Five New Years Resolutions For Your Sales Funnel

The year 2013 has arrived, and although you’ve likely made resolutions for your personal life, now is the time to chart a bold new course for your sales funnel as well. It’s always tempting to leave well enough alone, but the best marketers are never content to just let things be and are constantly striving to hit new benchmarks with their sales. This year, commit to getting your hands dirty with the following five time-tested commitments for your funnel.

1. Truly Talk To Your Customers

This year, don’t be content to to simply count your sales. Instead, commit to getting to know your customer base. You can do this by using surveys and phone interviews to ask probing questions,  and get to the core of what they are really coming to you for.

These insights can be used to echo back shopper concerns, motivations, and desires in your sales copy, which is much better than trying to craft a letter from the powers of your brain alone. Talking to your customers might not seem like ground breaking advice at first, but it goes beyond merely looking at the emails they send – it’s about starting conversations and encouraging a dialogue with them. Don’t ask leading questions like “Do you want lower prices on widgets?” Instead, go for open-ended questions like “Why did you come to this website today?”

For more ideas on how to think about the right questions to ask, and how to learn from the responses you receive, have a look at this great post on how to talk to your customers.

2. Decipher More Data

Going data-less is no way to make a killing in 2013. Anyone can record their data but it takes a seasoned mind to sift through the data and extract meaning and patterns from it that can be converted into actionable improvements. For instance, a beginning marketer would celebrate “more traffic” coming in, but a dedicated professional looks for which particular traffic is converting, and who is leaving without making a purchase.

Actionable data is how you begin to cut all the fat off your sales funnel and turn it into a lean, cost-effective conversion machine. In 2012, you might have thought “I’m spending $25,000/month on advertising, and my retail website is bringing back around $40,000. I’m coming out ahead so I’m doing well!” Don’t stop there this year. Instead, ask how much of that $25,000 is pure waste, and how can you squeeze even more effectiveness and sales out of your investment.

If you really don’t have a clue about analytics and you run an online store, you could do worse than to start by watching this 60 second video on how to track ecommerce with Google Analytics!

3. Build a Stable of Great Products

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As advertising costs continue to soar, it becomes increasingly difficult to make a profit on your very first sale. This underscores how important it is to sell more things to the same customers over time. This creates a functioning cycle of more profit, which leads to more funds available for advertising, which leads to more profit.

Conversely, if you only have a single $50 product for sale, it might be very hard to continue to profit as you expand your efforts from PPC to inbound marketing and beyond. But by creating a stable of products that build on each other and can be sold to the same customers to increase the profitability of bringing them into the funnel, you can survive the stormy seas of rising ad costs.

4. Refine Your USP

Many businesses are afraid to repel certain parts of the market. They shy away from bold, polarizing messages because they are worried that they might lose potential customers that aren’t necessarily in their exact narrow market space. Paradoxically though, by keeping your unique selling proposition (USP) tame and vague, you are missing out on the opportunity to completely blow away those in your target market and might be missing out on untold numbers of sales that could be made through total ownership of that space.

Find out the biggest benefit that your business is specially designed to serve and focus on reaching that market specifically. For some thought exercises to help you better define your USP, consult this quick guide from author David Airey.

5. Make This The Year Of The Test

Experimenting with what works can be a scary proposition. “What if I break it?” is a common fear, especially when you’re talking about something like your headline, or the sequence of your follow up emails. However this flawed logic is the same that keeps people from asking out the love of their lives, or switching up their work out routine in the gym. If you always do what you’ve always done, you’ll always get what you’ve always got.

A better approach is to make calculated experiments to the aspects of your sales funnel that could produce the biggest gains. Try split testing your offer page across several different variables:

  • Headline
  • Sales copy
  • Navigation design
  • Color scheme
  • Call to action

You can try out services such as Optimizely and Visual Website Optimizer, which are designed to make testing easy and effective for you.

Remember, if your experiments are a success your sales funnel will be better for it. If they are not, you can always revert the website back later. For a complete guide to user testing including speicific ideas and strategies you can begin rolling out today, check out the book Don’t Make Me Think by author Steve Krug.

Always Be Improving

There is a common theme running through these five separate resolutions: always be measuring and improving. Whether you’re taking feedback from your customers, performing behavioral testing on your landing page, or refining your sales letter, your key to success in 2013 (and every year for that matter) should be to stay hungry. Once you decide that your funnel is “good enough” and stop thinking of small ways to improve it, you set a cap on how great your company can be.

