Author: Russell Brunson
Over the past 19 years, Russell has built a following of over a million entrepreneurs, sold hundreds of thousands of copies of his books (making him a New York Times Bestselling Author), popularized the concept of sales funnels, and co-founded the software company called ClickFunnels that helps tens of thousands of entrepreneurs quickly get their message out to the marketplace.
Funnelology: The New Art And Science of Funnel Building…
Session #1: The Secret Formula
Session #2: The Value Ladder
Session #3: Front-End Lead Funnels
Session #4: Unboxing Funnels
Session #5: Presentation Funnels
How We Took 1 Dead Funnel, Made A Few Simple Tweaks, And Turned It Into A $500k Per Month Powerhouse Almost Overnight…
Earlier this year, we almost walked away from a sales funnel we had spent over 18 months trying to perfect, but we just couldn’t make profitable.
It was selling a new supplement we had invented, and while the website was creating customers, it was doing it at a loss.
Yes, for every $1 we put into ads, we were getting back about $0.40.
Not a good way to run a business long term.
We had tested and tried a LOT of things (as you may know, we literally wrote the book on split testing – you can get a free copy of that book at www.DotComSecretsLabs.com)…
Yet for some reason, we couldn’t turn the corner on this one.
Conversions were good… cashflow was bad.
About that time I had a chance to talk to a few guys I knew who were crushing it in a very similar market.
I showed them what we were doing, what our conversions were, and why I was frustrated.
He came back with two questions.
First) How much does it cost you to acquire a customer.
Ha ha… this one I knew. 🙂
After watching Shark Tank for years, I knew this was a core metric that EVERYONE had to master, or they couldn’t run a business.
“Depending on the traffic source, we average about $80 to acquire a customer.”
Boom – I’m pretty sure he was going to be impressed.
Then question #2 came out:
Second) What’s your average cart value?
Huh…? Cart Value? What’s that mean? Why aren’t you asking me about my conversion rates?
I had never heard of that metric before.
“It’s how much money you make on average, in the cart (including your upsells, downsales, etc…), when someone buys your product.” he said…
Now, that was a metric in our funnel I had never looked at before.
So I went back to the drawing board, started crunching our numbers, and figured out that our average cart value was ONLY about $32.
“Well, that’s your problem – you’re conversions might be awesome, but your cart value sucks. Get that up, and you’re back in the game.”
Hmmm… I had never thought about cart value before. How could I increase that?
Adding more upsells…
Adding a downsale…
Where else could I add in things to increase my revenue?
As you can guess, that put us on a new mission.
At the time, we only had 1 upsell, and while it converted great, the dollar amount didn’t get us even close to break even, let alone a profit.
So, we changed the first upsell, and did a bundle pack that sold 6 bottles.
We created another product for a second upsell, and then a third.
After we had everything in place, we turned the traffic back on.
We already knew it was going to take us about $80 to acquire a customer… but how much now would we make immediately, in the cart, from each person who bought?
Within hours, we knew we had a winner. We were averaging about $163 cart value on day #1 (before any follow ups went out!!!)
Do you know what that means?
$80 to acquire, and we immediately, point of sale (in the cart) make $163 back out!
$1 in… $2 back out!
That’s the formula for a winner!
Now all we had to do, was add more traffic, and watch how fast we could scale this offer.
And the results were awesome.
Within a month, we passed $100k in sales.
Within 2 months, over $300k.
And by month #3, less than 90 days after making those changes, we had passed the $500k a month mark!
So, next time you start to build a funnel (or you’re trying to fix a dead funnel) – remember these two metrics:
1st – what does it cost to acquire a customer?
2nd – what is your average cart value…
If you can get those 2 numbers right, everything else will take care of itself.