

I would love to schedule a quick call to explore how we can help. Email me at someaddress@somedomain.com.

Cheers,

Person’s Name

The Digesting Period

But Jon, what’s wrong with that email, it seems pretty straight forward.

If you are in this camp, you’re not alone. In fact, I would venture a guess that from my experience, most of the salespeople I’ve worked with would all consider this to be an acceptable and passable email for their SDRs to send out. They measure things in emails sent out, response rate, calls booked, etc.

One day, they’ll realize that there is only one metric that matters, conversion to paid customer.

Here’s why this is not a good email.

Comments are added in Italics

 

Hey Team LIFX,

Use “Hi” unless you are familiar with the person. Odds are you’re dealing with an adult and “Hey” can come off weird.

I noticed your awesome campaign on Kickstarter.

Our campaign ended in 2012 you’re sending this in 2016, there are far more relevant pieces of information to glean about our company that have taken place in the last 6 months. Focus on what’s next. Product cycles happen twice a year at least and most companies are already road mapped more than 18 months out at a minimum.

As we work with many crowdfunding campaigns, we know how important it is to get your product strategy, marketing, and product development right.

We’ve moved to the “we” rather than the “I” it seems. I’m OK with this.

The amount of passive voice in this kills me.

Try, “We work with companies that have successfully crowdfunded their initial products to ensure their product strategy, marketing, and ongoing product development are ready for continued growth.”

Give me something that I can sink my teeth into.

Moreover, I know that you finished the delivery of your product and you now need to move forward.

Get rid of “Moreover” it’s a waste. You’re back to “I” instead of “we” but this line shows me that you did zero research. If you Google LIFX I’ve done if for youhttps://www.google.com/?gws_rd=ssl#safe=off&q=LIFX+color+1000

You’ll see that we are in BestBuy, Lowe’s, Amazon, and Walmart. You’ll even see on the first page a recent press release showing that we have released even more products from our first round of Kickstarter products. I’m pretty sure we’ve been moving forward at a good rate, just check out our homepage to see the companies we work with. Also, look at Crunchbase and you’ll find that we raised $12 million in series A funding.

Why not with us?

This is easy, you can’t write, which means you can’t market. You can’t conduct research which means using you for product strategy and development are out and your company is pretty lazy in general. Crowdfunding is a broad group of everything so it shows no domain expertise. Your website has nothing listed under our space link redacted. I could go on, but you get the point.

I would love to schedule a quick call to explore how we can help. Email me at someperson@somedomain.com.

Don’t ask for a phone call to explore, if there was anything valuable in the email as you presented it, I would be asking to set up a call. No joke, people like me rely on media and partnerships. Seriously, we do and we listen to interesting propositions. This though was one of the worst most half-assed emails I’ve had passed to me, why would I respond?

By the way, the email to someperson@somedomain.com bounced.

Conclusion

Business and learning go hand in hand, but the amount times people skimp out on the basis is staggering and leads to missed opportunities for revenue that are often the difference between success and failure.

This isn’t the rep’s fault. If you’re in sales and you read this post and you were in the group that didn’t see anything wrong with the email, it’s your fault.

I doubt this rep was ever given any coaching on how to send out email, propose a value proposition, how to do research, etc.

This is a reflection on you, whoever is running the show, for not proofing, working through the basics and not supervising. Every email matters. Every action and moment spent at work should matter, it’s not about a response, it’s about conversion.

Bonus, how I would have written the email and why

Hi LIFX Team,

I saw your release of the Color 1000 in October and am very interested in your next product launch.

References a recent event, asks for a future event, so no immediate commitment. People plan things out months in advance.

My company, Acme, Inc., works exclusively with IoT companies(up to this point is visible on mobile email) to help them launch new products and ensure execution of marketing campaigns that align with your product strategy and ongoing product development.

Shows domain space expertise, explains what they do and how they operate. Complements current strategies, doesn’t try to sell all the services.

We’ve had great success with Company, Company, and Company.

Examples of who they have worked with which gives me the ability to look up recent product launches. Also lets me call people for references.

If you’re interested, I’d love to get LIFX’s demographic profile and work up a strategy to assist you with your next launch.

An ask with an offer that doesn’t take me that long to respond to.

Best,

Jon

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Mobile First

It’s a reality, it happened.

If your website isn’t optimized for a mobile experience, you’re missing out big. I know if you’re like me, your phone is something you check before you get out of bed, in most cases it’s the last thing you look at before you go to sleep. I check my email on it, I read the news on it, I control my lights with it.

They go with me everywhere, both of them. Yup, I like many other people have two cell phones, one for work, and one for personal. I am a pro when it comes to deleting emails and I’m not afraid to judge. You have a subject line and the precious characters that my iPhone shows me get me to open up your email. Choose wisely.

