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The Pareto Principle, also known as the 80/20 rule, has lots of applications in the online marketing world, like here and here. I even wrote about it here in a past life.

Another instance of the magical 80/20 ratio in Marketing occurred to me the other day as we were analyzing a client’s online checkout experience to prepare for rounds of testing. The checkout experience was wholly dry, transactional, and cold. After spending time in this particular checkout (which was NOT unique), I realized that the proportion of prospects who are “un-sold” when they encounter your shopping cart is likely 80%, while the audience segment that is truly “sold” is probably around 20%.

What I mean by “un-sold” is that they have a level of desire (think “D” from the AIDA sales model) which brought them to your checkout process, but they likely don’t have enough Desire to complete the desired Action of a full checkout.

What I mean by “sold” is that they have such an intense level of Desire (based on the product, the promotion, the incentive) that they will put up with all sorts of poor usability, confusing policies, and complex legalese in order to take Action and complete their purchase. If you have a product that is that Desired, congratulations, and please realize that you are in the minority!

Marketers, designers, developers, legal counsels, and copywriters often assume that all prospects are 100% sold by the time they enter checkout.

This is a dangerous assumption. It is more likely that 80% are un-sold and need continued persuasion throughout the process. The Fireclick Index reports that last week’s funnel conversion rate was 25%. Remove the 20% who are dead-set on buying, and you get only 5% of those who “add to cart” being persuaded to finish your checkout process.

In your checkout, therefore, the biggest revenue gains are to be made in persuasion and optimization, NOT in usability/design. Gorgeous design is unnecessary for those who are “sold,” and doesn’t have what it takes to sell the “un-sold.”

Assuming you believe my theory has legs, what is an eCommerce site leader to do?

Here are some things to test in your cart/checkout process to go after that elusive 80%:

1. Test enhancing the credibility of your checkout – there are many things to test here, and none of them are a “sure thing.”
2. Test increasing the readability of your checkout – a site cannot be persuasive if it cannot be understood.
3. Test optimizing product images in checkout – have you been so busy working on product pages that you’ve neglected the images in checkout?
4. Test product benefits in checkout – does your checkout only talk about shipping weights, SKU#s, and other technical details? What about the value of the product(s) in their cart?

When was the last time you went through your checkout process? Try going through it today with a lens of skepticism, hesitation, and fear. Does the process still persuade the un-sold?

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Are you considering a website redesign? Want to avoid the risk of hurting your conversion rate?

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GPS Central management was close to launching a redesigned website that an interactive agency had built for them when their SEO agency introduced them to WiderFunnel.

Although the GPS Central management team loved the look of the newly designed website, they were concerned about hurting sales by implementing it without testing. They had heard the horror stories of companies launching beautiful new sites only to find their sales suffering from poor conversion performance.

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Here is some fresh thinking for the new year for you: Do you really need a web redesign?

There are many situations that justify a website redesign: if the platform your current site sits on is outdated, for example, and you need greater functionality, is one of them. Other reasons include: your overall branding has dramatically changed and your website needs to change accordingly; you need to make the site web-accessible for disabled users; you face competitive needs driving a marketplace re-positioning; your target demographic has changed; or you need updating to web standards.

However, not all websites need a comprehensive redesign whenever management encounters a business challenge.

In fact, there really are *bad*reasons to redesign your website. These include this vague notion that “the site needs to be updated” because web visitors are “getting tired” and “the site looks old” – which are typically reasons ad agencies and web design agencies give to justify the recommendation to redesign a client’s website.

But where is the data to justify this recommendation?

What percentage of your web visitors are New vs. Repeat?

The argument that you need a large-scale web redesign because the site hasn’t changed in a long time and therefore looks old and does not inspire customers to take action can be easily supported or repudiated with data.

To do this, simply check your web analytics and determine what percentage of your web visitors are New vs. Repeat visitors.

If the vast majority of your web visitors are New, then the only people for whom the site is “looking tired” are your staff and your agency. No need for a large-scale web redesign project for them!

