Do You Trust Your Data?

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It is, and always will be, possible to find data that supports your theory. Data is not perfect. And though many of us treat it that way, it is this imperfection that will end up tricking us into doing things that aren’t to our benefit.

For example, if I want to prove my point that a specific page on your website needs to be updated, I could show you the page’s bounce rate, exit rate, or conversion value. I might show you that the bounce rate for your product page has gone up 20% over the last 30 days. So clearly something is wrong.

But what if during that time the traffic sources also changed drastically? Or perhaps the bounce rate on the entire site went up by 20% because of some change in consumer behavior we haven’t factored into our analysis.

Successfully data scientists and analysts get paid good money for a reason. It’s because they are able to tell when the data is lying to them. They have trained themselves to do everything possible to keep their own bias and subjectivity out of their work. They let the data speak to them instead of starting off with a guess about what the data will say.

The best analysts know that not all metrics are created equal. They weed out the metrics that don’t matter to find the ones that truly show us what’s happening with the business. For some companies, the average pages per visit on your website might matter a great deal. And for others, we could care less.

It’s about identifying the right data for the right purpose.

Trust the data. But that doesn’t mean you shouldn’t question it. The key is to make sure you are trusting the right data.

What are your Biggest Regrets of 2015?

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In business, just like in life, we make mistakes. It’s normal. It happens. If you don’t make any mistakes you’re not trying hard enough.

But the key to making mistakes is learning from them.

  1. Identify your mistakes
     
  2. Determine why the mistake was made
     
  3. Set a course to avoid that same mistake in the future

So as you sit down to develop your marketing plan for the New Year, make sure you learn from the mistakes you made this year. Otherwise, you are doomed to repeat them.

Once you're done looking at 2015, here are a few things to focus on in 2016.

How to Improve Your Sales Funnel

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Yesterday’s post was all about sales funnel analysis. It is the necessary lead up to today’s post, so if you didn’t get a chance to read it already, quickly do that now.

What you should have now is a full look at your sales funnel, with audience sizes for each layer or level, and conversion rates going from each level to the next.

Using that as your baseline, now you need to identify which transition you want to improve. Do you want to get more people from Intent to Purchase? Purchase to Loyalty? Awareness to Interest?

You might ask, how do I pick one? The truth is, most marketers over time will focus on all levels of the funnel. But you want to start where you see the most opportunity. Where is your conversion rate lowest? Where are most people falling out of the funnel?

If it’s a toss-up, flip a coin. Know that you can’t go wrong. If you improve one level of the funnel, it should improve the overall performance. Then you move on to the next level and keep going until you’ve hit them all.

Once you have decided which level you are looking to affect, now it’s time to decide what to do to improve it. Make a list of all the things you do today that impact the conversion rate at that level of the funnel. At the bottom of this post I will list some examples for each level.

Once you have your list of what you do today, make a list of changes, new processes, and other ideas you think will improve performance. Assign a cost to each one, and an expected outcome. Then prioritize them based on the expected return on each activity. For example, if one idea will cost you nothing to put in place and you expect it to improve conversion rate by 1%, that would likely go at the top of your list.

Then execute those ideas at the top of your list and measure the impact that they have. I know it sounds like I’m simplifying a complicated process here, and I am. But at a high level, that’s all you have to do.

Some ideas for each level of the funnel:

  • Grow UNQUALIFIED PROSPECTS through new products, new features, or new uses for your products, thereby growing the target market
  • Grow AWARENESS through social media outreach, PR, and advertising
  • Grow INTEREST through email marketing and an improved website experience
  • Grow CONSIDERATION through special offers and promotions
  • Grow INTENT through outbound and inbound sales processes, discounts and deadlines, and promotional literature
  • Grow PURCHASE through sales people and coaching, pricing plans, contracts and checkout process improvement
  • Grow LOYALTY through membership programs, exclusive offers, email, surveys, and customer service improvements

How to Analyze Your Sales Funnel

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Last week we took our first look at your sales funnel. Here are the different levels we used, from top down:

  • Unqualified Prospects
  • Awareness
  • Interest
  • Consideration
  • Intent
  • Purchase
  • Loyalty

Your company or industry might use variations on those terms, but for the most part the meanings and buckets will be the same.

So once you have a clear picture of your funnel, the next thing you need to do is begin to analyze it. How do you do that?

You start by assigning numbers to each level. How many people are in the pool of unqualified prospects? How many are in the awareness stage? And so on.

It might be difficult to get to exact numbers for each one, but you should have a sense, based on your own internal metrics and tracking.

You should know how big your target market is. If you got every single person in the market to purchase from you, how many people would that be?

You should know how many people came to your website, filled out your forms, became a sales lead, and purchased. And you should also know how many customers came back and made a repeat purchase. Adding a little bit of art to this science, you will end up with good estimates for each level on the funnel.

When you write those numbers down, you can do some quick math to see what percentage of people from each level make it down to the next level. This is your conversion rate at each stage.

For example, let’s say you have a total market size of 1000 people. That’s what you write down next to Unqualified Prospects. And you’ve judged 500 people to be in the awareness stage or beyond, meaning they have had some exposure to your brand. So you have an awareness rate of 50%.

Calculate that percentage throughout the funnel and you will have a complete look at the effectiveness of each stage of the sales process.

Tomorrow, we’ll take that analysis one step further and talk about how to use those numbers to improve your sales funnel.

How to Ruin an Ad – Part 8

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Welcome to the latest edition of our current weekly blog series, How to Ruin an Ad. As is most obvious from the title of this series, each week we’ll be identifying a key element of an ad that, when missing, is sure to reduce its effectiveness.

Last week’s ad was ruined by not proofreading.

Today’s ad is ruined by: Not Measuring Performance

An ad is an ad is an ad. It doesn’t matter that one looks prettier than the other, that one has a shorter headline, or a stronger call to action. What matters is whether or not an ad works.

What do I mean works? Every ad that a company runs has a goal attached to it. If you are a direct marketing company, that goal is usually a certain number of sales or leads, or a target cost per conversion. If you are branding, that goal is probably a measurable lift in brand recognition and positive association.

So the most important thing about your ad is whether or not it works. So did it? Did your ad work?

Too many companies can’t answer that question. The problem is, they start advertising before they have a mechanism in place to measure the effectiveness of their advertising. That’s a surefire way to blow through a lot of hard-earned money.

Marketers need to be able to measure the performance of every ad that they run. Whether you are using a free tool like Google Analytics, an expensive CRM like Salesforce, a custom-built database, or something else entirely, you must be able to state with confidence whether an ad worked or not.

That’s the only way you’ll know what ads drive your business and pay for themselves. It’s how you will optimize your advertising plan for growth and stop wasting money you can’t afford to be without.

Did you enjoy this post? Do you have a surefire way to ruin an ad you think we should cover in an upcoming post? Share it with us in the comments or by email.