Monthly Archives: May 2009

Form Fail

The quality of form design, in general, on the web continues to be a huge source of frustration for users and an embarassment for all of us who are involved in designing and building sites.

Here is a payment page that I needed to traverse recently…

Firstly, as originally served:

Payment Page

And, here once I’d disabled CSS:

Payment Page - No CSS

It took me a few attempts to even work out what was happening. Initially I just assumed that the page had somehow not completely loaded.

Then I highlighted the area where the labels should be and realised that they were actually white text on a white background!

I’m guessing that in this case the design is incompetent rather than malicious.

Perhaps it works fine in Internet Explorer? Who knows.

I was determined, so worked it out.  But, I expect I’m an exception.

If they measured their conversion rates on this page, surely they would find that a significant number of people simply give up, unable to work it out.

So, you have to assume that they probably never bothered to measure.

Of course, none of the intelligent and experienced people who take the time to read this blog would ever make a mistake as outrageous as that. Would you?

You might be surprised …

Let me try and debunk some axioms of registration page design, and in the process highlight a simple mistake that I would guess many of you have made without even realising it (I can only say that with confidence because I’ve made it myself many times).

To start, a question… what is the difference between these two forms?

Form Fail - With Tick Box

Form A: with tick-box

Form Fail - Sans Tick Box

Form B: without tick-box

Which is easier to use?  Or, to ask the same question in a more measurable way: which would have a higher conversion rate?

As we’ll see there is evidence to suggest that Form B is a much better design.

So, why are registration pages like Form A nearly ubiquitous?

Here are some possible reasons I can think of (if there are others, please let me know)…

Legal reasons

In case it’s not obvious, I’m not a lawyer!

If there are any lawyers reading I’d be interested to get an informed opinion on this.

My guess is that it doesn’t make any material difference.

Just think about how this would sound in court: “But, your honour, they ticked the box when they registered!”. Yeah, right.

And, even so, at what cost this additional legal protection? How many fewer registrations can you afford before it’s worth taking the risk?

Because everybody else does

This is probably getting closer to the major reason for the ubiquity.

And, there is something to be said for consistency. But, surely only when it doesn’t hurt!  Lemmings!

Just because everybody else does something, that doesn’t excuse us from measuring and understanding the impact of our design decisions.

How hard is it to tick a box?

Now we’re getting to the interesting bit…

I was recently talking to Nigel about some of the work he did on improving the StarNow registration page. This is the first example I’d come across where somebody had actually taken the time to measure specifically where people were failing on this sort of registration form.

It turned out, in their case, that 27.9% of people didn’t tick the box the first time, and as a result got a validation error. What’s more this only compounded other problems. When the tick box validation error was displayed the password fields were reset (as is common, unless you explicitly set these values when the page is returned, which is frowned upon by security types). So, of course, many people would read the error message, scroll down and tick the box, only to find that the form still didn’t submit successfully as they also needed to re-enter the password.

Does this sound familiar? I know I’ve been through this exact dance myself many times, and I consider myself a pretty savvy web user.

Overall they found that over 34% of people who attempted to complete the page (i.e. pushed the submit button at least once) abandoned the site without successfully completing their registration process.

By making simple changes they decreased this to 17%. That’s a staggering 26% improvement!

So, some suggestions:

  1. Ditch the tick-box from your registration page.
  2. If your lawyer complains ask them to justify the cost, which you will now be able to quantify.
  3. Re-populate password fields on post-back. Or, if you’re not comfortable doing that for security reasons, at least highlight the fields that people will need to re-enter to avoid further error messages.
  4. Most importantly: take the time to measure and understand exactly where people are failing on your site, then do something about it!

Xero Analysis

Xero has had a lot of media coverage in last couple of months.

They have announced a big capital raising and a number of new marketing partnerships, won some prestigious awards, and most importantly have signed up lots of new paying customers.

So, is now a good time to buy some shares?

Last week they announced that 70% of existing shareholders decided to buy some more in the recently completed round, at 90c per share (the market price as I type is $1.30).

Despite all that has been written there has been very little independent analysis of the company and its prospects. It’s been difficult for me to find information to point people at when I’ve been asked about this. So, I’m pleased to see the analysis that Sam Stewart has published on his blog.

As Sam correctly points out the key numbers to keep an eye on are:

  1. Average Revenue Per User (APRU), or how much the company earns from each customer (currently this is ~$33 per month).
  2. Operating Expenses, or how much the company spends to run the business (in 2008/09 this was $8.3 million, but this will increase as they hire more staff).

Depending on what you think will happen to these two numbers in the future you can can calculate how many customers you think they would need to break even. Or, looking even further ahead, to provide a return sufficient to compensate investors for the risk they are taking by investing at this early stage.

Sam thinks the first magic number is 28,000 customers (they currently have 7,500). But, there are lots of variables and assumptions, so I’d encourage you to read his post and play with the spreadsheet he has put together and form your own opinions.

The general advise to anybody who is investing in risky early-stage ventures like Xero, or thinking about it, is this:

There is a chance that the company will one day be worth a lot more than it is today. And, there is a chance it won’t. Make sure you are comfortable with either outcome.

