How a Venture Financing Can Implode Post-Term Sheet

I wrote a slight variant of this post a little while back and TechCrunch was gracious enough to publish it here.

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We’re talked a lot about the behind-the-scenes learnings  gained from being a relatively new VC partner.  What it’s like to raise a $180,000,000 fund (here).  My top mistakes (here).  Why VCs need Unicorns to survive (here).   Why most VCs are actually failing (here).  And even … why it’s OK to lose all your VCs’ money (here).

Screen Shot 2015-07-04 at 5.29.38 PMOne thing I’ve rarely seen discussed, let alone founder advice on, is why deals fall apart post-term sheet. As it turns out, this happens a lot more than you might realize. Especially these days, when timing is so compressed. In the old days when I raised money for my startups (’02, ’05, ’08), the VCs had tons of time, weeks or more, to do due diligence (i.e., to learn more about a company in which they are interested in investing). Today, term sheets are often issued just days, or even hours, after the first meeting.

This means that due diligence is really done post-term sheet, not pre-term sheet.

And deals can fall apart here. VCs operate in one of two modes — greed or fear. As a founder, your job is to make sure nothing really comes up post-term sheet, but pre-closing that creates enough fear to trump the greed. Most importantly, minimize surprises. All startups have issues and challenges, and all deals have some “hair” on them. But finding out post-term sheet about too many material issues can lead VCs to run for the hills.

Here my checklist of the Top 10 Issues that may lead a VC to pull a term sheet:

1. Missing your financial plan in the middle of a financing.

While startups have ups and downs, if you tell the VCs you’re going to hit $250,000 in revenue this month … make 100 percent sure you hit that projection. At least, just that one month during the funding process. This suggests any number of other undisclosed issues if you can’t even hit the projection you gave me two weeks ago.

2. Venture-inappropriate debt and equity docs.

Founder-friendly is the name of the game today. But don’t push it into the Totally Non-standard territory, especially when it comes to convertible debt and SAFE-like instruments. For example, a super-aggressive term you see sometimes is that the company can buy out the investors any time for 1x before the next round. No VC is going to agree to that. Up to a point, everything can be negotiated. But if you seem too hard to deal with, if you push it too far — VCs will walk.

3. Nondisclosure of loans and repayments of founder “debts” from proceeds.

I see this all the time. At the last minute, a founder brings up that he wants to be repaid $150,000 in expenses from the round. Different VCs will have different views on this. But if you disclose it at the last moment, it can kill a deal. Fast. If you want to do this, disclose it up front and discuss it.

4. A stock option plan that is too small, without back-up or consultation.

These days, every founder is pushing for a small stock option plan. The real goal here is to push up the effective price by having the VCs “pay” for an increase to the pool after the financing closes. Sometimes that’s fine. VCs get it, and get how it works. But don’t disclose this at the last minute. Don’t force VCs to find out in due diligence that only 2 percent of the pool, not the customary 15 percent or so, is available for new hires. If you discuss this in advance, it can always be worked out. But you don’t want to argue about this at the 11th hour.

5. Founder vesting issues.

If you don’t have much founder vesting left, disclose it early. When it comes up in due diligence, again, it creates anxiety. VCs have different views here, but almost everyone wants you to have some portion of your founder equity still investing. The best hack is to have just enough vesting that the VC won’t be thrilled, but can live with it. In any event, learning from your lawyers at the 11th hour that the founders are 100 percent vested creates anxiety and stress, and can kill deals.

6. Problematic customer due diligence; e.g., not disclosing customers are also investors, or ex-employees, etc.

VCs will ask you for customer references to call. If these customers used to work for you — disclose it! If these customers are your friends — disclose it! And if they are seed investing in the round (surprisingly common) — disclose it! VCs will discount the quality of the feedback from these customers, but making them find out during the calls will raise questions about your judgment.

7. Problematic on-site management due diligence.

There are often problems on the management team. That’s probably OK. VCs aren’t expecting that everyone on the team today can go the distance. But give your VCs a heads-up. If a VC is assuming you have a great VP of Sales, and it turns out the VC has to learn from talking to them that they’ve never done sales (this happens all the time) … again, that’s a big red flag as to your leadership skills. Identify the weaknesses on your team upfront. It’s OK — if you have a plan to make upgrades. If you don’t see these weaknesses though, that’s a red flag.

8. Who is the CEO?

This is surprisingly common in startups with more than two or three founders. Maybe Linda is nominally the CEO, but not really. Five folks are “in control.” Most VCs see this as a real issue, and will want it worked out before the financing closes. If they find out at the last minute that there isn’t 100 percent agreement as to who really runs the company, VCs may bolt. At the very least, it may bring a deal to a standstill until it can be worked out. Half of a VC investment is in the CEO. If you don’t know who that really is, it’s difficult to invest.

9. Highly suboptimal investor syndicate.

If it’s a party round, or at least, a group round … make sure the VCs in the round know who’s investing. Finding out at the 11th hour that the rest of the syndicate is unlikely to write another check can spook VCs. VCs know we often have to put more money into the company to get over bumps and humps. If the rest of the syndicate can’t do that, and we’re the only one that realistically will write a second check … it may be OK. But again, finding out at the 11th hour can blow up the deal. Talk about the syndicate upfront, and get VC buy-in early, if you can.

10. Non-standard, “Us vs. Them” vesting.

Again, another late uncovered issue. You see things like the founders insisting on vesting acceleration if they are terminated for any or no reason. Or additional non-standard option grants if they hit certain milestones. Or full anti-dilution protection. The problem with non-standard vesting terms like these is that they clearly present an “us vs. them” mentality to VCs. That may be OK if you are Airbnb doing a round at $20 billion. But it can totally undermine trust in an early stage deal.

In the end, it all boils down to trust. Even in the hottest of deals, post-term sheet, both sides need to continue to earn each other’s trust. After all, you probably haven’t know each other too long. VC investing is often like getting married after just one date. Avoid the rookie errors discussed here and you’ll still be walking to the altar.

BD024 – Doubling Down

HOW FELT LAST 2 WEEKS WENT

Rich – 5

Ben – 3

We’re actually going to be reducing how often the episodes come out down to once or twice a month whilst we focus on just one business – more on that in the update section.

SHOUTOUTS SECTION

  • We have 5 new slack members and we welcome Jason, Zam, Jeremy, Wayne
  • Now up to 87 members in our slack room and it’s free to join for the first 100 – subscribe here.

UPDATE

(02:50) Ben

Was talking to Hiten Shah the other day, had a great conversation, though it was also an extremely difficult conversation.

He suggested for me to:

  1. go back to my roots
  2. shut down my other projects
  3. stop doing the podcast

I’ve had a few days to think about this, and i’ve concluded that he’s 100% right. hiten is a really smart guy, and so when somebody like that gives me advice, i’m going to listen.

I spent a third of my life building up my tech superpowers. hiten was telling me, “why bother trying to learn new skills now? stick with what you already have, and what you’re already good at.”

Which is two things – wordpress, and cloud computing.

I’m good at both, but it’s become very clear that’s what i need to focus on.

There is a ton of revenue to be had in aws services, and i’m fairly confident that i can make a decent living for myself. also, Hiten said, “if you want to do a podcast, i would much rather see you do one in the aws cloud space, talking about how awesome aws is, and crack jokes about how ridiculous they can be sometimes.”

So even though it sounds like i’m back to square one, i’m really only starting where i left off… which is at the tail end of an 11 year professional career.

I’ve decided to double down on cloud computing instead of wordpress, because it’s just a bigger market. aws posted $4.6b in revenue last year, and is expecting $6b within the next year. As an individual, i’ll probably be trying to close high ticket deals in the range of $25k-$50k, and with a full time developer, those numbers are going to rise into multiple six figure deals (which could still win the competition for me).

I’ll most likely be operating under the name cloudoptimus.com. I need to shut down new revenue, because my heart just isn’t in it. probably the same for wp motion.

Also, i’m spending 10 hours per week (40+ hours per month) to produce this podcast, and both of us are no further along than when we started earlier this year. so here’s what i’m proposing: we do 1 episode per month, and we hire a company to do the edit for us. i think this will enable both of us to put out a much higher quality episodes in a fraction of the time, yet still keep the dream alive.

He said, “you’re in the most competitive and saturated startup category that exists. and even if you create a great course or ebook, your audience doesn’t have the money that you need to survive right now.”

Anyway, hiten asked me to do him a favor and focus on just one thing.

So that’s what i’m going to do.

