You want buyers. Not subscribers.
The trouble is, those big numbers are intoxicating. They’re seductive.
Making big numbers, become even bigger numbers, feels great. But it looks even better.
The press digs it. Bosses demand it. Underinformed clients eat it up.
So you do more. Place a higher emphasis on acquiring more Facebook fans. Up your frequency to publish more emails. Lower barriers-to-entry to convert more free trials.
At first, more = better. Success!
But in the long run, this behavior has the potential to undermine future profitability.
OVER-optimizing conversions can often be worse than doing nothing at all.
Here’s why, and how to avoid the temptation.
The Road to Hell was Paved with Good Intentions
Years ago, there was a bubble.
And like when all bubbles get too big, it popped.
A fancy economics principle (theory?) that describes what happens when a neutral third party gets hit with an unintended cost as the result of an economics transaction.
WTF does that mean?
Modern economies involve a mind-numbingly complex system of interconnected, moving parts. You mess with one aspect of it, and it’s going to affect other areas. Whether intentional or not.
Over a decade ago now, loan requirements began to loosen. New home deposit requirements dropped because of creative ‘securitization’ options. Banks began to loan more freely because they didn’t have to hold as much capital collateral.
Like levers, some got pulled down in the right sequence to create one BIG, unintended consequence.
Optimizing for conversions, albeit a much smaller scale, is somewhat similar. Decisions or actions made on a single variable (like landing page form fields) might ripple through the rest of your conversion funnel, helping (or hindering) future results.
And it opens the door to accidentally (or intentionally) over-optimizing one area, that might cause negative ramifications for others.
Take, for example, Facebook Fans.
Pity The Fool Who Buys Likes
How many ‘Likes’ you bench, bro?
After all, that big shiny vanity number is what counts, providing the same ‘mirror-muscle’ pump peeps obsess over.
Cue Fiverr. A couple of bucks. A bunch of new ‘Likes’. And success. New houses, expenses, my own business, a truck, hmm, and a couple o’ Benz’s.
Unfortunately for all of us, that ain’t the case.
Massimo recently dropped these truth bombs in the excellent Buying Facebook Likes Sucks.
Here’s a fast summary for the TL;DR crowd:
- Understanding: How do you get fans to purchase? There’s no way to know because your Insights data is polluted and murky beyond belief. You could just throw some spaghetti at the wall to see what sticks, but there’s only one problem…
- EdgeRank: Sees through this crap. Having TONS of inactive fans will destroy any organic reach you might receive. Meaning everything you post will fall, literally, on deaf ears. So instead, you would have to use…
- Advertising: Wanna target your real fans (instead of the faux ones)? Good luck. Successfully segmenting is a nightmare at best, impossible at worst.
We’re picking on purchased likes here, but even ‘organic’ methods can still lead to the same end result.
In the good ol’ days of like-gating, you could strategically place a 50% off coupon behind the ‘gate’, forcing users to opt-in before getting their grubby hands on the goods.
It worked great, until it didn’t.
Sure, initially numbers went up. Hooray! Sales temporarily followed, thanks in large part to that deeply discounted coupon.
But afterward? Crickets.
So, what to do instead?
Done well, even a tiny group of highly qualified prospects can outperform the largest, unengaged audiences.
Obvious, right? Let’s move on to another example then.
Dude, Where’s My Email?!
‘Graymail’ sounds like an odd Frankenstein pairing between Quentin Tarantino and a book about kinky bedroom stuff.
Unfortunately, it’s not nearly as cool.
Instead, graymail is the stuff that hovers between pure, unadulterated spam emails and the more legitimate, permission-based emails following an opt-in or transaction.
It’s kinda like card counting in a casino. Not illegal necessarily, but frowned upon.
Especially as email service providers are getting smarter, protecting their own users and servers to make sure deliverability isn’t jeopardized by someone’s Viagra email blast.
Case in point: Back in 2013, Google unveiled their new ‘tabbed’ inbox, automagically sorting and filtering out all cold or promotional messages from people’s inboxes.
(JK Google. Please don’t hate me. Or share my internet browsing history.)
