The Three Metrics You Need to Know Before You Waste Any Time on A/B Tests

It’s hard to argue that split testing (also know as A/B testing) is changing the face of marketing. According to Unbounce, 44% of online businesses are using split test software. And software products like Unbounce and Visual Website Optimizer are making it ever easier. Split testing, done right, with good context, can put a stop to all the guesswork, anecdotal conclusions, and correlation/causation errors that can abound in marketing circles.

But it’s not without risks: split tests are expensive to run, requiring investment for both software, and staff/consultants to run the tests. Not to mention the opportunity cost of lost time exploiting other profit levers in your business.

All of which underscores the importance of testing the right metrics in your business, and the potential cost in time and resources of testing the wrong ones.

While I can’t speak for all businesses, what I’ve seen again-and-again with clients and peers is businesses gravitating toward what’s easy to test – landing pages, checkout pages, email subject lines, and sales pages (all of which can be extremely important in the right context) – rather than what’s important.

That’s why one of the most meaningful changes you can make in your business is to implement a process for identifying which parameters to test and optimize. Below are 3 metrics you need to know before you spend one more minute split testing.

1. List-to-Sale Conversion Rate

What if I told you one simple calculation would tell you whether to optimize any conversion metrics between an opt-in and a sale, or to look elsewhere? That’s what the list-to-sale benchmark gives you. “List-to-sale” is the percentage of buyers of your product or service over a given time period relative to the number of opt-ins to your email list for the same period.

Say in a given month you get 1,000 opt-ins to your email list, and in that same month, you make 55 sales of your flagship product. Wondering whether you should go with a webinar funnel instead of an email onboarding sequence? Whether to incorporate video into your sales page? Whether to change the color of your “buy now” button?

The answer to all of them is “no”, and I didn’t even need to take a look inside your funnel. Why? With 55 sales, you’re converting at a staggering 5% list-to-sale.

To calculate, just take the sales in the last 30 days and divide those by opt-ins over the same time period.

list-to-sale-conversion-rate-formula

Some readers will be noticing the absence of a sales cycle in that calculation (i.e. since it takes days-to-weeks and several touch points to make a sale. We should be comparing this month’s buyers to last month’s opt-ins). You can control for this with a simple average:

  • Take the last 4 months, and average the opt-ins over the first 3
  • Then average the sales over the last 3.
  • Then perform the same percentage calculation. (Sales divided by opt-ins)

For example, say you’re calculating in August:

  • First you’d average the monthly opt-ins for April, May, and June. Let’s just say the average is 1500.
  • Then you’d average the sales from May, June, and July, in order to leave a 30-day lag. Let’s say that average came out to 75.
  • Dividing the sales by the opt-ins, and you’d get 5%.

The benchmark you should be aiming for? 1-2%. Below that, go nuts with split testing parts of your funnel. Above 1%, look elsewhere.

Above 2%, and I’d seriously consider raising your prices. In the hypothetical case of the 5% from above, I’d immediately double the price.

Next, and especially if your list-to-sale conversion is at-or-above the 1-2% benchmark, it’s time to look at your traffic.

2. Opt-in Conversion Rate

The vast majority of businesses I work with have list-to-sale conversion rates closer to benchmarks than their opt-in conversion rates. Put another way, if they’re wasting any resources split-testing their funnel or sales copy, they’re completely ignoring the sizable cohort of website visitors who never even see the offer because they bounce off the site.

As with list-to-sale conversions, you can do a back-of-the-napkin calculation for opt-ins. Just count your new subscribes from the last 30 days and divide it by total website visitors during that same 30 days.

The benchmark to aim at for opt-in conversion is 10%.

If you haven’t ever found your opt-in rate before, my guess is you’ll be astonished how low it is. I’ve seen it as low as 1-2%.

Luckily, there’s a simple strategy to improve it:

  • Find the individual opt-in rates of your biggest webpages and your 10 most popular content pieces. (If you’re using a plugin like SumoMe or OptinMonster, you can set up the software to tell you your opt-ins for each page.)
  • Look for the “outliers” – content pages often perform worse than home and about pages.

Once you’ve identified the worst-performers, perform this simple checklist (from lowest-hanging-fruit to more subtle)

  1. Can readers find your opt-in offer, or is it buried below the fold or ¾ of the way down a blog post?
  2. Are you giving your visitors only one thing to do on each page or post, or are you offering 3 different giveaways on various parts of your page?
  3. This is not the type of page you want to create if you’re looking to increase opt-ins.

    too-many-ctas-blog-postDon’t give your readers more than one choice when optimizing for opt-ins

  4. Is your opt-in offer not just well written, but well copywritten? Does it specify exactly who it’s for, describe a clear, specific benefit, and emphasize the urgency for opting in? (Even high performing opt-ins can usually be improved).
  5. Are you requiring your subscribers to double-opt-in? This will lower your opt-in conversions. Many founders I’ve talked to like to use a double-opt-in because it seems more “polite”. In my opinion, making somebody go off the page to get the freebie they just gave your email address for, let-alone to wait up to 20 minutes for it to arrive in their mailbox isn’t particularly polite. When I give my email address to get a lead magnet, I want it now – not after reconfirming my email address and waiting 20 minutes for the email.

Split-test ninjas take-note: if you’ve read this far, and your opt-in rate is indeed garbage, there’s ample opportunity to split test:

  • Two versions of a homepage with different opt-in copy/design.
  • Two versions of an exit-pop on a popular content piece.

Go nuts.

3. Traffic

If you’re among the extremely lucky minority with list-to-sale conversions at-or-above 2%, and opt-in conversions at-or-above 10%, and you’ve raised your prices, I have some disappointing (although kind of good) news: split testing is not a good fit for your business.

Here’s the question to ask: Are your monthly sessions at least 50% of your list size? (i.e. if your list has 2,000 subscribers, are you getting at least 1,000 uniques per month?) If not, you need a traffic strategy. Don’t waste your time A/B testing anything.

While I’m a conversions expert and not a traffic expert, here’s a quick decision tree:

  • Determine your market size. If you could 5x your traffic, are there enough people in your market to support it?
  • Implement a content/syndication/guest-post strategy ASAP. It’s practically the only guaranteed winner across all verticals, but it can take up to a year to bear fruit.
  • Consider hiring a paid traffic expert for one month to test customer acquisition costs from various paid sources. Choose the most profitable and double down while you wait for organic traffic to grow.

Bottom line: the same month spent split testing two opt-in offers on a homepage, landing page, or content page, could provide a 2-4x increase in revenue (by, say, improving an opt-in conversion rate from 1% to 4%), while the same time and money spent trying to boost an already maxed-out sales conversion rate would have a much smaller return.

That’s why a little context can save you thousands.

About the Author: Nate Smith is a direct-response copywriter and funnel expert who helps businesses scale by exploiting their most powerful profit levers. Nate is founder of 8020MarketingGuy.com.

5 Ways Your Fans Can Help Optimize Your Site for Conversions

I’ve been watching Facebook closely for a long time.

I’ve tested hundreds of ad iterations.

I’ve worked hard to build organic reach for myself and my clients.

Here’s what I’ve concluded: Facebook is awesome. But it’s also tricky.

Why? Because the algorithm is constantly shifting, forcing marketers to up their game, readjust their techniques, and reorient their strategies.