It today’s connected world, the phone is the first thing people reach for.

I look up everything on my phone, because of the way my brain works, if I think of something or I remember it, I search it. 99% of the time this is on my smart phone.

It’s simply the way that people work these days. I had a conversation with a company the other day about their strategy to go live. We talked about their product and the desktop app they were building, but their product interfaced with the real world, which begged the question, why not an app or a mobile platform?

As much as html5 has been hyped as the perfect way to have a non-app version of your website, the culture is still around apps when it comes to mobile experiences, they are just better.

Facebook’s traffic now is dominated by mobile.

Create content that is designed for mobile. Know that people will see it on their phones before they see it on a desktop. Purchasing is now skewing in the direction of mobile first as well. Don’t get left behind.

Yet, most companies still do all their email mockups on desktops and a good amount of them don’t even bother to see what it would look like on mobile displays before hitting send.

Improve your conversion rate, write for mobile.

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Understanding the “real” customer journey

I’ve been in many a room with many a company hearing them tell me what their sales process is like, what stages there are, what steps happen after which. Sadly, they are all wrong. But not for the reasons you think.

The modern customer journey, what is not taught in any sales course or training doesn’t gel well with sales at all. I can only assume this is the case because no one wants to admit that the role of a sales person is diminishing. (It’s common for companies especially in technology to scale engineers and sales teams far before the rest.)

Allow me to break down the “real” customer journey that is taking place today.

Step 1: Awareness

Someone must be aware of the existence of something before they can contemplate purchasing or using it. How good is your SEO? In today’s world the first thing that someone does when they have a question is to hit up Google, usually on their phone (remember this part for Step 2).

Once the do a search, they need to find at least one answer to their question in the results, if they don’t, it means they need to redo their search with better terms or more applicable ones.

So you’re aware that you have a problem and that somewhere out there a program or product might be able to help, you search and you get a few results. What’s next?

Step 2: High-Level Browsing (Credibility Check)

The next step is what I like to call “High-Level Browsing” or a Credibility Check.

High-Level Browsing is when someone clicks on a link to your website, note from above, a lot of this happens on mobile these days. Does your website look credible?

Ask yourself the following:

Is my website mobile compatible?

With the majority of traffic coming from mobile and searches happening at more random times when people have a thought, most of the time they aren’t near their computer, but rather, their mobile phone. In today’s world, your site should be optimized for mobile first.

Do I have a simplified version for mobile to minimize scrolling?

Your desktop version can have all the bells and whistles, people will bookmark the mobile url for later so they can see it on desktop, no one wants to read a novel on a phone, keep it short and sweet, yet compelling with a clear value proposition.

Is the layout easy to follow, are things easy for me to find?

Are the basics evident, users today hate having to search for things on complicated websites, they hate long lists of features and they despise the fact that if they are comparing you to another company, they are going to have to make a spreadsheet. If you’re going to list your features, also put them in an easy to download .csv (not that this is being done, but it should be by everyone). This last part dovetails into something that companies suck at, making all the important information easy to access, download, or compile. It’s there for the customer to get a sense of who you are and research your product, make it easy.

Is the company faceless or can I see who comprises it?

People like to connect with other people. Show some personality. Digital agencies tend to do this best being unique and memorable, your people should match the image of your company. If you do have sales people, they should be the ones writing your blog, not your company product update blog, your business blog about your industry. (Most early companies, don’t even consider doing one of these, but it’s a huge mistake not to.)

So you’ve passed the test of being credible, what’s next?

Step 3: Research

If you’re credible, you’ve made a list. The next step for people is to look up reviews of your product, preferably from 3rd parties not related to your company. If you’ve done a case study, don’t have that person do the review. Most people are smart enough to know that only case studies with successful results are published. Many fall on the editing room table.

So what do you do if you can’t get enough information about your shortlisted companies and your spreadsheet has some holes in it? Ask your network.

Step 4: Social Proof

Many companies try to accomplish this by posting big companies they work with to bring about credibility, but depending on who your market is, sometimes this just won’t resonate or resonate incorrectly.

What people are really looking for is social proof. Someone in their network, virtual or personal, that can vouch for, show, or suggest the program or product directly to you. People in social situations are very honest when it comes to suggesting or recommending something. They are a far more valuable source than a 3rd party review, a testimonial, or any company logo.

If you pass social proof, the next step is Trial/Purchase…

Step 5: Trial/Purchase

Assuming a customer followed all these steps, they will now take the time and effort to test out the products that they think would be the best fit. Everything is a trial. Most sales people don’t fully grasp this, but any contract is a trial, the sale is the easy part, the repeat business is the “real” modern sale. (Sounds a bit like customer service doesn’t it?)

