Senior Director of Editorial Content at MarketingSherpa and MECLABS Institute
Daniel oversees all editorial content coming from the MarketingExperiments and MarketingSherpa brands while helping to shape the editorial direction for MECLABS – working with his team of reporters to dig for actionable information while serving as an advocate for the audience. Previously, he was the main writer powering MarketingExperiments publishing engine – from Web clinics to Research Journals to the blog.
Daniel is also a frequent speaker and moderator at live events and on webinars. Prior to joining the team, Daniel was Vice President of MindPulse Communications – a boutique communications consultancy specializing in IT clients such as IBM, VMware, and BEA Systems. Daniel has more than 15 years of experience in copywriting, editing, internal communications, sales enablement and field marketing communications.
What 20 Years Of Research
Says About The Conversion Process
Tactic that has had the biggest impact on Daniel’s success
Looking at the customer onboarding forms and scrutinizing the data being solicited
Result if you follow the steps in Daniel’s session
A frictionless and positive onboarding experience for your customers
Full session with video, notes, audio and discussion inside EHQ Club. Learn more
Expert session snapshot
This is what we call the conversion heuristic. So it looks complicated, but I’m gonna break it down. Very simple, for you can see the C = 4m + 3v +2 (i-f) – 2a.
So this has all the factors that lead to the probability of conversion that is C, right? M is the motivation and the customer is the value proposition. I as incentive, F is friction and A as anxiety. And let’s walk through these kind of one by one, as we go into the different levels.
So at the base level, right, if you’re just starting out in marketing, it’s incentive, right? You give, you know, a customer an incentive to take action. And, you know, they’re more likely to act.
So we see this all the time and companies just starting out, they’re like, well, you know, not sure what the value proposition my product is, you know, oh my gosh, I just got to sell it cheap. You know, I’m competing with Amazon and all that stuff. So let’s just give them an incentive, but we’ll give them free shipping on what they want to buy or we’ll give them a free product then 20% off.
So when you think of incentive, I like to call it the bacon of marketing tactics, right? Because if you’re a bad cook here, here’s a quick cooking tip for you. If you’re a bad cook, you can take almost anything and make it tastes better with bacon. Right? You’ve got a kale salad, throw some bacon in there, it’ll taste better.
You’ve got a lousy product with no value proposition, you don’t even know what the customer wants, throw an incentive in there, and you might be able to get more customers. So at a big high level example, you might not be familiar with this. But around 2008-2009 when everything was starting to crash on the American car companies, GM, Chrysler, their way of selling cars was paying people to buy the cars.
So you buy a car, will give you 3000 cashback, 4000 cashback, $6,000 cash back. So surprisingly, that was not a sustainable business model. Eventually, they went bankrupt and the government bailed them out.
So the point there is like, yes, incentives, they may work in certain instances, it’s a good way to start out, we’re really going to have to build above just incentives if we want to build, you know, successful online conversion and a successful business, right?
It’s not just about the conversions. We don’t just want conversions. We want conversions that give us margins to build sustainable business success, right?
Yeah, and I can see how incentives if used in the wrong way can damage the relationship with a customer and if you’re always constantly giving them a discount when they you know, leaving stuff in the basket or they’re checking out and they’re going to stop, becoming to expect these discounts and they’re not never going to buy something for price. And so there is some costs, if you like, or some disincentives to be using incentives.
Yeah, exactly. So you can use it in, you know, small individual instances, sometimes the tip the value more in the favor of the customer, but like you said, it can be a beast. Like, I know, for example, I bought luggage not too long ago, I just put it in my cart and left.
And I knew a day later, I would get that 20% off coupon and I bought it then. So I was gonna buy the luggage anyway. But you know, I’m a marketer. I know the system works.