Here’s the thing. If you have a social presence for your business, Facebook has decided that your organic reach needs to shrink.

Again.

You know, of course, that this isn’t the first time the social giant tweaked its algorithm.

In June, Adam Mosseri, VP, Product Management for News Feed at Facebook, shared a post that detailed how Facebook was updating the news feed.

The core of the update is to prioritize posts that come from friends and family while reducing the onslaught of content from businesses and other publishers. Facebook wants users to see more posts from actual people, not businesses doing marketing.

The gist of the algorithm remains the same.

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But the variability is increasing. Mosseri explained:

It will vary a lot by publisher mostly based on how much of their referral traffic or their reach is based on people who actually share their content directly…

If you’ve got strong engagement from your audience and they’re shouting your name from the rooftops as they share your content, or generate content around your brand, you’ll be far less impacted by the update.

But most of the businesses I work with aren’t enjoying that level of stellar engagement.

This is what it boils down to. If you want to improve your reach and engagement, you’ll need to find ways to leverage user-generated content (UGC) since that’s what friends and family will see first.

What I want to communicate is pretty simple: User-generated content is one of the most effective forms of content marketing available today.

User-generated content is the future of content marketing.

UGC will act as dynamite to your social media presence, accelerate your onsite content efforts, increase engagement, boost conversions, and build up a wall of defense against any algorithm the world throws your way.

Let’s talk about where the rubber meets the road-your fans helping your site become a conversion-generating machine.

Why you should put your money into user-generated content

There are a lot of benefits to UGC, and those benefits can be significant. And that’s primarily because you’re not limited to social media when it comes to working with customers to acquire and leverage it-though that’s where a bulk of your gains can come into play.

Consider for a moment that more than half of the adult users on Facebook have around 200 people in their immediate networks, according to Pew Research.

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That social network graph looks something like this:

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If the algorithm wants all those people to see content from their connections first, it’s in your best interest to get your audience producing or creating content about you.

And that’s not just for the sake of a little (or even big) boost in visibility.

Consumers fully admit they find branded information from their peers trustworthy-85% of consumers, to be exact.

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That’s because the vast majority of them find that kind of content to be helpful when they make a decision about whether or not to make a purchase.

Nielsen’s study on this subject showed that 92% of consumers trust content and the opinions of their peers over any other kind of advertising.

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UGC also has influence over that trust, according to data shared by Yotpo:

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UGC is the best way to beat an algorithm that wants to topple and bury your promotions amid pictures of babies, beards, and breakfast platters.

But you’re not limited to Facebook in leveraging it.

With variations in engagement time across different social channels, you can see where there are opportunities to use user-generated content to drive up engagement as well as increase consumer trust.

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Some brands are having a lot of success on other social channels and digital properties with UGC.

Below are a couple of examples of brands that leverage UGC using different channels.

A touch of wanderlust

National Geographic asked users to capture unforgettable people, places, and experiences that have impacted their lives from their travels around the world. The hashtag campaign (#wanderlustcontest) brought in tens of thousands of submissions branded to NatGeo.

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And, of course, among those public submissions were some truly breathtaking and awe-inspiring photos people were all too happy to continue sharing.

Ignite user creativity

Nissan’s luxury car brand, Infiniti, ran a campaign promoting its Q30 model, aiming to leverage the content of its fans to help promote the vehicle. The New Heights contest had users print out a marker card that would display the vehicle in 3D when used with their mobile app.

Fans were encouraged to show off the vehicle in unexpected places by snapping pictures and sharing them with a branded hashtag via different social channels.

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These two great examples of building campaigns and visibility from user-generated content had a couple of things in common:

  1. They both revolved around contests. While this is a good way to encourage action among your followers, it’s not always necessary to give something away in order to source user-generated content.
  2. These two campaigns were actively asking their fans to provide the content.

This aspect-the asking-is the most important part you need to remember.

Why? Because the majority of brands simply don’t ask. If you don’t ask for it, you won’t get it.

It’s just that simple.

So, what’s the simplest and most effective way to get UGC?

Ask your users to provide it.

If you want UGC, ask your followers to provide it

Brands don’t want to be pushy, but with UGC, you’ve got to approach it like you approach a call to action (CTA).

With a CTA, you’re telling your audience explicitly what you want them to do. It’s been proven time and again that without a clear call to action, you lose conversions.

But only about 16% of brands take the same approach with UGC, expressing to fans just what kind of content they want to see. Without that kind of direction, consumers aren’t sure what’s okay to share.

In fact, 50% of consumers want brands to tell them what they should include when creating and sharing content.

You don’t need to give away a luxury or big-ticket item when you make the ask, but you do need to ask.

Don’t sit and wait for your fans to provide you with gold.

Here are some of the best ways you can start sourcing and leveraging user-generated content for your brand and social channels.

1. Curate user-generated content with Yotpo

I’ve long felt that Yotpo is an impressive platform for sourcing reviews, engaging customers, and utilizing customer feedback to promote growth.

Now, it’s even better than ever.

Yotpo has stepped up its game with the recent launch of the Yotpo Curation tool.

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This tool allows you to collect relevant Instagram photos from fans and influencers, displaying them on a single dashboard.

From there, you can tag products and handle rights management (including engagement with the original user to say thanks), inject the photos into your product pages, and even sell from your timeline.

This simplifies the tedium of trying to manually source user-generated images and lets you quickly benefit from the social proof tied to UGC.

In one survey conducted by Yotpo, 77% of consumers admitted they preferred to see consumer photos over professional shots:image03

That’s a clear indication of what you should have on your product pages.

Imagine the impact of having quality reviews alongside images showing off your products being used by actual customers.

It would provide a significant lift in conversions when you consider that 63% of customers are more likely to make a purchase from a site displaying user reviews. A study conducted by Reevoo showed that reviews alone, without any other UGC, lift sales by 18%.

The Yotpo tool turns your customers into brand ambassadors right on your product pages, plus you can create your own shoppable Instagram galleries or post that UGC to other social channels.

2. Build a community

When I talk about building a community, I’m referring to a gathering of people. Literal people in online gatherings.

You may view your social channels as individual and separate communities, but they’re really not. At least not without some kind of organization.

There are a lot of ways to build communities, e.g., Facebook groups, subreddits on Reddit.com, or communities built into your website.

A community you create and manage can give your fans a sense of belonging and make them feel connected to your brand. They’ll share a mix of personal content as well as content related to the brand as they engage with one another.

Through this engagement, you’ll see things like images, videos, and testimonials crop up that are ripe for the picking.

That user-generated content feeds back into the community, encouraging others to generate more of it, and it helps anchor prospective customers who were on the fence about making a purchase.

Giant Vapes is one of the largest online retailers of e-liquid for electronic cigarettes. It also operates a Facebook community, roughly 25,000 members strong. Members regularly share the products they’ve purchased, industry news, their opinions about interactions with the company, praise over shipping and deals, and more.

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3. Give them customization and unique experiences

Customization provides your fans and customers with a sense of real ownership. They’ll naturally want to share with their friends and family what they’ve created, and you can play on that desire by asking them to do so.

Whether it’s a customized piece of clothing, a bag, or a vehicle, customization often leads to some great user-generated content.

And sometimes you don’t even have to ask.

Scores of people got excited about the announcement of Nintendo’s Super Mario Maker. Players create their own Mario levels to play on their own or share with the community. Fans, new and old, went crazy when it launched, and YouTube was flooded with the creations of streamers, generating a lot of visibility for the brand and the game.