What do you think?

For the sake of full disclosure: I am a shareholder in Xero. I was not part of the recent capital raising, but I did subscribe for the maximum number of shares available to me under the share purchase plan. I also worked at Xero from May 2007 until February 2008, but I no longer have any day-to-day role in the business. Naturally, as both a shareholder and interested observer, I continue to hope that they are able to build a significant and profitable business.

Rugby Ballet

Do you remember when rugby players wore tight shorts and loose tops, and international teams played games against provincial teams, and test matches started at 2:30pm?

This short film from NZ On Screen might take you back…

Score - Part 1

Funding Options

Here are a few different ways to fund your start-up…

The “Burn Baby Burn” Approach

This approach involves raising as much money as you can up-front, and then spending it aggressively in the pursuit of revenue.

If you go down this road, it’s important that you can paint a big picture, because people who invest a lot of money into this sort of venture will need to believe there is a chance they will get an even larger amount of money back in time. So, hype it up!

The problem with this sort of approach is that it’s a big punt. Perhaps there won’t be quite as many customers as you think, or perhaps it will take you longer than you thought to convince them to buy. Either way, there is a possibility that you will spend all of the money you raised before you get enough revenue to cover your costs into the future.

If that happens you’ll find yourself needing to move from a high-cost model to a low-cost model, which is hard (especially if you’ve hired people you like). As Bernard points out, the big media companies are the latest group to experience this.

And, unless you can demonstrate momentum and find a way to talk an even bigger story, you’ll probably find it difficult to raise more money down the track if that’s required.

Of course, if you can get to break-even before you burn through all of your fuel, then you will have used other peoples money to fund the business to that point and hopefully have held on to enough of a stake for yourself to make it interesting.

The “2-Minute Noodles” Approach

This approach is all about keeping your costs as low as possible for as long as possible (i.e. living on 2-Minute Noodles), and trying to quickly get to a profitable position.

Maybe you fund it yourself from savings, or maybe you find a kind benefactor who is prepared to invest a modest amount of capital. Either way, it’s all about making a small amount of cash go a long way. Ideally all the way to a profitable business (or at least “ramen profitable”).

However, there are two obvious problems with this approach:

Firstly, it’s only really possible if you’re young (or stupid!) The rest of us already have too many expensive tastes and responsibilities.

Secondly, it can take forever, literally, so you need to be patient. In the meantime perhaps somebody else will come along with more resources (see “Burn Baby Burn” above) and take your customers before you can get to them.

Or, maybe it would require more investment (time and/or money) than your limited resources can provide?

Of course, if it does work, you are left owning most of a business that’s paying for itself, and generating cash. That puts you in a strong position to talk to potential investors, to re-invest in growing the business further yourself, or to simply sit back and enjoy the profits.

The “Hybrid” Approach

This approach involves using revenue from the consulting part of your business to fund your venture.

In other words you spend some of your time working for other people, so you have enough money to spend on your own ideas.

There is one big problem with hybrids, as Shai Agassi said in his TED talk this year (he was quoting Carlos Ghosn, the CEO of Renault/Nissan, and was referring to hybrid cars, but the metaphor is relevant here too):

“Hybrids are like mermaids: when you want a fish you get a woman and when you need a woman you get a fish.”

The obvious risk is that you find it difficult to wean yourself off your dependence on the comfortable salary your consulting work provides.

Or, perhaps you find it difficult to say ‘no’ to work when it is available, and as a result the consulting work comes to take all of your time leaving little space for anything else.

Of course, if you can find the right balance, this is a great way to fund a business without having to constantly scrimp and save and do everything cheaply, and without having to raise money from external investors.

There is no right answer

There are examples of companies that have been successful using each of these approaches. So, asking which is “best” is the wrong question, I think.

If you talk to people who have been successful in the past, I think you’ll tend to find that they will simply recommend the approach that worked for them. So, be careful in whose counsel you take.

The important thing is to choose.

Pick the option that seems right for you, and go with it.

Whatever you do, don’t get stuck halfway between – i.e. taking on investment (with the associated expectations that brings) but not really raising enough money to really go hard, or taking a “hybrid” approach as well as taking on external shareholders, etc.

And, don’t forget, how you fund your venture is ultimately irrelevant unless you make something people want.

Keeping Score

“If you count something interesting, you will learn something interesting”

- Atul Gawande

Last year I read two excellent books by Atul Gawande:

I recommend them both.

One idea that has stuck with me from these is the power of simple tests or checklists.

An example he gives in “Better” is the Apgar Score, created by Dr Virginia Apgar in the early 1950s as a quick and easy way to assess the health or otherwise of a new born baby.

It is almost certainly the first test you passed in your life!

Prior to this many babies which were the wrong size (too small) the wrong colour (blue) or not breathing, perhaps as a result of a difficult birth, would die because it was assumed that nothing could be done to save them.  At the time, remember, over 3% of babies died during child birth.

