Myths are just part of human existence. People can be tricked into all kinds of things, like believing that Pop Rocks and Coke killed Mikey from that cereal commercial. Or that you need at least eight glasses of water a day to survive (pretty sure at least two of those can be bourbon... right?). People can also be tricked into believing their marketing tactics are achieving good results when in reality they're not.
This can happen for a bunch of reasons. Sometimes it’s just that people are looking at their numbers out of context or they might be measuring the wrong things. Simply looking at key statistics like “clicks” or “new visitors” can give you a false sense of security. While these numbers are important, they don’t tell the whole story. That’s where we come in with a straight story.
Since our product, Talu, is based on a methodology we call Story Based Analytics, we want to make sure we are getting the “whole story” on our conversion metrics. Specifically, we want to know how new visitors from our website are converting into trial customers. In order to do that, we applied our story-based methodology to see if we are asking ourselves the right questions like:
How many new visitors are coming to our site?
How many of those new visitors are converting into “trial users”?
Which channels are those visitors coming from?
Are these customers actually engaged with our product?
The last question is the trickiest. Most people focus on the first three questions and then stop, but that doesn’t tell the whole story on how well your conversions are working. So let's debunk some myths about conversion metrics.
The first three questions asked above can be answered by looking at the following data:
Number of new visitors to your site
Number of new visitors that converted into your trial
Number of new visitors that convert into your trial from a specific channel
Just looking at these numbers alone, we could assume our marketing is working quite well if we're achieving our goals based on our top line counts of new visitors and trial conversions. However, without answering the fourth question, are these customers actually engaged with our product?, we would never get the whole story.
And that whole story is important because we want more than just sign ups! We want engaged customers. Without the fourth question we wouldn’t know what to improve. Our product in general? Marketing? We would wonder if we should be making our product easier for customers to get started with or maybe adding different features? We'd wonder if anyone even appreciated our product. And then we might mess with a good thing. We concluded we had to measure engagement.
But first, we had to define engagement.
So we analyzed our conversion funnel, looking at all the steps each user took from the beginning when they requested to sign up until they were actually using our product.
By design, our whole sign-up process was architected to take less than 60 seconds. We wanted the “lift” for a customer to set up and try our product to be as simple as possible. Even with our team's focus on making our setup quick and minimal, a user still has six steps to walk through before we can consider them initially “converted and engaged.”
If a customer doesn’t make it through all six of these steps, they would never view a story (report) from our system and therefore we could never determine if the service is of value to them. So a conversion for us isn’t just a new visitor clicking on the "free trial button." We had to ensure a customer accomplished all six steps. This metric would tell us that our marketing and on-boarding is working.
Our initial goal was to convert 10% of our new visitors into trial users. So far, we have fluctuated between 4-10% depending on the channel and our campaigns. Of the customers that click “sign up,” approximately 50-55% make it through our entire funnel and view one of our reports. This means that only half of our marketing efforts ever get a potential customer to realize the value of our service.
How does this impact our sales and marketing efforts?
If we are getting 100 new visitors to our site each week, ten will convert into our trial and only five will ever realize value. So working backwards, if we are trying to achieve certain marketing and sales goals, we need to make sure we have enough new visitors get through to our “engaged” metric, or we'll never realize our greater sales goals. We can impact these efforts by getting more new visitors to our site, or helping convert the ones the are already coming and make sure that they get through the final step of our funnel.
Without this additional context to our conversion cycle we could easily trick ourselves into believing that we would reach our greater marketing and sales goals because our top line numbers were achieving their initial goals.
So how do you keep yourself from being “tricked”? Let me break it down into three easy steps:
Step 1: Identify your key “engagement” metrics in your sales and marketing funnel
What is the one thing in your funnel that a customer would initially determine “value” from your product?
Step 2: Ensure you have the right tools in place to measure your conversions
Tools? You like ‘em, we got ‘em. We use the following to get our metrics:
- Google Analytics - Google Analytics captures all of our data and set up “goals” for users converting into our trial
- Talu - We leverage our own product to summarize the traffic report from Google Analytics. We are also working on a new story that will help us -and our customers- track their conversion by channels more closely
- Kissmetrics - We can see each of our six funnel steps from “sign up” to “view story” using Kissmetrics. This also could be done in Google Analytics
Step 3: Start setting up some baseline data to measure against, either from historical data or based on some initial assumptions
Start answering the questions as we outlined above and start understanding the “whole story” behind your sales and conversion funnel. The whole truth and nothing but the truth is out there, we swear.
We’re sharing our story, but we’d love to hear yours. Leave a comment below or drop us a line via email firstname.lastname@example.org