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This video has almost 12 million views to date.

In the same vein of creating unique experiences, Hello Games is seeing images and videos of their game No Man’s Sky showing up all over the web, including a subreddit devoted to the game (a user-created community).

No Man’s Sky features a universe boasting over 10 quintillion procedurally (randomly) generated planets, each with creatures and alien plant life different from the last. That guarantees unique content, and fans have been quick to share images and videos of their discoveries since its recent launch.

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When you give your audience something they’ve never experienced before and the chance to create something unique they feel they own, they’re more likely to share that experience far and wide. That builds a lot of trust and provides a lift in conversions.

4. The UGC contest

I touched on contests above with a couple of examples, but in recommending this approach, I wanted to add one more because of the success of the campaign.

Back in 2014, Starbucks invited fans to decorate their white cups with customized art. Fans were asked to submit the images through Twitter with the #whitecupcontest hashtag for a chance to win. There were thousands of entries, and, of course, a constant stream of buzz that drove customers to their local stores.

//platform.twitter.com/widgets.js

I’m mentioning this contest specifically because it pulls in elements from my last point: let users customize and do something unique.

You don’t have to have a multi-million dollar budget to add customization to your product line.

Sometimes, you just need to give your customers a blank canvas and set their creativity free.

5. Use videos on product pages

Yotpo can strap a rocket onto your conversions with user-generated images, but don’t let the rocket run out of fuel.

If you can get your fans and customers generating videos of your products in use, those should be added to your product pages as well.

Explainer videos are great, but there’s nothing that sells a product faster than a video showing real, happy customers, who are 100% satisfied with their purchase.

Here are some quick stats that show how effective product videos really are:

  • 90% of users admit that seeing a video about a product helps them make a purchase decision
  • 36% of customers trust video ads; imagine the trust you gain from earned media
  • 64% of visitors are more likely to buy a product after watching a video online
  • Product videos can increase conversions by as much as 20%

Conclusion

Aside from those five tips, it goes without saying that you should absolutely be using product reviews on your website and social channels such as Facebook.

Leverage that social proof, and find creative ways to team up with your customers.

A large portion of your audience are happy to create and share content for you-they just need to know what you’re looking for.

Tell them how to help, inspire them to get creative, and watch your conversions climb steadily as your collection of UGC grows.

Are you using user-generated content right now to build trust with your audience and increase your brand’s visibility? What techniques are you using, and what’s the most successful?

How to Turn Online Marketing Leads into Online Marketing Sales

If you’re doing online marketing right, you should be driving a steady stream of inexpensive, qualified leads to your sales team.

That means tons of sales and profit for your business, right?

Unfortunately, that’s not always the case. Often, you may be sending all the right leads to your sales team, but they simply aren’t turning into sales.

What’s going on?

Is it a problem with your sales team? A problem with your leads? Maybe, but often, the problem is simply a marketing-sales mismatch.

When Things Go Wrong

A few months back, we were using paid search to drive leads for a client. We thought we were doing a pretty good job, but there was a problem-our leads weren’t turning into sales.

To be honest, this came as a surprise.

We had a lot of experience in this particular industry, so we knew our campaigns were driving a lot of high-quality leads.

In fact, from a marketing perspective, our campaigns were a hands-down success! We were sending hundreds of high-intent leads to their sales team at a great cost-per-lead.

What more could you ask for, right?

In our experience, they should have been closing at least 10% of these leads…but they weren’t. As it turned out, they were only closing 1% of their paid search leads.

wait-what

What were we doing wrong? 

On paper, everything looked great, so I called the client to get his thoughts. His answer was both candid and insightful:

“Jake, the leads are great. We don’t have a lead problem. My sales team just doesn’t know how to close these leads.”

Now, this problem isn’t unique. I’ve seen it before. Great online marketing can get leads in the door, but it can’t make them close.

That job rests on the shoulders of the sales team.

So, if you want your online marketing to yield great results, your job doesn’t end with lead generation. You need to make sure your sales team knows how to get those leads to close.

Turning Leads Into Sales

With online marketing, you control all aspects of the lead generation process: targeting, ads, landing page content and call-to-action.

The problem is, while you may intimately understand your leads, your sales team might not really know where your leads came from, why they reached out and what they are looking for in a business.

And, unfortunately, if your sales team doesn’t really understand their leads, they are going to have a hard time closing them.

In order to successfully close online marketing leads, your sales team needs to understand a couple of key things about their leads:

You’re Not the Only Business After Their Business

When it comes to online marketing, you can’t expect leads to sit still.

If someone is interested enough in what your business has to offer to reach out, there’s a pretty good chance that they’ve reached out to your competition, too.

However, first to call is first to close.

In fact, 50% of leads end up choosing the company that reaches out first

New leads are also 100x more responsive if your sales team reaches out in 5 minutes instead of 30 minutes and several thousand times more responsive if you’re reaching out within 5 minutes vs a day or two later.

Fortunately, most of your competitors wait hours or even days to respond to new leads, so if your sales team is quick on the draw, they have a good chance of being the first to respond, make contact and close the deal.

The Internet is a Distracting Place

When it comes to online leads, you can assume that by the time you reach out, they’ve already moved on to something else.

Maybe it’s a competitor’s site. Maybe it’s social media. Maybe it’s back to whatever they were doing before your ads caught their attention.

Whatever the reason, they usually aren’t sitting around waiting for your call.

That means your leads are probably distracted and might miss (or ignore) your first few contact attempts. So, if you want to get a hold of your leads, your sales team can’t just send one email and call it quits.

In fact, it takes a minimum of 8-12 contact attempts to get a 90% contact rate. Even if you’re only after a 50% contact rate, your sales team will still need to make at least 6 contact attempts.

The only problem is, most reps only make 1-2 contact attempts per lead. As a result, internet leads are only contacted about a quarter of the time.

You fight tooth and nail to get those great leads in the door and sales only contacts 25% of them?

epic-fail

Imagine what would happen if your sales team started reaching out 8-12 times and achieved a contact rate of 90%. That would increase your contact rate by 360%.

If your sales team’s contact-to-close rate stayed the same, contacting 3.6x more leads would result in 3.6x more sales. Can you imagine how that would affect your business?

Getting Marketing and Sales in Alignment

In addition to giving your sales team insights into what tactics work best for online marketing leads, there are a couple of things you can do on the marketing side to improve sales performance.

Talk to Sales!

Online marketing leads convert because they believe that your company has the solution to their problems. Your sales team’s job is to confirm that belief.

However, if your sales team isn’t making good on the promises of your marketing, your customers will feel betrayed and they won’t want to buy.

To avoid this, your sales team’s message needs to match your marketing message.

Yes, that means you’ll have to talk to your sales team about the intent, pain points and goals of your leads, but guess what? The better your sales team understands where their leads are coming from, the more effective they will be at closing sales.

In my experience, getting marketing and sales on the same page will make your online marketing effects far more effective and can drive millions in added revenue for your business.

There is Such a Thing as Too Many Leads

If you’ve got your campaigns set up right, online marketing (especially pay-per-click marketing) is pretty simple.

Insert the money, out come the leads.

Now, you and I both know that there’s a ton of work behind that equation, but if you’re feeding too many coins into the marketing machine, the resulting surplus of leads can make your sales team a little lazy.

