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Startup School Winter 2020
January 20, 2020, Online, USA
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Kevin Hale - How to Improve Conversion Rates
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About the talk

YC Partner Kevin Hale covers the first principles of conversion, one of the main drivers of growth for your startup, and how you can improve it starting with your landing page.

Transcript and lecture slides here: https://www.ycombinator.com/library/6l-how-to-improve-conversion-rates

This lecture is part of YC's Startup School, a free online program and global community of founders. Register and join the community at https://www.startupschool.org/

Timestamps

0:00 Introduction

1:04 Benchmarks

3:28 The knowledge gap

5:05 How do I get users to push the button?

11:00 Real-world examples

00:00 Intro

01:04 Benchmarks

03:28 The knowledge gap

05:05 How do I get users to push the button?

11:00 Real-world examples

About speaker

Kevin Hale
Partner at Y Combinator

Kevin Hale was the cofounder of Wufoo, which was funded by Y Combinator in 2006 and acquired by SurveyMonkey in 2011. He was responsible for Wufoo’s much-admired design and speaks widely about UX. Before Wufoo he wrote about design for Particletree and was editor in chief of the web development magazine Treehouse. He has a BA from Stetson University in Digital Arts and English.

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So this presentation on improving conversion rates, it's designed to mostly focus on like landing pages. But all the principles and ideas that I'll talk about in the stock, actually can help you improve the conversion rate of almost anything any user interface to keep that in mind. Typical example, conversion, rate funnel. And when you're trying to improve the efficiency of going for one step to the next and the thing is, Why would care about conversion rate is because it's part of two

different aspects of gross. The two main sort of drivers. And so gross is kind of like the balance between conversion and churn and basically growth happens as a gap between the two. Something to keep in mind, is that working on Sharon is actually much easier than working on conversion. So this talk, where are working on the harder thing to think that usually are going to get started. When I talked to a company and I'm trying to help them with their conversion rates. The first thing I usually try to figure out is, do we even need to be working on this

at all? So the only time you should be working on and improving your conversion rate is because you have a leaky bucket. So I'd like to just talk about a couple of benchmarks and Industry. So that would be all kind of sit on the same page and understand whether like we should be working on this or working on something else like putting more things into the top of the funnel. Shareware, version by Tiara is about 5%. So basically, this is old school, like, before the internet, if people just really software out for free, and they just hope that somebody will pay for

it or their own good. Will, this is the conversion rate you can expect Casual download games at 2% so stuff that you sort of play on and off while waiting in line. Most companies premium software-as-a-service companies, they range between 1.5 and 5% on average is about 3%. So once I talk to a company and they have pages that are converting at about 3% and that is from like out of a hundred visitors that does your page 2 to 3 % up. I usually say you probably don't need to spend that much

more time on this other things you should work on instead. That being said, you can do much better than that. Flicker. Back in the hay day. I had a conversion rate between 5 and 10%. Adult Friend Finder. The depending on what you're selling people wanted a whole lot more so than the 22% for sex and end of loneliness. Even better that these are if you don't recognize them children's social networks. And so basically, this is the conversion rate to get your kid to shut the fuk up. I meant to leave you alone.

TurboTax online, the monster 70% conversion rate. Basically, you're going to TurboTax, you're downloading that software, you are paying for. It is a very, very high and tight. Every conversion rate problem. Looks like every other user interface problem and the concept or framework that I'd like to use to explain how to solve any user interface problem is using something called the knowledge Spectrum. This was created by amazing interface designer named Jared, spool

and basic knowledge inspection says that this represents All knowledge on a spectrum and I'll decide represent zero knowledge. No knowledge. You don't know anything and it side is God like all knowledge your products and your user sits on two points on that line. The two dimensions. Your user sits here. I will be called the current knowledge point and your interface, your landing page. The thing you want them to do. So it's here at the Target know which point

and every interface problem. That's trying to be solved. You trying to close what we call the knowledge Gap to sit. You don't need to go to a complicated design school. To know how to solve these problems, you either going to increase the amount of knowledge that is needed by your user. Or you need to decrease the amount of knowledge needed to use your product face whenever I'm looking at anyone's design problem, trying to figure out if I need to increase knowledge, or do I need to decrease it? So the most helpful exercise that I will use them. That's what I understand the concept.

