It was Monday morning when Simon gave me the awful news. “You’re not going to like this…” I braced myself as he told me that a number of our websites had been disabled by our web hosting company… and a significant part of our business was offline for an unknown period of time.

Simon got in touch with our web host and, after some to-ing and fro-ing, it turned out that a hacker had exploited a vulnerability in one of the scripts we were running on the web server (the computer that hosted our sites). But before I go on, let me say that what I’m about to reveal holds some critical lessons for you.

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A case study published in MarketingSherpa recently illustrates how to convert a percentage of shoppers who abandon your shopping cart.

Diapers.com set up a system whereby an email was sent to any registered user who abandoned their cart. The email went out at least 24 hours AFTER abandonment and featured the items left in the cart.

Why the wait? Many of Diapers.com’s customers ordered online late at night. The company reasoned that it was better to give these customers some space before contacting them again.

The emails were:

personalized, using the customer’s first name;

included three text paragraphs in order to get the key message to readers who might have images turned off in their email program; and

included a “View Cart” hotlink to allow customers to click through and complete the purchase.

As a result of this approach…

Diapers.com’s conversion rate was 129 percent higher than that achieved by any previous marketing campaign; and

The emails sent after abandonment made up 10.4 percent of the total revenue from Diapers.com’s email marketing program despite constituting just 2.7 percent of the total volume sent.

We have long advised clients to specifically follow up on customers who abandon their shopping carts. We also do this for our own sites and have been exceptionally pleased with the business we’ve received from customers who, for a range of reasons, didn’t complete their original order. (Hint: it’s not necessarily because they’ve changed their mind about buying from you…)

Source: MarketingSherpa, “Focusing on Referrals, Abandons Helps Eretailer Grow List, Bolster Sales”, MarketingSherpa, September 10, 2008

Here’s a major tip for multiplying your profits: use up-sells and cross-sells in your sales process.

While some time may be taken in creating or finding suitable products and integrating them as up-sells or cross-sells on your site, if you choose correctly, I can almost GUARANTEE that a percentage of customers will take you up on your up-sell or cross-sell offers, resulting in more sales and profits for you.

Now, before I go on, let me quickly clarify what I mean by “up-sell” and “cross-sell”.

An “up-sell” is where you attempt to sell a customer the more expensive (i.e. premium) version of the product or service they have chosen to buy. A “cross-sell” is where you attempt to sell them an additional product or service to the one they are already buying.

Depending on your current line of products and services, as well as your target market, a cross-sell, up-sell or combination of both might work best.

It’s a good idea to test different approaches to determine which is the most effective.

There are also different ways to integrate such offers into your sales process. For example, many Internet marketers offer up-sells or cross-sells just before, or when, a customer arrives at the shopping cart. However, where you place your up-sell or cross-sell offers is just as important as choosing to offer them in the first place. In some cases, displaying them before or on the shopping cart page may not be easy to implement or ideal. Forcing customers to jump through several pages of up-sell or cross-sell offers may actually DECREASE sales.

FootSmart.com, an online retailer profiled by MarketingSherpa, found itself wasting a lot of time and not achieving a desirable return on investment (ROI) by constantly manually adjusting cross-sell offers in its shopping cart. So it changed tack and implemented a solution whereby each time a customer clicked on a product details page, four other items (cross-sells) would appear alongside the selected product.

These additional offers included a similar product, complementary product, accessory product and “discovery item” (i.e. a product the customer may not have thought of buying). Each additional item could be added to the customer’s shopping cart. By integrating the cross-sells into its product details pages FootSmart.com achieved a 70 percent increase in revenues.

For information marketers, I suggest implementing the following:

1. An upsell after someone has chosen a lower priced product;
2. A cross-sell after they’ve decided on the product they wish to buy;
3. A special offer (cross-sell) after they’ve purchased.

For etailers, try FootSmart.coms’s approach of generating cross-sells whenever someone clicks on a given product details page. You may also wish to try a special offer after they’ve purchased.

Then test both alternative approaches and offers to continually improve your sales and profits.

And remember, if you don’t have enough of your own products or services to use as up-sells or cross-sells, look for some high quality affiliate products to offer instead. Just keep in mind that you don’t want anyone clicking on an affiliate link and ending up on some other website until AFTER they’ve purchased from you. On that basis, you might want to contact the merchant and see if you can integrate their offer into your sales sequence without requiring customers to leave your site.

All in all, consider using up-sells and cross-sells. Once you’ve set these up in your sales process it’s an almost effortless way to multiply your profits.

Sources: MarketingSherpa, “Cross-Sells on Product Pages Boost Revenue 70%: 3 Easy Steps”, MarketingSherpa, Jul 24, 2008

I love forced continuity. I love it from a marketer’s perspective. And I love it from a customer’s perspective.

As a customer, I appreciate it when various companies bill me automatically and I don’t have to remember to pay them. That includes my daughter’s kindergarten, my health insurance company, my life insurance company, my credit card company, my health club, and yes, some of the Internet marketing services I use, such as my Internet phone service, my article submission service, and my shopping cart.

Frankly, I would prefer it if MORE companies offered forced continuity. That’s because, when I’m using a service that I want on an ongoing basis, I appreciate the convenience of having payments paid automatically (without me having to think about it) and the avoidance of any risk that the service will stop because I haven’t remembered to pay the required amount by a certain date.

So why are so many Internet marketing forum members complaining about forced continuity?

Well, although some people may be against forced continuity of any kind (a view I can’t understand for the reasons given above) the main problem appears to be with hidden forced continuity. This is where a customer isn’t clearly notified before they order a given product or service that they will automatically be billed each month (or other applicable time period).

This is where forced continuity is wrong. Not just morally. It’s illegal under the misleading and deceptive laws of countries including Australia and the United States. Nor is the issue one of those “grey” areas – you either make it clear to someone that they will be automatically billed each month or you don’t. Failing to state this upfront… hiding it in fine print… or disguising it as some other kind of offer… are all attempts to mislead or deceive.

Those who attempt to hide or disguise their hidden continuity programs should stop treating their customers like idiots.

Firstly, if they have a service that people want, they should have nothing to fear from making the forced continuity obvious. I’m certainly not the only one who WANTS companies who deliver something I want to bill me automatically.

Secondly, such marketers are on shaky ground. As a lawyer who has advised in this area, I can say with some confidence that attempts to hide forced continuity constitute misleading and deceptive acts under Australian law. I’m told these are likely to fall afoul of U.S. law too.It only takes one person to make a complaint and an enthusiastic regulator for an Internet marketer who breaches such laws to be prosecuted and face heavy fines and other undesirable consequences.