Showing posts with label conversion. Show all posts
Showing posts with label conversion. Show all posts

Tuesday, January 09, 2018

The Curious Case of Ecommerce Buttons: A Best Practices Guide

Ideally, all aspects of your ecommerce experience drive shoppers towards a conversion. Depending on your business and the point in the sales funnel your prospect is, your conversion goal could be to get individuals to enter contact information, finalize a sale or share a promotion.
Whatever your goal is, the final hurdle to get a conversion is getting a user to hit a button to actually take some sort of action. And when it comes to helping nudge your customers to finally click that button, I’ve put together a few best practices to follow.

Find the Right Call-To-Action

Your call-to-action needs to clearly state the action that customers are about to take. Use unambiguous, active language on and around your button that reinforces the value to expect. If you leave anything open to interpretation or use words that imply extra work or more commitment on the part of the shopper, they’ll have more hesitation and are less likely to convert.
So, do use words like “see”, “give”, “get” or “reserve” as they demonstrate momentum and will encourage individuals to continue. A study from HubSpot showed that from a list of action words, “Click here” and “Go” actually had the highest conversion rates. Alternatively, words that can have the opposite effect include “download”, “submit” or “register.”
Additionally, shifting from second person to first person can also have a considerable effect. A study by Michael Aagaard, Unbounce’s Senior Conversion Optimizer, demonstrated how changing a call-to-action button from “Get your free template” to “Get my free template” resulted in a 90% increase in conversions.

Colors Matter

With online shopping being so visual, it makes sense that color can have a huge impact on conversions. For starters, certain colors can have drastically different connotations from country to country. For example, while yellow signifies jealously in France, it can mean bravery or wealth in Japan. Purple is considered a color of mourning in Thailand, while the Western cultures tend to view it as a symbol of royalty. So, it’s important to pick colors that carries positive sentiments, keeping in mind that you may have to use different colors for different countries. It’s also important to keep colors consistent in your ecommerce experience and on brand.
Unfortunately, there is no one-size-fits-all when it comes to button color. Every customer segment is different so experiment to see which colors create the highest conversion rates for your business. As UX Dilemma points out, the best way to bypass the different associations that can occur with each color and each culture is to emphasize the button with a color that contrasts the other colors on your page.
color-wheel
Image source: Bright Hub

Pay Attention to Your Fonts and Button Shape

In addition to being a contrasting color to the rest of your page, UserTesting Blog says that buy buttons should appear large enough on your page so that customers can easily pick it out, but not so large that it appears obnoxious on the webpage.
You also need to avoid hard-to-read fonts and all-caps. The lack of letter variation in all-caps actually makes reading it more difficult. Follow these simple guidelines of formatting a call-to-action button by using a rectangle shape, having clear boundaries and borders and using white space around the buy button. Vitally, make sure all of your spelling and grammar is correct! These can cause a great deal of hesitation in shoppers and cause them to not hit that button.

Create Urgency

Creating a sense of urgency can have a huge impact on the effectiveness of your ecommerce buttons. One case studyfound that creating a sense of urgency helped increase sales by 332%.
There are lots of ways to create a sense of urgency including limited-time discounts, communicating that only a limited amount of stock is available or adding countdown clocks to the end of a sale. Use words such as “now” and “today” to reinforce this sense of urgency.

Find What Works for Your Ecommerce Store

There’s obviously a lot more that goes into optimizing your checkout than just the button. But it is the final barrier, so you need to do everything you can to eliminate any risk of hesitation. Be mindful of the particular needs and desires of your target market to help your buttons convert. And be prepared to test different combinations to see what works best for your ecommerce business.

Tuesday, October 17, 2017

7 Facts to consider for marketing: Desktop vs. Mobile


Mobile marketing has today become one of the most convenient ways to reaching the end consumer. It is effective and convenient for both the marketer and the consumer. On the other hand, however, desktop marketing also has some distinct pros. The desktop has features that are not available on mobile and vice versa. 

Average Conversion Rate
The average conversion rate is the number of conversions per click on average. This figure is determined by calculating the number of conversions per ad click then noted down as a percentage. Average Conversion Rate for Desktop is much more than on mobile. "websitebuilder.com" informs us that desktops have a conversion rate of 2.06% while mobile has a rate of 0.55%. A high conversion rate reflects more sales from the advertising means used.

CTR (Paid Research)
A click-through rate is the average number of times your ad is clicked over the number of times your ad is displayed. Desktops have a click-through rate on 2.1 and mobile phones 2.7. A high click-through rate indicates that your customers find your advertisement useful. Having an ascending trend of the click-through rate will have a positive impact on your business. 

Average Revenue per visit
This figure is arrived at by dividing the total revenue by the total number of visits to your web page. $4.11 is the average revenue per visit on the desktop, and  $0.87 is the average revenue per visit on mobile. 
A higher revenue per visit relates to higher profits and a faster growth from competitors. 