When I'm trying to design a landing page or didn't prove, it is a simplify things. Very, very simply and what I imagine is something called the one button interface. So let's imagine that we reduced our landing page. Our products to just one button on a page. The question becomes. What do I have to put on this page? To get someone to push the button? What's the minimum amount? That's what you want to have on there. And are there any information that I put on this page? That keeps me from pushing the button or is there any lack of information that

keeps me from pushing the button now for every time that I deal with, Any patient looking at that? I'm trying to help improve. I basically go through a series of seven questions and then through the series of seven questions. I look very smart. You now to be smart on your. The first question I ask is, what's it called? Action is the button is the thing. I most want my user to do. Is it super obvious? Where do I find it? And the thing to keep in mind about the call, the action is,

it should be really, really close to a concept. I like to call. The magic moments, the Magic Moment is basically the experience, the knowledge information. The interaction that someone has with your startup and all the sudden it gets tingly inside the light. Bulb goes off and go. Ho Lee fuk. I've been waiting for this my whole life. I now get it. This is super exciting. I can't wait to use this and your call the action, she would be as close to that magic moments possible that when I click that button underneath taken to that

point. So often I go to a design critic with someone. I'm like, what's your magic moment? And then somehow the call the action is like 27 steps away, from whatever it is that make someone feel special or gets really excited about your part or app. So you should be as close to zero as possible from your call the action. The six other questions where to go through relatively quickly. And then we're going to go to two examples from people participating in. Start school. Just watch them in action. The next question is, what is this? What is This Magic Moment?

And my test for this, my lips Miss test is like, can I just copy paste a sentence on this page? The same page that I can put into an email and send it to my mom. My mom goes. I understand what this is. 99% of time, I look at people's websites and they're so filled with MBA marketing. Jargon and talked that there's no sentence that exist on that page. That elects me very clearly understand what it is at this company. Does Is it right for me? So people who are super in a rush

impatient, trying to solve their problems. They're quickly, try to identify themselves as like, am I in the wrong place? Is this the right product? And the way they're trying to determine that this is he like, is there any reflection of themselves in this, or any reflection of their problems? Look at it, anywhere on the page? Is it legit? So the threshold is very low here just can't look like a Russian spamming website, right? Outside of that. You don't need to overthink this. Thanks to on the templates and themes out there. You should get be able to get over

this bar. Very, very quickly. Who else is using at. So lot of people are uncomfortable using a product unless they know that there's something else out there and you might think it's a variation of lives yet. But again, this far is completely different. It's letting me kind of know. Oh, a shortcut for is it right for me? And is it legit? And basically a shortcut for trust? And people often are trying to say like, oh, it's so it's so as already using that, then I should actually get this a chance. How much is a, what's the catch? This is the one that's so many be to be

on a private company are afraid to put on their website and which is why we've paired this talk up with pricing and basically, You should have some empathy. How many times do you go to a website and go? Like, well, I'll use this without knowing how much it cost. Sounds good to me. Let's just do it. No one does that until you should be surprised that your conversion rates are affected cuz you don't tell people how much it cost or what's the catch. So, let's say you're giving away something for free and really your business models, you make money some other way. You

should explain that to people cuz otherwise people feel paranoid or worried or feels kind of weird. The last leg is where can I get help? There's always a percentage of users who go to your website and don't know, it doesn't matter that you have all the FAQ use, you written everything down. You crazy. You Beautiful video, documentation. They will just go. Like, I just want to ask someone. I just need to talk to somebody. I need someone to tell me directly and part of it is some people are just like, I just want to see if there's a real person behind the bus number one,

or some people are just can't be bothered. And sometimes it's easier for them to just directly ask then navigate to the website. And if you don't make it really easy to find in contact you or make it look like that, you were going to help them if they start using the product. They probably won't use it. This talk is so short. Those are the seven questions. We are now going to go through two examples of start school companies, that sent their stuff to me, and I don't really have their permission. But

they did submit it when they asked to have a designcrete critique done in the surgical forms. So I feel like we're going to be okay, okay. So, the first one we're going to do. Is meeting room. I owe? All right. First question. What is the call the action? What is it that this company most wants me to do? And then what I do is I basically then try to do that thing and just follow it all the way through and just see how far away am I from the magic moment. So these guys

