Show Notes
- Sweet Fish Media wrote a nice recap of this episode in their post 9 Insanely Effective Time-Management Tactics.
- ConversionCast podcast
- GoToWebinar
- RxRemindMe iPhone app
- GTD – Getting Things Done
- Trello
- SimpleNote
- AnyList
Transcript
[00:00] ROB: In this episode of Startups for the Rest of Us, Mike and I discuss nine tactics for aggressive time management. This is Start Ups for the Rest of Us episode 204.
[00:08] Music
[00:15] Welcome to Startups for the Rest of Us, the podcast that helps, developers, designers, and entrepreneurs be awesome at launching software products. Whether you’ve built your first product or are just thinking about it. I’m Rob.
[00:24] MIKE: And I’m Mike.
[00:25] ROB: And we’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s the word this week Mike?
[00:29] MIKE: Dear Skype, you’re not actually improving my Skype experience when you just randomly upgrade in the middle of the day for an hour.
[00:35] ROB: Oh, and then the UI is different every time they do.
[00:39] MIKE: It drives me nuts. I mean I understand there are certain types of software and there’s time where you need to do it, but it seems like every single time I fire it up it’s just like, “There’s something new! Here you go. Learn it all over again.” It drives me insane.
[00:53] ROB: Yeah, that’s not cool. On a lighter note, we have pictures from MicroConf 2014 in Vegas and those are live at microconfpics.com. So if you want to check out some of the fun, speaker photos, attendee photos, and all kinds of tasty goodness, it’s over there microconfpics.com.
[01:09] MIKE: Cool. I’m upgrading my iPad to iOS 8. I read the other day that iOS 8 adoption is apparently really low and I think it would be a lot higher if it didn’t take forty-five hours to download and then midway through it decides it can’t finish the connection so it just dies.
[01:24] ROB: Did it?
[01:25] MIKE: So you have to start over.
[01:26] ROB: Forty-five hours seems like an unusually long connection. So I haven’t upgraded because I’m heading out of the country tomorrow and the last thing I needed was to either be in the middle of an update or to get an update and have it break something. And I bring multiple devices, you know, this year we decided not to bring – we pretty much aren’t bringing any physical books. Trying to bring as little paper with us as possible, just purely because we’re moving around so much in Thailand and don’t want the weight.
[01:51] MIKE: Yeah I don’t blame you. It’s nice with the Kindles, you can just put lots and lots of books on there and if you get bored you’ve got your whole library. It’s awesome.
[01:57] ROB: It’s crazy, yup. And they don’t take up much room and then the nice part is you can also put PDFs in there as well. And you can download them in advance and you don’t have to worry about – Because sometimes Dropbox will download something but then it’ll restart and nothing will be there. Whereas with the Kindle if you’ve download it into your library it should be there when you get there so that even if we don’t have internet access we should be able to practice music and do some of the independent study stuff we’re doing with one of our kids who’s in school. That should all be in tact.
[02:24] MIKE: Do you do that through the Kindle app or just through an actual Kindle?
[02:29] ROB: No we have Kindle app on iPhone and then you email the PDFs to your Kindle app address that you can get from Amazon.
[02:37] MIKE: So, the only other thing I’ve got is that I held my first webinar this past week. You know, it didn’t go nearly as well as I would have liked. I didn’t get much in terms of attendance. At the same time, I had a very short time window to promote it and I’m still trying to figure out how to promote it. That’s one of the big things that’s kind of on my list is to figure out how to start promoting the webinar because over time, I don’t want to saturate my list with the same webinar over and over again so I’ve let them know and told them and I have to figure out how to scale that up. Try to do that.
[03:05] ROB: I’ve heard a couple of approaches; the one that I hear most often is to use the Facebook newsfeed and you can actually put a short video in there. There’s one recent recording – I think it was ConversionCast – and I would listen back a couple of episodes and someone talks about promoting webinars directly using Facebook newsfeed ads which kind of talks through the process that they use and that’s where I would start if I was going to do it. I have not actually done it, but they have a lot of success with it.