The concept of the test was more or less dismissed when she first suggested it because it was thought to be too simplistic to be useful, but today is used all around the world, and has had a massive impact.  

Here is a quote from the book:

“The score turned an intangible and impressionistic clinical concept – the condition of new babies – into numbers that people could collect and compare. Using it required more careful observation and documentation of the true condition of every baby. Moreover, even if only because doctors are competitive, it drove them to want to produce better scores – and therefore better outcomes – for the newborns they delivered.”

He was recently interviewed by Charlie Rose:

http://www.charlierose.com/view/interview/10191

Here is an extract from that interview, where he talks about the same idea, this time in the context of general surgery: specifically a checklist used by surgeons at key points during a procedure, and the massive difference it has had to the outcomes where it has been used:

“We introduced a 90-second checklist that happens right before [the patient goes] to sleep, and then right before an incision, and right before [the patient] leaves the room, kind of like before takeoff, after takeoff and on landing.”

“It checks 19 things that if we missed them, we will harm you.  But it turns out we miss one of those steps about two-thirds of the time, and using the checklist in every hospital we put it in – we put it in eight hospitals that range from rural Tanzania to Seattle, Washington – and each hospital it went into reduced complications by double digits, on average by about a third.”

Something that was easy and made such a big impact would be popular, right?  Actually no…

“Q:  And how is the medical profession responding to this?”

“A: Well, there are two kinds of reactions.  We surveyed the teams afterwards, asked them what did you think.  And about 80 percent said, you know, in the end, it wasn’t as bad as I thought.  It was swift.  I thought it improved care.  But there was a solid 20 percent who said, this is a waste of my time.  I don’t think it improves anything.  But then we asked them one more thing.  We said, if you were having surgery, would you want the checklist?  And 94 percent said they would want it.”

It makes me wonder what other things we dismiss as being too simple to be useful.  Or, what things we oppose for ourselves but which we would think others should do.  ”Do as I say not as I do” perhaps, or is it “I’m an expert, so I don’t need it”?

I’m sure this same idea could be applied to a wide range of different things.

For example, imagine a simple test that you could do at the end of each day which measures the impact of your actions on your own health:

  1. Did you eat well?
  2. Did you exercise?
  3. Did you get enough sleep?
  4. Did you spend time with family and friends?

How would you score?  

Would you want to know?

Maybe you would even share your results with others, in order to be able to compare?

And then, having created a false sense of competition, wouldn’t you be incented to do better?

Clearly keeping score can be pretty powerful, as long as you choose the right score to keep.

Knocking the bugger off

Like many of you, I’m sure, I’m enjoying following the adventures of Vaughan Rowsell, who is now more than two weeks into his attempt to ride the full length of New Zealand “uphill” (i.e. starting at the bottom and finishing at the top).

Here are the videos he has posted on his blog summarising the distance covered so far:

Week 1 – Stewart Island to Mosgiel

Week 2 – Mosgiel to Waikouaiti

He also has some route maps on his site.

What make this so exciting?  Just that he’s doing it.

In other words: what sounds impossible is actually quite achievable, which is not to say easy.

The only thing that makes him different from you (and me!) is that he has managed to bridge that massive gap between thinking about doing something great and actually making it happen.

From Twitter:

“I do feel like I am doing something impossible! Something I never thought I was able to do. It’s such an awesome feeling. Try it.”

– @rowsell

It certainly beats sitting on the couch feeling fat and lazy and generally sorry for yourself.

I got to know Vaughan a little when we worked together on the first part of the Travel Bug project (then going by it’s code name “Jandals”)

He’s a pretty unassuming guy who deserves all of the credit and support that I hope he gets (en route he is raising money for The Agency for Spinal Concern).

I don’t know if he is thinking this far ahead yet … possibly only when it gets really hard grinding up a big hill or into a headwind in the rain … but the feeling he’ll have when he gets to the end is going to be crazy awesome.

I’m really looking forward to spending a day riding with him when he gets to Wellington.

Maybe two, if he’ll have me?

UPDATE (21-May)

I rode with Vaughan from Wellington to Otaki.  It was a cold wet day, and the route we took over the Akatarawas was pretty brutal, but it was fun anyway.  His blog has some details.

Since then he has continued on up the country and is now into the final week or so of his ride.

If you are in the Auckland area get out this weekend and support him as he rides across the bridge.

And, where ever you are, you can support his charity by donating through his page on Give A Little.

Keep Calm And Carry On

There hasn’t been nearly enough of this kind of thinking lately…

keep-calm-and-carry-on

Link via Andy Lark from earlier this year.

So, I enjoyed this, from the Last Word section of yesterday’s Dom Post, quoting a question about the swine flu put to University of Warwick Professor Andrew Easton by London’s Science Media Centre:

“Q: Are we all going to die?
A: Yes, but probably not of the flu and more probably not of this virus”

PS you really should read Andy’s post – it explains why the “Keep calm and carry on” message is so much more effective than “Don’t panic!”, no matter how friendly the type face

PPS there’s plenty of stuff you can buy on Trade Me if you want to spread the word