When Testing New Products, Close your Sales Funnel and Make Pre-Sales
This article is for marketers, product owners and sales people that want to test new products or new features of existing products quickly with little risk, to see if their users or readers actually want to spend money on their new idea.
I’m going to share a detailed story of how I turned 1 single blog post into an information product that has made over $2,500 in revenue with a 70% profit margin, excluding my time of course. This is not a get rich scheme, $2.5k is not a huge some of money. But I learned a lot of marketing and sales lessons with this simple product that I have applied to other products and features of larger products.
My goal is to share what I’ve learned to get feedback and connect with other people who are working on similar projects. I’m a huge fan of specifics, real examples, and getting sh%t done and it would be great to connect with like minded people.
Before we get started, a few key lessons I’m going to share.
- CLOSE YOUR SALE FUNNEL. What do I mean by this? When you are testing a new product or feature, you want a potential user, reader, or lead to only be able to make it down the path in 1 possible way. If there is only one possible way for them to go, it easier for you to track, optimize and make conclusions about what you’re testing. Especially when trying to determine if there is demand for a new product or feature you want better leads NOT more leads. Often 10 sales is all you need to convince yourself to build a prototype. Also, you need to be able to understand each number along the sales funnel so if you don’t get the wanted results, you have an idea where you can change something to run a new test.
- Get Good Numbers. Too many marketers are lazy at the really specific numbers that they will need to run marketing campaigns and know if its working or not. By closing the sales funnel you can gather the numbers needed to scale your market afterwards if the product is a success. In my case, I know the expected profit per free download of my product. Thus, I can use this number to run paid campaigns and know whether they are profitable or not.
- I’ll talk about how to take advantage of and integrate the many free tools available on the market so you can don’t need to pay money to test a product.
- How to get potential customers to self-select themselves if you already have access to a list/readership and if you don’t, how to gain access to one.
- Why it’s good to always assume your product is NOT going to work, and look for reasons why it will work. This is a much better frame and will reduce more risk then assuming people want to buy your product and search for reasons why they won’t.
First – What exactly is the product?
The product is a simple study guide with 200 questions, answers and explanations along with audio mp3 files if you want to pay more. It’s called the NABCEP Study Guide. The study guide is for a prestigious solar certification that is growing in demand with the explosive growth of the solar PV industry in the US. The NABCEP Certification is the best of the best in the solar PV industry and it also is feared by man within the industry. People are worried about not passing the exam.
How Did I test the Market?
The key challenge in testing a new product or feature is the catch 22 of the industry. I want to sell it before I have it, but I can’t sell it unless I have it.
With software and information products this most often can be overcome by giving something away for free and making pre-sales. In order to make pre-sales you need two things. First, some sort of customer insight that gives you evidence and inspiration into what customers might actually want to buy. Second, access to a list of readers that are potential customers.
Working with HeatSpring I had access to both.
Gaining Customer Insight
We have a face-to-face training NABCEP Prep Course that sells for $895. Clearly there is a need because we sell seats. However, some students couldn’t make the training and would ask over the phone, on chat or in email if they could buy just the study guide.
Access to a List
Our mailing list is around 33k that goes out once a month, plus a blog that gets over 4k visitors per month, so I had direct access to readers of a very specific and niche market.
I know what many of you are saying and that’s “well Chris, you had everything you needed it must have been soooo easy. How can I use your advice if I don’t have access to a list or customers asking to buy a product.”
My response to this is two fold. First, just because it looked like it was easy does not mean it was. I didn’t believe it would happen until someone gave me cash, simply because someone asks for a product doesn’t mean they will pay for it. Secondly, there are many ways to gather customers insights and data and also get access to a list even if you don’t have direct control over it. I’ve done this many times with other products that I will discuss in future posts. But here is my basic advice.