(06:05) Rich

Repositioned funnelengine.com to content marketing as a service that generates leads, attracts links and builds your audience of prospective customers. My market is going to be small business owners and likely going to be targeting the high end in terms of infusionsoft and hubspot customers – people paying 3 to 4 figs a month on software automation vs the average small business who has a budget for SEO.

Been looking at best way of building a propsect list such as using software tools like builtwith, datanyze, similar tech and nerdydata (shout out to Damian Thompson from salesability.co for some of those suggestions). Also set myself up on the hubspot CRM and sidekick which has now replaced streak – it’s cool software you can actually a prospecting function within the CRM too.

NEXT FEW WEEKS IN 30 SECONDS

Ben – outbound emails targeteing fortune 5000 software companies
Rich – Prospecting for funnelengine, content marketing, strategic outbound

The post BD024 – Doubling Down appeared first on Bootstrap Duel.

13 Important Questions You Need to Ask Yourself Before Blogging

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What’s the most important factor of every blog post?

Quality.

But sometimes, it’s easy to find yourself in a grind, cranking out content because you think you’re supposed to.

That’s when quality suffers.

When it comes to blog posts, it’s really all or nothing. A “good” post will get the same engagement and traffic as a “bad” post.

You have to create outstanding posts on a regular basis for your content to make a real difference.

Willpower can help you create these posts, but studies have shown that people have limited willpower.

Did you know that of 86% of marketers who use content marketing, only 30% have a consistent content strategy?

These marketers don’t have the systems in place to maximize the return on their efforts.

If you are one of the 70% of marketers creating more content this year than last year, you need to ensure you maintain a high quality writing standard throughout your content creation.

To help you maintain that quality, I’m giving you 13 questions you should ask yourself before and after writing a blog post.

Not all of these will apply to your specific business, but most will. Once you read through this article, download this simple checklist of questions to keep you accountable. Go through them for every post to ensure your continuous success. 

1. “Who is this post for?”

Have you heard that when you write a post, you should do it as if you’re writing to one specific person?

It’s true. That’s how you craft an article that really resonates with someone.

If you run a new or small blog, this is a fairly easy question to answer: write to your target audience. Before each post, think of your customer avatar, and write to him/her.

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But what about once you grow?

All of a sudden, you’ve attracted different types of people with one or more shared interests.

For example, Quick Sprout readers are made up of many types of people. Some are beginners trying to learn about marketing; others are employed professional marketers; and yet others are trying to market their own small businesses. And there are a few more distinct types of readers on top of that.

When I write a post, I know that it’s likely not going to resonate with everyone—that only happens once in a blue moon. But that’s okay.

Most often, a piece of content will speak to one or two segments of my audience. As long as I change it up, they all will find at least a few articles per month they will enjoy. This is another reason why consistent content creation is important.

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Let’s look at some examples from Quick Sprout…

How to Make Custom Images for Your Blog Posts Without Hiring a Designer

Many beginner marketers don’t have the budget to hire a designer. This post was for them. Some small business owners might also find this article useful.

How to Come Up with Winning A/B Tests Using Data

This post was not meant for newbie marketers. While they will learn a few things, they won’t be able to apply them right away. This post was for marketers working with a significant amount of traffic and looking to increase already substantial profits.

Is It Worth Speaking at Conferences? 

There is a very small portion of marketers who have the opportunity or desire to speak at conferences, and yet I wrote this post—for them. Some beginner marketers might find it interesting and consider speaking at conferences in the future, but it’s unlikely they’ll be able to apply any of the insights right away.

If you happen to run a blog with decent traffic, make sure you create detailed reader personas you can target with each post. Don’t let any important segment feel neglected as you plan your content schedule.

2. “What is the purpose of this post?”

Now that you know who you’re writing the post for, you need to decide what you want the post to accomplish.

In general, a post has 4 purposes:

  • to entertain
  • to solve a problem
  • to encourage discussion
  • to teach (not always the same as solving a problem)

Purpose #1: Entertain

Almost all posts contain entertaining parts, but their main goal is not entertainment. Conversely, some posts have a main goal of being interesting and entertaining, with only a small educational part.

Example: The $100,000 Challenge: May Update

You might learn a few things from each challenge update, but more than anything, they are entertaining. A large portion of Quick Sprout readers have never built a site that’s profitable, and they have a great interest in trying or seeing how it’s done. This post serves as an inspiration to help them move towards their own blogging goals.

Purpose #2: Solve a problem

The fundamental reason why most blogs are created in the first place is to solve a problem for a specific type of reader. That problem is typically large and complex. Each blog post has the opportunity to solve a smaller problem within that overall problem.

Example: How to Engage and Persuade People Through Storytelling

Most marketers know the power of storytelling but struggle to implement it. This is a problem. This particular blog post shows them how to solve this specific problem.

Purpose #3: Encourage discussion

In order to build a community, you need to get your readers to talk. There are many ways to do so, but the main ones are to pose a question or make an outrageous claim or observation.

Example: How to Make $100,000 a Month Within 1 Year

This is a very short post where I laid out the challenge. Not only did I claim the ability to reach a huge goal, but I also asked for your opinions to decide which site I should create. This post is one of the most commented on Quick Sprout with over 2,300 comments.

Purpose #4: Teach

Solving problems and teaching are closely related and often represented in the same blog post. I’d classify teaching as sharing general knowledge your readers need to possess before they can address specific problems. Both are important if your readers are to reach their overall goals (the reason you started your blog).

Example: How to Avoid a Google Penalty

In this article, my readers learn both what causes Google penalties and what precautions they need to take to avoid them. Technically, the reader doesn’t have a problem yet as they don’t have a penalty. In this instance, you could think of teaching as problem prevention.

Multiple Purposes

Some posts combine multiple purposes. For example, the post How Spending $162,301.42 on Clothes Made Me $692,500 is both entertaining and educational as it teaches how much looking your best really means (that sounds more shallow than it is!).

3. “Why will my readers care?”

There is a small but important difference between this question and the previous—“what is the purpose of this post?”—question.

The previous question is about the purpose of the post from your perspective.

This question, however, addresses your readers’ point of view. It will help you frame the blog post.

For example, you may solve a problem with a post, but the reader doesn’t care about the problem. They care about the pain the problem causes.

Why does that matter?

Because there are 2 types of pain points, and both need to be approached differently when writing a blog post.

Type 1: Acute

Acute pains are those that hurt now. You will go to great lengths to solve them. If you find a blog post that tells you how to solve those hurts now, you’re happy to read it. These types of pains (like fixing a Google penalty) are straightforward to write about.

Type 2: Chronic

We often live with a minor pain that comes and goes. It’s not always severe enough to seek out a solution. From a marketing point of view, for example, such a pain might be the stress that comes with a hectic publishing schedule and subpar results.

The problem with trying to solve these pains for people is that almost everyone underestimates how important they are (because they don’t hurt that much right now). Furthermore, we feel that we can live with these pains.

When your blog post solves a chronic pain, you must first focus on making your reader feel the pain before you show them the solution.

If I’m writing about creating a content schedule, for instance, I’m not going to start the post with jumping right into the step-by-step process. I might not even include it in the headline as some people might dismiss it, thinking “I don’t really need that right now.”

Instead, I’d start by illustrating the pain. I’d cite credible statistics about how the lack of a content schedule is the number one reason for failed blogs. I’d describe in detail that without a content schedule, you will never achieve the results of the blogs you admire.

Once a reader relives the pain they’ve felt before, then they are receptive to a solution you present. Then it’s your job to present a solution that actually solves the problem for them.

4. “What is my unique angle?”

Over 7 billion people live on this planet. Most are with reasonably similar points of view.

An original thought is rare.

Type in almost any topic in Google, and you will find hundreds of thousands of relevant articles.

Does that mean you shouldn’t bother blogging at all? No.

Just because a topic has been written about thousands of times doesn’t mean it’s been written in a way that can help your audience in the best way.

You may be able to connect personal experience, opinion, or other seemingly unrelated topics to offer a new perspective. And this perspective is valuable.

When I search for “How to write a good blog post,” I get 270,000 results. But even in the first few results, I can see different angles presented by different authors:

  • how to do it when you lack motivation
  • how to do it fast
  • how to write so that people don’t just skim

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In fact, I’ve written my own take on this topic in my guide to writing a data-driven post.

So, how do you find an angle that no one else has written on?

It starts with research

Before writing any post, read through as many of the best articles on the subject as possible. If you don’t, you might be repeating one of them without even knowing it.

This happens all the time in the startup community. Someone believes they have a novel idea—all because they didn’t research enough to see they already have competition.