Image credit: HiddedevriesMarius BDphifferMilosz1

How To Segment Your Email List & Close More Leads Like A Pro

As a marketer, it is your sworn duty to deliver a solid message-to-market match. That is, the language, timing, and product offer you use to speak to your prospective customers should fit their personalities like a glove. However, if you’re getting a bunch of sign-ups to your e-mail list from the same opt-in form, how can you discern the differences between these subscribers and speak to them as individuals not a nebulous group?

The answer is list segmentation. This strategy involves collecting information from your subscribers either at opt-in or through a survey that tells you more about their individual traits. Ultimately, segmentation enables you to divide your mailing list into smaller sub-groups that all receive different correspondence and offers from your brand, resulting in high conversion rates. Below, we explore important tips on how to get started.

Age Segmentation

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One of the first places most e-mail marketers begin segmentation is with basic age information. Age data guides you in determining what sort of language and cultural references are appropriate to use for your audience. As an example, if your list contains a large population under 25, it might not be impactful to compose them an email using singer David Lee Roth as an example to illustrate a higher-level marketing point.

Some typical age buckets ecommerce marketers use to segment their lists include:

  • Younger than 18: Teens and tweens who might not make purchases themselves but can influence the buying decisions of their elders.
  • 18-24: The college and young adult market. These people are typically focused on educational development, freedom and independence as they head out their own.
  • 25-31: The young professionals market. These people are starting to build their careers, settle down, and are beginning to start families.
  • 32-40: The family years. As babies become children and teenagers, these people tend to focus on financial stability and upward motion in their careers to provide for their families.
  • 40-50: The middle age market. As families mature, teens go off to college and people in this market tend to find more time to focus on themselves and their personal hobbies and interests.
  • 50-65: These are people are settling into their later years and are preparing for retirement from their careers.
  • Older than 65: These people are the retired class. They are focused on enjoying life outside of their careers, travel, and dedication to hobbies.

Career Segmentation

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Career data is the next “must have” email list segmentation point. The profession a person is in reveals a great deal about their thought process, personality type, and values. Entrepreneurs think differently than finance professionals, and you should never be attempting to speak to both in the same way.

This is true for all products and services, but especially when you’re selling anything work or business related. A new retail inventory system, for example, should be sold differently to high-level executives than to store managers. The former will care about ease of implementation and bottom-line impact. The latter will be impressed by the actual experience of using the technology to do their job.

Interest Categories

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Consider including a “Primary interests:” field in your opt-in form. This field can either contain a drop-down menu with predefined interest categories that you set, or it can be an open-ended text entry. This information is extremely valuable, as it will shine light on what percentages of your audience care the most about the various aspects of your brand.

To see a real life example of how this works, check out Electrical Engineering Web’s Pulse media kit. Pulse has broken down their subscriber base by interest category and displays those interest as percentages in a bar graph. Clearly, this level of insight helps both Pulse and its advertisers hone in on exactly what products, services, and discussions will be most relevant to its audience.

For retailers, this could be one of the most important ways to segment your list. Offer your customers the opportunity to check off their interests from a list of the product categories you sell (pop music, designer fashion, computers and gadgets, etc). You can then create targeted email correspondence for each subscriber such that those who checked “pop music,” for example, are offered discounts on band merchandise, while those who checked “automotive” are offered similar deals on performance parts.

Psychographic Segmentation

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Once you’ve nailed down the information above, you can use the different combinations you encounter to create psychographic profiles, or subscriber personas. As Pragmatic Marketing indicates, personas in marketing refer to “short descriptions or biographies of fictitious, archetypical customers.” Defining these requires creative thinking and discretion from the marketer, but can yield valuable insights into the people living behind the email addresses.

Personas will tell you about buyer motivation, and what’s important to these people beyond the narrow scope of your product or service. You’ll discover if you’re dealing with some of the following customers:

  • Practical career shoppers: These consumers are “facts only” decision makers who concentrate on price and utility for their job.
  • Entrepreneurs and dreamers: These are people who value creativity over statistics. They are concerned with how products will positively impact their lives and help them achieve their goals.
  • Artists and recreational shoppers: These are people who are on your site because your products relate to their hobbies. They are less concerned with price and more with how much joy and adventure the products can add to their lives.
  • Family shoppers: Concerned with the wellbeing and betterment of their family, these shoppers are going to be looking at price and quality of the items in search of great deals that allow them to stay on family budget.

