Five weeks ago I got accepted to CXL institutes’ conversion optimisation mini-degree scholarship. As part of the scholarship, I have to write an essay about what I learn each week. This is my fifth report.
There is a massive gap between checking something out on a website and handing over your credit card details for it. The overwhelming majority of people will not buy from you on their first visit.
E-books Are Terrible Lead Magnets#
A lead magnet is a highly actionable, specific piece of information. It’s purpose is to guide someone to a small, but meaningful first victory.
Let’s say you run a back pain clinic. A good lead magnet would be to get someone on the phone and have them do one exercise. Something specific, and then ask them if it helped.
If they say yes, they become a lead. They now know that you can help them with a certain kind of problem. They have experienced the relief. On one hand you have addressed the question of “can this person help me?”. On the other hand there is self doubt. I may trust that you have a solution but I don’t believe that I can actually get through it. A small win demonstrates that I can. Both birds, one lead magnet.
A lead magnet also segments your audience based on interest in a specific problem. A good magnet must be actionable and easy to consume. Checklists, mini case-studies, free trials, templates, downloads, quizzes and assessments all qualify.
E-books are not good lead magnets because they take too long to consume. A newsletter optin is also rubbish for the same reason, no one wants more email. When someone signs up to your newsletter they have performed no meaningful action, there is no personal victory, and it tells you nothing about that person.
The solution is to offer a small win in exchange for an email address or phone number. The aim is to help them believe they can do the thing, actually get the result, with you.
When someone gives you their contact details you have scaled the first hurdle. It does not mean they are ready to buy yet.
Tripwires Are Transitions#
The next hurdle is to go from a lead to a paid customer.
When someone gives you their contact details online it is the beginning of a delicate relationship. You have permission to contact them with a follow up message, but spam them and it’s game over.
A tripwire’s purpose is simple: money must exchange hands. You don’t need to make a profit for this to happen, but money must exchange hands.
A quintessential example of this is the penny offer from Columbia House Records. They would send you 12 records if you mailed them a physical penny. They will have lost money on the initial transaction, but they gained a list of people who were now comfortable sending them money by mail.
If Columbia gives away free CDs then how do they make money? Well, this is a controversial example because Columbia House and other record companies at the time used something called ‘negative option billing’. The penny deal opted you into a record catalogue each month. If you didn’t reply by mail and tell them that you don’t want to buy anything, then they would send you a popular record collection and charge you $20 for it. The free records were produced in house and were a lot cheaper than full price records. On top of that they didn’t pay out royalties for the free records because they counted as “free goods”. This kind of nonsense is mostly illegal now and completely unnecessary. Your tripwire can be better.
A trip wire has to be a fantastic deal for it to work. It must be an absolute no-brainer. Good tripwires are splintered from your core offering. You want there to be a logical transition to the eventual sale of your core offering.
An e-book can work here, but it’s still not the best. Physical products are better because they have a higher perceived value.
A great example of a tripwire is a carpet cleaning company offering a sofa steam cleaning service for $89. Getting your sofa steam cleaned for less than $100 is an amazing deal. If they do a good job, the logical progression to getting your carpets cleaned is obvious.
If you are a cosmetic dentist, start with an amazing whitening deal. Then transition to higher ticket cosmetic work. If you sell expensive guitars, sell utterly gorgeous picks for $1. Cover your acquisition costs when you can, but you will not make money with a tripwire.
Between a lead magnet and the tripwire the goal is to provide an incredible amount of value up front. Once people experience what you offer, they can, and will, assume that any future offer will have that same level of quality.
The transition from $0 to $1 changes the nature of your relationship. Once money exchanges hands a threshold is crossed. When someone buys from you, you are no longer a random person on the internet to them.
The transition from $1 to $100 to $1000 is quantitative. It is more of the same. As long as you don’t mess things up, you’ve earned the benefit of the doubt. Getting people to buy again is always easier than that first sale.
Lead magnets and tripwires can help you navigate the obstacle course of emotions that exist between someone checking your website out and handing over your credit card details for it.
So How Did I Apply This To My Own Business?#
I used to offer a free mini-course as my lead magnet. Now I give people 20 questions that let them audit their SaaS landing page for conversion problems. It’s a simple audit, it’s quick, and it gives you an incredible amount of information to work with.
One day after people get the 20 questions, I follow up and ask them how it went. I assume that most people will not have completed the audit yet, so I offer to complete it for them. I offer a comprehensive audit of their SaaS landing page for $10. It usually lasts about 20 minutes. They also get a list of clear suggestions for improvements to work on. They also get a recording of the review for future reference.
I think this combination of lead magnet and tripwire is a massive improvement over the old mini-course but there is still lots to improve.
Takes me about 2 hours to do a 20 minute review. Completely unsustainable. I am not too worried about that right now. If it starts to become a problem I will either increase the price or come up with a more scalable offer.
The second problem is that my core offering ranges from 4 to 22 thousand dollars. People who sign up for a review may not be able to afford this. This whole point is to qualify leads so my next step is to add restriction to the tripwire by defining my ideal customer (so only for B2B software companies in the productivity space that have their first 500 users). However, I don’t want to be picky right now because I am also looking for feedback on my reviews and I’m finding a sustainable system for producing them.
I hope this helped. It certainly helped me. If you have questions about how you can apply a lead magnet and tripwire to your own business feel free to get in touch.
- If you’d like to read more posts about conversion optimisation you can follow me on twitter @joshpitzalis.
- This is post 5 in a series. The rest of the posts are listed here.
- This is the CXL Institute’s conversion rate optimisation program I am currently doing.