A lot has to go right to get a new customer. First, they have to know you exist. Then, they need to be able to evaluate that your product does what they want it to do, and determine that they’re willing to pay for it. And, even if they do buy it, they need to keep wanting it for you to make more money.
Most businesses aren’t optimized to “win” at each of these key phases or inflection points in the buyer’s journey. But how do you know where the biggest opportunities lie?
By quantifying key patterns in prospect and customer behavior through this journey you’ll have objective measures in place to identify the biggest problem areas. With those known problems in-hand, we can then isolate the research, strategy, and tactics that need to be taken to turn those problems around.
Behaviors To Isolate Why People Aren’t Buying (More)
1. Not Enough People Know My Business Exists
How To Isolate This Problem: Look at objective measures to see if your business is getting noticed. For businesses who rely on some kind of digital presence to drive revenue (e.g. e-commerce stores, websites with contact us forms that drive leads), this is going to be all about traffic to your website. Free tools like Google Analytics will let you easily see the amount of visitors to your site as well as changes in visitors over time.
Naturally, not everyone that comes to your site will buy. Depending on your industry or category, you can expect anywhere between 1% to 4% of website visitors to ultimately be customers. If 1-4% of site visitors becoming customers looks like too low a number, you need more people to know you exist.
How To Address This Problem: To start building awareness in your business, you’ll need to invest in what’s called “top of funnel” or “awareness marketing” activities. These are marketing tactics that are oriented around getting prospective customers to learn about your business, and can include everything from paid marketing (e.g. Google or Facebook ads), building your presence on ratings and review sites (e.g. Yelp, Home Advisor), getting others to mention your business (e.g. media outlets, influencers), or improving your presence on Google searches. A mix of marketing activities reinforces each effort, and helps build awareness and interest over time.
2. People Seem To Check Me Out Briefly…But They Don’t Come Back
How To Isolate This Problem: Identifying this issue is almost the opposite approach to the problem above. Under this possibility, we’d expect to see high volumes of website traffic, but extremely low conversion rates. If you’re seeing that less than 1% of visitors are buying from you, or asking for more information, then this is likely an issue you have.
Additionally, if you see that your site has really low “Repeat Visitors,” a metric that can also be gleaned from Google Analytics, you’ll know that you’re getting people to take one look, but never come back.
– How To Address This Problem: There isn’t a clear “silver bullet” solution when it comes to tackling this issue. Instead, you’ll have to look into at least one, if not all three, of the areas below:
– Marketing Messaging & Positioning: People explore products with a particular idea or need in mind. If the information they’re seeing on a website, which includes headlines, descriptions, and images, doesn’t resonate, they’ll leave and never come back. Performing qualitative research with a few customers or prospective customers can identify if this is the issue. By identifying trends in customer needs, wants, and pain points, while also learning about who they are as people, you’ll be able to create distinct customer profiles and identify the types of messaging, copy, and imagery that will drive them to buy.
– Website User Experience: When businesses experience high bounce rates (i.e. people just look at one page on a website and then leave), it can be a sign that the user experience is poor. This could mean that the information people are looking for is hard to find or the navigation is confusing. Performing user experience research—observing individuals while they’re visiting your site, asking questions about their thought process as they visit pages or use the navigation—can isolate if this is an issue while also providing insights on how to fix the problem.
– Lifecycle Marketing / Lead Nurturing: In longer sales cycle businesses (e.g. higher-ticket consumer products, B2B sales), it’s not likely that a person will buy, or even request information, after just a single visit to your site. As a result, it’s important to do what’s called “lead nurturing.” This is the process of capturing their contact information, usually email address, and sending relevant, valuable information to them over time. Lead nurturing helps keep your products or services top of mind while also convincing prospective customers that your solution will fit their needs.
3. They’re So Close to Buying….But Then They Don’t
How To Isolate This Problem: Once again, we can rely on quantitative approaches to isolate this problem. For e-commerce businesses, the cart abandonment rate, which is the percent of people who add products to their cart but never buy is a great signal of this. The average rate across a wide variety of e-tailers is just under 70%. For SaaS businesses, which are those businesses that let people log on to access software via a web browser, looking at a trial conversion rate is a great metric. Unfortunately, there aren’t ideal target conversion rates since the nature of the product, the trial, and payment process all impact conversions. Regardless, if your rate is lower than 10%, it’s probably too low.
How To Address This Problem: Once again, there are a lot of factors that lead to people heavily considering your product but then choosing not to buy. Let’s look at the range of issues that could be resulting in lower-than-ideal conversion rates.