Where to get customer data
I’ve found some of the best places to get customer insights are on industry forums, industry associations, and if you read between the lines in a blog article and even better within blog comments. Gathering customer insights and getting inspiration for a new product or product feature, if you don’t already have an existing customer base, is much harder but it can be done.
There’s one insight that has helped me when dealing with customer insights. In the very beginning, qualitative information, anecdotes and real conversations tend to be much more insightful then hard data. I think this is true for a few reasons. You are still trying to convince yourself that someone may buy the product. Second, you don’t have enough traffic to be confidence in any hard data but a 6 minute phone conversation can be trusted.
How to get access to a list?
If you don’t have a blog or mailing list yourself, guest posts are a great way to get access to a list. Editors and content creators are always looking for good content that will be HELPFUL to their audience. Also, I’ve noticed that editors are much more likely to like a piece if you plan on getting really specific, going in depth into numbers like this post, or going really deep into a subject by interviewing researchers, or experts.
In your guest post, make sure to give away something for free that relates to the product or feature that you’re looking to test. “Sell around the product.” This free item will start to build your list of leads and within it you can even link to a sales page for the product that you’re trying to sell.
How to NOT Waste Your Time By Making Pre-Sales
Even though I had customer insights and access to a market, I did not want to waste any time creating a study guide if I wasn’t more then 90% sure that I could sell a few copies.
So, I created a free document called the “Free NABCEP Exam Study Guide Cliff Notes”. I made all of the cliff notes available for free in a blog post and also allowed people to download the PDF if they provided their name, email and phone. This was my first experiment, if they had access to all the cliff notes in a blog post, would they download the PDF? Yes, they would!
On the PDF of the cliff notes, I had one link and a few lines of copy to the sales page of the study guide. One link. That’s it. This is what it looked like.
My goal was to not publish the study guide until I had 10 people who wanted to purchase it. Let’s review the sales process steps for the pre-sales and I’ll discuss real conversion and sales numbers below
- One single blog post. The URL of the blog posts and the in-page elements were targeted to 5 specific keywords. Here’s the post: http://blog.heatspring.com/free-nabcep-exam-study-guide-cliff-notes/
- Download the PDF which has one link to the sales page.
- The Sales Page is a long form sales letter which has one link to buy a PDF and one link to a PDF and audio file. In real life, those links to go a purchase page. While testing, they go to a form.
- The BUY NOW buttons are redirected from the sales page to a simple page with a form that says “thank you for your interest in the nabcep study guide.” Please complete step 1 with your contact information and then proceed to step 2, the payment information. When they click on the payment info, they’re re-directed to a page that says the guide is not available right now. The key will pre-sales is that the process must feel like they’re really purchasing something so you can be confident in their intention. Here is an example of a pre-sales form.

My goal in the test was to get at least 10 pre-sales before I actually put in the time to write out the study guide and record the audio files. The light bulb went off that I was onto something when I had 7 pre-sales, but I had a customer call me 3 times in two weeks asking when the release would happen. I was getting so annoyed at him calling me, I told him I would sell him my notes, unedited and unpolished. He said ok. I realized that if someone would buy my notes, then the polished product would be pretty good.
Key Learning from Testing the Product
- When giving away a free product, there is one test it must pass before you know it’s amazing. “Will your tool/resource/free gift be amazingly useful if the person NEVER bought your paid material”. This is key because if you can answer yes, then you free product will get readers to trust you, respect you, and they will be more likely to feel comfortable paying you.
- By giving away amazingly useful content, the reader will think “This is awesome and free, so their paid stuff must be amazing!”
- Help First. When dealing with people you don’t personally know, you need to establish trust and respect. By giving something away, you’re helping them and building the relationship.
- Don’t hide. Many times with internet information products people try to hid behind the internet. Be open, put your direct email and phone number on the landing page for potential customers so they can call you if they want.
What does the sale funnel look like and what are conversion and sales numbers?
After selling the product since January until now, April 19th, here are the numbers.
