201% Growth: The Strategic Formula  Eileen Used to Transform a Mature Company

Copyright  The Conversion Wizards 2017

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On a beautiful late spring afternoon, fifteen years ago, Dave and Eileen graduated from the same college. Aside from their gender, they were very much alike, these two. Both had been better than average students, both were personable and both—as young grads do—had ambitious dreams.

 

Recently, the two, now marketing professionals, returned to their college for their 15th reunion.

They were still very much alike. Both were happily married. Both had one child. And both, it turned out, had taken entry level marketing jobs at Fortune 1000 companies.

 

What Made the Difference?

But there was one difference. Dave was a Marketing Manager. Eileen was the Chief Marketing Officer of her company.

 

Have you ever wondered, as I have, what makes this kind of difference in people’s lives? It isn’t talent or dedication. And it certainly isn’t that one person wants success and the other doesn’t.

 

Often, it comes down to what one person knows and how he or she uses that knowledge.

Eileen made it a habit to read in her field for an hour each day and stumbled on the work of a Cambridge University affiliated marketing researcher.

 

What it is and how to use it--watch FREE video below

 

Now it's Your Turn to Discover the Strategic Formula and Use it to Grow Your Business: Get It Here...

“As the person who invented the term ‘landing page’ in 1995 (right after Al Gore invented the internet) I can tell you that we’ve waited a long, long time for this kind of hands on, verified info. The bad news is that you are now out of excuses.”

 

Seth Godin, Best Selling Author and Marketing Guru, Says this About the Strategic Formula...

Why NOT Focus on Traffic (Initially)? 

You can certainly grow your business by increasing  traffic (web visitors ). But you cannot easily do so without incurring disproportionately higher costs--higher bids get more traffic but also result in higher CPCs (Costs Per Click) which will likely erase your profits.  Once you have some traffic it is best to focus most of your effort on conversion.
 
As for 'free' traffic (through SEO), this takes too long and is unpredictable.  You never know when the Google gods will turn against you! I don't know about you, but I like to control my destiny.  
 

Use the Strategic Formula to Activate the Virtuous Cycle of Conversion Rate Optimization*

Examples of the Law of Accumulative Advantage

•  Your revenue per visitor also increases by 20%, meaning that each of your traffic sources is now 20% more valuable
 
•  You can afford to bid more on SEM, PPC and Display ads was well as spend more on SEO. You can also pay affiliates more.
 
•  This results in more traffic and customers at the expense of your competitors
 
•  More people buy your product and you make more money, which you can invest in better technology, pay higher salaries and hire better people
 
•  If you are selling a physical product, the increased sales let you source it in larger quantities . You enjoy improved economies of scale, leading to more profits still. See?
 
•  And what if you also increase your customer lifetime value (using some of the tactics we teach) by 15%?
 

Over time, those that are slightly better end up with the majority of the rewards. Those that are slightly worse end up with next to nothing

Google vs. Bing

Google’s search results are only slightly better than Bing’s. In fact, for certain queries Bing is better.  But Google has 64% market share and $90 Billion in revenue while Bing has a $1 Billion.

 

In 2006, Facebook and Myspace were nearly at par. But Facebook invested in acquiring more users cost effectively—yes, they hired a Conversion Optimization firm and attained a slight edge over Myspace in growth. Today, Facebook is worth $400 billion while Myspace is a goner!

 

In the vacation rental market HomeAway was founded in 2005 and Airbnb in 2007. Both raised tens of millions of dollars early on. But AirBnB developed a slight edge in getting new listings.

Today AirBnB is worth $31 Billion while HomeAway is worth  $2.9 billion (more than 10 times less valuable!)

 

Facebook vs. MySpace

AirBnB vs. HomeAway

The effect is MULTIPLICATIVE and you dominate your industry. Small differences in performance lead to out-sized rewards,  known as Winner-Take-All Effects

What happens if you use the formula to increase your conversion rate (convincing custmers) by, say, 20%?

What begins as a slight edge over the competition compounds with each additional contest. Each cycle further cements the status of those at the top. It is also known as the Law of Accumulative Advantage.

The Strategic Formula has been taught at...

You see, In the early 1990’s this researcher, known as Dr. Flint McGlaughlin, realized that this internet thing could be the biggest behavioral testing lab ever known to humankind.

And for eleven years his team conducted more than 10,000 online experiments to understand: "What makes people say 'yes'?"

In 2001, they published their findings and distilled the key insights into a precise, patented methodology (The Strategic Formula). 

 

She discovered that several fortune 500 companies were given access to this formula to understand their customers and transform their online businesses--we are talking 40%, 110% and 541% revenue gains, without spending a single cent more on traffic!

 

So she persuaded her manager to hire Dr. Flint’s team.

In just a few months this strategic formula set off a chain reaction that helped grow their business division by 201%

For a mature public company this was rare and had a pronounced effect on both the company’s stock price and the CEO’s pay. It also transformed Eileen’s career.

 

While well-meaning Dave plodded along chasing traffic and brand awareness, Eileen invested most of her effort in converting the traffic they did get--using the strategic formula.

And this led to the chain reaction: lower acquisition cost, more customers and higher lifetime value. Which in turn let them afford more traffic and gain yet more customers, revenues and profits!

It turns out, this phenomenon has a name: The Virtuous Cycle of Conversion Rate Optimization. 

 

It is the very thing that leads to 'hockey stick' curve growth.

Eileen Was onto Something...

What about our friend, Dave?

*The term "Virtuous Cycle of Conversion Rate Optimiztion was coined by Dr. Karl Blanks, a pioneer in the field. The diagram is used with his permission.

 jasper@TheConversionWizards.com