Once you know what’s out there, you can put your own perspective on the subject in a number of ways:

  • improve upon an existing angle – e.g., “write a good blog post as fast as a professional typist”
  • add personal stories – all personal experience is unique
  • add your opinion – while it shouldn’t be all about your opinion, your readers follow you because they value what you think
  • combine two topics – e.g., What Einstein Taught Me About Death

Whichever you choose, find a way to present an original angle. The simplest, although not most comprehensive, way to double-check you’ve found a unique angle is to simply search for your headline in quotations. You have a unique angle if you can’t find any other results.

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5. “What’s the best way to present my point?”

Throughout history, authors have expressed themselves through many different forms:

  • poetry
  • song
  • plays
  • books
  • journals
  • stone tablets…

Each form has its own advantages and disadvantages as a means of expressing a message. Some are more entertaining than others, while others are more informative. Some are great for long messages, and others are great for short ones.

When it comes to a blog post, you have a variety of formats to incorporate into your post:

  • text
  • images/gifs
  • video
  • infographics
  • audio
  • embedded social media (tweets, slideshows, etc.)
  • formatting (bullets, bold, font size, etc.)

They each have a specific purpose, and each has its own strengths and weaknesses.

Text

Almost all blogs are built on text. It’s by far the simplest, fastest, and cheapest way to convey a message. But it’s also often not very effective at getting messages across. Reading takes a lot of time, and people can process images up to 60,000 times faster than words.

Images

You can’t create a blog post with just standalone images, but they can be used to enhance your content. Images can quickly convey data in a clear way or provide simple instructions that would otherwise require complex text descriptions. There are many types of images you can use in your posts: charts, screenshots, animations, and more.

Sites, such as Buzzfeed, often base entire articles on images or gifs illustrating their points:

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Video

Some things need to be learned visually, and images may not be enough to help with that. If you’re giving an overview of a tool, it can take several images to show what you need to show. In contrast, a video that’s 30 seconds to 2 minutes long can often show the features in an easier-to-understand way.

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Infographics

If you know me at all, you know I love infographics. Not only do infographics generate more shares than regular posts, they also allow you to quickly highlight the most important aspects of a topic.

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As a bonus, it’s very easy to write a post about a topic and then create an infographic with the key takeaways that can be used for another post.

Audio

Podcasting has exploded in the past few years. There were over 1 billion podcast episode downloads in 2014. But that doesn’t mean you need to create a traditional podcast if your readers like audio. On some posts on the Crazy Egg blog, we embed a short “podcast” that summarizes the content in the article. Anyone who doesn’t like to read can listen instead.

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Interactive content

Interactive content is still fairly underutilized, but it’s a great way to get readers to engage with your blog post. If you can find a way to get a reader to take action on something you mention, it can help illustrate a point you’re trying to make.

Quizzes and calculators help readers learn and apply something immediately. For example, SilkRoad built a truly ugly calculator for their homepage to show prospects how much money they could save on their hiring and training procedures.

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Formatting

Decide which points are most important and need to be emphasized. Format the post so that these are the biggest and bolded on the page. In addition, you can (and should) use formatting to make your article more readable to lower your bounce rate.

Overall, you can prove your point in many ways. Think about which ones you can create and which ones will get your message across more effectively. Don’t be afraid to combine them if you believe it will be most effective.

6. “Does any research need to be done ahead of time?”

The reason that most marketers “get away” with not having a content schedule is because most of the time, they can write a post last minute.

I still don’t think that’s a good idea for a number of reasons, but aside from that, you can’t always write at the last minute.

This means you’ll either have to publish a subpar post (useless) or postpone posting altogether, which can have consequences of its own.

The reason why you can’t always write a post at the last minute is because some of them require work before you even start writing.

Most posts don’t require too much work. I typically spend about an hour researching my topic and finding useful statistics that support my points.

But not all research is like that.

If you need to interview someone, especially someone busy, it can take weeks to schedule a time when you’re both available.

If you need to collect specific data for a post, such as the results of a split test, that also can take weeks or months. For example, Bryan Harris split-tested the effects of removing his sidebar on VideoFruit. He couldn’t have done that overnight.

What if you need to analyze that data? That can take even longer. For example, HubSpot, among other companies, frequently publishes massive reports of benchmarks. The team needs to spend weeks or months collecting the data and finding important trends that can be presented as statistics.

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Ideally, you should ask this question when you first come up with the post idea. At the very least, ask it before you start writing so that you can complete all background work as soon as possible.

7. “Is my deadline reasonable?”

Before you start writing, you should always have a deadline—and a reasonable one at that.

If your deadline is too short, you’ll end up rushing the post and producing mediocre content. We all know how that goes: less traffic, less engagement, and fewer subscribers.

But having a deadline that’s too long isn’t good either.

Work fills the time allotted for it; that’s Parkinson’s law. Extra time gives you an excuse to slack off.

So what you really need is a reasonable deadline.

This means that this particular question has to be asked before you even start writing. It needs to be asked when you’re planning your content schedule.

Don’t have a content schedule? Make one. That’s the only way you’ll be able to produce great posts on a regular basis. It allows you to have a little buffer room in case a post takes longer than expected.

8. “Can I go the extra mile?”

To really stand out in the flood of content online, you need to write exceptional content.

Amazing content has to be many things:

  • interesting
  • useful
  • actionable
  • fun to read

Creating a great blog post is more like crafting a piece of art than simply producing a manual on how to solve a problem.

There are many ways to go the extra mile, but I’d like to highlight a few of my favorites.

a) Custom images

As discussed before, images can help you highlight and reinforce concepts. On top of that, they can be entertaining. Some blogs regularly use comics and images to illustrate key points:

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b) Spreadsheets

If you’re writing a blog post that advocates using a spreadsheet to solve a problem, give your readers a sample or template. This will increase the chances of them taking action. You can even use this as a content upgrade.

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c) Checklists

If you write a step-by-step guide, what’s more useful than a checklist? Create a simple checklist, and let your readers download it. Again, they will be more likely to use it and to associate any positive result that comes from its use with you.

d) Back up claims

When I write, I try to back up all statements with credible references. It’s the main principle of writing data-driven posts. References help readers trust you and your posts more than a simple opinion.

9. “How does this lead into my next post?”

At some point during the planning, writing, or editing process, ask yourself this question.

When you consider your next post, you have the opportunity to create cliffhangers. Make a note somewhere in the post about a related topic that you’ll be covering shortly in the future.

Additionally, knowing what you’ll be posting about next is extremely important if you’re about to launch a product. You need to write your post while keeping in mind what role it will play in your launch. It may be a case study, an educational post, or a post that highlights a chronic pain.

During the launch, you’ll email your subscribers a mixture of content and information about your product. It often makes sense to include links to recent blog posts to support your case studies or to educate subscribers—but only if you’ve planned relevant posts.

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10. “How will I promote this post?”

Just like it’s a good idea to plan your content in advance, it’s also a good idea to plan your promotion.

Not all forms of content promotion need to be considered during the writing of your blog post, but some do.

One of my favorite tactics is to simply email everyone I mention in a post, letting them know that I enjoyed their particular post and that I linked to it in my article. Most of them will be happy to read it and share it with their audiences if they liked my post.

Before you publish your post, carefully go through it to see if you missed any opportunity to mention someone’s work.

Note that while you could mention someone for the sake of getting a bit of extra traffic, I do recommend linking only to posts and resources that add value to your post.

11. “Will I repurpose this post?”

Repurposing content is one of the best ways to bring down the cost of each individual piece of content you produce.

If you have a limited budget, this is how you can consistently publish high quality posts.

If you ask yourself this question before you start writing, it will make your life a lot easier.

How?

Imagine if you’re writing a blog post and also plan to turn it into an infographic. Instead of having to pull out all your stats and main points later, you can put them into a secondary text file as you’re writing the post.

In addition, you can paste the URLs that you’ll put at the bottom as your sources in that document instead of going through your blog post later to get them one by one.

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12. “What do I want readers to do after reading this?”

Blogs can have many purposes, but each blog post should help you accomplish each one.

Let’s hope that by the end of a blog post, you’ve imparted some wisdom to your readers or discussed an important problem or topic.

There are two things you should include at the end of each post.

First, while you may think it’s obvious what your readers should do next, it usually isn’t that obvious to them.

You need to spell it out. Tell them exactly what they should do with the information in the post.

Secondly, include some sort of call to action (CTA). At this point, they’ve taken the time to read your whole post, so they obviously found it useful. This is your chance to ask for a small “payment” for the post.

