What is a Self-liquidating Offer funnel?
Self Liquidating Offer (SLO) Funnels are one of the best front end sales funnels for online businesses.
They are designed with one thing in mind: cover the cost of advertising.
The overall structure of a SLO funnel is pretty simple:
Sales Page
Upsell Page
Thank You Page
Once you’ve started getting it optimized, you can add in a downsell after the upsell and you can add a second upsell.
Both of these can help boost your Average Cart Value, but I wouldn’t worry about them in the beginning.
Why are SLO funnels important?
Self-Liquidating Offer funnels are optimized to break even on the ad spend to get visitors to the funnel.
For most people who have never heard of this type of sales funnel, that sounds mediocre at best.
After all, why wouldn’t you want to make a profit?
It all comes down to the idea of front end sales funnels and back end sales funnels.
It’s easier to break even with lower cost products in an SLO funnel than it is to make a profit up front with a core offer.
A front end funnel just has a goal of growing your list and attracting people who would be a good fit for your main product.
This helps to decrease your cost of acquisition for your main product in two ways…
First, you’re able to only market to people who are already a good fit for your product, so you aren’t having to waste time with tire kickers…
Second, you’re able to build a relationship with your leads after they go through your SLO funnel, helping them to know, like and trust you, which makes future sales easier.
So once you know you have a backend funnel that is going to convert your list into high profit customers, you can focus on breaking even with your front end funnel because
“Whoever can spend the most money to acquire a customer wins.” – Dan Kennedy”
If you’re able to optimize your Self-Liquidating Offer funnel to break even, then you are essentially getting new leads for FREE!
And because you’re running ads instead of relying on organic traffic, you’re able to control how fast your business scales.
When to use SLO funnels?
Self-Liquidating Offer Funnels can be used by pretty much any business to scale faster, but there’s a time and place to use them.
I don’t suggest starting with a SLO Funnel right off the bat in a new business.
The biggest reason is that an SLO Funnel is completely focused on breaking even, not making a huge profit.
And for most businesses, they need cashflow coming in as quickly as possible when they’re first starting out.
For the most part, a business should start with a backend sales funnel that is selling a high profit product that is $250+.
This price point allows new business to make a profit even when they don’t have their sales funnel or their follow up sequences optimized.
Ad costs are always going up, so being able to afford ads in this early stage is crucial, that’s the biggest reason a high profit product is a must have.
Then, once this funnel gets dialed in, they can shift to setting up an SLO funnel.
At this point, there’s enough cashflow to weather the early stages of the SLO funnel when everything is getting figured out and optimized because no funnel ever starts off firing on all cylinders.
There’s always some time where it needs to get optimized and tweaked before everything works the way it’s supposed to
(most of this comes from adjusting sales copy)
5 Tips to improve your SLO Funnel
Split test EVERYTHING
This tip isn’t really specific to SLO funnels, but it’s a rule of thumb for all sales funnels in general.
No matter how much you know or how long you’ve been in a certain niche…
You never actually know what’s going to work best in a funnel.
Even world class marketers and sales funnel builders don’t get this right the first time.
All of them split test their funnels.
Now, yes, they are usually CLOSER to getting it right the first time…
And it usually doesn’t take them as long to get it optimized…
But they still go through the process of split testing because they want the BEST RESULTS POSSIBLE.
Optimize your funnel front to back
When you’re going through and split testing each part of your Self-Liquidating Offer Funnel, make sure to optimize it from front to back.
So start by optimizing your squeeze page first…
Then move to your sales page and so on.
Most people want to start by optimizing their pages with the highest profit products first.
Which can make sense…
But it’s not the most efficient way to do it.
Think about it…
If you can increase your opt-in rate on your squeeze page from let’s say 20% to 25%…
It seems like you’ve only made a 5% improvement, but in reality you have 25% more people getting through to the sales page
(5% is ¼ of the original 20%, or a 25% improvement).
If you now have 25% more people making it to the sales page…
Even if you haven’t improved the sales page at all…
You’re still getting a 25% increase in sales!
Then when you optimize your sales page, even a 2% increase in conversion rate, becomes a 20% increase in the number of sales…
Which is a 50% increase from the original number of sales!
Optimize your email follow up
One of the biggest missed opportunities in SLO Funnels, and sales funnels in general, is the follow up sequence.
In this case it more or less becomes an abandoned cart sequence.
You can keep this short, 1-3 emails, but you have to have it.
Some people just need a little more information or were distracted when they saw the sales page the first time.
So reaching back out to everyone who opted-in but didn’t purchase is important…
ESPECIALLY if you were marketing to colder traffic.
Think about it, if you’re able to convert even 5% of people who see the follow up emails, you’re still getting sales you would’ve otherwise missed!
The same logic applies to optimizing this, working front to back.
Start with the subject line of the first email, then the body, then the next email (if you have one).
Add in an order bump
An order form bump can work wonders for increasing your average cart value, but it’s not something you need to worry about when you build your first Self-Liquidating Offer Funnel.
It’s not very difficult to add to a funnel if you’re using a funnel builder like ClickFunnels…
But it can be distracting for beginners to come up with another product to add into their funnel up front.
If you don’t know what an order bump is…
It’s just a pre-purchase upsell that sits right above the submit button on your order form or sales page.
Like all high converting upsells, it’s a product that’s related to whatever else is being sold on the sales page that should really be a no brainer for customers to add.
Pricing your order form bump can work in different ways depending on your industry.
So you’re going to have to test with it.
I would start by having it be slightly less expensive than your first product.
Add in a second Upsell
This falls under the same category as the order form bump, just another opportunity to boost your average cart value.
And again, it’s usually too much to ask a beginner to come up with another product to put in their funnel while they’re trying to figure everything else out.
In most cases, this upsell is the highest priced product you offer in your SLO Funnel.
Really it’s only goal is to be there for your hyperactive buyers to buy.
This is the 80/20 rule in action.
Once you get more comfortable building SLO Funnels and have more products you can sell, both the order bump and the second upsell can go into your funnel from the beginning.
