optimization

How Lean Marketing Principles Provide Better Conversion Rates (in Less Time)

By David Hoos
10 minute read | Last Updated: October 3, 2018

The lean marketing approach gives you the budget, time, and ability to try ideas with a build-measure-learn sequence that drives results quickly.

What do we mean by “lean marketing”?

Lean marketing is the practice of using data and experimentation in your marketing processes to drive smart, iterative improvements that ultimately increase wins and reduce waste.

Here’s an example: Door-to-door fundraisers for the American Cancer Society were pulling a 29 percent donation rate. That’s a fairly healthy response, but organizers wanted to do better.

Rather than revamp the entire system, they opted to try a slight change in the messaging. At the end of the ask, solicitors threw in one more sentence: “Even a penny will help.” That one change boosted the response rate to 50 percent.

Who needs lean marketing?

Lean marketing principles are especially suited to ecommerce website development and optimization projects where the management team seeks results like this:

  • You want maximum efficiency and zero wasted time.
  • You’re wanting to see ideas move from conception to reality quickly.
  • You prefer to see how your customers and prospects react to changes rather than hear about what your design team thinks of changes.

If one or more of those desires apply to you, then lean marketing may help your company save time and money on your next conversion rate optimization effort.

Lean marketing principles are especially suited to ecommerce website development and optimization projects. Click To Tweet

In this article, we’ll cover the basics of the lean marketing concept: what it is, why it’s important, what it involves, and how you can apply its principles to speed up your conversion rate optimization process to get better results faster.

lean marketing
So, what is lean marketing?

Lean marketing incorporates the lean startup methodology proposed by entrepreneur and author Eric Ries. Its principles are related to the Japanese concepts of lean manufacturing where waste is minimized, efficiency is optimized, costs are reduced, and maximum productivity is the goal.

Here’s an example: Let’s say you’re a Formula One race car owner who would like to see your team gain better positions. You know your driver and pit crew are top-notch, so you focus on improving your car. You seek and get proposals from two race car development teams.

The first team says you need a total rebuild. The project will take months to complete and the cost is astronomical.

The second team says a slight adjustment in downforce aerodynamics can bring about a difference in cornering speed that can have you setting lap records and placing consistently in the top five finishers. They can have the job finished in a week and get you back on the track for testing.
Which proposal do you accept?

That scenario applies directly to your ecommerce conversion rate optimization work.

Ecommerce development teams often choose a “waterfall” process where the project is handed to a large team and divided into a series of discrete phases that lack flexibility and usually take months to carry out.

Waterfall teams look at the big picture – building a better car – and often fail to see or adjust the components of the system for optimum performance. Major change is the goal, and when desired results still aren’t achieved, another major change is in order.

Lean marketing adherents look for the minimum viable product (MVP). They want to know where they can make quick adjustments aimed at improving results. Turnaround speed allows them to apply a build-measure-learn sequence that provides rapid feedback and continually moves the dial forward.

The only way to win is to learn faster than anyone else. - @ericries Click To Tweet

What are the benefits of lean marketing?

We’ve already alluded to the primary benefits of adopting the lean process for marketing, but there are auxiliary benefits as well.

Here’s a list of the reasons why The Good utilizes lean marketing principles whenever and wherever possible:

  • Get feedback in a hurry. Rather than investing time and resources into a major website overhaul or marketing campaign and waiting till launch day to see how it performs, you can run smaller experiments that get observable results in a hurry with lean marketing.
  • Make adjustments faster. Learning quickly what does and doesn’t work will help you improve and innovate faster.
  • Focus on the customer. In traditional marketing, the final product is planned ahead of time and a team won’t adjust or adapt throughout the process. It can be easier to become disengaged with the customer by not testing regularly and measuring success on a regular basis. Lean marketing keeps the organization customer-focused.
  • Leave room for decision making. Lean marketing principles make business processes more efficient and streamlined. The lean concept gives more space and time for strategic decision making.
  • Know your priorities. Lean marketing provides easier management of changing priorities. You can filter through the noise and make smarter prioritization decisions.
  • See the progress. Lean marketing related tools like “Kanban” provide enhanced project visualization at the team level, improve communication, and reduce time in meetings. Team productivity can soar when traditional boundaries to innovation are relaxed.
  • Stop wasting resources. Lean teams aim to deliver the right message to the right place at the right time. When done effectively, this prevents wasting resources on those who aren’t listening.
  • Go lighter on the budget. The lean marketing approach frees up the budget to focus on those things that work and drop things that don’t work. Your marketing efforts are more effective.
  • Start small and think big. Cutting waste enables you to be more agile and get more opportunities to test innovative new ideas.
  • Reduce complexity. They help managers avoid getting caught up in the fog so they can perform management functions more effectively.

Once you’re versed in the lean methodology, you’ll see chances to use lean marketing principles daily – both in business and in your personal life.