– Product Market Fit: For someone to buy your product, it needs to fit a particular need they have. Part of trial experiences is to do this evaluation. If customers try but don’t buy, chances are your product doesn’t fit their, or the broader market’s, needs. To explore this further, consider qualitative research focused on lapsed trialists. That is, prospects that trialed your product but didn’t convert. Fielding 1:1 conversations across multiple lapsed trialists will help identify the needs customer had going into your product, and whether those needs were addressed. If you see gaps in needs versus product features, you have a product-market fit issue.
– Price point: No one sells their product in a vacuum. You’re always up against competitors and their pricing. Even if someone wants to buy your product, it could be that the price, or the pricing model, isn’t feasible or is inferior to what your competition is offering. A little price testing can identify if this is the issue. This can include classic survey research approaches to price testing, ideal for B2C oriented business with more volume, or testing price points or pricing models in real time to identify how changes in price impact conversion behavior, usually ideal in B2B settings. If you see preferences deviating from what you’re doing, chances are you need to revise your pricing.
– Product User Experience: For virtual products, it’s possible that the issue is your product experience. Once again, user experience testing, with a focus on seeing how users engage with the product, navigate across features and functionality, and achieve their goals using the solution may isolate that your product needs to be revamped.
– Marketing Enablement / Sales Operations: Not every business is self-serve, especially in B2B sales. During a trial process, prospects may need tours of the product to understand its full breadth or have a la carte questions answered. Some of this can tackled with Live Chat, via in-product automated tours, or automating best practice emails. In other cases, it may require a dedicated sales process to support customers through the trial. If you have a service that is complex, or has a lot of components, chances are enabling one of these functions will improve trial conversions.
4. They Bought Once…But They Aren’t Buying AgainÂ
How To Isolate This Problem: Looking at metrics like repeat purchase rates or renewal rates is an ideal way to isolate if you’re able to truly retain customers over the long haul. This is especially key since retaining customers and extracting more purchases from them improves their lifetime value, a measure of how much net profit you derive from them over their lifespan with your business. There’s no hard and fast rule around repeat purchase rates. However, if your average renewal rate is close to zero or your average purchase order is one, or close to it, you likely have a retention problem.
How To Address This Problem: Once again, there can a lot of culprits behind poor retention rates. Nevertheless, if you’ve gotten people as far as giving you money, it means they were very interested and willing to make a commitment. Somewhere, however, your product or service fell short. Three key areas likely warrant further exploration.
– Product Market Fit: While this was an issue above during the trial process, it could still be an issue even after someone has purchased. Customers frequently buy a product thinking it will do one thing when often times it won’t. Or, they may think it can tackle a broader range of their issues than it does. A great way to explore if this is the issue is by performing 1:1 interviews with lapsed customers. By understanding their upfront needs and expectations, how they used the product, and why they they ultimately churned, you’ll be able to identify if the product isn’t meeting the market’s needs.
– Customer Nurturing & Product Marketing: It’s important that customers continue to see value from your products or services, and it’s on you to communicate this. For e-commerce businesses this often means being intentional about advertising when new products are available. For digital products companies this usually means communicating new features of functionality. Leveraging product marketing—the practice of showcasing key products and features and how to get the most out of them—can go a long way to ensure customers get the greatest bang for their buck from your product.
– Customer Onboarding & Training: Sometimes the product is great and would meet customers needs…if only they knew how to fully use it. This is where customer onboarding and training can play a huge role. Depending on the nature of the product this can take the role of online training and support materials, live chat support, or automated emails triggered when features stay unused. For higher priced products, dedicated support reps may be warranted.
How To Prioritize What To Work On First
No business is perfect. Surely every business should tackle several, if not most, of these challenges. However, finite resources means you can’t do it all. There are a couple of ways to prioritize what to do first:
– Start where you have the biggest conversion drop offs: One approach recommends focusing on the part of your business where you are seeing the largest drop offs. For instance, if your trial to customer conversion rate is absurdly low, why bother trying to get any more people into the trial? Fix the trial experience first! By fixing major drop off areas, you can get more people into the next step of the purchase journey.
– Start lower in the marketing funnel first: This approach accepts that it’s incredibly hard to get people lower and lower in the purchase process. As a result, addressing the low funnel issues (e.g. trial conversion, retention) would make the most sense. This ensures that any efforts you’re making higher in the funnel (e.g. awareness marketing, website messaging) will result in new customers.
There’s no hard and fast rule on which option to choose. But, you do need to choose!