The point is, despite email still being tactic numero uno for marketers’ lead generation (so says 89% of them), it’s getting tougher to get messages delivered each and every day.
And that’s just the first hurdle! Then you have actually to get people to open and read the darn thing.
The easiest way to do that?
Send. More. Emails.
It’s a numbers game, right?!
Send daily emails, the ‘internet guru’s’ say. Didn’t someone read your latest? No problem, just create a new segment, switch up the subject line and resend!
At first, quantity moves the needle. But over time, your Blitzkrieg email strategy teaches people to ignore everything you send once subscriber recency sets in.
Even HubSpot, kings of graymail (seriously, check your inbox), took a step back recently to re-evaluate their own efforts, deleting over 250,000 email subscribers to put a bigger emphasis on quality over quantity.
Seth Godin puts it more eloquently than I ever could, describing the ‘curse of frequency’:
“The best members of your audience, the ones who are listening the most carefully, have to be bored/annoyed at the messages that show up after they take action. Some people pledge the first day of pledge week, or buy the book the day it comes out. Those folks don’t want or need to hear the message again.
Worse, frequency creates a culture of less engagement. Since we know that just about every important issue, opportunity or warning is going to be repeated a few times, we don’t engage as much. Why bother to listen, we say, they’ll just repeat it.”
The good news is that’s possible to still increase results without completely overwhelming everyone.
It just takes segmentation to add more nuance and subtly to your approach.
Eliciting specific interest around a topic that helps them with a particular pain point gives you an upper hand.
In today’s already-over saturated world, better = more context and more personalization. Not just more period.
That insight can be used to increase email effectiveness, or — when the timing permits — to temporarily increase frequency, WITHOUT constantly bombarding users to the point of exhaustion and opting out.
Why 70% of Your ‘Free Trials’ are Useless
The less fields, the better. Right?!
One company saw a 120% conversion lift by taking form fields from 11 to four.
Soooo… let’s get rid of them all!
Let’s only ask for one, like an email, and the conversion rate should skyrocket. Sounds logical.
Conversion rates go up. While conversions (as in, actual paying customers) goes down.
Limiting friction in the sign-up process, like requiring a credit card on file, undoubtedly will fill the top of your funnel with more potential people.
One study by Totango showed that while only 2% of visitors sign up for a free trial when a credit card is required, 10% do when it’s not.
Sounds like a no-brainer. Except when you factor in quality.
The same study showed as many as 70% of your free trial signups are effectively useless (while only about 20% are truly evaluating your product).
And if that’s not bad enough, there’s conflicting data about what happens when it comes to real conversions.
50% of those consumers that used their credit card went on to become customers, while only 15% of those who didn’t, did not.
The point is, there are a bunch of factors at play. And only looking at one angle oversimplifies (and misleads) your results.
The cure? As Neil Patel said, “Optimize for revenue, not conversions.”
Counterintuitively, the most profitable Moz customers ARE NOT those who convert on the first or second visit.
But the ones who visit at least eight times! Rand himself says of their experience:
“Many, many visits are often correlated with high purchase prices.”
The ones who are quick to come, converting the highest initially, are also quick to leave (with the highest churn rates).
That’s why when it comes to using paid methods to convert customers, you should start with those already most interested and familiar with your brand (as opposed to new, cold ones with little-to-no brand awareness).
Narratives are powerful.
Hockey stick graphs are always a hit with bosses, boards, and clients. No matter which numbers or trends they depict.
The danger is letting your attention, focus and resources get side tracked by vanity metrics that may (yet probably won’t) make a dent on your bottom line.
All of the unengaged Facebook fans in the world won’t turn a meaningful profit. Same holds true for overwhelmed email subscribers who turn a blind eye to your never-ending firehose of messages. While free account sign-ups are meaningful, only when they truly are.
Obviously, optimizing your marketing campaigns is a critical step to squeezing out higher ROI’s. But there’s a line.
There’s a point when optimizing for the sake of optimizing, or simply hitting diminishing returns, means it’s time to turn your attention somewhere else.
Otherwise, you might run the risk of squandering future profits for the sake of ego stroking today.