For some strange reason, memories of my old physics classes seem to crop up on a regular basis within these pages. I’ve prattled on about how explosive the experiments were and how all this work was underpinned with some solid ‘problem busting’ scientific thought. Both of which I have then gone on to apply as possible solutions to the problems businesses may be facing in a down economy.
From all this you could assume – quite incorrectly I might add – that I was a bit of swot when it came to science. But I wasn’t. I struggled like the rest of them and just managed to scrape through with a B pass for my Cambridge O Level end-of-year exams. Nevertheless, I fall back to this time for content because of the most basic of reasons – I enjoyed it. You see, as a lad I was probably the same weight I am now but a good half the height. A bit of a porker was I. So sports were never my thing, English was a struggle, languages were even worse, so science was for me.
So while I found it hard work it was the certainty of the results that really appealed. Complete the experiment in the right way – mix blue powder with hot water and ba boom – one large bright and very messy explosion for all to see. Follow the same steps and the same results occurred – every time for everyone that followed the same process. Repeatable results – yep, that seemed quite cool to me.
I thought engineering contained the same type of thinking, so on leaving school I joined up to be an apprentice technician engineer at a local factory. Then, after a fair bit of travel, a few career changes and a dabble with redundancy, I started this company in 2002. There’s been quite a bit of change along the way but the theme that underpins Permission – delivering repeatable results – is the same one that interested me as student while I worked through those experiments. Thankfully, there are no unexpected explosions this time.
Nevertheless, there are some areas we work within that create a bigger economic ‘bang’ for our client’s buck than others. However, ensuring our clients allow us to focus their efforts in this space can be a challenge. For example, while our customers come in various personality styles, they all seem to have a core desire to want more traffic to their website. It’s like an obsession for some. These people pour over their Google Analytics reports each Monday morning to see how far their traffic has risen since the week before. And if it hasn’t, then in comes an email to ask what is happening. We answer all these politely, but at the same time try to avert their laser-like focus onto another part of their site that could return them more for their consulting spend.
And what is that ideal focus point?
Yes, I have talked about this before in the newsletter but this time I’m going back to one of my old physics lectures to illustrate my point about how improvements in this space can be so lucrative. Remember fulcrums and levers?
I think it was Archimedes who said “Give me a place to stand, and I shall move the earth with a lever”. Well, I don’t think we need to move a planet, just a website’s performance, so this should be a doddle in comparison.
To help me out here, please find to follow a simple image of a classic lever / fulcrum set-up – it has a rather skinny guy trying to lift a very heavy rock.
Hopefully, most of you have your eyes transfixed on the rock, which represents a nice heavy pile of cash. This is good. If nothing else, it has distracted you from the hard work of the person with the cap – forcing down on the pole (creating website traffic). Things are a bit blurry but I’m sure he is grimacing as he struggles away. Now the amount of swearing that is going on with Mr Lifter will depend on how effective his fulcrum is – which in my little diagram is the conversion rate of the site.
This basic physics principle highlights a few very important things. Firstly, for those obsessed with just generating traffic to their website, you will notice that without any fulcrum in place no cash will be raised. Yep, absolutely nothing – nadda. Send progressively more traffic to a website that doesn’t convert and your results remain the same – zilch.
Secondly, the work of Mr Lifter would be a lot easier if he had a better fulcrum. He could in fact use less force (need less traffic) and still lift more (generate more cash) when compared with someone who had more traffic BUT a weaker fulcrum (poorer conversion rate). Hmm, do less work and achieve more. Sound like a plan?
So how does all this semi-theoretical physics mumbo jumbo translate into tasks you can put on your to-do list next week? Well, here’s a few to consider.
First off, let’s get stuck into the hard one – changing your mindset from focusing on traffic to driving up conversions. With some luck the image of the pile of cash being lifted upwards by Mr Lifter with relative ease should help. However, I realise that making the right changes to your website to improve conversion rates is anything but easy.
It takes time to set up experiments, even with Google’s free Website Optimiser product, and then patience to let enough conversions pile up so the results are valid. All this relies on a bit of methodical thinking and a strong self-image to know that, even with all this work, your changes could be proven to either have no positive impact or to actually reduce the conversion rate of your site.
But there is always a bright side. Doesn’t knowing what doesn’t work take you one step closer to knowing what does? (I think it was Thomas Edison who mentioned this after conducting thousands of failed experiments before he settled on the winning one.) And, like Edison, once you know what works well you can mine this success for ages. More on the economic power these results can provide you later.
Nevertheless, there is sometimes a short cut to conversion rate improvement. This has you looking out for other conversion choices – think other fulcrums – for your website to lever more cash from your visitors. For instance, an e-commerce website that achieves a credible 3.5% conversion rate still has 96.5% of its visitors leaving without buying. Now, I would guess that not all of this group are totally disinterested in what the website offers – it’s just that they weren’t ready to buy just when they visited.
But 15% could be keen enough to join a newsletter list. And a further 5% may well be in love with the brand so much that they would join the site’s fan page on Facebook. So to 3.5% of core sales conversions we can now add another 20% of additional ‘contact conversions’, realising that not all of those will buy now, but a high percentage could be persuaded to buy later.
A recent conversation I had with a prospect during one of our introductory online marketing performance review sessions highlighted this exact same issue. Their website offered a small range of products via a very simple e-commerce offer. Buying these items and contacting them for assistance were the only two conversion options the site offered. What’s more, their target market was proven to devour any information they were offered on the subject area. Add to this the fact that their product offered a novel twist to solve this very common problem, coupled with a great story behind it – and there were opportunities abound to offer an email newsletter of sorts and gather many more conversions from the traffic that was currently leaving the site.
Offering information is a great option to backfill a website’s conversion choices. Some industries / products make this strategy an easy one to exploit. But even for those that may struggle there are occasionally opportunities that arise to turn a relatively dry subject into something that many are keen to learn more about. For instance, if you run an accountancy practice, the latest changes to New Zealand’s GST and PAYE rates are an actual goldmine of opportunity. Used properly, information on these subject areas is an ideal way to engage with both prospects and existing clients. I recently sat in on a presentation from one practice that took us through the GST changes from start to end in a very practical and informative manner. I had never heard of this business before I was invited, but now if I was looking for a new accountant then they would be close to the top of my list. But have I seen dozens of accountants offering complimentary courses on the changes to reap the value of this opportunity? Nope – hardly any.
Which leads me nicely back to the subject of seizing every opportunity to make your conversion rate fulcrum work as hard as it can. The numbers can be very compelling – e-commerce websites especially can reap huge gains from relatively small improvements. For instance, say you own an e-commerce website that receives 8000 unique visitors per month and converts 2.5% of this traffic with an average sale value of $80. All you need to do is move this up 0.5% and your revenue per month increases by over $3000 – for every month going forward. That’s over $100,000 in extra revenue over three years.
Getting to grips with numbers like these can be a good way to help galvanise yourself into action. This month’s customer conference call included a section where I presented an interactive PDF document that should help many. By using this you can manipulate your own visitor numbers and conversion rates to see how sensitive each of them is to your overall financial results. As a customer you would have received a copy of this document.
I suggest you spend a few moments plugging in your own details to see what they show. You should be pleasantly surprised how much extra cash your website can raise just by applying some small changes to your fulcrum of conversion. Now that should replace any grimace with a nice smile.