If your marketing was on point, your web design and content easy to navigate, your customer service great (think social proof here), and the reviews checked out validating the opinions in your social network to confirm something beyond any possible agenda, you’ll realize that the customer would have sold themselves on your product before you even talk to them.

Bonus Step 6: Referral

The best way to build a business is through stellar word of mouth. Referrals are gold (see social proof above). Nothing will help you close someone quicker than when their network is already doing it for you. Evangelize your network, don’t think of your needs but rather theirs, how can you help them. If you can succeed in helping them, they will feel the strong need and desire to be reciprocal.

 

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90-day plan

Companies today ask for a 90-plan, if they don’t, they should be, here’s why:

A 90-day plan gives the company insight into what a new hire hopes to accomplish in their first 90-days. It is a telling sign of how they approach problems, what they have done in the past, and at the same time allows them a good deal of creative flexibility in explaining their immediate goals in a new position.

All 90-day plans should be structured something like this:

Days 1-30: Observe and Learn

The first 30 days your one job is to observe everything. When you start a new role, the best way to learn is to get as much information about current clients or potential demographics. You should reach out to these clients directly to collect missing information. Every piece of information that you collect from them should be categorized, segmented, and placed in a different basket.
Nothing is more important in sales or marketing than the customer journey.

Days 31-60: Planning for Success

Your second 30 days is where you’ll take the information that you’ve collected and you’ll start slicing and dicing it to decide on next steps. What I mean by this, is be very smart about every choices you make in sales and/or in marketing. Don’t got down a rabbit hole of assumptions.
Once you have your data collected, you’re going to work through it to find patterns. From patterns and customer feedback, you can begin to develop programs that help target the appropriate demographic. If you have the appropriate demographic, you’ll watch your conversion rate skyrocket. At the end of the day it’s all about efficiency.
Once you have a good understanding of who your customer is, you need to build content that they will enjoy, share, and most importantly, contribute to. Think of ways to engage and leverage your existing customers.
There are always ways to improve customer interactions. Always.

Days 61-90: Action Time

Day 60 through 90 are where the rubber hits the road. At this point, your sole focus is to ensure that the customer journey is clear, your calls to action are clear, that behind every motion your client or potential has a sense of scarcity and urgency.

Build the tools necessary to pinpoint your highest conversion tactics and double down, but always be thinking of content plays in the back of your mind. With every interaction is a play for the spread of information.

Leverage everything.

 

A 90-day plan is the best way to rate and evaluate a new employee, consultant, executive, etc. The best ones knock it out of the park well before the first 90-days, but they all follow these steps to get there.

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Conversion matters more than traffic

Traffic is great, but it doesn’t matter.

Most marketing managers miss the mark on this one in a very large way.

The focus for so many years has been, how to drive more traffic, versus how to drive and connect with the right audience. No place are we more isolated in this bubble than in Silicon Valley.

Example: Selling a product that costs $50

If you are selling a product that costs $50 this amount of money is relative to the geographic location and income earned in that location. The value of that $50 ranges widely from state to state and city to city.

In places in the USA where people do not have high wages, it could take more than a full day after taxes to be able to afford that product. Whereas in most major cities across the USA it might take most employees less than 3 hours to be able to afford that $50 product.

I have seen this time and time again, companies making bad decisions and flushing tens of thousands of dollars down the drain marketing to the wrong segments and trying to sell companies that simply do not pay their employees enough money to be able to justify the cost of some business software options. I’m not saying don’t ever go after this sector, what I am saying is in the beginning, before you start perpetuating a good reputation without the need for advertising,  go after the markets that make the most sense, do not waste money and time on markets that aren’t a good fit that increase traffic without any real possibility of increasing conversion.

It’s not rocket science, anyone that can work their way through statistics and knows how to actually look at data can put together a great report for how to succeed as long as they understand the market and know what to look for.

 

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Everyone wants a bargain

Today, everyone likes a bargain.

People are only willing to pay top dollar for things that are limited in production and command a high price, think of any good that sells out, in most cases artificially so.

It’s why Zara is beating just about every other retailer out there and why H&M has watched their growth remain steady while the likes of other big brand stores have plummeted. These two examples are all about speed and scarcity.

Scarcity and urgency are the only two things that matter in business. Make something that people want and figure out a way to motivate them to convert. In today’s culture, there are things that people will only purchase if they can get a discount.

Example, I’ll never pay full price for clothing or shoes. I could, it wouldn’t be terrible to do so, but those markets overproduce and misjudge their sell through so badly that you can always get a good deal. They also have a substantial markup built into the product.

Same goes for a software product. An experienced person will know that you can always work a deal, if you wait til the end of the month when the company is crunch over hitting numbers, you’ll get your best deal as well. (Still weirded out that we look at numbers on a month over month rather than a cumulative 90 days or so but a topic for another day.)