Once you’re versed in the lean methodology, you’ll see chances to use lean marketing principles daily. Click To Tweet

Many lean adherents notice a subtle switch in their thinking: They move from the need to plan everything years in advance, they begin to see their lives and their work as an experiment. Rather than invest excessive time in remorse over a failed plan, they’re excited to get feedback so they can try again from a different approach.

7 key components of lean marketing

You understand the lean concept, but what are the components of lean marketing? What special tools or knowledge are required? What does the lean marketing process involve? Let’s turn to look at the fundamental inner workings of a lean marketing approach. Once you’ve secured buy-in from everyone concerned, here are the bases to cover:

1. Clearly identify your best audience

Audience targeting is part of any proper marketing plan. In lean marketing, knowing who you want to reach is an essential piece of the puzzle. The better defined your audience, the more successful you’ll be at speaking with them.

2. Clearly describe what you hope to accomplish

Lean marketing doesn’t just seek to build a better ecommerce website. That’s too general. Lean principles focus on setting focused goals like boost your email list opt-in conversion rate by twenty percent or reduce your abandoned cart rate by ten percent.

3. Analyze your path to sales to uncover stuck points

You should already be measuring conversion rates at strategic points along your path to sales. If you’re not, make that your first lean marketing project. Look closely at that data to identify the steepest drop-off points – places where prospects leave the trail instead of following through to selection and checkout.

4. Choose one focus point per team per round

You can tackle multiple projects at once as long as each team sticks to one project at a time. One team. One project. Keep all other needs and initiatives safely filed away out of sight. You’re not abandoning them. It’s just not their time to be in the limelight… yet.

5. Clearly state all parameters

You’ve already described what you hope to accomplish. Taking the specific focus point into consideration, expand that statement to include not just the goal statement but how you intend to measure success, how much (time, money, and effort) you’re willing to invest in the project, and how important the project is in relation to other marketing. Make every part of the plan totally transparent to the team.

6. Choose your measurement points and tools

Like the highway department setting out temporary measurement devices to get the feel for how much traffic a certain section of the road is getting, you may want to implement special measurement points or methods to help the team gather the information they need for the project. Heatmaps, A/B tests, and user testing are examples of tools typically employed.

7. Assign team responsibilities and get started

You’ll need a team leader who thoroughly understands the lean process and is capable of managing the effort within the timeframe, team size, and budget allotted. Although every member should know exactly what they’re responsible for, each should also be encouraged to generate ideas and pitch in to collaborate with others.

Get better results in less time

Teams at The Good have found that lean marketing principles and conversion rate optimization go hand-in-hand. Both leverage rapid improvement sequences and never-ending innovation to help you outpace the competition.

One of the beauties of the lean approach is that it gives you the budget, time, and ability to try ideas that seem so counterintuitive a waterfall/big picture team wouldn’t even consider trying.

Here’s an example: Following up on the American Cancer Society lean marketing win we opened with, researchers wanted to know whether the amount mentioned would affect the outcome.

A control group raising money for the National Reye’s Syndrome Foundation stuck with “Even a penny will help.” Another group said “Even a dollar will help.” And a third pitch ended with “Even five dollars will help.”

Which do you suppose pulled the highest pledge rate? And which do you suppose pulled the highest average amount of donation?

Check the graphic below as reported by the Science of Fundraising:

lean marketing

Incredibly, the higher ask pulled the most pledges and the highest average amount pledged. But why does that matter to us?

You can test variables like pricing quickly and efficiently when you take a lean marketing approach. Under the waterfall system, a change like that could require a series of sign-offs and internal baton-passing.

Would raising the price of an item or offer make a significant difference in sales? Conversion rate optimization led by a team experienced with lean marketing can either confirm or deny the theory and end all argument.

Here are three closing prerequisites to lean-marketing to help you get going:

  1. The team should begin each day with a stand-up meeting where essential information is transmitted. No sitting down. No donuts. No boring presentations. Deliver the essentials and get after it.
  2. Use a Kanban-style project management and project visualization board. The literal meaning of Kanban is “signboard.” The system uses colored blocks to track the movement of a task through the workflow. Kanban supports incremental improvement, anytime changes, and teamwork.
  3. Lean marketing isn’t a silver bullet approach to marketing. It focuses on a base-by-base approach to ecommerce site improvement rather than looking for the next home run. Keep moving in the right direction. Don’t worry about going viral. Focus on getting better.

Begin by learning. Then focus on building a solution to a certain observed bottleneck. Measure the results. Then return to learning. The beauty of lean marketing is its simplicity and power. You can do this. Stop listening to the people who are mainly concerned with how good your ecommerce site looks. Begin listening to those who want to make it perform better. If you need help launching your lean marketing project or have questions about how lean marketing can work for you, call The Good.

Resources:

About the author: David Hoos is Marketing Manager at The Good, conversion rate experts who deliver more revenues, customers, and leads. David and the team at The Good have made a practice of advising brands on how to see online revenue double through their conversion rate optimization services.

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