Improve product conversion rate and manage "user value" well

If you want to increase product sales, conversion rate and user value are the key points. This article analyzes and summarizes how to improve conversion rate and manage user value from three aspects: attracting new users, conversion, and retention, for everyone to learn and refer to.

There are four points to a successful product:

1. Solve user needs – pain points (demand analysis and feedback)
2. Simple and easy to operate – good user experience (interactive experience and copywriting)
3. High frequency of use – high frequency application (attracting new customers, retaining customers and promoting activation)
4. Commercial realization – In the commercial era, products that do not make money are useless (obtain income, increase profits)

As for the fourth point of commercial monetization, in simple terms it means “making money”. We can use a formula to explain how to make money:

Sales = Traffic * Conversion Rate * User Value

Profit = Sales - Cost

Here is an example to illustrate how to use this formula:

Assuming that Xiao Q spends 1,500 yuan to purchase 3,000 customer lists, plus provides follow-up calls to each customer at 0.1 yuan per call, the total cost is 1,500 yuan + 3,000*0.1 yuan = 1,800 yuan.

So as long as there is a group of customers who can spend 2,000 yuan, it means "making money".

According to this idea, 3,000 lists of targeted customers can be randomly divided into 3 groups, with 1,000 customers in each group:

Group 1: Conversion rate is 2%, average order value: 150 yuan

Group 2: Conversion rate is 3%, average order value: 100 yuan

Group 3: Conversion rate is 1%, average order value: RMB 135

We analyze it specifically based on the actual values:

Group 2 has the highest conversion rate. 1,000 customers completed 30 orders, and the average order value was 100 yuan. 30*100=3,000 yuan, which is greater than 1,800 yuan. Conclusion: Make money.

Group 1 has the second lowest conversion rate, with 20 orders completed out of 1,000 customers. However, the average order value is slightly higher by 50 yuan, 20*150=300 yuan, which is greater than 1,800 yuan. Conclusion: Make money too.

Group 3 is not profitable: 10*135=1350<1800. Conclusion: Not profitable.

To sum up, sales can be increased from two aspects: one is to improve conversion rate, and the other is to manage user value well.

The way to improve conversion rate is to continuously optimize accurate user portraits and place advertisements. Continue to optimize products, strengthen innovation and upgrade content, and build word of mouth.

The method to manage user value well is: continuously purchase customer lists, optimize operational marketing plans (especially copywriting), make 1V1 follow-up visits to potential users, and tap into user value.

This article summarizes and analyzes how to be "people-oriented" and manage "user value" from three aspects?

01 La: Where the attention is, there is the wealth

First we need to enclose the land and sow seeds (attract new customers). The so-called enclosure and sowing means increasing traffic and acquiring potential users. Convert potential users into audiences, fans and users.

The core of enclosure and seeding is to build your own user pool, use every possible means to find your users, and then use every possible means to make your users come to you and start using your products.

There are two ways to sow seeds: online advertising and social marketing fission

1. Online advertising

There are two main approaches to advertising:

1) Make good use of search engines: Baidu (SEM+SEO). For example, if you choose different long-tail keywords and try to get on the Baidu homepage, you can basically generate sales conversions;

2) Make smart use of social media: maintain communication between machines and humans, and activate users’ potential consumption desires through various forms.

• Social communication channels: WeChat, Moments
• Live streaming/short video channels: Douyin, Bilibili
• Social e-commerce channels: Pinduoduo, Xiaohongshu

The process of online advertising follows the same logic as product iteration: "quick trial and error, small steps and fast progress". Some ads can be tested on a small scale before being launched on a large scale. If an ad is found to be profitable through testing, then it will continue to be optimized and amplified.

2. Social marketing fission

The influence of "social factors" on user payment decisions is becoming increasingly prominent, and the scenarios are becoming more and more diverse. The core of social networking is people, building personal IP and creating personal brand. Sell ​​yourself first, then sell your products!

This is like when we make online education products. If we can create 1-2 superstar teachers and use the star halo as a portal for traffic aggregation, we can increase trust and conversion rate. After the users are attracted to form a user pool, we can leverage the power of the community and use social tools such as WeChat to communicate with new users, activate the fan group, and create a fission effect.

The difficulty of fission lies in how to make users recognize your ideas and obtain their value. Xiao Q has a way to overcome this difficulty, which is to share money with them. Let them feel that they can make money and discover their own value through making money. When users feel involved, their perception of the product improves. Only when users gain value can your product be successful.

02 Forward: If you want high returns, pay for value

If you want users to pay, the key is to solve the user's "trust" problem. After solving the most difficult "trust" problem, you can continue to innovate and develop product series, and encourage users to repurchase through the "old customers bring in new customers" method.

The "old customers bring in new customers" method can be combined with a tiered model to efficiently acquire customers by transferring part of the profits.

By using the means of "free", the customer value is reduced, and by using the method of "instant understanding", the user's mind is captured. for example:

• Old users share to get coupons, new users register to get red envelopes
• Create a group number and invite people to enjoy discounts
• Group buying and bargaining
• Free Trial

Because old users have already developed "trust" in the product, the new users brought by old users will generally be more accurate than the social media marketing fission mentioned above to some extent.

03 Maintenance: After the user consumes, the service has just begun

The key is: provide good after-sales service, increase repurchase rate, and improve communication power.

To provide good after-sales service means to pay attention to user feedback. Regularly track user usage and resolve user doubts. This process is also a process of promoting and educating users. From a service perspective, paying attention to user situations can drive decision-making.

Increasing the repurchase rate means increasing the frequency of product use. Based on defining the user pool and discovering their pain points, you can use operational marketing methods to gradually "educate" your users to use your products frequently.

By improving the communication power, we can use the "anchoring effect" to allow users to be unconsciously guided by various preconceived information. for example:

• Stimulate user interest: Use media and social relationships to spread effective content
• Interaction drives decision making: increase the number of clicks, comments, and shares, and recommend products to people you know
• Marketing triggers fission: With leaders as the core, forwarding offers to others and contributing knowledge to others

Summarize

Pain points are necessary, high frequency is not necessary. The frequency can be increased through "pain points" + "user education"! The prerequisite for increasing the frequency is that there is a high level of trust.

If you want your products to be better and generate high profits, you must upgrade your product thinking. People-oriented, manage "user value" well!

Author: Mandy Quan

Source: Xiao Q Chats About Products