[03:29] MIKE: I’ll have to take a look at that. I did try to record it using GoToWebinar’s built-in recording and they just completely mangled the entire thing. I don’t know what happened. The webinar itself went fine but then the recording itself, it was all messed up. All the transitions and stuff, it just hung up –
[03:44] ROB: Oh no.
[03:45] MIKE: And then I tried converting it to other formats thinking that was it but it’s the source that’s messed up. This past week has just been a total bust for me.
[03:52] ROB: Yeah, that’s a bummer. Do you have an alternative for recording your webinars? Are you going to try to do it through Camtasia or something?
[03:59] MIKE: I’m just going to try to do it again. If I do it again the next time I do the webinar and it doesn’t record again what I’ll do is I’ll give the webinar separately and just record it through Camtasia and that way I can polish it up a little bit. And there are services that you can use where you can send them a webinar or a podcast or something along those lines and you can have white papers and eBooks and stuff created out of them. So I have to take a look at that; I learned about it at the Business of Software so I’m going to take a look and see if I can generate some content out of that kind of thing.
[04:28] ROB: Very good. Well let’s dive into our topic for today. We’re going to talk about nine tactics for aggressive time management. A listener of the show emailed me and he said: “I just read a good article in Entrepreneur Magazine on time management in an age of information overload. This is a topic I’m very interested in because I think I lose a lot of time in my effort to be responsive. I suspect that this is something that a lot of folks in the startup tech community struggle with.” So I gave this a bit of thought and what I didn’t want to do was record an episode where we say the same things you’ve already heard about time management which is: don’t check email in the morning, only reply twice a day, take notes, and have a to do list, and all that kind of stuff. So I really wanted to try to get a little more aggressive with it and maybe talk a little deeper about some of the ways that you and I manage our time in a way that I’ve found to be more effective over the years.
[05:18] So we have nine points here and I think I’ll just dive into the first one. The first tactic is to answer email in the morning even though everyone says not to. The key here is to have the willpower to prioritize, to move things out of your email into your to do list, and to not sit there and kill two hours managing your email. Because if you lose the morning – which tends to be most people’s most productive time – then you’re doing this wrong. But over the years I’ve realized that not checking it in the morning doesn’t work for my particular work scenario because I have urgent support requests that are sometimes there, I have issues that come up that I need to triage and I need to be able to prioritize and if I try to come in and do something first that doesn’t involve email, I will often leave the most important thing until lunch time at which point it’s too late.
[06:03] MIKE: Yeah, I answer email first thing in the morning as well. I have a tendency to have a lot of emails come in overnight that I have to deal with and if I don’t deal with them then somewhere in the back of my mind there’s this little voice saying, “Hey you’ve got a ton of email that you have to do something about.” And then I’ll check it kind of periodically throughout the day but I don’t spend a lot of time on it. I do the same thing as you: I spend some time first thing in the morning, get most of my email cleared kind of out of the way, and then deal with it as it comes in throughout the day. But there’s also times when I’ll just pause my email and just ignore it for several hours at a time before I need to come back to it.
[06:35] ROB: Yeah, that’s what I do as well: I check it first thing in the morning, I triage everything, if it’s a quick reply, I reply instantly. I delete most of it, frankly, I put some of it into Trello, I try to get to inbox zero – I don’t always. And then I will just close the Gmail tab. I have no pop-up notifications, nothing that notifies me when a new email is sent. And then I’ll sit and try to get – now that I have my day prioritized and laid out, the agenda set – then I try to get at least a couple of solid hours of work in before lunch.
[07:05] MIKE: Now, do you answer emails in the evenings too or no?
[07:08] ROB: I do answer emails in the evenings but not every night. Typically if something requires a quick response, I will do it on my phone if I’m out and I’m able to check email. When I’m with my kids in the evening, I typically try to put my phone in another room so I don’t check it for a few hours, but then I will check it, let’s say eight or nine o’clock after the kids have gone to bed and if there’s something that’s either a quick response or that’s urgent I will reply. But if there’s anything that requires more thought or a little more work, then I try to triage it, get it out of the inbox so it’s set on the agenda either for the next day or for down the line. And I do use the A and the B priority stuff in Trello, so if it’s something that can wait I will kind of kick it down the line and expect to get to it in a week or two when I have time.
