2016-04-10 | 1219 Print PDF
Here is a food for thought, as we move slowly to another 2nd quarter of the year: how is your business doing? I meant both online and offline. Have you been getting better conversion rate on your goals? Have you executed a web analysis recently on your website to evaluate why all the dollar spent on advertising your website is not pulling in returns as expected?
This thought of reasoning as brought me to the first question addressed to you : how is your business doing?.
To be frank I believe opportunities can be created if we don't misuse our open windows to do so (convert them), and if you term that luck you might be right, but I like to term it has being diligent.
Now I don't know if you run some sort of online awareness via a website or an ecommerce, even if you had run some sort of online marketing package or service for your business, the number one question that most people do ask is why can't I get more website conversion or how to increase conversion rates.
If you fall under this, then I need to let you in on one thing, you are not alone in this, especially if you have huge numbers of traffic via your Google analytics readings and see less goals or website conversion rate, this can demoralize any one. Another thing I need to point out is that conversion means different things to different people, eg a conversion might be a purchase or a signup, it all depends what you have defined as a conversion goal.
In a research conducted by UK based research company Baymard Institute, 68% of online shopping carts end up getting abandoned. For every 100 customers who plan to make a purchase with you, 68 leave without buying anything. That’s a lot of figures not converting to revenues, and this is more observant on ecommerce conversion rate. But why does this happen?
I find this topic so broad that I will try as much to touch on the basis. According to Statista 3 Major culprit to this never ending trend are;
Pricing- 56% of web visitors that visit your site are bound to drop out when they see hidden charges or are shocked with unexpected cost of the product/service they are to purchase.
They tend to rationalize if the price for the service/product is overpriced or under priced giving rise to question quality and integrity of the product/service.
website navigation- 25% of web visitors dislike a poorly designed website, it may have all the best graphics in the world but still be complicated for users to find their way around your site, this department is called User experience also know as UX.
You design your website for your web visitors and not for yourself, you are in business for your clients, so if they find your site all flashy but have the wrong perception about it, then you are bound to lose customers.
Please read 12 Things To Do When Designing Website User Experience Using User Testing. [link open in new window]
page speed- 24% of web visitors abandon websites that take longer to load, it's always better to have your site load under the 3 seconds margin, above 5 seconds is a disaster. It might be shocking but page speed is really important if you ever want to retain customers, imagine going through two pages and its taking forever to load the contents? the effect of page speed goes a long way as well and I can't say much than to emphasize on its respectful importance.
I have written some post on page speed, which you can find useful, please do visit them to learn a thing or two. Visit How to improve your website page speed [Link opens in new window].
The only area have not touched here is Pricing, as simple has it may sound, it ain't. I for one can testify to this, trying to execute a better conversion rate optimization with our pricing plans.
One thing is clear people love to try things for free before engaging to become a paid member, it is the best way to convert new web visitors to your website, offer your service for a trial with no HIDDEN COST and if you can provide a free extra service, please do, they all go a long way.
If you had noticed something that a lot of service provider sites do offer monthly and yearly payment structures on their websites, eg a annual payment or a monthly payment some even go ahead with a quarterly payment and half annual payment all encapsulated with discount incentives to drive in more conversion.
Payment design do matter a lot when users visit your site and if they see how flexible your payment plans are it gives them more options as to what to go for, providing your customers with more option sometimes do confuses them so you might need to give them an option to start off with.
eg going to buy a dress in a mall and later finding out that there are several colors, obviously you will instantly want to try them all one by one and get a third person view about it prior making a purchase. So take this concept online by providing choices as well for your payment packages or plans.
According to digital telepathy, from their research post of payment plan structure found in the image above and with this field test Six months ago, you reserved a ticket to a theater event. Yesterday, you went to the box office and paid $50 for your ticket, which is nonrefundable. Today, you’re feeling ill. Since the event is tonight, will you attend or stay home? which reveals that 60% respondent that they will go, while a second scenario was that the ticket had actually been paid for six months ago (not yesterday, as in the first scenario). Now only 30% responded that they will go, what this concluded was that "timing—the immediacy of payment—drives attention to the cost of the event. And let’s face it, costs are painful. So when people are made aware of the cost, they react by wanting to make the most of what they’ve purchased, instead of letting it to go to waste. That, in turn, drives motivation to use the product or service – even sometimes, at the cost of something else, like one’s health or level of enjoyment."
The way you ask for payment after or before a service/product do matter, but people don't know how this can psychologically affect a customers perception about your business. Because of this I have adopted a pay as you go payment structure instead of the normal auto renewal service, ie you pay for the month you utilize, eg if you make use of our service for a month you get to pay for it for that month before (not after) product/service delivery. If you want to continue using the service is based on your own discretion.
Some businesses utilize a auto renewal service for their services eg magazine companies, club membership services, etc there are benefits to this and also a downsides Many customers may not become repeat buyers unless they are actively using the product or service they’ve purchased.
And this is one reason why companies should care about usage. For health clubs – and most other businesses, as well – it costs a lot more to acquire new customers than to keep existing ones. Customer retention depends a lot on the extent to which products and services are actually being used or consumed.
Many companies give considerable attention to determining the right price for a product or service, but not so much to the timing and schedule of payment. In general, there are three different scenarios that can occur in regard to the timing of paying and consuming:
Many businesses prefer that customers pay up front because they receive payment earlier rather than later. In a previous article, by digital-telepathy they discussed how pre-paying can also help people find more enjoyment during the actual consumption experience –because the pain of payment is distanced from when the product/service is actually used. In fact, sometimes consumption can actually end up feeling ‘free.’
There are other factors one need to look at when discussing on steps to conversion rate optimization, a psychology approach may also be needed in order to understand how to increase your ecommerce conversion rate. This aspect of conversion rates is so vital that it is part of a degree course under sales psychology, which aim is to help business owners understand the stages of converting customers and making more sales by improving conversion rate optimization.
Please click on the infographic image below to download "for more insight on how to convert customers using psychology".