Issue #019

Choice kills conversions

In 2000, two psychologists ran a study.

At an upscale food market, the pair performed two tests. They were trying to figure out what effect variety had in getting people to buy jars of jam.

  1. On the first day, they set out a large table with 24 varieties of jam. To sweeten the pot, anyone who sample the jam would get a $1 off coupon.

  2. On a later date, they set out a smaller table with just 6 varieties.

The larger display attracted significantly more interest, but people at the large table were one-tenth less likely to buy when compared to those who visited the smaller table!

Additional studies have continued to show that buyers are easily paralysed by choice. People want to be told what to do. And given too many options, they can become easily overwhelmed and put away their wallet.

FROM THE HARVARD BUSINESS REVIEW:

Marketers assume that the more choices they offer, the more likely customers will be able to find just the right thing. They assume, for instance, that offering 50 styles of jeans instead of two increases the chances that shoppers will find a pair they really like.

Nevertheless, research now shows that there can be too much choice; when there is, consumers are less likely to buy anything at all, and if they do buy, they are less satisfied with their selection.

(source)

How Pat Flynn & Smart Passive Income reduced choice and increased conversions by 2.38x

In 2018, the RightMessage team and I worked with Pat Flynn and the Smart Passive Income (SPI) team to put together a killer experiment for their "SPI-ber Monday" annual sale.

SPI has a bunch of courses that they host on Teachable.

The plan was, like always, to discount across the board and send their list to go and grab whatever courses they wanted.

But... the "choice" problem.

"I'm not an Amazon or ecommerce store where browsing for multiple products on a single page is the normal buying behavior. For online marketers, especially if you're building audiences and serving them with quality products, you want to be more direct when possible:

“Have this specific problem? Here's this specific solution.”
– Pat Flynn

The 'trick'? Segmentation.

"Have this specific problem? ..."

SPI needed to answer the 'problem' question before they could recommend a solution, so a few months before their SPI-ber Monday promotion they started running surveys on their website.

(Full disclosure: they used my software, RightMessage, to do this. But this could also be done with link triggers in your emails.)

Over time, their subscribers started self-segmenting based on things like their business experience and what they were interested in / had experience with.

All of this data became neatly associated with their subscriber record in ConvertKit.

For Black Friday / Cyber Monday "SPI-ber Monday", the team simply drove their list to a personalised "this is what you should buy" offer page, rather than simply presenting a smorgasbord of courses on offer.

And because SPI rocks, they A/B tested the hell out of the campaign: some people got the smorgasbord, others got the "just buy this" offer.

The results:

  • An additional $104,000 in sales

  • Overall increase of 2.38x for the "just buy this" offer vs. the control

  • 60,000 additional segmentation data points captured

I absolutely love how they were able to overcome choice paralysis with a bit of upfront thinking, segmentation, and some if-this-do-that conditionals.

The entire case study is available here. I'd highly recommend you give it a read.

Less of a focus on choice, not a removal of choice

SPI still gave discounts across the board.

But they made it very clear that if someone was to invest in just ONE thing, so-and-so is what they should buy today.

Which makes sense. Attention is limited, and it's even more limited during Black Friday / Cyber Monday, when offers are everywhere.

If you have even a few products that you're selling, I'd highly encourage you to consider coming up with a personalised recommended offer for each subscriber on your list.

You can still offer what you were planning to, just highlight (and send a dedicated email about) a specific offer that someone should buy.