CPM
CPM refers to the cost per thousand impressions. It is used by e-commerce in their display ads and the affiliate-related businesses. Websitebuilder.org states that 10.4% is the cost incurred on desktops and 12.4% is spent on mobile. Businesses strive to reduce their costs to increase their net profit. A reduced CPM will translate positively on the balance sheets. 

Internet Usage
Customers spent more time on the internet from their phones than on desktops. The difference is however not so great. Websitebuilder.com informs us that the rate of internet usage on the phone is 51.3% and on the desktop is 48.7%. A business can use either platform to display their ads as the view rate is almost similar.

Ads Spending
The total amount of spending on ads is higher on the desktop than on mobile phones. For some reason there is some difference but not so significant. The amount spent on desktops is on average 51% and on mobile phones 49% almost similar to the internet usage differences. 

People’s Digital Attention
This is a number of attention individuals have on the internet on either mobile or desktop platforms. More attention is realized on the mobile at around 68%, and a lower rate is realized on the desktops at around 32%. This difference is substantial enough to base marketing decisions on. It is expected to have a higher attendance rate when your advertisement is viewed on mobile. 

Tuesday, October 10, 2017

The Pricing Power of 9: Does it Work?

Finding the best price for your software product or service is essential to succeed in today’s competitive marketplace. But what price exactly will get the most people to buy?

Many companies offer their products or services at “odd” prices like $4.99 or €24.98. But does lowering your price by even just a little bit from a round number really make that much of a difference? Surprisingly, when it’s time to buy, people can be somewhat irrational and the answer seems to be yes.

The ‘9’ Factor

Enter pricing psychology tactic number one. The 9 Factor, otherwise known as charm pricing, is one of the most widely used and oldest pricing practices. Ending prices with .99 or .97, or a little less than a round number, is a market psychology tactic that profoundly affects buying decisions.
Consumers perceive these odd prices as being significantly lower than they actually are, as they tend to round them to the next lowest monetary unit. As consumers, we’ve been culturally conditioned to associate prices ending in 9 with discounts and better deals. As a result, prices like $1.99 are more associated with spending $1 rather than $2.
The motivation behind this is obvious: to make the price seem lower. But is it effective? Do consumers look at a $99 price point (versus $100) and think it’s a better deal? Somewhat amazingly, research shows that they do. In his book Priceless, William Poundstone dissects eight different studies on the use of charm pricing and found that, on average, they increased sales by 24% versus ’rounded’ price points. Can you imagine increasing your revenue that much!

The Sale Price Advantage

A classic example of the power of 9 is an experiment conducted by MIT and the University of Chicago in which a standard women’s clothing item was tested at prices of $34, $39, and $44. To the researchers’ surprise, the item sold best at $39 – even though it was more expensive than one of the other options. Similarly to Poundstone’s findings, this study also found that the prices ending in 9 outperformed lower prices on average by more than 24%.
The number 9 also comes out on top when it is used in combination with a sale price. When the number 9 was included with a discounted price, it again outperformed lower price points (for example, “Was $60, now only $49!” outperformed “Was $60, now only $45!”).

Left-Digit Effect

Savvy merchants also get help from the pricing perceptions of consumers themselves. The typical consumer reads numbers from left to right, which is called the left-digit effect. When buyers do this, they interpret a $7.99 price as $7 – especially if they are scanning quickly. This makes the price seem lower, and thus more affordable and appealing. Not surprisingly, when it’s perceived as such, a sale is much more likely to happen.

Apply and Try

When finding the perfect price for your product, it’s also important to consider how your customers view prices, especially ones that end in the number 9. Charm pricing can have a significant impact on your sales and even the most sophisticated brands use it.
Keep in mind that charm pricing works best in price-conscious markets, which can include everything from household cleaners to software. To optimize your price, consider this pricing technique when developing an ecommerce pricing strategy and then test with your target market.

5 Essential Components for Attracting International CustomersImage Map
There are a lot of factors that can impact the effectiveness of your price. Access our comprehensive report on hacks that can help you find the perfect price.

Friday, May 15, 2015

SaaS Metrics: How to Calculate Your Quick Ratio


Investors have been embracing SaaS businesses in a big way in recent years. One of the biggest reasons is the promise of stable, recurring revenue over an indefinite period. This is in addition to the huge opportunity presented by a rapidly growing appetite by businesses and consumers for cloud-based software solutions. If done right, a subscription model can increase the total amount of revenue earned by software companies and, by extension, investors while also providing users with ongoing value.
But with this increased attention from investors, SaaS companies now find themselves needing to be fluent in a number of KPIs not normally used in non-subscription software businesses. In addition to customer lifetime value, monthly recurring revenue and churn, another indicator has emerged to gauge the long-term viability of SaaS companies: the quick ratio.
Described by venture capitalist Mamoom Hamid at this year’s annual SaaStr conference, the SaaS quick ratio compiles data in a way that helps to determine if a company is likely to be a profitable investment. As an example, Hamid used this metric to help make a decision about investing in Slack, which had a high quick ratio and then proceeded to grow to over $10 million in annual recurring revenue (ARR) in just 11 months.