What percentage of your web visitors come from organically generated traffic vs. paid sources?

If a significant percentage of your web visitors come from SEO traffic, then a large-scale web redesign project is a risky undertaking. A brand new site is likely to have a negative impact on your SEO efforts, taking valuable time to replace the traffic you have come to take (almost!) for granted.

A poor conversion rate is a particularly bad reason (in and of itself) to embark on a web redesign project.

We know this as we often get calls from prospective clients asking us to redesign their site because it is underperforming and they need to improve their conversion rate. After an initial discussion, it very often becomes apparent that a large-scale web redesign is not the optimal way to proceed, and it certainly is not the most cost-efficient way to go either!

Very often, a much better approach is to analyze the website, identify the web pages that need to “work harder” for the company and then only optimize those pages. (At WiderFunnel, we call this the Kaizen Plan)

In other words, even though your agency told you that you needed a new website, it is quite likely that your site is just fine, thank you very much – you just need to make specific web pages work harder!

It’s time for smart marketers to move away from large-scale web redesign projects to evolutionary, data-driven website improvements.

Marketers need to shift from the “accepted wisdom” that their websites needs a total re-build at regular intervals to an attitude about continuous improvement and incremental change based on conversion optimization.

The benefits an improved conversion rate generates are clear: increased profits from traffic-building tactics (you knew that) without risking any loss in that beautiful thing that an effectively search-engine-optimized site is.

But what is fresh thinking for the new year is this: not having to invest in a large-scale web redesign by only focusing on improving the conversion rate on key web pages will free up your marketing budget to invest where it generates the highest demonstrable ROI.

Happy 2011!

While online social networks like Facebook, Twitter and MySpace are known hang-outs for younger adults and teenagers, older generations in recent months have been taking to the medium at a faster rate than any other age group, according to industry reports.

According to an informal survey by Stanford University professor BJ Fogg, many of these older folks use social networks to keep tabs on younger family members and they often find fruitful connections with their peers after they’ve friended all of their kids and grandkids. (Yes, “to friend” is now a verb).

Facebook’s popularity is growing most quickly among women older than 55, according to a site called Inside Facebook, which tracks Facebook’s growth.

• There are now about 1.5 million female users older than 55 on the site — roughly a 550 percent increase over six months ago

• By comparison, membership among people younger than 25 grew by less than 20 percent over the same period

Facebook now says it has 200 million users, making its user base larger than the populations of all the world’s countries except China, India, the United States and Indonesia.

Such a vast presence, coupled with news media buzz about all social media, has pushed online social networking to a “tipping point,” said Amanda Lenhart, a senior research specialist at the Pew Internet & American Life Project.

But older folk have concerns:

• They often must overcome fears about privacy issues before they will join Facebook

• Also often they don’t understand the interface

• Many are afraid of scams

All this bodes well for marketers attracting older customers via Facebook – as long as the differences are noted.

To read up on Twitter user profiles go here and to learn how Men differ from Women (online, anyway) go here.

This morning, eMarketer reports that US men are the minority online:

• Currently, 96 million males are Internet users, compared with 103 million females
• eMarketer estimates that the number of men online will reach 106 million in 2013—but remain the minority.

And how do Men differ from Women (on the Internet, anyway)?

• Online, men visit more sites and stay longer than females.
• They are search engine users and participate in all forms of social media, particularly videos.
• In addition, they are more mobile—avid users of laptops, wireless broadband connections and mobile phones.
• For men, online shopping behavior is more goal-oriented, much like offline trips to a store.
• Men are not as bothered by sites cluttered with ads and do not abandon them as quickly as women do.

This is crucial information, especially for Conversion Optimization.

The learning here is that when creating Test hypothesis to optimize landing pages for conversion, you must remember that “Men and Women aren’t created equal”.

What do you think?

What criteria do you use to evaluate website design? Is it totally based on results, or are there other factors?

The Drudge Report – Is it beautiful?