One step to make more money today!
Have you ever looked at the long line in a Starbucks and decided to get your coffee somewhere else?
What a waste!
Think about it: attracting customers is HARD—and here they have customers who are ready to buy and they’re just walking away.
And what about the people who are willing to stand in line? Doesn’t it make sense to give them their coffee faster? And to take their money faster? It’s a win / win opportunity, and when you multiply it by the number of Starbucks stores on the planet you realize what a big deal this is.
Fix your funnel
If you think about it, Starbucks could boost revenue just by making line speed their #1 priority. They don’t have to open any more stores. They just have to make sure everyone gets their coffee faster.
They have done a few things over the years to tackle this issue. At some stores there are baristas working the line and taking people’s orders in advance. This does speed things up, but it doesn’t seem to totally solve the problem.
They also have an app that allows you to pre-order, which sounds great…but not everyone uses the app. So there’s still always a line
I walked into a New York City Starbucks this morning and here’s what I saw:
They put an extra cash register at the front of the line, which kept it short. I was in and out of there in five minutes! During the morning rush.
Hallelujah!
How does this relate to your business?
We can all do a better job of helping our prospective customers.
I hear a ton of entrepreneurs tell me how they can succeed IF someone invests in their company. That’s when I start asking questions to try to understand their current landscape.
And it often turns out that they already have what they need to take the next step without investment.
Counter-intuitively, the best way to raise money is to not need it—so succeeding on your own is actually a terrific strategy.
How does this play out in real life?
“We’ve tried everything and we can’t move the needle on signups.”
Here was a company telling me that they had tried a bunch of different marketing and advertising strategies but they couldn’t attract more people to their website.
Okay, but are you converting everyone who’s already showing up?
I asked them to take me through their conversion funnel. Turns out they’re getting a certain number of completed signups, let’s call it 100 per day, but ten times as many people are starting the signup process and then dropping out.
So 1,000 people per day start trying to make a purchase…and 900 of them disappear. They don’t know why.
It turns out their website has a single application form with a bunch of questions and a line to collect an email address at the end. The person has to fill everything out and press the Submit button in order for the company to collect any information.
“We’ve tried everything and we can’t move the needle on signups.”
So if the person doesn’t complete the application the company has no idea why. And there’s no email address to follow up.
Remember, these are people who’ve started the purchasing process so they’re extremely valuable.
Where do the other 900 people go?
We decided to do two things:
- Split the signup form into four sections with a Continue button for each. Data will be gathered with each click.
- Move the email address into the first section, so it’s collected pretty much no matter what.
I would usually recommend not changing the order of the questions in the application form until they had more data, but we agreed that collecting email addresses early was vital.
Now they can measure where people are dropping off in the on-boarding process. Is there a pattern? Where is the biggest drop off happening? What can they do to improve their completion rate?
Plus this new system allows them to collect hundreds of additional email addresses per day from interested people who they can reach out to:
“I notice that you started filling out our application. Can I help answer any questions?”
These conversations with people lead to insights that you can’t get from data. Remember that analytics tell you what, but you usually have to talk to actual human beings to figure out why.
These two changes have set them on a path to quickly improve their sales numbers—without spending additional money on marketing or advertising.
Now it’s your turn
So my question to you is: how can you make it easier for people to buy from you? Here are some places to look, all of which can seem simple to you yet feel confusing to your prospective customers:
- Pricing
- Signup form
- Payment
- Proposal process
- Response time
- Contracts
Mike Lingle is obsessed with helping founders grow their businesses. I’m a serial entrepreneur, mentor, and executive in residence at Babson College. Check out my Rocket Pro Forma if you want to quickly create your financial projections.
