The magic of compounding conversions

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When looking at conversion rate optimization it is common to think that you can just throw up a few split tests and magically your conversion rate will go up by 50%, 100%, or in some cases more.
Well in some cases, yes that is the case. You test something that absolutely knocks it out of the park, bases loaded grand slam.
What most people fail to realize is ONE HUGE factor and that is in marketing, you are dealing with people when it all boils down. That ‘people’ factor is a major unknown and that is why conversion rate optimization is important.
Not only do you need to find out what they want, but more importantly in most cases what they don’t want.
You have multiple variables… things such as traffic source, ads, landing pages, checkout pages, upsells, emails, product delivery, customer service, and loads of other elements.
That is why it is important that you TEST multiple things every step of the way all leading to the end goal of increased sales and customer value. Unfortunately the only real limiting factor we have is time.
Time to let tests run long enough to get statistically significant results, time to test and scale traffic sources so you can test faster, and time to actually put it all together.
You can improve and make almost any campaign profitable, with some exceptions, but only if you give it enough time.
Time for the magic of compounding conversions to take shape.
To give you an idea just how much the power of compounding conversions can have, let’s break it down a little.
As W. Clement Stone said, “Big doors swing on small hinges.”
So let’s say you have 3 pages in your funnel…
A Squeeze Page (which captures visitors’ email addresses)
A Sales Page (which convinces the visitor to add your product to their shopping cart), and A Checkout Page (where visitors enter their credit card information and confirm their purchase)
You don’t NEED to have a multi-page funnel to get compound boosts… you can also get them through testing several elements on one page (like button color, call to action, pricing options etc.)…
But for the sake of this demonstration, let’s look at a simple 3-page funnel so I can show you how Compound Conversion Boosts work…
Now… let’s plug in some numbers to see how this all works out…
You have 10,000 visitors a month… And your product is $69.95…
Again, you might have more or less traffic and be selling something for a higher or lower price, it doesn’t matter, the principle is the same…
Now… WITHOUT increasing your traffic, and without changing your price, we’re going to see what can happen with a few tiny conversion boosts…
You have your Opt-in rate… which again is the % of visitors who give their email address or other information you are requesting on the Squeeze Page
Your Click-through rate (which is the % of people who hit “add to cart” on your Sales Page… And your “completed Sales” which is the % of people who stay on your checkout page and complete their purchase…
So let’s start with a 50% opt-in rate… a 4% click-through from the sales page… and a 25% ‘completed sale’ rate… at that price with that much traffic, you’re looking at a total Revenue of $3497.50…
And those numbers are pretty reasonable…
Now… let’s see what happens when we get an opt-in rate bump from 50% to 70%… which again, is not at all unreasonable… we’ll keep the click-through rate the same at 4% and the ‘completed sale’ rate the same at 25%… with that one boost, you’ve gone from $3497.50 to $4896.50 in total revenue… Not bad…
Now, let’s say you split-test the sales page and you get a small bump from a 4% to a 5% conversion rate…
You still have your 70% opt-in rate and we’ll keep the ‘Checkout Page”’s conversion rate at 25%… Now, your total revenue is $6120.62… Again… not bad for a small boost on one page…
Finally, let’s say you split-tested your checkout page and saw a bump from a 25% to a 30% conversion rate…
When you compound all the gains you’ve gotten you’re not looking at a total of $8079.22 in sales…
So as you can see, each small improvement built upon the last… and they compounded for a total boost of 230%
And these are just from small changes… it’s not unusual to sometimes get a 200% or 300% or even 400% conversion boost from a single split-test… It doesn’t happen every time… but it does happen…
So from 3 little boosts, you just more than doubled your income…
So next time you are testing, which should be daily, think about the small incremental improvement that will lead to the bigger picture win. Give it time to run and see the magic happen.