Common CTAs include asking your readers to comment by answering a question (my favorite), asking them to share on social media, or asking them to sign up to your list.

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You might find that one type of CTA is more important to your business than another, so focus on that, and mix in the others when appropriate.

13. “How will I measure success?”

One of the hardest things about blogging for a business is tracking the results.

Not all posts are created equal. Some take weeks to write, others take hours. Some have custom images, some don’t. And almost all posts address different topics, which makes them hard to compare.

While we generally look to see whether we increased the number of backlinks, comments, or shares over a long period of time, these metrics aren’t very useful when determining if a single post is successful or not.

But we also know that the vast majority of engagement or results come within the first week or two of publishing a post. That gives us a time frame we can use to evaluate the results of each post individually.

Before you write the post, and while you are editing the post, ask yourself how you will measure its success.

Some posts are made to generate links and social shares, e.g., roundup posts.

Others are made to generate discussion, e.g., my earlier example of my $100,000 per month challenge introduction.

image04

Yet others are written to build relationships with influencers. A post can give you a reason to reach out and give them something of value.

You should regularly review the results of your past posts. The idea isn’t to deem each one a failure or success but to learn what does and doesn’t work for your business and your audience.

Conclusion

Nothing in this article is particularly complicated to apply—that’s the point.

These are simple questions you should ask yourself through your content creation process to make sure you don’t forget anything important.

I’ve put together a basic checklist you can print out and keep at your desk if you’d like: download it here.

I’ve said it before: consistency leads to success. Get in the habit of answering these questions for every post, and you will produce better content on a regular basis.

Now I have a question for you, which I’d like you to answer by leaving a comment below.

Which of the questions in this article is most important for your blog?

The Top 8 Mistakes I Made In My First 18 Months As a VC Partner

So I’ve been investing “institutionally” as a VC for about 18 months now (maybe really only 12, counting from the first check that really mattered).  A little bit before that as an angel, but not that much.  ‘Cause I sort of needed to decompress for a little while after I sold my last company.

oy_friggin_vey_mugAt first, I really did not know what I was doing.  I probably still don’t entirely.

And I haven’t yet returned a nickel of capital yet back to our investors, the “LPs”, which is the ultimate game.

And yes, while I lived through ’08-’09 as a founder and ’00-’03 as a start-up exec … still, as all the LPs say … I haven’t been a VC through a downturn.

But so far my bets have turned out decent, my paper returns are solid (in the Age of Unicorns at least), the MRR growth in aggregate is better than I ever did, and I’m now enough “in the money” on paper at least to have some learnings.  And I don’t think I’ve invested in a single dog.  So I’m not an idiot, at least.

It’s a super nichey thing to do, this VC thing, but perhaps by sharing my mistakes, it will be cathartic for some and perhaps help founders understand VC just a tiny bit better.

So here are My Top 8 mistakes, if you’re curious:

  • #1 — Not Immediately Investing in the Truly Great Ones.  Everyone tells you to start slow as a VC.  The common advice is “it’s OK to not even do an investment your first year.  Just learn.”  Well, phooey.  The deals we didn’t do to take it slow in my first 90 days were epic.  Epic.  When you meet a truly great one, and can afford the entry price — just do it.  I learned.  With Talkdesk, Algolia, Avanoo, RainforestQA etc. I was basically ready to invest (conceptually, not quite literally, i.e., pending diligence) within 20 minutes.  If it’s potentially great and meets your criteria — just get it done.
  • #2 — Not Investing the Maximum Amount.  This took me a while to figure out.  As an angel, you want to be thoughtful and spread your bets, I guess.  Even as a new VC, you worry about losing too much.  It turns out it doesn’t matter.  Once you’re up even say “just” $30 or $40m million as a VC on paper, and trending up (at least for now) … or whatever number that is some geometric multiple of capital invested … does it even matter if a $2m bet goes bad?  Not really, if it went bad for the right reason, if it was an intelligent bet.  Even more importantly, if you could have invested say $4m, but only invested $3m … dude.  Same amount of work, less returns.  Rookie move.  You only lose another $1m.  But if it hits … you can make soooo much more if you are early stage.  This is the power law cr*p.  Now, I always invest the maximum amount the founders are cool with.
  • #3 — Looking for consensus.  Consensus is just super hard in early-stage investing.  No one can really get to know a 5 person start-up in a 40 minute Monday afternoon pitch.   I didn’t do a few great deals looking for consensus.  Rookie error.  Painful one.
  • #4 — Meeting with anyone that hasn’t already picked me.  When I started, I did maybe 10 founder meetings a week.  Now I do 1.  Max.  There are a number of reasons for that (more here), but I stopped meeting with any founders just looking to raise money, no matter how warm the intro or how hot it sounded.  I learned that for early-stage investing at least, VC is a double opt-in, at least for me.  They pick you.  Then you try to pick well back.  If they don’t know me, of me, who I am, what my values are … forget it.  Meet with another guy, with a bigger fund, with a longer track record.  Again, please don’t tell the LPs about the 1 meeting a week thing.
  • #5 – Trying to Create Deals.  I know some VCs are great at this but clearly I am not.  I tried in the early days to get founders that I believed in to take money when they weren’t looking.  I batted 0.000.  I’m done there.  Others can make this work.  You go do your pre-emptive rounds.  At least, clearly, it didn’t work for me.
  • #6 – Spending Time On Anything Outside My Sweet Spot.  I know VCs are supposed to learn new things, but I just want to learn new things within SaaS.  Not other stuff.  No ad tech, no blockchain, no space craft things, no ecommerce (unless it’s software with 75%+ gross margins), no Facebook platform plays.  There are big winners there.  A lot of this is interesting.  It’s just if I can’t figure it out in 20 minutes, then I can’t learn from mistake #1 above.
  • #7 – Trying to Actively Do Two-Handed Deals.  In the old days (like a few years ago), founders were willing to sell more on a percentage basis, and that made it easier for 2 VCs to invest at the same time, a so-called “2-handed deal”.  It’s still true in early seed rounds, but not so much for The Next Guy.  It’s rare now that the companies I look at have room for two VCs at the time, because each VC wants to buy >10%.  A second hand can help both founders (more help, more sources of capital) and me (derisks the investment, at least, maybe, if someone else can also help carry the company financially), but I stopped trying to do most of these deals.  If it works out, great.  But now I just assume I’ll be the only guy in the round, 8 times out of 10.
  • #8 – Worrying At All About Price.  This isn’t a Top 5 point, but I decided to stop trying to negotiate anything really.  I’ll tell you the price I can afford, and give you very simple founder-friendly terms.  One board seat for all the institutional investors, don’t care about anything else except investing in great companies at a price I can afford, or really, that fits our investment model.  If that doesn’t work for you, totally cool.  It’s easier just to let it go then and work on the next one then, then try to force something on stage / price / structure that doesn’t quite fit.  This doesn’t mean be cheap, or anything at all like that.  It just means be Zen and let the ones you can’t just afford go.  I don’t have a Billion$+ fund so I have structural limitations.  The square pegs don’t ever seem to fit into the round holes here, at least, not for me.

My Top 8.

Not profound.

But perhaps, just a little bit, cathartic.

Co-Working, Mastermind Group Tips & Excellent Headlines from The Onion (FS117)

On this week’s episode we explore a handful of current events, sharing some news of our own along the way.

  • Co-working experiences evaluated
  • Barrett’s Elon Musk (+ Peter Thiel) obsession
  • Ideas for telling others’ stories (instead of your own)
  • A quick lil’ mastermind trick.

That’s a few of the goodies we dive into in this episode. Enjoy!

It’s better to listen on the go!    Subscribe on iTunes 


A current events episode from entrepreneurs who know their stuff!


Show Notes

Gumroad Affiliate Program Beta: email sahil@gumroad.com to join.

Supreme Court On Gay Marriage: ‘Sure, Who Cares’ – The Onion – America’s Finest News Source

Soho House Chicago | Home

Build A Better Network: The Third Tier Theory

Kingsman: The Secret Service (2014) – IMDb

Zero to One: Notes on Startups, or How to Build the Future by Peter Thiel

Buyable Pins | Pinterest for Business

LIKEtoKNOW.it

Amazon Echo: Always Ready, Connected, and Fast.

