Startup Marketing: A Client Who Disappears At The Bottom Of A Funnel And Why Too Much Traffic Attention Is Dangerous For Your Business

Greetings, dear Habrasociety. Attracting and retaining customers - the most important tasks of the business. Therefore, I want to share with you a translation of the material written by Rob Walling. The information will be useful both for startups, and for those who have already achieved certain results. .

Part 1: A client who disappeared at the bottom of the funnel

Talking recently with one of the participants of the Micropreneur Academy, I realized that the guys at startups consider increasing traffic and increasing conversion an exciting game. However, if the offered service is regular, it is necessary to remember the next step - the retention of existing users.



If you spend all your time on optimizing a sales funnel, it is not surprising that you may not pay attention to customer reviews. In addition, it is difficult to correctly prioritize what to do next - continue to engage in traffic and conversion, or direct efforts towards creating new product features.

Of course, traffic and conversion are the sources of business growth, but often the addition of new functionality is more significant than focusing on sales than actually selling. I wrote a lot about marketing and sales, because these are the key points of success, but in the case of a regular service, it is necessary to achieve a compromise between building traffic and keeping existing customers happy.

To better understand this circumstance, I decided to imagine customers who refused the service as having disappeared at the bottom of the sales funnel.

Third circle

When we use the sales funnel model, the key metrics are traffic (how many people hit the top of the funnel) and conversion (how many people fell through it further).
You get traffic through SEO, AdWords, blogs, tweets, social networks and other well-known tricks. Caring for traffic is now in vogue.

Conversion can be improved by conducting a series of A / B tests. But if you have a regular service, and you have made incredible efforts to convince someone to buy it, it will be painfully painful if this person refuses the service in a month.

Life at the bottom of the funnel

Suppose, for example, that you provide a SaaS application.
Since you thoroughly researched this business niche and compiled the correct mailing list, your launch went brilliantly and in the first week you got a few subscribers. You have high-quality traffic sources, therefore, you have a high conversion rate. You will no longer have such chances to attract customers, as at the time of launch. The first two laps you have passed.

And a strange thing: you almost immediately began to receive user requests that it would be necessary to add functionality. However, when you started up with a minimal set of features in order to start making money faster and getting feedback, you were ready for such requests, and in this sense everything is just wonderful.
But here you can ruin everything. We can say that the first 1-2 months after launch is a critical period during which you will have to dodge the letter “si” and satisfy as many requests for new functionality as possible, otherwise you will begin to lose customers at the very bottom of your funnel.

And it turns out that you caught traffic and turned it into customers only so that it would then flow away in the form of people disappointed in you.

To allow this is worse than not managing the increase in conversion. Each client who has left you because of dissatisfaction with functionality (or for another specific reason) is your time and efforts that you spent to direct a person to your site and turn him into a client. Imagine that if you have a 1% conversion, then every lost customer is like 100 people who, as if they didn’t come to you. Just cross out this part of the traffic from your logs.
As I think about it, a tear comes.

Solution The

solution is to first imagine that this has happened and begin to take measures to prevent the diversion of the clientele - in advance. Adding new key features and thus retaining most existing customers is the best solution.
If you imagine the customer’s refusal of the service as the third circle, the third level of your sales funnel, it becomes easier to understand that the success of your enterprise depends on the activity at each stage, and if something goes “somewhere”, then the whole wonderful system will be ineffective. If you cannot direct a potential customer to the funnel, you will never sell him anything. If you cannot convince some of the potential customers to move inside your funnel, you will never sell them anything. And if you cannot stop the customer leak at the bottom of the funnel, your business will die out as an unsuccessful evolution experiment.

And you tried so hard when you created traffic and conjured over its transformation! And all in vain ... Shut up to flow at the bottom of your funnel!

Part 2: Why paying too much attention to traffic is dangerous for your business

Here is a great exercise: find a startup and ask him the following:

“What are the 3 key approaches you use to find customers?”

The most common answers you get are: search engine optimization, AdWords, blogging, podcasts and possibly social networks. These are good answers - such methods will really attract a significant amount of traffic to your site.

