Entrepreneurs who limit themselves to what they could learn if their prospects lacked the power of speech adopt what I call a veterinary marketing model. It’s not a viable approach to market exploration.
Q: We are doing our first landing page to test a new product concept, we are running Google Adwords with a budget of $25/day to drive traffic. We’ve had 1000 impressions and had 17 click-through to the landing page none have signed up. We are unsure if:
- No one likes the product concept
- The landing page is not designed well
- The traffic we are driving from Google Adwords is not good
- We have too small a sample size
- Something else entirely
A: Entrepreneurs who like a challenge often adopt a veterinary approach to customer development; they limit themselves to what they could learn if their prospects lacked the power of speech. It increases the degree of difficulty by perhaps two orders of magnitude, allows them to avoid the surprise triggered by a prospect’s verbalized insights, and gives them the opportunity to speculate at length in an effort to infer a prospect’s needs and state of mind from a limited set of on-line behaviors.
If two weeks in the lab will save you two hours in the library, then five months of Adword selection and landing page A/B tests will save you from five conversations with prospects.
You need to talk to prospects.
Q: But isn’t this just early days? What if we wait for a larger sample size, for example 100 people visiting the site (e.g. 100 people visiting the site). We have heard that conversion rates (as determined by people giving their email) of 10-40% are “normal.” However, we are not trending well. So, what are we doing wrong? Should we take this as an indication that no one likes the product? Do we need to start A/B testing our way up to a higher conversion rate? Do we need to work other channels to get better traffic sent to the site? Or do we just sit back and wait until we hit 100 site visits? What should our expectations be?
A: Based on the number times the request “please help me debug my landing page, no one is signing up!” comes up in the various customer development discussion groups I am a member of, the most likely conversion rate for a new startup’s landing page is 0%.
Your results are average, certainly for those teams that have not talked to prospects. It’s a variation of premature scaling–you are acting as if you have debugged key hypotheses and are ready to build a messaging channel (in this case Adwords).
You need to break out the hypotheses implicit in your product concept. In particular:
- What can you do to debug or test the product concept before building the landing page?
- What are your customer hypotheses about who would purchase the product?
- How are people solving the problem now?
- What are unsatisfactory aspects of their current approach that you are attacking?
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