- Visited the post = 1,467 unique visitors
- Downloaded PDF = 649. 44% Conversion Rate. No A/B Testing yet
- Visited sales page = 404. 62% Conversion Rate. No A/B Testing yet
- Purchased PDF = 20 @ 29.95 = 5% conversion on the written study guide
- Purchase PDF and audio guide = 39 @ $44.95 = 9.6% conversion on the written and audio guide. People are almost 100% more likely to buy the written and audio guide.
- Total Sales 59 = 14.65% conversion with a weight average revenue is $39.70. The expected profit per sale is $27.79. $39.70 x 70%, I need to pay the author of the question 30% profit sharing)
- Expected Revenue of Each Cliff Note Download is $3.60 per person who downloaded the free cliff notes, THIS DRIVES CPC work. $2,342 in total revenue (for the cliff note sales funnel) divided by the total number of people who downloaded the guide, 649, is $3.60. I can use this number to drive any CPC campaigns. If I can acquire a download for less then $3.60 it should be profitable. However, one think to keep in mind is that the profitability of different funnels tends to be different due to the type of users coming from each funnel.
A good, but unexpected thing happened while I was testing the cliff notes sales. The first plan was to ONLY ask for money from people who had already downloaded the study guide. However, google indexed the weebly page (http://www.nabcepexamstudyguide.com) that I created. The page was just created to provide a place for for downloading the guide, thank you pages, etc.
When it started to gain some traffic I created a 2nd set of cliff notes that led people to a different sales page and also set up a direct buy button on the weebly page. I made sure to create a new product name with PayPal that would only be listed on the weebly page, so I could track exactly how many sales were coming from organic searches verus those comes from cliff note downloads.
Here are the numbers from January 1st until april 19th for the Weebly page.
- ORGANIC Visits to the home page = 788
- Downloaded Cliff Notes = 22 is 2.7% conversion.
- Purchased AFTER downloading the cliff notes = 1 is 4.5% conversion.
- Purchased the guide SIMPLY from searching and visiting the landing page = 6 is .7% conversion rate. Yes, less then 1%. But keep in mind, I did nothing for these sales everything was already created, I just added a few buttons.
There are a few things to note with this sales funnel. First, I’m amazed I was able to get any traffic let alone sales from the weebly site, it’s pretty ghetto. Second, the numbers are too low for me to be confident in the conversion rates. Third, when tracking the purchases of people who downloaded the study guide first, I only had email addresses to verify and people could use two different emails so I’m not confident in this number either.
What will I be Testing?
Until now, I haven’t been testing anything out of pure laziness, but now I’m curious.
Cliff Note Sales Funnel
The challenge with running any real tests is you need a large enough sample size to be confident. So, while I would like to just increase the conversion in the funnel where people pay me money, I need to make sure enough people are visiting the sale page in the first place to make this happen.
- I’m going to try to increase the conversion from step 1 (visited the page) to step 2 (downloaded the guide). My hunch is that if readers feel that the the downloadable PDF has a little more, or a little better information then the blog post, they will be more likely to download it and I can drastically increase download rate.
- I’d like to see how I can increase the number of people who download the PDF and then go to the sales page with some email campaigns. I’ve never sent an email to the 600+ people who downloaded the guide so this would be a logical place to start. An easy way of making the emails useful for them would be to send sample questions and real answers along with a link to purchase the guide.
Weebly Sales Funnel
- For the weebly site, I need to overcome some credibility issue, to increase conversion rates. When anyone is searching on google and randomly comes to a website asking for money, they think it’s a scam. My plan is to make the site better and increase the number of people that I can get to download the cliff notes. I’ll do this through design, making it more personable, adding an about, etc. It just needs to look more like a real website rather then a skam.
What Tools Did I use and Why?
The best part of the fermium model of many software applications is that you can use them easily for free.