As a result, ambitious sales reps might be tempted to sift through your leads to pick the ones that will be easiest to close.

They’ll look like superstar salesmen, but on closer inspection, you’ll notice that their lead-to-close rate is actually terrible.

Even though these “rockstar” reps look like they are closing a lot of deals, they waste a ton of expensive leads. In many cases, companies will end up paying more for those wasted leads than they’ll earn off of that “all star” rep’s closed sales.

So, how can you avoid this?

Easy, just keep your sales team hungry.

If you’re putting less money into the marketing machine, your sales reps will pay more attention to the individual leads they’re getting. 

However, you want to be careful with this tactic. Give your sales team too few leads and you’ll hurt productivity and morale.

So, if your sales team is begging for more leads, up your marketing budget. On the other hand, if you’re not getting any requests for more leads and your close-to-sale rate isn’t doing so hot…you might want to dial back your marketing spend.

Conclusion

It’s hard to make a profit off of online marketing if your sales team doesn’t know how to close your hard-won leads.

But, if you’re willing to work with your sales team, your marketing campaigns will not only produce profitable leads-they’ll produce profitable sales.

And isn’t that what online marketing is all about?

You’ve heard my two cents, now it’s your turn.

In your experience, how have sales short-changed your online marketing efforts (or vice versa)? How have you helped your sales team work more effectively with paid search leads?

About the Author: Jacob Baadsgaard is the CEO and fearless leader of Disruptive Advertising, an online marketing agency dedicated to using PPC advertising and website optimization to drive sales. His face is as big as his heart and he loves to help businesses achieve their online potential. Connect with him on LinkedIn or Twitter.

How Personalization Can Help You Close Leads and Win Customers (with Examples)

Remember the last time you landed on the Amazon homepage and saw a bunch of recommendations based on your browsing habits?

Or that time when you got an email from your favorite airline thanking you by name and even mentioning your home city?

This is the power of personalization.

Personalization is easy enough to understand: the process of crafting personalized experiences for individual customers through data.

The data is pretty clear: personalization is good for your customers and your bottom-line.

  • 75% of customers say that they like when brands personalize the shopping experience for them (Aberdeen Group).
  • 74% of online customers get frustrated with website when content appears that has nothing to do with their interests (Janrain).
  • 86% of customers say that personalization affects their purchase decision (Infosys).
  • Marketers who personalize the user-experience and are able to implement the changes see on average a 19% uplift in sales (Monetate).

In this post, I’m going to help you understand personalization and show you how you can use it in your business.

Three Types of Personalization

Broadly speaking, you can divide any kind of on-site personalization into three categories:

1. Product-Specific Personalization

In this type of personalization, you show customers products based on what others have bought, or products that go well together (also called “affinity analysis”).

Essentially, it’s a way to upsell additional products based on what the customer is already viewing.

As an example, consider how Amazon shows you popular product combinations (“Frequently Bought Together”):

amazon-frequently-bought-together

Amazon also shows you products viewed/bought by other customers:

customers-bought-viewed-after-product

According to one study, this type of personalization generates the highest revenue for E-commerce stores:

personalied-product-recommendation-type-usage

It works due to three reasons:

  • Knowing that there are others who’ve bought similar products acts as powerful social proof, improving conversions.
  • Product recommendations are served right when customers are ready to buy. Think McDonald’s “Would you like fries with that?” upsell.
  • It encourages customers to view more products. Even if they don’t buy them, you get additional data and customers get exposed to new products.

This type of personalization is relatively easy to setup since it doesn’t require user-specific data. You can even set up product combinations (aka “Frequently Bought Together”) manually if you have a small inventory.

Similarly, setting up recommendations based on behavior of other customers (aka “Customers Who Viewed this Also Viewed”) is relatively easy if you have data on your customers’ behavior flow.

2. User-Focused Personalization

This personalization-type focuses on crafting customized experiences for every user.

You can further divide it into two sub-categories:

A. Data blind personalization

In this case, you know nothing about the user, so you gather key information right on the landing page itself.

For example, NakedWines asks you specific questions at the start to give you a personalized shopping experience. The more information they have on you, the better wine they’d be able to recommend.

nakedwines-survey-questionnaire

Unless you have a lot of customer data, most of your personalization will be data blind. You’ll have to use tactics to quickly gather customer information when they land on your site (more on this below).

Alternatively, you can personalize your site depending on information you already know – the user’s location, browsing device, referral source, etc.

For example, if you browse LLBean.com from Mexico, you’ll see an alert in Spanish notifying you about international shipping. LLBean can easily get this data from your browser itself.

ll-bean-geolocation

B. Data backed personalization

Users who’ve registered or bought something from your store fall into this category. Since you already have some data on these users’ preferences and shopping behavior, you can use it to create personalized experiences/recommendations.

For example, look at Amazon’s “You might also like” or “Inspired from your browsing history” recommendations.

amazon-inspired-by-your-browsing-history

Or Amazon’s “Featured Recommendations” based on recent history:

amazon-featured-recommendations

Data-backed personalization is a powerful tool for improving your conversions. Since it’s based on past user-behavior, you can show highly accurate recommendations to customers and increase your customer LTV.

3. Real-Time Personalization

Real-time personalization is a personalization technique that uses data collected from visitors to create personalized shopping experience on the fly.

In a way, it’s another form of data blind personalization, except it works in real-time.

For example, take a look at Burton‘s real-time weather-based personalization. Based on the weather at the user’s location, a tile on the homepage adapts and shows relevant products to buy.

burton-real-time-weather-personalization

Here’s another example from Volcom. Depending on your location, you would see two entirely different pages:

volcom-personalization

Real-time personalization often creates serendipitous “wow” moments for your customers. Using it too much, however, can leave visitors confused. Some users might even see it as an invasion of their privacy.

If you must use it, use it sparingly.

Before You Start Personalization: Things You’ll Need

We’ve seen how personalization can help you increase conversions while also improving your customer experience.

Before you can start the personalization process, however, there are a few things you’ll need.

1. The right audience

Unless you have a treasure trove of customer data and a crack team of data scientists to make sense of it (like Amazon), most of your personalization tactics will revolve around your “ideal” buyers.

These are buyers who have the money, the motivation and the need for your product.

The best way to identify this ideal audience is to create a thorough customer profile. This should more than just a brief statement like “Men who are above the age of 40 and who like sports”.

Instead, your “ideal buyer” customer profile should include the following:

  • Demographic information: This may include age, gender, location, ethnic background, marital status, income, and more.
  • Psychographic information: This information is about the customer’s psychology, interests, hobbies, values, lifestyle etc.
  • Firmographic information: This is more relevant to B2B businesses. Information on company name(s), size, industry, revenue etc.

How do you find this data?

This post from Chloe Mason Grey is a good place to start.

Most businesses will have multiple “ideal buyers” (say, a shoe store that sells running gear as well as formal dresswear). Use the data you gathered above to segregate your customers into distinct customer profiles.

2. The right message for the right customer

Different messages resonate with different customer profiles. Your 50-year old customer who buys $400 formal footwear isn’t going to respond to the same message as the 20-year old buying skateboarding shoes.

The next thing you’ll need for personalization, therefore, is the right messaging for different customer groups.

For example, if you sell software for businesses, you may want to show different landing pages for different segments of your target market.