After that, ask about their next step:

“After you drive traffic to your site, how do you turn visitors into customers?”

And after this question, you usually see surprised looks, a shrug and awkward smiles. Most people starting their business on the Internet only think about how to drive traffic, and almost none of them think about improving the conversion rate. Why it happens?

Good marketing just looks

The most likely reason is that good marketing, like good design, looks simple. It’s so simple that it is practically invisible.

Good marketing is when you are impressed enough with a marketing message to get your hard-earned money out of your pocket. In such a situation, I’m sure you have no idea how they made you get a credit card. If you thought about it, then you probably didn’t get it right away.

Good marketing, as a rule, does not look like marketing at all. I have been reading Joel software literature for 8 years and have been a paid FogBugz user for about 4 years, and I never felt like they were making money on me because they were doing it skillfully. So skillfully that with the naked eye it is even imperceptible.

Therefore, most people believe that good marketing is very easy. It’s about how to see a good website design that seems as simple and straightforward as possible. Often people think: “I can do it too, just add some text, select it in a special font and put a plus sign.” But it turns out quite wrong.
Usually, designers start with more complex designs and spend a lot of time to make it concise and “straightforward”. Achieving this effect is not easy.
To create your own website with high conversion, you need to understand that you will have to make a lot of efforts to create a website that really convinces users to buy.

Another reason why most people focus on traffic rather than conversion is that there is a lot of talk about traffic. For every 50 books or blogs about SEO or AdWords, there’s only one source dedicated to improving conversion rates. Almost everyone writes about traffic, so it is not surprising that they attach such great importance to it.

Traffic is entertaining. Conversion - hardly

Actually generating traffic is a very entertaining and enjoyable process. I understand that this sounds strange, but attracting decent traffic is not only very nice, but it is an achievement that can be seen right away.

Generating and measuring traffic is pretty easy. Many tactics are described by various authors and bloggers, and, following their advice, you can attract hundreds of visitors to your site very quickly. Also, you can almost instantly see the fruits of your efforts using special applications. And you will get instant job satisfaction.
With conversion, everything is exactly the opposite. Conducting A / B testing takes a huge amount of time, and spend enough of them to significantly increase conversion - and even longer. Increasing your conversion rate requires a lot of patience, foresight and a certain amount of attention - more than when watching a video on YouTube. Many people simply do not.

So what is the answer?

Since I already launched and optimized sites, this process has become almost template for me. Each website starts with virtually zero traffic. Then a little marketing - and traffic appears, however, the conversion rate remains terribly low. Conversion is never done from the very beginning.

So, you have a certain amount of traffic, you managed to make several sales, and what to do next? Most novice Internet entrepreneurs think, “You need to get more traffic.” Incorrect answer.

The correct answer is to work to increase your conversion rate before you start spending more time and money on driving traffic.

On non-optimized selling sites, the conversion rate is usually in the range of 0.1-0.5%. You will have to attract really a lot of traffic to start earning at such a low conversion. Compare with the situation on optimized sites with a conversion rate between 0.7 and 4% (depending on the price category and the quality of traffic).

Therefore, you have a choice: double traffic or double conversion rate. I went through this many times and am ready to assure you that increasing the conversion rate will be much cheaper and will significantly increase your sales in the long term than attracting traffic. Especially when it comes to completely non-optimized sites that are the easiest to work with and see progress.

Moreover, almost no one uses this approach.

In fact, I always start doing this a bit later. Usually, I stop all active actions to generate traffic to a site with a low conversion long before I start to increase the conversion rate using A / B testing.

Typically, the process of working with traffic and conversion is as follows:

1. Get some traffic. Several hundred visitors per month, maybe thousands.
2. Improve your conversion rate.
3. Generate additional traffic.
4. Work a little more on the conversion rate.
5. Again traffic.
6. Spend your retirement years in the Bahamas.

Note: I have not reached stage 6 yet. However, I witnessed how the conversion increased 10 times after A / B testing.

Naturally, as you attract more and more traffic to the site for the entire time of its existence, your earnings, of course, will also grow.