[07:54] Second tactic I want to talk about, which is something that I’ve already touched on a little bit, is to turn off email, Facebook, and Twitter notifications and any other social network or any other thing that can interrupt you during the day. Text messages are a big one as well. I think a big exception, of course, is if you’re kids’ school is going to call or there’s something you really have to be alerted to. But, frankly, I turn off all notifications and people know that they should text me or they should call me if it’s urgent.
[08:22] MIKE: So by Facebook and Twitter notifications you mean, you have these apps installed on your phone or your iPad or whatever and you have the notification to pop up to the screen turned off? Like the banner?
[08:33] ROB: Exactly. I know people that every time they’re mentioned on Twitter, their phone buzzes like it’s a text message. And every time that someone likes one of their posts or does something on Facebook – shares their post, I don’t know what it is, but they do something – then they get a buzz on their phone. Frankly, if you’re trying to get work done that is awful.
[08:51] MIKE: Yeah I know what you mean. I actually got to the point where I turned off a lot of them. I still have one, that prescription app I think it’s from Walgreens – Rx Reminder or something like that – and what it does is it just reminds me every two hours to drink a glass of water and the primary use of it is actually to remind me to drink eight glasses of water a day.
[09:08] ROB: Yeah, well that makes sense. And every two hours isn’t actually that bad. I have things like, obviously calendar reminders if I have a call, or if I have something where I need to be somewhere, yes, those are going to buzz because I need the reminder ten minutes before. And then if you’re doing a Pomodoro technique where you’re working in twenty-five minute stretches, obviously you need a timer or some kind of alert to alert you to the end of that. So I wouldn’t say turn off all notifications of any kind, but it’s the things that are interrupting, the things that take your focus away. What I find is that people slip in and out of this, I do as well, where sometimes I find myself just leaving my Gmail tab open because it’s like my lizard brain wants me to get distracted and it doesn’t want to sit down and do the hard work. And I have to actively think, “Close this down. Shut off the notifications, really get to work” and force yourself to do it. Because your mind doesn’t want you to do it because that’s the hard work and you’re kind of trying to trick it into focusing.
[10:05] MIKE: I’ve found myself doing that sometimes where I’ll be flipping over to my email every once in a while – every couple of minutes – and it’s like, “Wait.” If I’m working I’ll actually close down the tab, like you were just saying, and put a pause on the email box so that even if I go to my phone the stuff just doesn’t show up.
[10:21] ROB: Third technique I want to talk about is to stop watching, listening to, reading, or otherwise consuming mainstream news. If something important happens, you are going to hear about it – someone’s going to talk about it, someone’s going to mention it – you’re going to hear about it. Instead of news, I choose to focus on listening to audiobooks or podcasts that actually educate you, or listening purely to fiction. Stuff that’s actually going to relax you and kind of get your creative juices flowing. Instead of news of your phone, instead of sitting there and thumbing through news stories from the day which is just… It’s strange, it’s similar to Facebook and Twitter where I’ll find myself… I’ve actually deleted Facebook from my phone. And the reason is because I would find myself going to Facebook and the top two posts are interesting and relating to me: it’s my wife saying something or my mom or something. So I read through it and then before long I’ve been on there for ten minutes and I’m looking at people from high school and I really don’t care what they’re up to; I don’t care what their kid’s doing, or whatever. And yet, you get sucked into this thing. And that’s what I feel like the news on my phone turned into; the New York Times alerts and it would have news that was interesting at the top but then I’d spend fifteen minutes reading it, and it’s just a way for your mind to kind of try to occupy itself instead of actually being calm and actually either centering yourself for the day or thinking about things that are important.
[11:39] Instead of reading news on your phone, think about being productive like answering emails, or write a blog post, or write notes for a blog post, or schedule a Tweet for that matter, engage with your audience a little bit. There is very, very little value that you will get from mainstream news whereas you can actually get some value out of certain audiobooks, podcasts, and, potentially, listening to fiction.
