Chapter One:
PLANNING
If you donât know where you are going,
any road will get you there.
âLEWIS CARROLL, ALICE IN WONDERLAND
Planning involves everything that happens before a visitor reaches your site. It includes steps you take to get traffic to your siteâthe creation of the elements for your conversion process and the storyboard of your site that guide visitors once they are there. It includes strategic marketing planning such as the development of your unique value proposition (UVP), your understanding of the marketplace and targeted customers, and your brand and brand positioning. Planning is about understanding your visitors and their values, so you can anticipate their knowledge levels, moods, and mindsets, and thereby meet their needs.
The planning principles presented here will help you âget your act togetherâ so you âknow where youâre goingâ before you invest costly resources. These planning principles yield exceptional results in terms of sales for your Web site and help maximize the return on your investments (ROI) of time, energy, and dollars.
AN INCREDIBLY CONDENSED HISTORY
OF PERSUASION AND SALES
To maximize ROI on your Web site, you must have an organized persuasive purpose for your Web siteâto get someone to subscribe, to register, to inquire, or to buy something. To better grasp the concept of persuasion and Web site sales, we should trace back through time and observe the evolution of sales. As we talk about various phases, be sure to notice how each step in the evolution of sales seems to make the purchase easier for the buyer and harder on the vendor. Each step seems to remove some of the friction buyers feel and makes the purchase process smoother for the buyer.
Depending on your religious persuasion, you may or may not believe that the first sale involved an appleâif not, sales of some sort is certainly the worldâs oldest profession even if it involved some form of inexact exchange in the form of barter. In ancient times, someone would have chickens, and someone else would have cows, and they would decide how many chickens were worth exchanging for a cow. Obviously, this system was inefficient for both partiesâsuppose one party actually wanted ducks rather than chickens.
Over time trade fairs and open marketplaces developed, so that many trades could be made simultaneously until each party got approximately what they came for. Until money came along, goods and services were difficult to value since barter required so many trades and middlemen.
When trade evolved by making money the standard of exchange, it became much easier to exchange value since every product and service had a monetary value assigned to it by the free market. You either paid the value in money or not.
Eventually, vendors decided it made sense to aggregate in one area, so that all the buyers could meet them. This created a larger market for the vendors but also opened them to competition for price and selection. Even then, merchants would develop reputations for expertise in one product line or service line.
Centuries down the road, the market evolved to open-air vendors who established specialized stores. Because they no longer needed to travel around, businesses were able to offer greater convenience and more inventory. Stores became bigger and concentrated in commercial districts. Further down the road, commercial districts became malls. So now, in addition to a large selection of stores that offered one-stop shopping, buyers could partake of food and entertainment.
When catalogs appeared, they offered specialty products that stores couldnât carry and remote shopping for those buyers who did not have stores near them. The Sears catalog, transported along railroad lines, brought the far-away to buyers so they could shop from home.
If people could buy from their homes, then why not take the old âbarkerâ style of selling and present it to them right through their televisions? Thatâs exactly what QVC and HSN offered. These elaborate interactive catalogs were a huge success with buyers who could now buy while sitting on their sofas with phones at their ears and remote controls in their hands.
By the late 1990s the Internet changed everything. It would trump QVC and HSN with interactive, on-demand catalogs available 24/7, 365 days a year, with unlimited options to choose from, lots of competitors to decide between, and all the strangest things you could imagine waiting to be found (check out eBay). For buyers, this was simply one more evolutionary step.
The next phase of online sales history will belong to those who grasp and correctly apply the concept of what might be called a digital salespersonâa Web site that performs all the functions that an expert human salesperson would in the real world, is able to guide the prospect through all five steps of a professional sale, acknowledges how different people want to be sold to, and can adapt to those needs.
The bottom line: each evolutionary step has forced the merchant to work harder and systematically to remove friction from the buyerâs experience. The Internet offers a virtually frictionless way for consumers to buy, which means that we must work that much harder to persuade and inform buyers. As a merchant, you have to decide if you will do the hard work, leave it up to the buyer, or let your competitor do it.
Itâs up to youâthe buyer is always one click away from goodbye.
VALUEâCUSTOMER DEFINED
In order to keep your visitors from exercising their right and their opportunity to make that click to another Web site, you know you must provide them with one or more values that appeal to them or fulfill the search that brought them to you.
How would you define the value that your visitors are hoping to find at your Web site? Can you provide a definition that supports and reinforces your persuasive process? Itâs a trick question. Actually, there is no one way of looking at value. But there are qualities in the broad concept of value that your particular business will answer differently for each visitor to your Web site.