One Entrepreneur’s Story: Joseph Michael / Learn Scrivener Fast

How To Design A Great Ebook Without Design Skills (+ 10 Ebook Page Templates For Your Book)

A ROADMAP for the 6 Stages of Small Business (FS100)

Friday Q & A: How to Find Your Ideal User Personas, How to “Add Value” to a Mentor’s Life When You’re Just Starting Out, and What Tools We Use to Track Metrics

Every Friday, we’re answering your questions about business, startups, customer success and more.

Happy Friday!

In our new Groove Friday Q & A segment, we’re answering any questions that you have about, well, anything.

A huge thank you to Anastasia Uldanova, Peter Kakoma and Kevin Enloe for this week’s questions.

Check out this week’s answers below, and jump in with your own thoughts in the comments!

How Do You Find Your Ideal User Personas?

Finding your ideal user persona is a much more important mission to a business than most give it credit for. In fact, it’s absolutely critical; companies who fail to do this, fail to survive.

User personas are very specific “profiles” of the type of customer that’s valuable to your business. Most businesses have more than one, but having too many will make it difficult to connect meaningfully with any one of them. At Groove, we have 4-6 “target” personas that we try to attract, though it fluctuates as we learn more and more.

There are really only two ways that we’ve been able to make progress narrowing down our user personas:

  1. Really aggressive customer development. Spend many, many hours talking to your potential customers, and, if you have them, your actual customers. Learn exactly what their backgrounds are. Their hopes and challenges. Their fears and dreams. Their demography. Ask them specific questions about these things, and use their answers to build an educated hypothesis around your ideal personas.
  2. Equally aggressive testing. We learned very quickly that we had spent 6 months and $50,000 building our product for the wrong personas. Don’t do that. Do your customer development first, and then test your hypothesis. The easiest way to start doing that is with your messaging. Tailor your marketing copy specifically to different personas, and see what works and what doesn’t.

Once you’ve done that, it’s important to work on figuring out which personas are actually valuable to your business, and which ones respond to your messaging and product, but are unlikely to ever pay you money or refer paying customers to you.

And that’s where customer development comes in once again.

How Do You “Add Value” to a Mentor’s Life When You’re Just Starting Out?

I see this kind of question a lot, and I think that there are two important things to do:

  1. Reframe your thinking on this. Instead of thinking “I probably have no value to offer because I’m just starting out,” challenge yourself to think about the value you can offer. If you assume you can’t offer value, then you definitely can’t. But by getting creative, you certainly can.
  2. Think about what you have that the mentor does not have. It’s not money, and it’s probably not business advice, but that’s not all there is.

Consider:

  • Time. What can you do for this person that they might not have time to do?
  • Your own expertise. You may not have gotten far in business yet, but what skills do you have that you can offer? Gary Vaynerchuk’s video editor got a full-time job on Gary’s team by offering to make him a free video. Maybe you have some other skill you can offer.
  • Introductions. Successful people have strong networks, but they know the value of powerful connections. Find out if there’s someone that the influencer wants to meet (whether it’s a specific person, or a role (e.g., “front-end developers” or “health tech founders”). Those people will probably be a lot more accessible to you than the successful person, which is fantastic: do everything you can to get to know those people so that you can introduce them to your future mentor.

That last point is exactly how I got our first advisor.

What Tools Do You Use to Track Metrics?

We use a lot of different tools at Groove, and we’re constantly testing new ones. But when it comes to metrics, we’ve been using the same stand-by’s for quite some time:

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Your Turn: Ask Groove Anything

I’d love for this new weekly segment to be successful, and provide a valuable repository of answers from our entire community for entrepreneurs everywhere.

To do that, I need your help.

Here’s what you can do to get involved:

  1. Ask questions. Post them in the comments of this post, or Tweet them to us at @Groove.
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The Top Five Kissmetrics Reports Every Ecommerce Marketer Needs

Today’s ecommerce marketers have a tough job. Their main objective: get the messaging out about the store and deliver sales. You have the website at your disposal and a mediocre advertising budget.

The challenge for you, as an ecommerce marketer, is how do you compete against a service like Amazon? They’re big, they can undercut your prices, and they can handle low margins while you cannot.

You need to optimize everywhere you can, including your funnel and your marketing channels, and you need to build a loyal customer base. Fortunately, Kissmetrics is here to help. Our software provides insights that can help visitors into customers. And once you get those customers, we provide data that can help you acquire more of the loyal ones.

Let’s see how.

1) Purchase Funnel – See Where You’re Losing Customers

Every website has a set of steps visitors need to go through before they can purchase. The Kissmetrics Funnel Report is used to help marketers identify the areas of their website where visitors depart. Once they identify those areas, they can then A/B test their way to growth.

Here’s how a funnel for an ecommerce site might look:

ecommerce-purchase-funnel

What we know from viewing this graph is that visitors have two big roadblocks to becoming customers. Of those who view the product page, only 33% convert to adding a product to their cart. And once they do add a product to their cart, only 13% of them end up purchasing. If you’re a marketer and this is your data, you know you can do better than a 13% conversion from cart to purchase. And if you do improve, you’ll end up getting more purchases for your company. Cha-ching!

To get you on your path to increased purchases, you’ll need to run A/B tests on the product pages and throughout the shopping cart checkout process (more on that later). You can create your A/B tests in whichever tool you use – Optimizely, VWO, etc. – and then track the results with the Kissmetrics A/B Test Report.

The cool thing about this report is that you can see how an A/B test impacts your entire funnel. So if you run a test on the product page, you can see how it impacts further on down the funnel, all the way to the purchase! You aren’t limited to testing only to the next conversion step.

You can also set up a funnel to view how people move through the checkout process. Let’s get into that now.

2) Funnel Report – See Where Customers Drop Off in the Checkout Funnel

You can break funnels into two categories – macro and micro. The macro funnels take a bird’s-eye view of your site, often viewing your whole site. The purchase funnel is a lot like that. It goes from the start of the funnel all the way to the end. A micro funnel allows marketers to zoom in and see a specific flow within their site. A funnel report on the checkout funnel is one example.

Here’s how it might look:

ecommerce-checkout-funnel

Looking at this graph, where would you say drop-off is occurring?

Without question, most people who end up putting a product in their cart don’t even advance to the next step in the funnel (the Payment Page). If we can increase the people who convert from the Added Product to Cart page to Payment Page, we’ll have a pretty linear increase in purchases.

So if you’re a marketer and you want to increase conversions (who doesn’t), here’s what you do:

  • Use the Kissmetrics Funnel Report to see where visitors are dropping off.
  • Run A/B tests on those pages. Track the tests in the Kissmetrics A/B Test Report. The more tests you run, the more winners you’ll find, and the more purchases you’ll bring.

With Engage from Kissmetrics, you’ll be able to put modals on your site that can increase conversions. A lot of our customers have experienced a conversion boost by using Engage.

The best marketers are able to drive loyal customers. Lucky for marketers, Kissmetrics has a report that shows marketers where their most loyal customers come from.

Click here to watch a short demo of the Kissmetrics Funnel Report.

3) Cohort Report – Find Customers Who Repurchase

Businesses live and die on their ability to attract and retain customers. To track customer retention, marketers can create a cohort report that shows them how often customers come back and repurchase products. They can even group them together and see which products or product lines have people coming back for more.

A cohort is a group of people who share a common characteristic or experience within a defined period. For example, people who purchased from your site during April are in a cohort because they all did one thing (purchase) during a defined period (April).

Taking this a step further, the Kissmetrics Cohort Report allows you to group people by any characteristic and then segment them by any property. Let’s see this in action.

We want to track repurchase rates (i.e., people who purchase, then purchase again). We can find those people, but what do we group them by? Time? Marketing channel? Product? Product category? As long as you’re tracking the property in Kissmetrics, you can segment people by it.

Let’s use marketing channel as our example. This segments people by the channel they came from. The higher the percentages (darker shade of blue), the better.

channel-purchases-cohort-report-kissmetrics

On the left side we get the number of people from each channel who have purchased. This is not a traffic report. We’re looking at purchases. We see that most of our purchases are from people in the Social channel. The right side (all the blue shaded cells with percentages in them) shows us how many of those people came back and purchased again, by month.

Social looks like it delivers a lot of purchases and repurchases. If we can acquire more people from this channel, chances are we’ll be acquiring loyal customers. The more targeted we can make our marketing, the more loyal customers we’ll attract. And businesses that win have loyal customers.

As mentioned above, we aren’t limited to grouping people only by channel. We can group them by product (see which products get the most repurchases), product line, any UTM parameter, time, etc. As long as you track it, you can get the data that matters to you.

Click here to watch a short demo of the Kissmetrics Cohort Report.