DemandBase, for instance, mentions a customer’s company name and custom image (in this case, Salesforce) on its landing page:

demandbase-salesforce

Ideally, you should have separate messaging for each of your identified customer profiles.

For instance, suppose you identify two ideal customer profiles for your shoe store:

  • Millennials under 25 who buy cheap casual shoes, read Complex magazine and buy 10+ video games every year.
  • Professionals above 35 who buy expensive, but quality formal shoes, read niche fashion sites and occupy senior management positions.

You can then craft personalized messaging for both these customer profiles.

For your millennial buyers, for example, you might send them an email informing them about a new sneaker recently reviewed by Complex. For your older buyers, you could send them a personalized email about a classic Alden shoe that pairs perfectly with a quality suit.

Organize these messages in a “Messaging Matrix”, like this:

messaging-matrix

3. The right place to show your messages

Now that you know who your audience is and what messages resonate with them, it’s time to figure out where they hang out.

Ask yourself: which websites and social networks do they visit frequently? Do they regularly check their emails? Are there any apps they can’t live without?

Doing this will ensure that your personalized message reach your audience at the right place.

For example, if your customer research shows that most of your audience spends much of its time on email instead of reading blogs, investing time in personalized blog posts will be a waste of time.

Use this data to prioritize your message distribution. If you’ve worked out the message to get more conversions, then make sure you place it where the traffic is high (and of high quality).

For instance, Target shows its personalized recommendations right after you add a product to cart:

target-guests-also-bought

This will likely have strong conversions since it shows up right when the customer is ready to checkout.

How to Use Personalization in Your Business

By now, you should have:

  • A detailed profile of the “right” customer(s)
  • Messaging that resonates with these customers
  • A distribution system to deliver this messaging to your ideal customers.

The obvious question now is: how do you actually apply all this to personalization?

In this section I’ll share some strategies for using personalization.

1. Focus on capturing data

Data is the heart of personalization. In any personalization campaign, your focus should be to capture as much data as possible. This should include data for both logged-in and raw users.

Here are a few questions you should have answers to:

  • Traffic source: Where does your traffic come from? What devices and browsers do they use?
  • Behavior flow: What other pages do your visitors view? How long do they stay on these pages? Do they click/purchase anything from these pages?
  • Engagement metrics: What pages do your visitors engage with the most? What parts of the page do they spend the most time viewing?
  • Subjective data: Can customers actually find what they were looking for on your site? Use on-site forms to ask users such questions.
  • Click behavior: What links do your users click on? What links to they ignore?
  • CRM data: What part of the buying cycle are your users in? Use your CRM data to figure this out.
  • User data: When did your customer sign-up with you? How many products have they purchased from you? What is their average order value? Where are they located?
  • Search data: What keywords are customers searching for on your site?

Besides the above, you can also collect data when a user lands on a page and customize the experience on the fly. A very simple example of this is Lufthansa asking users what region and language they want to see the site in:

lufthansa-my-country-language

Here’s another example from Doggyloot. Instead of simply sending customers to the homepage, Doggyloot shows them a custom landing page based on the size of their dogs.

doggyloot-custom-landing-page

You can gradually ask for more and more data from the user to create more customized experiences. For instance, on the Sales Benchmark Index homepage, users are asked to choose their current role:

sbi-choose-your-role

Based on their choice, users are sent to a page with handpicked posts from the SBI blog:

sbi-personalized-page

If a user downloads an eBook or guide, SBI shows them additional content recommendations:

sbi-similar-blog-posts

Even the most basic data can help you create personalized experiences. JetBlue, for example, sent out customers a “happy anniversary” email to thank them for signing up.

jetblue-happy-anniversary-email

Keep in mind that you don’t necessarily need your own data to run personalized campaigns. Most ad platforms will likely already have lots of data you can leverage to create such experiences.

For example, you can run two Facebook campaigns:

  • Campaign #1: Targets 20-something first-time entrepreneurs who like TechCrunch and Hacker News.
  • Campaign #2: Targets CIOs at large companies who read CIO magazine and subscribe to niche industry blogs.

Since you’ve already qualified your audience, you can now create two custom landing pages for each of these two customer profiles.

For instance, your campaign #1 landing page might say “If you love Hacker News, you’ll love our tech community as well”, while the second landing page might share a whitepaper on a topic recently shared by CIO.

This is very raw personalization (if any), but it’s a quick alternative to combating a lack of data.

2. Personalize based on current position in the buyer’s journey

A user you’ve already touched multiple times wants to see very different things than a user landing on your site for the first time.

By combining data from your CRM, you can personalize your experience based on the user’s current position in the funnel.

For example, you might email a user late in the funnel a discount coupon to close the deal. A first-time visitor, on the other hand, can be sent to a personalized page with a beginner’s “how to guide”.

Lynton, an inbound marketing agency, shows this landing page to customers who haven’t been converted to leads yet (i.e. they are in the Awareness stage):

lynton-non-converted-leads

After Lynton has qualified the lead, it shows a custom landing page (for inbound marketers):

lynton-custom-landing-page

If you don’t have CRM data, you can also use keyword data to estimate the user’s position in the buyer’s journey.

For instance, if you’re selling analytics software, a user who searches for “what is analytics?” is likely in the “Awareness” stage. A customer who searches for “analytics software discounts” is probably in the “Decision” stage and can be shown a different page.

HubSpot, for example, has dedicated landing pages for “what is inbound marketing” (an Awareness stage keyword) and “best inbound marketing software” (a Consideration stage keyword).

inbound-marketing-consideration-awareness-stages

3. Personalize based on user’s past behavior

If the user has interacted with your business earlier, you can use that data to personalize her current experience.

For example, a customer named Emily (who has already bought from you in the past) lands on your site. However, instead of her usual USA location, she seems to be browsing from Europe. You can change your site to show prices in Euros, or give her shipping information for Europe (while also greeting her by name).

There are a few things you must consider when personalizing your content based on past customer behavior:

  • Positive behavioral indicators: If you dig through your analytics, you’ll find that certain behavioral indicators signal a high conversion chance. For example, suppose your data shows that customers who view an item > 4 times are highly likely to convert. A personalization campaign that focuses on such customers would be more successful.
  • Exclude repeat customers: Showing personalized campaigns to customers who’ve already bought the same (or similar) products recently is a waste of resources. Dig through your analytics to exclude any such customers from your campaigns.

One easy way to personalize on-page content is to use “Smart Content”. This is content that essentially updates automatically based on available user data.

For example, on the “Play Like a Girl” homepage, new visitors see this message:

welcome-to-play-like-a-girl

Logged-in users, however, see a personalized greeting:

play-like-a-girl-personalization

Here’s another example from Nike showing how even simple data (in this case, the user’s gender) can help create a more personalized experience. Male users see the page on the left, while females see the page on the right:

nike-male-female-website

You can use user-data to personalize everything from landing pages to CTAs and forms. In fact, HubSpot’s data shows that personalized CTAs regularly outperform non-personalized CTAs:

hubspot-personalized-ctas

4. Personalization based on data from other users

This strategy involves using data from other users to personalize a user’s shopping experience.

For example, suppose your data shows that repeat customers prefer downloading whitepaper #5 while new customers read whitepaper #2 multiple times. You can use this information to push new users to the right download in your emails.

