CXL Institute CRO Minidegree Review Part 11

Customer Value Optimization, Creating a Segmentation Strategy, and Digital Psychology and Behavioural Design

This is part 11/12 in my series reviewing the CXL Institute CRO Minidegree. I will be posting a new part every week.

CXL Institute offers some of the best online courses and industry-recognized certifications for those seeking to learn new technical marketing skills and tools highly useful to growth professionals, product managers, UX/UI experts, and any other marketing profile looking to become more customer-centric.

I was given an amazing opportunity to access and review one of their online course tracks, the Conversion Rate Optimization (CRO) Minidegree. For the next few weeks, I’ll be discussing the content of the course as well as what I think of it as I go through it. Here is part 11!

Customer Value Optimization

Justin Rondeau CEO and optimization lead at Digital Marketer teaches this course about the Customer Value Optimization Model, a proven 5-step framework that will help you convert leads in a wide variety of industries.

The framework focuses on all of the steps in a customer’s journey, and it is similar to the AARRR funnel model popular among growth experts. These are the 5 stages:

• Identifying the product-market fit
• Generating leads
• Converting leads into buyers
• Up-selling, cross-selling and increasing repeat purchases
• Re-engaging lost or old customers

Customer value is often underestimated by marketers, despite the commonly known fact that repeat buyers are easier to sell to and generate more revenue than acquiring new ones. The companies that have the most potential to grow are usually those that focus on value after the conversion occurs.

In order to optimize value, you first have to understand your product-market fit. This is usually the longest step in this process. Is it actually something people want? Is it bringing value to your target audience? What is the before and after experience for this group? Identify things such as what they have, how they feel, and what kind of status it gives them. By identifying these aspects of your offer, you can then construct what the course refers to as a “Statement of Value”. This statement should explain your core offer clearly to your customer base.

The next step is to create a lead magnet for the target audience. Lead magnets should fulfill the following requirements:

• They are highly actionable
• The perceived value is high
• The actual value is high
• The content is easy to consume

Case studies, reports, free trials, quizzes, and other forms of similar content can provide this kind of value easily, which is why they are very popular lead magnets today. Nevertheless, Rondeau recommends staying away from e-books or newsletter opt-ins since they do not provide quality leads and the material is difficult to consume. A good lead magnet empowers visitors and sets them up for becoming a customer.

After building the right lead magnet, the next thing you need is a “tripwire”. A tripwire is an “irresistible offer that makes sense to buy”, or an offer that is meant to convert prospects into buyers. This is an effective tool because even when a person spends as little as a dollar with you, they are very likely to spend much more in the future. A well-placed tripwire will alleviate acquisition costs, and it can change visitors into repeat buyers. Good examples of this are physical products such as books, or small pieces of your main offer.

After someone purchases your core offer, the next thing you need to think about is cross-selling and up-selling. This is the stage where you need to incorporate profit maximizers. Rondeau recommends using a “slack adjuster”, or a high-ticket item that appeals to a very small portion of your audience, in order to maximize profit potential.

The last step, the return path, is about re-engaging customers that have left the funnel. This can be done in several ways:

• Automatic follow-ups, usually done via email
• Exit offers, or strategic on-site retargeting
• Remarketing (display ads and custom audience)

Creating a Segmentation Strategy

This quick course on how you can get started with segmenting your data is led by Candace Ohm, a data scientist, growth expert, and UX specialist. Segmentation allows you to understand your visitors and your users better. In turn, this will tell you which marketing efforts and ideas work best. Segmenting your users also allows you to create customized content and optimize funnels for a specific audience. This is known as personalization.

Segmenting your visitors will start with grouping them by acquisition channel and funnel step. The next layer is splitting users based on demographics. You can also create segments based on the device or browser they are using, the region they are from or based on specific events that they have taken. By calculating the conversion rate for each step of the funnel and for each different audience category, you can identify issues that were previously hidden in aggregated data.

Digital Psychology and Behavioural Design

Understanding the science behind online behavior and design is key in finding conversion opportunities. Often we have a sense of how certain things are supposed to look on a website, even without understanding the theory behind it. Dr. Brian Cugelman, a highly-experienced behavioral scientist and psychologist, discusses this next course about behavioral design conventions and strategies.

Changing user behavior comes down to combining influence techniques with specific media formats. We can take a number of perspectives to assess the various issues a website has, but the focus of this course is on psychology, neurology, and “industry lingo” (what is known to work based on many years of research in a particular industry). Similarly, the content of the course also focuses on the point in the funnel from when the visitor is being informed until the moment that they become trusting, or confident in their decision to go further with the purchase.

This set of courses was a nice and diverse break from the series of (mainly) statistics courses that came before it. The key lesson of the first two courses is that you should look at how you can maximize value for specific audiences, which you can segment in many different ways.

In the next part, I’ll be covering “Applied Neuromarketing” and “How to Design and Roll Out an Optimization Program”!

This is part 11/12 in my series reviewing the CXL Institute CRO Minidegree. I will be posting a new part every week!