With this understanding, you’ll learn how to speak to each segmentation of your leads in a voice that resonates with them. Rather than sending the same adrenaline-fueled hype pitch to everyone, you’ll develop several niched emails that may vary greatly between each other, and deliver each one exclusively to a particular personality type on your list.

Past Buying History

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In your subscriber database, you need to be keeping a record of which products and services each user has purchased. Of course, it’s good to know which subscribers have purchased your products before because they will be the ones most open to future pitches and supportive products. However, it is equally valuable to study the subscribers who have not bought from you.

In fact, many research organizations have studied the phenomenon of “shopping cart abandonment,” which occurs when shoppers behave as though they are ready to buy, but ultimately do not complete their transaction. Depending on the study you read, these rates can account for between 60 and 90% of shoppers who arrive on your page.

Who are these subscribers and why have they not converted? Which pitches did they receive and how were they spoken to? Are there kinks in your shopping cart system or hidden fees that appear at the last minute? By attempting to diagnose these problems, you’ll find yourself defining a new buyer persona that you failed to discover in the past.  You can then use these insights to create a new list segment specifically aimed at delivering content for this type of subscriber in the future. Some tips on diagnosing and reducing this behavior for retail websites can be found in this CrazyEgg guide.

Behavioral Segmentation

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Most of the segmentation techniques discussed above are fairly simple to manually collect using opt in forms and list surveys. However, for the truly advanced email marketer, list management software such as Infusionsoft can unlock a deeper level of organization known as behavioral segmentation.

Behavioral segmentation means tracking every willful interaction the customer has had with the e-mails you send. In effect, you can create tripwires that tell you who downloaded a free guide, signed up for your online course, or opened every e-mail you’ve ever sent, etc.

Using this information, you can create hyper segmented lists that gauge both the level and area of interest for all subscribers on your list. Some ideas of how retailers can use behavioral segmentation include sending :

People who clicked the email link for a sale on sporting goods: They should receive sporting related emails in the future.

People who have opened your email about a sale on baby supplies: These are new parents who should continue to receive emails on childcare products.

People who signed up for your retail management training course: These are profitable retail professionals dedicated to their careers. They should receive further training tools and knowledge shares in the future.

Depending on how deep you want to go, the email variations and niched markets you can define are practically endless with professional email list management software.

How Many Online Stores are there in the U.S.?

Here at ReferralCandy we got to wondering how many e-commerce retailers there are in the USA and how much they make. Asking Google brought us some possible answers, but nothing about how they were derived, or why they might be the right ones. So we decided to look for numbers we could crunch ourselves to get a good guesstimate.

So where do we begin? We found this June 2012 article about the Internet Retailer Top 500 Guide which had this nugget:

Overall, the Top 500 retailers have a 77% share of the $198 billion U.S. e-retailing market.

The Top 500 Guide also lists each retailer’s annual sales revenue. We plotted a graph of those 500 retailers and their revenues to see if there was anything useful we could find.

This is what we got:

That graph sure looked like it followed a power law. Could we figure out what the precise function was? After removing the top 10 retailers (since they were “noisy”) and asking Excel for a little help, we found a function with a pretty good fit:

That’s better. Now we’re getting close! Assuming that the power law held for retailers past the top 500, we now had a way of reasonably ascertaining the rank of any online store. Say we wanted the rank of someone running a side business making $12,000 a year. With a bit of math, we would be able to get the magic number of… 90,501. Plugging in a few more numbers would give us the following table:

Yearly sales of at least Number of retailers
$12,000 90,501
$25,000 54,686
$50,000 33,983
$100,000 21,118

Our power law formula also gives us a way of estimating the combined revenue of all the retailers making less than $1,000 a month (spoiler: around US$1 billion!).

So if we only considered online stores making more than $12,000 in sales a year, that comes up to about 90,500 retailers with a combined revenue of $197 billion in the U.S. That’s more than the population of the Seychelles!

So there we have it. Stay tuned for more number-crunching adventures! And feel free to ask any questions.

Image Credit: bfishadow