- Weebly – Weebly is awesome because it’s free to create sites and also for hosting. Thus, all you need to do is purchase a domain name and it will be hosted on weebly. Weebly is also great because you can create pages and hide them from the general navigation bar. This is extremely useful when you’re using google optimizers, sales pages, and thank you pages that you don’t want everyone to see. There are a few other sites like weebly, I just like them the best.
- Gravity Forms - I used gravity forms to create the download form for the NABCEP Cliff notes. It’s just the best and easiest form product out there.
- Unbounce – I used the unbound free account to test the product. Unboune is great because you can create a sales page easily, you can also change the DNS settings of the server with-in weebly to make the URL more friendly. So for example, http://promo.nabcepexamstudyguide.com, looks better then another random sales page URL.
- Pages – I used standard template on pages in iOS to take the questions and answers from the document to make them look pretty.
- E-Junkie and Payal – I use e-junkie and paypal to manage the cash and distribution of the product. You need to pay small fees, but it’s super easy.
What are the largest things I learned and how I apply this to selling now and future products?
- Companies like information products because the margins are so high, distribution is cheap and you test easily. But it’s hard to find good customers and create a product people rave about. I think part of the success of the NABCEP study guide is that it has a very specific market and the product has a specific goal. Students are already paying $300 to sit for the exam, so a $30 study guide doesn’t seem like much. This contrasts with information products that are something like “give me $20 and I’ll show you how to create a Facebook page”.
- Test the market with something really useful, I mean actually useful (like really, really useful) not that kind of “useful” that content markets tend to throw around.
- When testing a market it helps to do 2 or more things at once. For example, with my free cliff notes. Even if no one purchased the study guide it would not have been a waste of time because it was contributing to HeatSpring Magazine and growing our list when people downloaded the guide. I couldn’t loose!
- Looks don’t seem to matter much for Version 1.0. I show the sales page and funnel to my hip “designer” friends and they laugh because, and I agree with them, the page looks silly. But the numbers don’t lie, no one seems to care that there is a “this page is made with weebly” at the bottom of it. Franky, this is a place that holds up a lot of designers and programmers from launching and gives salespeople, like myself, an advantage. If you are a designer or programmer your ego is built into each product, I only care if the product sells. Also, there is a huge difference between going from version 0 to version 1, to 1.1 to 2.0. Most of the time perfectionists are only valuable when going into version 2.0, which are never new products.
- Very small niches can be extremely profitable. The total traffic of the 5 keywords that drive all of these sales are less then 2,000 per month combined. If you ask most internet marketing people, this is too small of a niche. But again, numbers don’t lie.
- The free cliff notes were so useful, other people started spreading it for me: http://thirdindustrial.com/nabcep-exam-study-guide-cliffnotes-solarmooc/. Also, a few times I would double check sales that were coming through with the list of people who downloaded the cliff notes. Every once and while they would not match up. Because there is only ONE LINK in the world to that sales page, people must have been sharing and emailing the cliff notes to each other.
- There will be attrition from pre-sales to real sales and refunds will happen. I’ve made two refunds and out of the 7 pre-sales, only 4 turned into customers. I’m okay with this because the pre-sales gave me the confidence to build a product that was then sold to many more people.
- Competition doesn’t matter. A free study guide already exists but people still buy the paid one. Why? It’s better. And also, all customers are never 100% aware of all choices, nor do they care. You can see this in the restaurant business, competitions exists but that says nothing for how well YOUR restaurant will do. If your customers LOVE YOU, and you have enough of them, you can have a business.
- I applied this process to launching a new product, but you could apply to the same logic to adding new features or product lines to an existing product. By giving away something that is extremely useful for free, the readers or customers that are interested will self-select themselves and display their interest. You will then have a much smaller list of more qualified people that you can sell to.
Chris Williams is not a marketer, but he likes to get sh%t done and hates vanity metrics. He’s CMO at HeatSpring and Partner at Cammpus, a marketing tool that gives brands the power to create their own branded university to educate their customers in minutes with no IT.
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