Determining Your SaaS Quick Ratio

The SaaS quick ratio stems from an accounting concept which measures a company’s short-term liquidity by comparing assets and liabilities. For the quick ratio, however, the “good” SaaS metrics that indicate recurring revenue growth are measured against “bad” metrics that eat away at recurring revenue. Specifically, the sum of upgrades (expansions) and new acquisitions are measured against the sum of cancelled contracts and downgrades (contractions):

Quick Ratio Formula

Unlike measuring churn or MRR alone, this ratio can be telling for SaaS businesses who may post strong MRR growth or low churn but have significant underlying weaknesses. In one example Hamid presented, a company looked like a viable investment based on its expansion MRR. However, when churn was taken into account like the quick ratio does, it was clear that while expansion MRR was high, it was merely keeping the company afloat and net MRR was quite low.

Quick Ratio Graph


Things to Consider

For a SaaS company to be considered a viable investment, investors tend to set a benchmark ratio of 4. In other words, the company must average over 4 times as much MRR added in a given period than MRR lost. Above that rate, companies have relatively good prospects for continued recurring revenue growth and are likely to be good investments.
For the best results, the ratio should be examined over different time periods to account for periodic variations. While in one month businesses may fall below the benchmark, a quarterly comparison may indicate substantial growth. However, if your SaaS business is consistently failing to achieve a ratio equal to or above the 4 benchmark, you may want to consider looking into product fit or better facilitating customer success.
Companies must also consider which stage of their lifecycle they are in before calculating their SaaS quick ratio for investors. Similar to churn, the ratio is irrelevant for start-ups in their first year of business who have many new customer acquisitions locked into contracts. This will only lead to an inflated ratio and subsequently, an inaccurate evaluation of your company.
The quick ratio ensures SaaS companies looking for investment can’t hide behind good churn or customer acquisition numbers alone. To achieve a SaaS quick ratio of 4 or above, companies need to make sure they are applying strategies that acquire, retain and upsell customers. Of course, there’s more that goes into an investment decision than just one metric. But a good quick ratio is a good indication to investors that your service is in demand and you have a solid process in place to successfully scale.


-Jason
Jason Kiwaluk
Director of Ideation

Wednesday, November 26, 2014

How to Convert Trial Users into Paid Customers


Free or discounted trials are a great way to attract new customers, especially for SaaS and other subscription companies. While successful subscription companies are regularly able toconvert up to 25% of trial users into paid customers, many others fail to reach conversion rates to make themselves viable.
There are some common reasons for this disconnect when converting trial users into paid customers:
  1. Companies fail to connect with their trial users after they sign up.
  2. Companies do not properly track user interactions, limiting their ability to properly engage users.
  3. The product fails to meet the customer’s expectation.
Determining how to turn more trial users into paid customers can be difficult but here are a few tips to help you increase your conversion rate.

 

Make User Onboarding Quick & Easy

Your initial goal is to ensure new users are onboarded smoothly and are actively using your service quickly. Though it varies between products, especially between B2B and B2C products, the initial time period you have to activate potential customers using a trial service is limited. If they don’t start using the trial within an initial period, they are unlikely to ever use it. And if they don’t use the trial service, you’ve then lost the opportunity for conversion to a fully paid subscription. This is especially unfortunate because they already took that first step to sign up for trial.
The best way to ensure users actually use your product is to make it easy for them to start. Every step you add before they can start seeing the value of your service increases the number of users that are going to decide it’s not worth their time. Similarly, access should be quick, if not immediate.

 

Know How New Users Interact With Your Service

Once your new users have tried out your product, the next step is keeping them engaged with it. If a user signed in initially but after 7 days hasn’t signed in again, there’s a 60% chance they will never use your service again. Keeping new users engaged relies mostly on good product design, but building relationships and product understanding is also important.
But to effectively engage new users through responsive product design and relationship building, you first need to know how they use your service. How often are they accessing your product? What features are they actually using? When are they using it?
Talk to your paying customers who have recently converted from trial users. Find out why they started using your service, how your product is helping them (or where they feel it falls short) and what their first-time experience was like. Likewise, reach out to users who chose not to upgrade to find out why they didn’t. Compare the differences between these groups and use the information to strengthen your product design and communications strategies. Your customers are the experts in this case so your products and user experience needs to be designed for them based on their actual experiences. Once you start to get higher traffic volumes, you can also conduct A/B split tests to help improve conversion rates and identify what is and is not working.

