We all like to trim the fat at the beginning of a New Year. We all try to consume less, get fitter and cut back on unnecessary luxuries. What about in your organisation? Think optimisation rather than reduction.

There are many challenges and looking at the year ahead there are some big decisions to make (carefully).

Return on Investment

Instead of just cutting back on marketing activities to reign in your budget before the fiscal year end, it pays to think strategically about how you are spending your campaign allocation.

Are you focusing on promotional activities or on brand building ones? Whether at the end or the beginning of a campaign, analysing return on investment is a smart strategy to ensure that your efforts are reaping the most rewards and a good way to build your learning for next time.

If short-term results are important to you tactical initiatives are a good way to reach your goals providing they consider the bigger picture. Select targeting with an offer and call to action with efficient measurement can do wonders to deliver quick ROI.

Longer-term programmes will require deeper investment in time and resources to ensure your research and planning provide the robust platform for a strong brief. This time and process is critical to ensure that sales and marketing outcomes are aligned with your forecast return.

Re-evaluating Your Competitive Advantage

Why not spend the first few months of 2011 re-evaluating your competitive advantage? You can do this by looking at your market, your customers, trends, your product, offer and key messaging making sure that you haven’t taken the easy train… making sure that you are maintaining your position in the market and keeping the revenue flowing in.

One thing is for certain, at least one of your competitors will, as a minimum, be looking to creep slowly into your point of differentiation having redefined their own competitive advantage against you. It’s never too late to make a slight change moving forward, to invest a day in a workshop to step back from your business or to try something new.

Get on the weighing scales

A helpful cleansing exercise is to take a look back and review what you said you needed to achieve and what you actually did achieve. This can be done statistically, financially, visually and even by actually doing some simple research to sense check. Are you slipping back into old habits? It’s easy to eat takeaway when it’s convenient, and there’s nothing wrong with it in moderation, as long as a quick and easy solution isn’t taking over your well-intentioned strategy or plan. Use this exercise to plan out where you want to go, and to ensure you keep doing what’s good and change what’s not so good.

Best wishes for gaining a competitive advantage in 2011.

We visit and make purchases from websites regularly, but did you ever wonder why you ended up purchasing something from one site rather than another? Whether you made an impulse purchase or closed the browser just after adding items to your shopping cart, could it be that the design of the site subconsciously led you – or your customers, to make one decision over another?

A study published in a 2010 article called “Using Clickstream Data to Enhance B2B Web Site Performance” by R. Wilson in vol. 25 of the Journal of Business and Industrial Marketing, outlined the results from a study designed to examine some of the web design factors that contributed to customers’ purchase decisions as they clicked along the purchase process.

The study examined the behaviour of 900 site visitors who were divided into two groups. One group was not offered free shipping, while visitors from the other group were made aware of a free shipping offer.

Test group without free shipping offer:

92.7% of visitors visited product index

89.1% of visitors went to a product specification page

16.7% of visitors entered the shopping area

8.9% of visitors added items to their shopping card

5.1% of visitors completed a purchase (23 of 450 visitors made a purchase)

Test group with free shipping offer:

92.9% of visitors visited product index

88.4% of visitors went to a product specification page

20.9% of visitors entered the shopping area

12.2% of visitors added items to their shopping card

7.1% of visitors completed a purchase (32 of 450 visitors made a purchase)

In the study, the organisation found that although offering free shipping had greater costs, the ROI was greater with an increase in sales, as well as an increase in the average value of each customer purchase. This study resulted in a 7% conversion rate without free shipping, and an 11% conversion rate with free shipping. Although conversion rates vary by price point and industry, an increase in conversion rates of 4% was found in this instance to be well worth the cost of shipping. In a similar subsequent study, a site that had free shipping listed on the shopping page had a conversion rate of 8.8%, while a free shipping offer listed on a site’s main page had a conversion rate of 11.0%, with a 27.7% increase in the number of visitors completing an online purchase.

Although the information presented simply reflects one study performed, and recognising that each business or industry would have unique results, it does raise the question of whether a site is optimised for purchases. What % increase in sales would make it more financially beneficial to offer free shipping to your customers? What would your ROI be for offering such a service? Is a 4% increase in sales financially worth it for you?

What impact does the design of your site have to your brand and competitive advantage?