But everyone does love a bargain, but when you pair that bargain with scarcity and urgency, think limiting amount and time here, your conversion rate, the only thing that matters will 10x at least.

The beauty is, it doesn’t matter what the product is, as long as you find the right market for it.

Flash sales work. If you know your margins and aren’t afraid to fire a few clients, I would really suggest using them.

Consumer goods, should use them and slim their margins because the lifetime value of that customer will make up for the discount.

SaaS should use them because they forget that they can always fire a client. Sign shorter contracts, if you’re product is good and sticky for the business, they’ll happily pay more down the road, if it’s not a great fit, you don’t have to chase them in collections. Note: many companies do month to month these days with a cancel at any time feature, this gives customers the satisfaction of knowing they can walk away and lowers the barrier of entry to try.

I shop and if I see something say 1 left or sale ends Thursday, I’m a lot more likely to buy, it’s getting a perceived value of something, even if the excess is just arbitrarily baked into the product itself with no plans of ever selling at MSRP, hell car companies have been doing this for years.

Create a culture around providing psychologically what people want, a deal, and you’ll watch more deals close.

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Finding a customer’s pain isn’t the solution

Many sales managers and sales trainers focus on finding the customer pain points. If all you’ve ever done in your life is sales, this makes complete sense. If you’ve done any bit of consulting, you know that it’s not about the pain points, but rather, where the pain points really stem from.

There’s that old adage a woman comes to a man and is going through a tough time, the man wants to fix the problem, but in the end all the woman wants is for the man to listen to the problem and be supportive.

Sales executives are trying to fix the problem without listening to determine if they can actually fix the problem.

To provide real value is to listen to the entire problem and have enough experience to determine if your solution is the proper fit, or if the solution will not solve a deeper pain point that exisits internally in the company.

There isn’t one company that runs as efficiently as possible, for this reason, pain points emerge when the people behind the companies do not follow through with their responsibilities or lack the requisite knowledge to succeed. To counteract these feelings of pain, they search for remedies outside their internal structures by the way of software or other products to keep them organized. These function as band-aids.

In the world of startups where the average age of an account executive is often less than 30 with minimal real world experience, they’re ability to know, understand, and diagnose your pain is always going to be a bit of a hope, wish, and a dream.

In a world where quota determines your success, not long term clients, the incentives for most sales representatives are off.

It is better for a sales representative to convince a company of a pain they did not think of, talked a lot by the Challenger Sale Model, the idea that there is a cost to doing nothing, and then sell them a solution.

I hate this notion. Here’s why:

  1. Unless you work at a company for a prolonged period of time with unfettered access to all levels of employees, you cannot accurately understand the company dynamics and the internal workings of such company
  2. There is a reason they haven’t done anything about the “pain” before, it’s not viewed as being “big enough”
  3. Massive change comes at the most volitile times in a businesses life – watch an episode of bar or kitchen rescue – but 90% of those businesses go back to their same habits from before “experts” came in to fix things, and they had real pain too.
  4. When a pain does get big enough, it becomes the only thing visible, the underlying causes that allowed it to get big, are rarely addressed
  5. People hate being told what to do from outsiders

There was a phrase I used to say a lot while on calls with clients, “Your next step is a business decision that I don’t have the knowledge to advise you on. I’ve never been to your office, I don’t know your personal situation, I can’t provide that advice to you.”

I focused on being there to help make a product decision, not a business one. My clients respected me for that, I wasn’t fooling them into buying a product that would solve all their problems, I was providing them with knowledge and use cases for a product. I was an off-site consultant filling a potential void in their current business software. But I was never in it for the quick close and churn.

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Why it’s time to ditch the testimonials

You see them on nearly every website, speech bubbles from “actual customers” telling you to buy the product of the page they appear on.

They say things like,

“Before Acme, Inc. I used to spend 1o hours invoicing, now I can do it all in less than 4 hours!”

Most people at most companies would think this is great and that it’s exactly the type of thing that will sell their product. The problem is, it tells most people nothing. If you were lucky enough to get someone down that far on your page to read it, you’ve failed at giving them anything.

People care about stories, about other people they can relate to about struggles and triumphs over them.

What the don’t care about is vague claims that aren’t backed up by anything actionable.

How did you save 6 hours, did you outsource your work to someone else, did you find someone else more skilled at doing the work, did you cut your staff so there was less work, did you realize that you were adding work by not automating a process?

You can see where not giving the full story is enough to tease people, but leaving it like that doesn’t really make anyone want to do anything more than find out a bit more. If that’s what you’re after good for you, it may work, but most people also know these testimonials are scripted and arranged, that’s how they make it on your website.

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