SparkleWise

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Lately, I got this idea of making a website providing gift certificate templates. I selected this niche because:

• there’s a decent number of searches: Google Adwords reports “gift certificate templates” is searched 60000 times a month. Plus there are an number of alternative searches: “printable gift certificates”, “gift voucher templates”, “online gift certificates” etc. So combining all these searches, it seems like we have a healthy search volume.
• competition is OK. The first site showing up in a “gift certificate templates” search on Google is the Microsoft Office page providing templates for Microsoft Word. The second one is “Gift Card Designer”, which seems to be a worthy competitor. However, they have a Google PageRank of 1: that means that I can expect to come to the number 1 spot for google searches in a reasonable amount of time.
• the main competitor seems to be doing OK, with a company backing it, a “we’re hiring” page and other signs which seem to indicate they do get some business. So that means that’s a decent market for a one-man operation to break into.

After the idea and product selection, I wanted to do some Adword testing. The idea is the following:

If you have a idea for a business, you can very easily test it. It takes a landing page and a few dollars worth of Adwords credit to test the concept.

You can measure how often people click on a certain button for example. In my case, there were two goals:

• Measuring demand: how many people are willing to buy gift certificate templates?
• Get people to subscribe to a mailing list and give me feedback, by filling a form on the website.

To make this happen, I bought a template on ThemeForest that means I can get a good basic design for my website without paying big bucks to hire a designer. I’ve selected the Lander template (cost: 8$), and made a couple of modifications on it. I’ve also paid a designer on Odesk (cost:12$) to create a gift certificate design that I could show off on the landing page.

Anyway, I’ve created a basic first version of the website, like this:

You notice the clear tagline: “Gift certificate templates for your business”, the nice gift certificate picture, and a clear, aggressive call to action: ‘Buy Now’ with the price of the gift certificate: ‘$5′. However, there is no real website behind this landing page. That’s intentional, since I didn’t want to build a full website to just test an idea. I just wanted to drive traffic to this landing page and see whether people would click on the ‘Buy Now’ button. The trick is, when people click on ‘Buy Now’, they will land on that page:

The idea with this page is to collect email address of prospects, and engage them to give me feedback about what they expect from a template site. That way I could have a more precise direction of what my potential customers want (even though i can default on to copying what the main competitor does, but it’s good to understand which things I can do better).

Once this mini-website was set up I ran a campaign on adwords. That means I created a few advertisements to display when people make searches on Google for a few targeted keywords. Adwords can actually advise which keywords to target based on primary keywords. Say, you want to target “gift certificate templates”, Adwords will advise you to use:

• printable gift certificates
• templates for gift certificate
• gift certificate maker
• gift certificate boxes
• …

To run the campaign, I created a few ads that would display on the right-hand side of google search results when people look for the selected keywords:

So, equipped with my list of keywords and my ads, I set up a maximum daily budget of 15 euros and started the campaign. After 2 days of running the campaign, I had these results:

So, we can spot a problem here. There are not enough conversions-that is, the people who click on the buy button- to get a significant amount of people to sign up for the newsletter and give me feedback. Each conversion costs 15 euros, and out of these conversions, even less will decide to sign up for the newsletter. Actually, out of the 2 people converted in 2 days, 0 signed up for the newsletter.

For the good news, I’ve got a 4.55% conversion which is actually not that bad (that’s a good conversion rate for an ecommerce store, from what I’ve read), and that validates the idea that a sizeable amount of prospects would be willing to buy templates. However, one could point out that 2 conversions out of 44 prospects is not statistically significant. That’s true, however there’s also a balance to find between the money you’re willing to spend and the information you want to find. So I decided to stop here the first learning phase – measuring demand.

But if I wanted people to actually subscribe to the mailing list and volunteer to give their feedback, I was going to need a lot of money using that strategy. So, I changed strategy at that point, and instead of having an aggressive ‘Buy Now’ button right on the landing page (which seems weird anyways), I replaced it with a more laidback ‘templates’ button.

After 2 more days of running the ad campaign, the results were looking very different: conversion rate was almost at 60%!

Of course, it’s kind of normal that the new design converts much better (that is – quite some people click on the call-to-action button “templates”). However the goal was to get prospects to subscribe to the mailing list and give me feedback. I must say the results for this second approach are a bit disappointing, as I’ve got only 2 signups for the mailing list and I’ve got zero feedback from potential customers.

So, to sum up how my initial Adwords testing went:

• to measure demand and to get prospects to sign for a mailing list, I set up a Google adwords campaign to drive traffic to my site.
• the first adword testing phase (to measure demand for the product) was encouraging since 4.55% of people clicked directly on ‘buy’. However the small sample makes it non statiscally representative. To ensure that the results would be reliable statiscally, I would have need to let the campaign run longer, but that would have costed quite some money.
• the second adword testing phase was more disappointing since I’ve only got 2 signups for the mailing list, and no feedback at all. Maybe this is not the right strategy to get feedback in the early stage. If you have more ideas on how to sollicit feedback from potential customers from a landing page, please let me know in the comments!

Lessons learned:

• it is hard to do testing with multiple goals: testing for conversions needs a different environment than getting a few initial prospects.
• adwords is a bit tricky for beginners. I ended up spending money faster than expected because of a few parameters I didn’t adjust in the beginning. There are a couple of tricks I didn’t know that would like to talk about in a future post.
• money is spent fast on adwords. No wonder Google makes a killing with it!