 

Make it Easy to Upgrade

Similar to the initial sign up, make sure the process of upgrading from a trial user to paid customer is as user-friendly and quick as possible. Dropbox is a great example of a company that creates a smooth transition from trial user to paid customer. What Dropbox is doing right:
  • Their sign-up page is simple and access is instant;
  • Users pay for ease of use;
  • They encourage people to refer friends to their service by offering rewards to customers;
  • They make it easy to upgrade – all files are already in Dropbox so there is no harsh transition;
  • They educate their users, walking them through each step they need to take in order to reach activation;
  • They encourage users to reach out with any questions they may have when they are at the website’s Upgrade page.

 

Key Takeaways

A successful SaaS or subscription service is having many trial users and the ability to regularly convert them to long-term, paying customers. Getting them onboarded quickly and engaged continually in the trial period is vital and the best bet for success. Using the strategies above will help alleviate the disconnect that prevents users from converting and guide your subscription business to accomplishing just that.

–Jason
Jason Kiwaluk
Director of Ideation 

Wednesday, October 15, 2014

5 Simple Ways to Improve Website Conversions



If you’re a merchant with an online presence, you need to make it simple for customers to navigate your website’s conversion funnel. That conversion can be anything from signing up for a newsletter, registering for a webinar, downloading content, filling out a contact form or clicking thatCheckout button. Conversion is the most important factor to the success of your online marketing goals and everything on your website should focus on turning shoppers into customers.

Here are five ways to get there.

1. Simplify Your Site

According to a recent study by Business Insider, 25% of people said they abandon online shopping carts because thewebsite is too complicated. In fact, companies typically spend $92 to attract customers to their site, but only $1 to convert them.1 This strongly implies that a lot of merchants need to reduce the barriers to conversion by focusing on site usability. Here are some tips for better usability.
  • Make Navigation Seamless: Visitors need to be able to get to where they want to go without thinking too much.
  • Remove Unnecessary Page Elements: Avoid using too much text or distracting sidebars. Replace text blocks with bullet points where possible (people don’t read, they scan).
  • Use Images in Moderation: An image or two is a great way to keep users visually engaged. However, use them sparingly and keep them clean and professional.
  • Use Compelling Buttons: Ensure that buttons are easy to find and read. Don’t bury them in hard-to-find hyperlinks. Remember, this is your desired action.
  • Implement Easy-to-Submit Forms: A form should have the minimum required fields and be in a prominent place so the user can easily see it when the page first loads.

 

2. Minimize Load Time

A second or two in loading time can make or break your website conversion rate: 47% of eCommerce customers expect page load times of less than 2 seconds before they consider leaving and 40% will abandon a site when waiting 3 seconds.There’s more: Radware reveals that a site that takes 5 seconds to load experience 35% fewer page views and a 105% higher bounce rate, with a -38% impact on conversions. To keep that customer interested and engaged, you need to ensure your pages load fast.

3. Have a Clear Call to Action

Essentially, a Call to Action (CTA) takes the user to a page, which should clearly deliver on the CTA’s promise (download, sign-up, buy). Like a headline, the CTA is what grabs the visitor’s attention and moves them to conversion. More than 90% of visitors who read your headline also read your CTA.2 So, think creatively: the more interesting your CTA is, the more likely you’ll turn your visitor into a customer.

4. Discover What You Shouldn’t be Doing

Web analytics software such as Google Analytics or Crazy Egg is essential for understanding your visitors – where they came from and which links they clicked on. Google Analytics is sufficient for most websites, but Crazy Egg takes it to another level by showing you which parts of your pages your visitors click on, including clicks that weren’t on a link (perhaps they should be!). Whatever you choose, using analytics will reveal what’s getting the most attention and allow you to optimize intelligently.

5. Test!

Using the right targeting and testing methods can increase conversion rates by up to 300%.3 Companies spend so much time building a website that they often neglect to actually test the site to see if it’s working properly. This task usually falls on the one who built the site, but everyone involved should take part; on every browser, device and operating system. This is also where A/B testing comes in. A/B testing is the most used testing method for improving conversion rates.4 It allows businesses to see what works and what doesn’t. For eCommerce sites, the purchase funnel is typically a good candidate for A/B testing, as even marginal improvements in drop-off rates can represent a significant gain in sales.

The key overall is simplicity. If your site is fast, easy to view and navigate, customers are much more likely to stay engaged and move through the conversion funnel. If you analyze and test, then you will educate yourself on what is (and isn’t) working. Only then will you see the difference between attracting visitors and converting them into lifetime customers.


– Jason
Jason Kiwaluk
Director of Ideation


1 Source: Eisenberg Holdings
2 Source: Unbounce
3 Source: Steelhouse
4 Source: Steelhouse
Above sources referenced from:

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