If your Web site offers no perceived value, the visitor is gone. But you . . . stick around! Mohanbir Sawhney, McCormick Tribune Professor of Technology at Northwestern Universityâs Kellogg School of Management, organized his ideas on the nature of value into seven over-arching qualities. These words (slightly abridged) are his:
Value is customer-defined. Never forget that value is defined by those who use it and those who pay for it. To understand the true nature of value, you need to get inside the minds and hearts of your customers, whether theyâre internal or external.
Vendors must communicate the value of their products not in terms of what these products do, but what they do for customers, expressed in a language that customers can relate to.
Value is opaque. An important consequence of value being defined by customers is that it is very difficult to quantify. You need to understand all factors that customers take into consideration in assessing value, and you have to understand the relative importance that customers place on each factor. In the absence of this understanding, you are shooting in the dark. Once you understand the factors that specific customers consider when making decisions, and how they make trade-offs, you can develop a better understanding of the value propositions that might appeal to each one.
Value is multidimensional. A common myth in business is that decisions are made solely on functional value, that is, a productâs features and functionality. Value has two other dimensions as well: economic valueâwhat these features and functions are worth to customers in terms of time and money; and psychological valueâthe emotional benefits that customers get from your products or your company.
Value is a trade-off. Value is the perceived worth of something in relation to the total cost that customers pay for it. This definition underscores the fact that value is a trade-off between costs and benefits.
Value is contextual. You cannot divorce the value of [something] from the context in which it will be used . . . Unless you understand the end-usage context, you run the risk of creating value propositions and offerings that are irrelevant for customers.
Value is relative. Customers never assess the value of an offering in isolation. They always consider value relative to alternatives. These alternatives may not be other products or systems, but other ways of accomplishing the same goals or doing nothing at all . . . By understanding competing alternatives, you will also be able to focus on points of differentiation relative to these options and ignore points of parity that clutter and dilute your value proposition.
Value is a mind-set. The value mind-set is grounded in the belief that the sole purpose of a company is to create value for its customers and to be compensated equitably for its efforts. Therefore, everything the company says and does should revolve around its customers, not its products. This is a radical shift in perspective, and few companies truly embrace this idea despite their claims of being customer-focused.1
Are You Providing Value?
Letâs take what Mohanbir Sawhney says in such a textbook manner and give it an everyday perspective and language.
People have some interesting notions about what constitutes value. If they pay a lot for something, they either think theyâve purchased a high-quality product or theyâve just been ripped off. Stuff with bargain-basement price tags is considered . . . well . . . bargain-basement. Find a high-quality product at a substantially reduced price, and, hey, youâve just found value!
This is just one view, not remotely the complete picture. But online, people still believe value is all about price although off-line this was shown to be untrue years ago. Sure, you might get lucky and make a few sales based on a super-discounted price alone. But if thatâs all youâre offering, youâre building zero loyalty, and youâre begging for competition.
If you want lots of delighted, loyal, repeat customers, you have to realize superior value goes way beyond price, and superior value is what keeps them coming back. Just look to the recent success of cross-channel promotions where the customer can order online and pick up the product off-line. All those sales werenât to least-cost buyers!
Try on the idea that you are not just offering your customers a price proposition, but rather that you are actually offering them a value proposition. Itâs a complete package, filled with lots of human-friendly usability elements, attractive but fast-loading and functional design, great information, great products, appropriate prices, top-notch customer service, plus lots of nice little guaranteed-to-make-them-smile extras you devise to set yourself apart from the guys and gals that just offer . . . well, price.
If you still think online isnât about sustainable value, consider the results of an online-buying study by MIT that discovered âonly 47 percent of the consumers . . . bought from the lowest-priced seller . . . in fact . . . price was the least important factor.â2 And what beat price? The biggest factor was whether the customer had visited the site before (see why we will be going on and on in this book about making the right impression?), followed by familiarity with the company, and then shipping time (think, service).
Truth is, value is so subjective you can often be more successful charging higher prices, provided you pay close attention to all the other factors that influence the buyerâs perception of the value of your product. A lot of that perception hinges on your market position: if youâre selling coffee, are you a corner lunch counter or a Starbucks?
Remember, image alone wonât do the trick, particularly online, where itâs that much harder for your prospects to bask in your fancy ambience. Folks flat out demand real substance, and they consistently vote with just a click or two of their mouse.
Now, doesnât that put Mohanbir Sawhneyâs principles into perspective?
And the Value Is . . . ?
As Sawhney so eloquently points out, the value of whatever you are doing in cyber-space lives...