4) Revenue Report – See Which Products Bring the Most Valuable Customers

Your revenue is probably coming from dozens (hundreds) of sources. Maybe a feature on CNN got you a ton of orders, or you get a lot of purchasers coming from Google searches.

The Kissmetrics Revenue Report is used to segment your revenue and see which sources are bringing you the most valuable customers. Here is how it could look for a company selling clothes:

kissmetrics-revenue-report-ecommerce

We’re segmenting revenue by collection (aka product category). The In-House Generic Tees bring tons of revenue (over $630k) and customers (over 9,700). The other metrics (average revenue/person, lifetime value, and churn) tell us how valuable these collections are for our business. We want high numbers on average revenue/person and lifetime value, but low percentages for churn. (Churn represents the percentage of people who ordered from that collection but did not order again within a defined time period.)

Just like the Cohort Report in the above section, we aren’t limited to segmenting only by collection. We can also segment by marketing channel, so we can see which channels bring us the most valuable customers. By the way, the channels property works automatically in Kissmetrics. There are no custom rules or custom code needed.

Click here to watch a short demo of the Kissmetrics Revenue Report.

5) People Search – Find People Who Have Abandoned Their Cart

The biggest problem for a lot of ecommerce companies is customers who abandon their cart. They view a product, add it to their cart, but never return again. They’re missing out on a big opportunity if they don’t make an effort to re-engage these people. If marketers can get them re-engaged (through cart abandonment emails) they are giving themselves a better shot at recapturing these lost orders.

The problem for many marketers is they don’t know where to start to get a list of these people. The Kissmetrics People Search makes this process easy. All you have to do is set your criteria to get a list of people you are looking for. There is no need to bug engineers to run a SQL query.

Here’s what our criteria looks like. We’re looking for people who have added a product to their cart but have not purchased. We want to see all the people who fit this criteria in the past 7 days.

people-search-add-product-to-cart-ecommerce

We click Search and get our list of people:

people-search-kissmetrics-cart-abandonment

There are a few things we can do with this list:

  • We can click on each person and get a Person Details report. This will show us all the events and properties the person triggered (i.e., what they’ve done on the site) as well as tell us the last time they were seen.
  • We can export the list to a CSV file and then upload it into an email service provider like MailChimp and send an email to each person to get them re-engaged and hopefully recover some lost sales.

Important note: You’ll get a list of email addresses only under certain circumstances:

Click here to watch a short demo of the Kissmetrics People Search.

Optimize Your Marketing with Kissmetrics

These are just a few examples of what Kissmetrics can do for ecommerce companies. Our reports are more than useless metrics – they provide insights into how users are behaving on your site. Once you see this data, you’ll know what needs to be improved. Once you see this data, you’ll know what needs to be improved.

Head on over to the Demo site and see how Kissmetrics works for ecommerce sites. Or better yet, schedule a personalized demo.

Ready to get straight into the action? Just click the button below to sign up for a free 2-week trial of Kissmetrics.

cta-6-11-2012

About the Author: Zach Bulygo (Twitter) is a Content Writer for Kissmetrics.

11 Things That Work More Often Than Not in A/B Tests

While there are no universal rules in conversion optimization, there are some things that tend to work more often than not. This article will give you some of these tactics to test for yourself.

Let’s be realistic: websites are highly contextual, and what works for website A, doesn’t work for website B. In addition, the concept of a tactic is one thing, its impact is all about the specific implementation. So nothing in this post is guaranteed to work.

That being said, there are a few tactics that we’ve seen win time and time again. These are principles that, while they don’t work 100% of the time, work more often than not.

We also asked some notable CRO experts about any tactics that work more often than not. Muchas gracias to the following for the input:

Sure enough, a lot of the answers were similar. We’ll outline them here.

Whether you’re just starting your first a/b tests or you’re just looking for continuous and never ending improvements, these tactics are worth a look. At the very least, question your assumptions and give ‘em a test.

1. Static Image w/ Single Value Proposition Is Better Than Auto-rotating Slider

Sooner or later you’ll find yourself asking the question, “should I use an auto-rotating slider”?

The answer is: no, you shouldn’t

Should_I_Make_a_Carousel
Image source

We’ve written about this topic extensively in other articles.

In general, don’t use auto-rotating sliders (aka carousels). Though there are undoubtedly examples of them working better than static images (rare as they are), for the vast majority of sites, they are a usability nightmare. Here’s what Peep has to say about the subject:

Peep Laja on Auto Rotating Sliders Carousels

“These days so many e-commerce sites use rotating offers – and I think it’s not because they tested it, but due to herd mentality – “others have it, so should we”.

Peep Laja (Click to Tweet)

What’s wrong with using carousels?

There are multiple reasons for this, but in our article, we outlined three:

  • The human eye reacts to movement (thus missing the important stuff)
  • Too many messages equals no message (clutter effect)
  • They look like banners, which people ignore because they hate them (banner blindness)

Ultimately, users crave control, and auto-rotating carousels offer the opposite of that. The solution? Implement a simple, static hero image like this one:

Hero Image on Lands End Home Page

This example from Lands’ End is still a bit noisy, but our eyes travel right over to Zann Roberts Rassi and her guest editorial feature.

But – if you’re set on the carousel, for whatever reason, there are ways to improve upon it.

Improving the carousel

Nielsen Norman Group offers the following tips for proper carousel design:

  1. Include five or fewer frames within the carousel
  2. Use crisp-looking text and images that coincide with the organization’s charter.
  3. Indicate how many frames are present, and where the user is within the “progression.” This helps people feel in control.
  4. Use icons and links that are understandable and recognizable
  5. Ensure that navigation controls appear inside the carousel, not below it or separated by a fold.
  6. If offering a navigation button for each frame (rather than arrows to scroll through), ensure that each button looks different, and represents the frame.
  7. Make links and buttons large enough to decipher and click.

So to reiterate, this:

Best Buy Home Page Hero Image

is better than this:

Zappos Home Page Carousel

But if you’re going to do a carousel, do it right. You should probably just scrap the carousel, though.

If you’re looking for a redesign, Mightybytes offers a pretty fantastic resource on that.

2. Hamburger+”Menu” Beats Just Hamburger

The hamburger icon is like a bad piece of folklore.

Like any good myth, it’s passed down generation to generation until its origin is entirely obfuscated. The problem with the hamburger icon is that we just assume it works. However, the vast majority of our tests say something else:

In most cases, using hamburger + a “menu” label beats just a hamburger icon.

As an example, here’s a test we did a while back. We tested these three icons, plus the addition of a hamburger icon+menu label in a bright pink color:

ConversionXL Hamburger test
Outcome: All 4 treatments brought in more revenue than the control.

Hamburger test results
(Click to enlarge)

If you want to read more about this, check out our article on testing the hamburger icon.

Note: not everyone hates the hamburger icon (goes back to the point of no universal rules). But if you were a betting person, you would have good odds betting against the hamburger icon. Why?

To the last point, try to label these four icons:

Other_Icons

They are:

  • Motorola Hardware Menu Button
  • MS Word Bullet Butcon
  • Android Holo Composition Icon
  • Android Context Action Bar Overflow (top right on Android devices)

In our tests, hamburger+menu+a bold color usually perform best. It removes the ambiguity and makes the icon noticeable and intuitive. Problem solved.

3. Proper Value Proposition Beats No Value Proposition

You’d be surprised how many businesses don’t have a value proposition. It’s not just that they lack a good, proper value prop – they lack one altogether.

So it’s pretty easy for us to say that most tests confirm: value prop is better than no value prop.

What is a value proposition? Simply put, it’s the primary reason a prospect should buy from you. Even more bluntly, it’s the #1 reason someone will continue to read or hit the back button.

What does a proper value proposition consist of? A few things:

  1. Headline. This is the attention grabber. What’s your offer? Short, sweet, concise, and relevant.
  2. Sub-headline or a 2-3 sentence paragraph. This gets more into the nitty gritty of what you’re offering, for whom, and why it’s beneficial.
  3. 3 bullet points. Here you can list the key benefits or features.
  4. Visual. Images communicate much faster than words. Show the product, the hero shot or an image reinforcing your main message.

What should your value proposition convey? Relevancy, quantifiable value, and unique differentiation. Honestly, it would take a lot of words to fully expound upon proper value propositions, and I don’t want to do that here (we already wrote a post about that). Instead, here’s the good:

Screen Shot 2015-06-18 at 4.06.41 PM

The bad:

Screen Shot 2015-06-22 at 2.17.11 PM

And the entirely missing value prop:

missing value prop

4. “Sticky” Content

Brian Massey from Conversion Sciences Brian Massey, Conversion Scientist™

“Our Conversion Scientists have consistently found upside with “sticky” content. On small-screen mobile websites, having a sticky header or footer containing a call to action has consistently increased conversion rates. This call to action may be “Subscribe”, “Search” or “Click to Call”.