To make better use of customer data for serving personalized recommendations, there are a few things you need to know:

  • Ensure segment overlap, if possible: Instead of making blind recommendations based on-page behavior, show recommendations of similar products bought by customers in the same segment. For example, if you know a user belongs to the “millennial movie lover” segment, consider recommendations based on what other customers in this segment also bought, instead of generic recommendations.
  • Limit price variance: A customer looking at a $20 product isn’t very likely to buy a recommended product that costs $200. Setup maxima and minima prices for your recommended products to improve conversions.

The “customers who viewed this also viewed/bought” personalization is the best example of this. Besides what Amazon does, you can also push conversions up by showing the difference between what customers viewed and what they actually bought.

Target does this exceptionally well:

guests-also-viewed-ultimately-bought-target

If you don’t have a lot of customer data, you can also do product-level personalization. For example, ASOS upsells other clothes worn by its models with a section titled ‘Buy the Look’ after you add a product to your cart.

asos-buy-the-look

This technique is effective because the customer can see how the other items already fit together. Plus, it doesn’t require extensive user-data.

Another example that uses very little data is this landing page from Barilliance showing the number of marketers who’ve downloaded an eBook recently:

barilliane-personalization-whitepaper

Conclusion

Personalization is a powerful strategy for increasing conversions, but it is also easy to get overwhelmed by it.

If you haven’t already put this system in place by now, start small by using personalization on your top-converting pages. Split test personalized vs. non-personalized versions of these pages to see whether your users respond to these changes.

Remember that you don’t have to personalize every part of your site, just the bits that matter.

And finally, always keep testing.

About the Author: John Stevens is a seasoned marketer and entrepreneur. Currently, he’s the founder and marketing head at HostingFacts. He also helps businesses select better site building tools at WebsiteBuilder.org.

Starting from Zero? A Customer Acquisition Playbook for New Websites

Every new ideas begins with a new domain name.

And with every new domain name, comes hundreds of problems.

Hosting, at this point, is the least of your worries.

Go ahead with some crappy shared one like Bluehost.

Because chances are you’re not going to get enough visits to even matter.

Here’s why, and how to fix it.

Why ‘Search’ Can’t Help You

Search engines haven’t really changed all that much over the past few years.

Sure, they use machine learning now. There was a Panda, a Penguin, and a Hummingbird.

Things have evolved. Been refined.

But they haven’t changed.

The principles are still the same.

They still use ‘spiders’ or bots, crawling and gathering data on millions of websites. Those pages are indexed; grouped into similar topics based on relevancy.

Higher rankings (i.e. greater visibility) still comes largely from the citations of others, increasing your popularity, authority, and overall trustworthiness of a site (including even qualitative factors).

The trouble, is that search engines have been designed – from the beginning – to reward websites that have been around the block (incorporating things like the domain age as a ranking factor).

Throw in the growing preference towards established brands and you got a problem.

New websites are anything but popular, authoritative, or trustworthy. In fact, you typically have to work twice as hard, because no one knows who you are (and they certainly don’t trust you – ready to hand over their credit card).

So while it’s tempting to wait around for the Google God’s to smile upon you, sending thousands of ‘free’ visits overnight, it ain’t likely.

But wait, because it’s about to get worse!

Advertising Probably Ain’t Gonna Happen, Either

One of the greatest misconceptions small or new ventures have that advertising is either (a) ineffective or (b) too expensive.

When done correctly, it’s neither.

Groupon successfully used it to fuel massive growth, acquiring 33 million subscribers in a single quarter. Bootstrapped AppSumo used it too.

But despite all this…

There’s an opportunity cost.

You need bodies. Equipment. Leases. Available money typically gets absorbed by the mind-numbing quantity of stuff needed to get a new venture off the ground.

Unless you’re Color (wow, how’s that for a dated reference?!), there’s probably not enough cash in the bank to throw around for advertising initially.

Hate to break it to you, but this now effectively rules out the two best methods for acquiring new customers.

That doesn’t leave us with very many other options.

So of those restricted possibilities, here are some of your best bets for a customer acquisition playbook for new sites.

Then Where Are Your Early Visits Going to Come From?

If you’ve looked at any analytics program in the past, you’ll notice that we’ve ruled out Search and Advertising. Only a few sources left.

Direct, or people typing in your URL, also isn’t likely initially because no one knows who you are.

So strike that one off your list too while you’re at it.

That leaves us with Referrals, Social and Email.

Awesome. Now we’re getting somewhere.

The DNS is pointed, WordPress blog up-and-running, and you’re ready to rattle off ~500 words about your latest and greatest.

Don’t.

Because nobody cares. That’s harsh. Unfortunately, also true.

Sure, you should get a landing page up. Create a blog. Prep. Cause you’re gonna need someplace to send people.

But then turn your attention outside. Because the biggest opportunities for early visits are going to come from proactively reaching out to other people.

Other communities, media properties, group’s, companies, bloggers, journalists.

In short, influencer marketing.

And while that phrase makes me cringe, using it in a blog post is guaranteed to shoot you to the top of Inbound.org (so alas, my hands are tied).

I’m also not referencing the half assed, trite, “Nice blog post!”-style of influencer marketing. Nor the incestuous, growth hackers talking about growth hacking to growth hackers, that’s also common these days.

But the good kind. That resembles old school marketing at it’s finest.

Specifically, here are five sources to tap today.

Source #1. Channel Partners

Perry Marshall’s 80/20 Sales and Marketing uses a visceral story to explain this first source: “Racking the Shotgun”.

The idea, which I’m no doubt about to butcher, is to go after the people most likely to respond.

Understanding distribution helps. In other words, where do people already go to buy stuff like yours?

Health conscious people buy organic food direct or at specialty food stores.

That’s why Liquid Aminos perform best on Amazon or Whole Foods, but probably not your neighborhood grocery market or (God forbid) Walmart.

If you want to find the people most likely to purchase your widget, go first to the places people are most likely to purchase something similar.

People learning how to code, are most likely going to freelance and send an invoice at a certain point in their life. Freshbooks working out a deal with Treehouse is a perfect example.

treehouse-student-perks

These can be official partnerships or revenue sharing agreements that can be tracked using specific codes or conversion points (like specific forms or landing pages).

Even simple, basic, old school cross promotions would work, such as running a joint-contest or sending email promotions to each other’s audience.

Source #2. Offline Events

Real people don’t read.

Normal people (i.e. your customers) don’t spend all day on Hacker News or Inbound.org.

So where do they get their news? Where do they find solutions to the big problems (like the ones you solve)?

Outside. IRL. At events.

Step 1. Go to them. (Shocking.)

Step 2. Volunteer/speak/help them.

Working events puts you in the middle of the action, and the people who matter, who can refer you and connect you with the best attendees. And volunteering effort, time or expertise is almost welcomed.

For example, there’s meetups happening all around you every single day.

sf-bayarea-machine-learning-meetup

Hakka Labs attends, records, and distributes the audio records of engineer related events making them a valuable asset to the community (and getting props in return).

hakka-video-of-talk

Source #3. PR Outreach

Everyone’s favorite PR advice is to just jump on HARO and… wait?

The problem with that approach, is that passiveness is a cancer in new ventures.

Instead, do some research to build your own media list. (After all, that’s what you’re paying for with most PR companies anyway.)

It’s easy. Here, I’ll show you.