create virtual meeting room platform. So basically You don't have a copy paste out of state. But basically it's like you want to meet in VR space with someone. You can use this to help create that space and create that sort of meeting. Imagine it is get a virtual room right now. There's a lot of things have sort of competing with it for all the called actions on this page, and we kind of don't repeat it down here that reminds me, where to go. So, let's go to the most efficient. Get it for from eating room right now. And then out here, we

have competing calls actions to download and then we have managed rooms and then there's a start here to get to your virtual room, which is the carousel that walks you through seven steps to finally get to making a room. But none of these are the actual forms to do it. So you have to then go here. And then hopefully you will remember all of those seven steps in the Carousel and he'll walk all the way through it. so, Things that I would recommend would be like I want to have always one button.

That's a very very clear as what I want you to do on any given page. Number two. I don't think this makes it. Easy to understand and I can't keep it in my head, The Fallout, it's good, that they know all this stuff, but I would probably imagine that. There's something that's going to help me experience that magic moment much soon. And what I imagine is that magic moment happens when I finally like makeup booking and I meet with someone in a room together and we start interacting and we're solving something. And I feel like if I can't do that right

away. Then I want to have them be able to experience it somewhere. I would totally add some kind of video. I think they have that kind of here. All kind of show it off. This is this video kind of long and doesn't get it to that sort of magical place. So that's a One S. What is this sober for meeting room platform. But if I copy and pasted that, I wouldn't quite now. Also, you see this carousels? Kind of moving around? Carousels, don't work for a while cuz you're hiding information that I might want to have the answer 81.7 questions.

And secondly, we do this thing. Recalled an open beta and so the legit are here, so it's going to affect it. Like I can't rely on this and the later on the sign-up page and talks about entering into the closed Beta. And so these are all things that indicators like I'm not ready for you to experience this don't use me for any real meetings. So at the start of a lacrosse and so if this basically works I will try to move that straight forward to that. Down here. We're trying to look for like who else is also using

it. So we don't have a list of customers and said we have a bunch of other logos here in terms of features in a bunch of press that we have partners that, you know what that means. And then we have a bunch of awards but none of them are actual people using it, until it's so many logos of other things that it would make me, nervous. No one's really using this. As a result. And then, lastly, what do I get out? We've done. Intercom in the lower, right? And then we also have Help page. No documentation

to quickly made certain look at the see how this works. And then the last one is going to pricing. So here. Look at this point and I realize, okay, see this pricing. If I need 12 people in a room going to be $99 a month and then I can start working on one page over and I go for the free again, will go through all this whole process. It's a bunch of little things. We just go through all the questions again. See, a bunch of non-optimal stuff on this page, but they were second example, KB different company called and so

they describe themselves as a react codebase generator and then he has his windows,, Does it? Use our free web-based tool to create the perfect codebase for your next project to my first question. I'm trying to figure out is like what's it called action? He most wants me to do inside like scroll down this page, but that's nothing that looks like a giant button. And actually the big thing you want me to do is click on one of these templates. The screenshots that are supposed to be the button. Sweaters in a Ford in the problem and then we go into here. And my magic

moment is when I get over and realize it's like, oh it's not just like landing page templates, but it's like a dashboard. It's like a sign in page of pricing but it's like the entire project for building a sassa is all located here, which I think is really amazing and nothing just tells me. That's why it's all here. And I might not find out until I export code and I hit download. Get the code. There were so many steps away from sort of experiencing that and also I feel like it's so not explicit that I might miss. How amazing what he's built here is the

terms of what he's offering. One thing he does kind of wild as like he doesn't have like a logos of customers, but he has shown how many people have created or downloaded the templates. So this number kind of set that I know there's two boxes using this and finding it useful. Down here. He tries to get out of everything. You need is included, and they ads all the other texts, but that text is there and it's odds are your users aren't going to read them. The because it's loaded into that copy, get kind of lost. Then again, we have an

intercom. This is not enough information, terms of like as a q's right at about page. That just makes me go like, oh, that this is more than a side project. And so, in terms of like how much I can sort of invest in this and how much I can rely on this down, the road in the future is going to be miserable as a result. Great.

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