One of our clients saw a 400% increase in mobile leads from a sticky header. Note that the target audience here is high-school students, and this data may be skewed.

So effective has this been that we are now testing these on desktop “big-screen” websites. So far we’ve seen one successful test of this.

There appears to be some blindness with footers as opposed to headers. This may be thanks to mobile ads. Who hasn’t learned to hate “Art of War”? We’ll probably see a decrease in the effectiveness on these over time. Visitors will form lexical memories that will make stickies less tempting to click. But right now, they are hot. They are hot because they funnel engaged visitors like crazy.”

Here’s a good example of sticky content:

STICKY content

5. Product Videos Are Better Than No Videos

So first off, having video usually converts users better than having no video. No, it’s not just for branding and awareness. Video can actually help move customers down the funnel and convert them (even if they don’t watch the video).

We found one result that was pretty extraordinary. Matt Lawson, Head of Conversion at ao.com was quoted in this article as saying, “We have tested and proven that when someone watches our video reviews they’re 120.5% more likely to buy, spend 157.2% longer on the site and spend 9.1% more per order.”

ao has product videos

Now, results like that aren’t typical. But using video to improve conversions works more often than not.

But here’s something that might be controversial:

Any casual user of Facebook will know that autoplay video are annoying (Twitter too now). But, oddly enough, most of the time they convert better.

auto play videos work

Of course, this makes sense when you think about. As a data-driven company, Facebook is clearly seeing better results from autoplaying video. In fact, they tested it and noted that they found a “10% increase in people watching, liking, sharing and commenting on videos.”

Not bad.

Twitter tested autoplay as well and found the following results:

  • People were 2.5X more likely to prefer autoplay videos over other viewing methods (including click-to-play and video preview thumbnails).
  • They have better video recall with autoplay. In fact, we saw a significant 14% lift in video recall over other video formats.
  • For brands, during our autoplay tests we saw a 7x increase in completions of Promoted Videos.

 

For more info, check out our post on how to use video to increase conversions.

6. Removing form fields

Tim Ash from Site Tuners Tim Ash, CEO of Site Tuners, Chairperson of Conversion Conference

“Often we online marketers suffer from “greedy marketer syndrome” and try to collect as much information as possible. One sure conversion-killer is asking for unnecessary information on forms. A longer form often looks more imposing and some people will be less likely to complete it simply for that reason. If the actual information is sensitive in nature they will also have a strong adverse emotional reaction to it.

In my Landing Page Optimization book, I proposed the following Form Field Test: “Is this information absolutely necessary to complete the current transaction?” If you can’t answer “yes” to that question, the form field should be removed.”

Nice, simple sign up form from Inbound.org:

simple form

Note that you can also add form fields when you want to qualify leads. For example, we added a budget field on our conversion optimization services page. This way, we don’t waste our time on unqualified leads and they don’t waste their time on something not in their budget:

conversion optimization budget

7. Prominent Contact Information

Even though it seems like a small thing, putting your phone number and email address on the top of your site usually boosts conversions.

It’s a trust thing. People want to know that they can reach you. It’s a simple fix that adds a lot of value in most cases. The famous example, of course, is Zappos. Along with their fanatical customer support, they’ve always featured their number prominently on their site:

prominent contact info zappos

An example of this is when LessAccounting.com ran a simple a/b test where they boosted conversions 1.8% by adding a 1-800 phone number to the top of their site.

As Sean Work from KissMetrics said, “The bottom line is that having a phone number does bring peace of mind to consumers and people you do business with. If, at the very least, it instills trust in your visitors and removes any “fly-by-night-operation” fear they may have.”

Furthermore, click-to-call helps mobile convert better, especially for local businesses. Google actually did a study in 2013 that showed 70% of people use the click-to-call feature. In addition, they found 61% of mobile searchers said click to call is most important in the purchase phase of the shopping process.

Calls are king, and putting a phone number up is a pretty painless way to increase conversion rates (more often than not).

8. Live Chat

Live Chat has almost become ubiquitous with good service, and with good reason: live chat usually helps convert. Here’s an example of a live chat:

Live Chat and conversions

I do my banking with Charles Schwab, and they have a pretty excellent Live Chat feature for all of my silly questions:

Charles Schwab and live chat

What’s the point? Well, according to a Forrester report, “Many online consumers want help from a live person while they are shopping online; in fact, 44% of online consumers say that having questions answered by a live person while in the middle of an online purchase is one of the most important features a Web site can offer.”

Awesome article about increasing conversions with Live Chat from the Conversion Scientist here.

9. Trustworthy Testimonials Beat No Testimonials

Not surprisingly, leveraging social proof with legitimate testimonials can often increase conversions. Since word of mouth is a huge factor in purchase behavior, displaying testimonials can help drive trust in your site.

But your testimonials should be authentic and trustworthy. If not, consumers are skeptical. In fact, an econsultancy study found that negative reviews can help boost your conversion rate (only to a certain extent, though. Too many negative reviews is not a good thing.)

How you display testimonials matters, too.

Simple text testimonials can help. But adding a photo of the reviewer can help even more. Quality photos in general can help boost conversions, but specifically in the domain of reviews, they help add authenticity to the text. Finally, adding video testimonials can help boost credibility even further.

testimonials boost conversions

You can also leverage the credibility of other sites by pulling your testimonials from Yelp and other review sites. As Sean Ellis wrote in an Unbounce article, “When you use the testimonials from trusted sites, you hit a trifecta of credibility: authenticity of real customer feedback, published on a credible website, with a more objective bent because it appeared elsewhere on the web.”

10. Offer a guest checkout option

A few weeks ago, I wanted to buy this tank top:

tank top shopping cart

I went through the checkout process, and I was happy to note that they had a ‘guest’ option:

guest checkout boost conversions

I chose ‘guest’ and paid for the item. Later on, they asked if I wanted to register, and I did anyway.

This is a common experience. The converse is much less smooth. When e-commerce sites force registration, they put up one extra barrier for the customer. In fact, 1 in 4 customers leave because of forced registration. It’s just another facet of ‘greedy marketer syndrome,’ and it can be solved with a guest checkout option.

11. Free shipping

Charging for shipping is a conversion killer. At this point, the majority of companies offer some form of free shipping. If you’re not one of them, start trying to figure out a way you can offer it.

You’ve surely heard of the research on this:

As David Bell said, “The phrase “free shipping” is like a siren song to many who shop on the Internet.”

free-book-chris-anderson-750806-742646
For more info on the power of free, check out “Free” by Chris Anderson.

Note: this is not just a test object. This is a fundamental business decision. Shipping is a large expense for small businesses, and this is a tactic you will have to learn to bake into your business strategy. Sometimes, it might be damn near impossible to make free shipping profitable. However, there are strategies you can experiment with:

In an article for Kissmetrics, Andy Hunt outlines 4 ways to make free shipping profitable for your business:

  1. Establish a Baseline: Compare conversion with and without a free shipping offer.
  2. Create Thresholds: Increase the minimum order value required for free shipping, and test the improvement in margin.
  3. Set Restrictions: See what kind of improvement you’ll get by offering free shipping only on select products where it is profitable.
  4. Enact Price Increases: Increase all your product prices to compensate for the loss you take on free shipping, and see how your profit compares.

Conclusion

Nothing is universal. Your website has specific problems, not generic problems. You’re better off doing proper conversion research using a data-driven framework (like ResearchXL) to make sure you’re testing the right things. CRO is a process, not a list of tactics.

But the 10 things above boost conversions more often than not. They’re a good starting place for test ideas as well.

The post 11 Things That Work More Often Than Not in A/B Tests appeared first on ConversionXL.

How to Use a Giveaway to Accelerate the Growth of Your Email List

We all want a massive email list, but growing one can be like climbing a mountain. It takes a lot of time, hard work, and perseverance. Or, does it?

Today, I’m going to share stories of three different businesses – a freelance writer/programmer, an iconic candy company, and an innovative fragrance products company – that accelerated the growth of their email lists using giveaways.

Each of the stories is unique, inspiring, and jam-packed with insights that every business considering a giveaway as a lead-generation option should know.