Search Engine Journal was literally the first industry blog that popped in my head. I opened up a recent blog post and found the author.

Hi, Danny!🙂

facebook-wants-to-kill-clickbait

The easiest way to ‘break the ice’ would be through social somewhere, where people are much more likely to actually respond (as opposed to cold email which makes you look like every other spammer imaginable).

For example, you could try LinkedIn to see if you have any connections who could recommend you. Now for some good old fashioned internet stalking… (c’mon – don’t act like you have no idea what your ex is up to now).

linkedin-common-connection

See. Literally the first try.

You can also save prospects in the LinkedIn Sales Navigator to get each and every single one of their updates in a specially tailored inbox that allows you to begin engaging with them on the daily until they recognize you.

I’d show you a picture, but I think I’ve already creeped Danny out enough for one day.

Source #4. Referrals from Your Early Visits (or Customers)

Some of the most successful companies on the face of the planet have used distribution hacks like referrals to skyrocket user growth (and revenue).

Dropbox, for example, went from 100,000 paying customers to over 4 million. In one year.

One of the Lean Startup’s “engines of growth” focused on sticky businesses, where you prevent people from churning and inspire true word-of-mouth so that growth “comes from the action of past customers”.

ReferralCandy is an excellent example, removing the technical requirements (and excuses) to implementing simple referral campaigns. They even integrate with Shopify!

referral-candy-referral-programsImage Source

The primary value proposition on Lob‘s website says, “Programmatically send physical mail at scale”. Um, yes please?! (Someone’s been reading their Copy Hackers.)

That means you can automatically kick off stuff to go out in the mail to new customers without doing, well much of anything after setting it up.

Giving your customers a reason to spread your Gospel doesn’t take a ton of effort. Just show you care and appreciate them.

Source #5. Become a Sought-After Expert

‘Thought leadership’ sounds like one of those business school myths perpetuated by narcissists.

But in reality, it makes everything easier.

Being your own brand gives channel partners a reason to work with you. It makes speaking at offline events (or working with online ones like Kissmetrics webinars) simple because they’re in constant need for industry practitioners who can share their expertise.

measure-influencer-roi-webinar

It gives you a ‘Halo Effect‘ when reaching out to the media or speaking with your own customers.

Best of all, becoming a thought leader also gives you an audience who’s willing to cite, recommend or share your expertise.

Which raises your online popularity, authoritativeness, and trustworthiness. Which, if you remember, is the catalyst to finally getting scalable traffic from Organic Search.

Conclusion

The quicker you realize that new website visits aren’t coming from passive sources like Search or Advertising, and only from proactive ones like Referrals, the better.

It’s a tough pill to swallow at first, but it gives you a critical posture change that’s required to succeed in getting a new site off the ground.

Your initial prognosis is only as good as the people who can potentially refer you.

So as soon as possible, start focusing the bulk of your attention on helping others – whether as a resource, speaker, volunteer, rev-share partner, or whatever – the better your odds of success.

About the Author: Brad Smith is a founding partner at Codeless Interactive, a digital agency specializing in creating personalized customer experiences. Brad’s blog also features more marketing thoughts, opinions and the occasional insight.

9 Psychological Insights I Use When Designing a Pricing Page

Let me be upfront with you.

I’m not a web designer.

I work with some amazing web designers. I know a few things about web design. But when it comes right down to it, I’m not a designer.

What am I? I’m a marketer.

Why am I talking about designing a web page, specifically a pricing page?

Here’s why. Web design and marketing overlap. A lot.

When you get into a discussion about web design, you can’t help but talk about psychology. And when the page being designed is a pricing page, psychology plays a huge role.

What kind of psychology? Customer psychology.

Customer psychology is the study of the way people think, act, decide, and make purchases.

It has everything to do with motivation, mind tricks, color, placement, filtering, eye tracking studies, and, yes, web design.

That’s why I’m confident in my ability to design a great pricing page.

I constantly A/B-test my pages to make sure I’m choosing the most optimal design, and most of the design choices you see throughout my web properties is based on simple psychological principles.

Psychology is common in marketing and design, regardless of the industry. Look at a casino, for example.

image06

Every inch of that building, from the carpet and floor designs to the signs and turns was designed to psychologically keep people in the building spending money, not focusing on time and outside responsibilities.

Web design is the same way. And when it comes to the pricing page, these psychological principles are extremely important.

Here are a few of the tactics I use when designing pricing pages-one of the most important steps in your conversion funnel. 

1. Devalue money in the viewer’s eyes

Since we’re on the subject of Las Vegas… Another trick casino owners use is the idea of mentally devaluing money.

When you step up to a table, they exchange your money for chips.

image01

Why? There are several reasons. One is that it makes it easier for dealers to count, but it also detaches people from the value of their money. It’s easier to gamble away two chips than $2,000.

A lot of people are in debt, and, while it’s great that you run a business, you need to get people to stop thinking about their bills.

The average user who looks at your pricing page might have in the back of their mind their consumer credit card debt.

image13

Maybe you’re not running a casino. How do you get people to stop thinking about their debt problems and instead focus on the value of your product, regardless of the price?

Let me give you an example.

Cornell researchers recently partnered with the Culinary Institute of America to research this concept of devaluing money on restaurant menus. Two different study groups were given two different menus, one with a dollar sign next to the pricing and one without.

image07

The group given the menus without the dollar sign spent more money. Why? Because they weren’t put off by the high $ price.

One example I’ve shown elsewhere is this pricing page. Notice the small dollar signs?

image15

That’s not a mistake.

The same thing is happening here:

image11

The dollar sign serves as a trigger to remind people of the value of money. What they should be thinking about is the value of your product.

A simple removal or minimization of the dollar sign will make your pricing page more compelling, more powerful, and more psychologically potent.

2. Color-coordinate everything

Research from the US National Library of Medicine and National Institutes of Health indicates colors are perceived in different ways by different people based on experiences, genetics, context, and other factors.

Still, there are brands of every kind that use specific colors within their logos.

image10

If you’re at the beginning stage of building your company, choose a color scheme that matches the emotion you’re trying to evoke.

There was a time when Geocities ruled the web and websites commonly looked as though they were drawn by crayons. Thankfully, we’ve progressed, so basic black text on a white background is considered standard for text (with a few exceptions).

Headers and buttons, however, can vary greatly. Amazon uses a yellow color for the “Add to Cart” button on its pricing pages.

image14

Walmart uses a red-orange.

image02

Best Buy utilizes bright blue and yellow for different options.

image17

Whatever you choose, make sure it speaks to your brand and is consistent all the way through to avoid confusing customers at a crucial step.

3. Size matters

Size does matter when designing a pricing page.

Here’s the simple truth. You want people to see the important parts first because that’s what needs to stick with them the longest.

Let me go back to this pricing page to show what I mean:

image00

What’s the first thing you look at when you see this page?

Probably the center column, focusing on the “Growth” package at $400 a month.

Why? Because it pops with a vivid blue against a very light gray backdrop.

Plus, it’s bigger than the others. Size is important. It’s also centrally located.

All of these are key differentiating features that psychologically emphasize the importance and superiority of that plan.

Where exactly does size matter?

  • Headlines
  • Call-to-action buttons
  • Price boxes (as pictured above)

As explained in Psychology in Action, larger fonts make messages enter our brains faster as we don’t have to struggle to see them.