Josh Earl Grew His Email List by 3,418% (Nearly 200K!) in 11 days

Josh Earl is a freelance writer and programmer who started an email list of people interested in learning tips for using a sophisticated text editor called Sublime Text. After growing his email list to 5,500 subscribers, he wanted to run a giveaway contest to attract even more people to sign up for his list.

But here’s the catch: Josh didn’t want to add just random names to his email list. He wanted to attract quality subscribers who would be his ideal customers. That’s the ultimate goal for any business, right?

Using the WordPress plugin KingSumo, Josh created his giveaway. His prize was a free license for Sublime Text, which is valued at $70. With his prize chosen and giveaway set up, he took to social media and his current list to spread the word about his offer. After 11 days of promoting his giveaway, these were Josh’s results:

  • He collected 187,991 email addresses.
  • His website received visits from 398,896 unique visitors.
  • Thanks to the flood of tweets that mentioned his contest (and included his Twitter handle), his Twitter following more than doubled, from 13,460 to 32,427.
  • The massive, sustained flood of traffic had a great impact on his site’s Alexa ranking. He leapfrogged 2,043,911 other websites and became the 49,137th most popular site on the Internet.

sublime-text-giveaway

The success of Josh’s giveaway was not a fluke. There are two major reasons it succeeded:

#1 – He used his prize to attract highly qualified subscribers.

Choosing the right giveaway prize can be tricky. If your offer appeals to an audience that is too wide, you could end up with a massive list of unqualified leads. But if your offer appeals to an audience that is too narrow, you could hurt your giveaway’s chances of being shared far and wide across the web. This is a delicate balance that Josh nailed.

Josh gave away a Sublime Text license. This is a product that he knew had a substantial and established market value. He also knew the only people who would enter to win his giveaway were people familiar with, and maybe even regular users of, the text editor. These were his kind of people – people he knew he could sell to if he could get them on his list. And he did. Josh’s first book Sublime Productivity, which he promotes with his email list, has sold more than 2,000 copies and earned him $38,000, and counting.

The important lesson here: Your prize is one of the easiest and most effective ways to attract qualified leads. Choose it wisely.

#2 – He leveraged the self-interest of others.

Josh figured out early on that most giveaways perform poorly because businesses rely on their entrants to act against their own self-interest.

What does this mean exactly?

When a business asks entrants to pass along information about a giveaway contest after submitting an entry, the entrants think something like this: “The fewer people who know about this awesome giveaway that I really want to win, the better chance I have of winning.” Then, to the detriment of the contest, they decide, “I’m not going to tell anyone.”

Thus, many giveaways never gain traction because people aren’t willing to share an offer if it means acting against their own self-interest.

So, how do you make people feel good and excited about sharing your giveaway? You incentivize sharing to work in their favor, not against it.

This is what Josh did: When a person submitted their entry, Josh had an entry confirmation autoresponder set up that plugged an additional offer. Each person who would share a special “lucky URL” (a unique link to his giveaway) and assist a new giveaway entrant would receive three extra chances to win. Doing this allowed Josh to engineer his giveaway for virality.

Tootsie Roll Gathered 43,292 Email Addresses and Secured 400 “Taste Testers” in 3 Days

When the iconic candy company Tootsie Roll released a brand new lollipop flavor in a limited number of stores, it didn’t generate too much buzz initially. Before hitting the global market, the company wanted to increase its brand awareness and receive feedback on the new lollipop flavor to make sure it would be a success.

To accomplish both of these goals in a small window of time, Tootsie Roll organized a giveaway. Using ShortStack, they built a branded landing page for their giveaway, allowing their fans and followers to enter for a chance to be one of the exclusive taste testers of Tootsie Roll’s latest pop flavor. After sharing their name, age, email address, and mailing address, entrants were narrowed down and sent samples of the lollipop with a survey for feedback.

enter-for-a-chance

Tootsie Roll mainly wanted to interact with their Facebook audience, so they promoted their giveaway to only that audience. They posted organic status updates and invested in boosted page posts. After just 3 days of promoting their giveaway, these were Tootsie Roll’s results:

  • They received 43,292 entries. This was a 702% increase in entries over a similar promotion they had run in the past.
  • Their promotion reached more than one million people.
  • From their 43,292 entries, they secured 400 taste testers, exceeding their original goal of 100. The 400 Taste Testers were mailed a Tootsie Roll Pops sample pack that included a printed insert with a Quick Response Code (QR code) that took testers to a survey with 10 feedback questions about the new pop flavor.

Results like this don’t just happen unless you’ve done a few things right. Here are the two major takeaways we can all learn from Tootsie Roll’s giveaway:

#1 – They hosted their giveaway on a landing page that was independent from Facebook.

While Tootsie Roll was looking to engage with only their Facebook audience, they wanted entry to be as seamless as possible. Publishing their giveaway as a landing page ensured that their mobile and desktop fans could participate in their giveaway without any barriers from Facebook.

#2 – They treated their giveaway as an investment.

To give their promotion momentum, Tootsie Roll made the choice to pay to play. They used a small advertising budget to extend the reach of their campaign beyond their organic audience. This investment paid off for Tootsie Roll, as they were able to increase the reach of the post promoting their giveaway by 587%.

JewelScent Grew Their Email List by 3,431 New Subscribers and Made $18,776.49 in 8 Days

Two years ago, an innovative fragrance products company called JewelScent launched. What makes JewelScent different from all their candle, hand wash, and aromatherapy competitors? Hidden inside each of their products is a jewel valued from $10 to $7,500.

To rev up sales and create awareness for one of their most popular and sought-after products, their jewelry candle, JewelScent hosted a giveaway the week before Valentine’s Day. Using the tool ViralSweep, they set up their giveaway with a single entry field. To enter to win, entrants simply had to share their email address.

jewel-scent

To encourage sharing, after a user pressed “Enter,” they were presented with several social media sharing options. Each share meant the entrant earned additional entries into the giveaway.

jewel-scent-social

Just 8 days after announcing their Valentine’s-Day-themed giveaway, these were JewelScent’s results:

  • They received 15,675 entries, 3,431 of which were from new people who JewelScent did not yet have on their email list. This meant that about 22% of the people who entered their giveaway were entirely new people brought in by JewelScent’s current network.
  • They generated $11,659.33 in direct revenue and $7,117.16 in indirect revenue. This comes to a grand total of $18,776.49, which is $2,862.35 per day over the length of time the giveaway was running!

JewelScent did many things right with their giveaway, but here are the two decisions that made the greatest impact:

#1 – They used tracking links to measure the monetary return of their giveaway’s efforts.

When JewelScent started their giveaway, two of their biggest goals were to grow their email newsletter list and drive revenue. These two things do not always go hand in hand, but in JewelScent’s case they did.

Why? Because they did the proper legwork that needed to be done once they collected their data (more on this in the next point). What’s more, they used a tracking link on the button that people would click to go to JewelScent’s website after they entered the giveaway. This helped them to know whether or not their giveaway produced sales.

#2 – They kept in constant communication with their entrants.

Email marketing played a significant role in the success of JewelScent’s giveaway. Throughout the duration of the promotion, their team communicated with their entrants via Facebook and email. Even after their giveaway ended, everyone who didn’t win was sent an email with a 10% off coupon. This effort generated $7,117.16 in revenue.

The takeaway here: A giveaway is not valuable unless you put the data you collect to work for you. It’s what you do with your list (i.e., how you sell to your subscribers after your giveaway is over) that matters most.

Final Thoughts

Giveaways can be an excellent option if you want to accelerate the growth of your email list. That said, there are still no shortcuts to the top. Climbing a mountain, even if you have assistance, is never a walk in the park. To truly reap the rewards of offering a giveaway, it’s imperative that you strategize, invest your time and other resources, and make use of all the information you collect to forge new relationships and drive sales.

Have you ever hosted a giveaway to help grow your email list? If so, sound off in the comment section below. I’d love to hear your stories!

About the Author: Chelsea Hejny works as a content creator at ShortStack.com, an online tool you can use to build your business’s social media marketing campaigns, promotions, and landing pages. Want to chat with her about using a giveaway? Shoot her a tweet to get the conversation going.

Building a Company That’s Set up to Scale

David Ciccarelli, CEO of Voices.com and weekly contributor to the Wall Street Journal, Entrepreneur.com, and others, talks with us about building a company that's systems-oriented, and making sure you're set up to scale without sinking a ton of time and money into unnecessary tech and automation up front.

Show Notes:

  • David Ciccarelli
  • Voices.com
  • Intro Song by Alex Koch of Digital Dust Studios
  • Outro Song Widowspeak - "Girls"