This split-second difference of time and attention puts the page into a logical and cohesive, Feng Shui-like, order for browsers.

4. Limited time offers

If someone thinks their time to act is limited, they’re more likely to take action quickly rather than delay it.

Several studies have looked at how limited time offers affect our brains. Sites such as eBay and Groupon have practically built empires on the concept.

Essentially, it boils down to supply and demand.

When you create scarcity, the perceived value of an item goes up. It’s called a theory of psychological reactance, which explains why we hate to miss out on a golden opportunity when presented with it.

You’ve probably heard of fear of missing out, or FOMO, right? Same idea, different angle.

image16

Amazon uses this technique to great effect with constant inventory reminders on every item: “Only 10 left in stock – order soon.”

It’s a great call to action.

image12

Even though we know one of the world’s largest fulfillment centers will definitely replenish its supplies of literally everything, will it happen soon enough? Can we wait and will it be more expensive next time?

Dr. Eldar Shafir, from Princeton, and Dr. Sendhil Mullainathan, from Harvard, explored how people’s minds work when they feel they’re lacking something. The perception of scarcity leads them to make mistakes or bad financial decisions, spending more money than they should.

Psychology Today’s author Shahram Heshmat notes,

Scarcity orients the mind automatically and powerfully toward unfulfilled needs.

It also motivates us to prioritize our choices, e.g., we’re more frugal with toothpaste when the tube is close to empty, and we rush to purchase a product or service to obtain a deal.

5. Discounts and VIP membership

People love feeling like they belong. Costco, Sam’s Club, and AAA are just a few of the memberships you can get these days to feel like you’re part of a country club.

Everyone wants to be a VIP, so offering VIP membership bonuses and discounts encourages customers to keep spending money at your business. Instead of buying just one roll of paper towels, you can subscribe and save.

image18

Or buy 10 and get one free.

These promotions increase clicks because, as Ian Newby-Clark explains in Psychology Today,

We are social creatures who yearn to be included. We want to be a part of the group and strive for goals set for us.

It’s like a drug: belonging to something bigger than yourself provides a sense of purpose and meaning to our lives.

Marketing Profs has a great article describing how the inclusion of fans into a community motivates them to support a brand both as customers and ambassadors. I suggest you take a look at it as it’s a great read.

As psychologists point out, our social identity is defined by the groups we belong to. This is why Xbox and PlayStation fans, for example, are so prone to debating their platform’s superiority.

image04

The NFL, along with all other major sports organization in America, uses this psychological principle to its advantage.

Fans show up sporting their team’s colors and mascot costumes because it makes them feel like they belong.

Seattle Seahawks fans surround a Cleveland Browns fan as she mugs for TV cameras Sunday, Nov. 30, 2003 at Seahawks Stadium in Seattle. (AP Photo/Ted S. Warren)

Above: Seattle Seahawks fans surround a Cleveland Browns fan Sunday, Nov. 30, 2003, at Seahawks Stadium in Seattle. (AP Photo/Ted S. Warren)

6. Offer tiered pricing

As Talia Wolf points out,

Tiered pricing opens the door to all sorts of psychological techniques.

Hyperbolic discounting occurs when different pricing models provide different benefits, allowing us to personalize our shopping experience. Dropbox employs this technique:

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Choice-supportive pricing, anchoring effect, and the decoy effect can also be employed to your advantage. With tiered pricing, anything is possible.

Amazon has about a dozen varieties of Prime combined with rewards cards, affiliate bounties, and subscription services to give you payment options beyond just “cash or credit.”

Tiered pricing is becoming even more popular these days with the growth of the software-as-a-service (SaaS) business model.

By subscribing for longer terms, people know they can often save money and thus seek out these types of deals.

Rational choice theory is a framework to model social and economic behavior. It states individual actors choose the option that maximizes their interests and provides the greatest benefit.

A tiered pricing model provides customers with purchasing options that are all, ultimately, with you.

7. Doorbusters work

Retail has long utilized doorbusters to get people in the doors. These savings are responsible for Black Friday leaking further into Thanksgiving every year. Once you have people in the door to buy a low-priced item, you can upsell them better, more expensive products.

Any pricing page should also have a “recommended” and “similar” section. These personalized offers help lead consumers to buy the right item for them, increasing trust in your e-commerce brand along with the ROI.

It should be noted, however, you should avoid the classic bait-and-switch scam that will get you in trouble with the FTC and ruin the reputation of both you and your brand.

It’s also worth mentioning that many analysts think Black Friday is about more than just the doorbusters.

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Professor Jane Thomas at Winthrop University says:

It’s more of a tradition than anything else. People ritualistically line up at brick-and-mortar stores the Friday after Thanksgiving while a growing number wait for Cyber Monday the following week online.

There’s also a psychological difference in the way we perceive prices such as $13.99 vs $14.00. The item priced at $13.99 is more likely to sell because even though it’s only a penny short, it’s $13 and change instead of $14.

Although consumers initially hit a website looking for a cheap deal on SEO services, soon they realize they’re also missing social media, video, CRO, PPC, and many other aspects of marketing.

They want more.

That’s the value of the doorbuster.

The initial doorbuster brings them to you for a killer deal. You get them in and then convert them to buy more stuff.

8. Get smaller yeses first

Much like with the doorbuster sale, you want to lead people by convincing them to agree to smaller things before hitting them with the big ask.

Zendesk does a great job of leading customers through smaller yeses first:

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While the option is there to buy, Zendesk wants you to try the free version first because they’re confident you’ll come back as a paying subscriber once you’ve experienced the platform.

Who doesn’t like free stuff?

By convincing customers to say yes to the smaller ask first, you make saying yes to the bigger ask much easier.

It’s all part of the psychology of negotiation,

explains Heidi Grant Halvorson, PhD.

Making the pie bigger for everyone increases the maximally efficient outcome 79% of the time.

You don’t have to necessarily give out anything for free either. As explained above, even month-to-month subscriptions are a smaller ask than a year-long contract, so providing different levels of the same offer will do the trick.

9. Provide choices

As explained above, offering both payment and product choices is a great way to improve revenue on pricing pages.

A customer is buying a TV, do they need a warranty? Cables? A stand or mount? A DVD Player, home stereo system, or Chromecast?

Give people options for bundles, add-ons, and other available sizes, colors, and brands. But don’t give them so many options that they get overloaded.

In 2000, researchers S.S. Inyengar and M.R. Leper conducted a study allowing supermarket shoppers to sample the different flavors of jam available for purchase. The test compared the impact of having 24 jam flavors to choose from versus having only 6.

Only 3% of those who sampled the 24 flavors went on to purchase the jam, compared to 30% who sampled only 6 flavors.

Too many options will inhibit your customers’ ability to make a clear decision.

Conclusion

Psychology is important in web design and marketing. How people perceive a brand is directly impacted by the appearance of every landing page, including the pricing, checkout, and confirmation pages.

By A/B-testing different versions of those pages, while implementing the psychological principles discussed above, you’ll be able to optimize conversions and revenue streams from your online marketing.

What psychological techniques help you design your web properties?

Australian scientists just set a new solar power efficiency record

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Scientists at the Australian National University have set a world record for efficiency for a solar thermal dish generating steam for power stations.

The team halved energy losses and achieved a 97 percent conversion of sunlight into steam through a new receiver for a solar concentrator dish. This beats commercial systems by about seven percentage points.