[12:01] MIKE: I totally agree with you. I notice different people have their favorite news websites and stuff like that, and I do as well, but the one I’ve sort of gravitated towards is CNN.com and MSN.com and I’ve found that just by not going there ever, it’s wasn’t as if I ever missed anything. And you’re right – other people will mention it to you if it’s important. And the reality is that most of the stuff you see on mainstream news is just clearly not important to you. It just doesn’t matter. It’s not going to materially affect your life. And I’d say that’s the real problem with them; they’re sucking away your time and not really giving anything back to you.
[12:35] ROB: That’s the issue I have with it. I’m not saying that news is not valuable, I’m not saying that being informed about the world, and politics, and what’s going on is not valuable. But doing it every time you’re standing in line or every thirty minutes compulsively checking the news – and I’ve got friends who are news junkies – it winds up being a tremendous amount of time and it’s a bit of a crutch or an addiction of sorts, just like Facebook and Twitter and social networks and all that stuff can be. Or email can be for us, where we actually want to seek that interruption and it kind of relaxes us. It’s getting away from that stuff that you’re doing impulsively and I think news is a big one.
[13:09] So the fourth tactic I want to talk about – I mentioned already – is to put your phone in the other room when you’re with your family. And the reason I say that is because when you’re working, you should be working. You should be working really hard. And when you’re not working, when you’re with your family, you should be with your family. And you should be doing that really well. So you either need to figure out a way to not take your phone out of your pocket – which I do almost instinctively every ten or fifteen minutes. And so putting it in the other room, out just getting it out of arm’s reach, is a good way to really step away from something for a few hours.
[13:41] MIKE: You know, when I carried my phone around in my pocket a lot I had this natural tendency to pull out my phone and check my email and Twitter and all this other stuff just because I had my phone with me. Even if the phone is just not in your pocket, if it’s somewhere else – like if it’s on the microwave, or it’s on a shelf, or something like that – it doesn’t even need to be in the other room. As long as it’s inconvenient for you to go get it, that’s generally enough of a hurdle for you to not do it.
[14:05] ROB: Tactic number five is: don’t say “Email me” or “Call me” unless you really mean it. And what I mean by that is, at the end of my talks, I used to say, “Here’s my email address. Email me if you have questions.” Or when I’d meet with founders, we’d have a discussion over lunch and I’d do something to help them out and at the end I’d say, “Email me if you every have questions.” If you do that long enough, suddenly you are going to get too many emails and you’re not going to be able to answer them all and you’re going to feel guilty. So I’ve now taken a little more of a strategic approach to this and when I’m at the end of a meeting with founders or with people asking me advice, I typically say, “Well, I wish you the best of luck with it.” And, you know, if they do email me, that’s cool. And if they ask, “Can I email you with questions?” I’ll always say, “Yes,” because I still answer a lot of these emails. But I’ve stopped putting it out there because at a certain point, it just becomes a little too much to keep up with.
[14:59] The sixth tactic is to say, “No” a lot. This requires quite a bit of discipline, actually. I get multiple requests per day for my time for different reasons: people want to jump on calls, people have questions, people have… there’s just a ton of different things it could revolve around. Whether it’s MicroConf or any number of projects or apps that I’m working on, and the way that I’ve found to guard my time is to say “No.” And I have to say no to stuff that I want to do, even stuff that will help people out, there’s some local stuff where people have asked me to speak and I really have wanted to, and it would be fun, and it would give back to them, and sometimes I do do it. But other times, you just have to say “No.” And you can’t just weigh the time. If somebody says, “Hey, can you come do a twenty minute talk somewhere,” or “Help us out by just writing a little bit of code or doing two hours of tech support for this local Nonprofit.” If you have the time, that’s awesome, but you also have to think about the greater ramifications of that. A twenty minute talk means you then have to prep it, you have to practice it, you have to show up, you have to be there for whatever, the full hour, you have to talk to people afterwards, you may get invited to do other things. It always turns into more time than you think it’s going to. And, I’ve always made it a point to donate quite a bit of my time and money to charities and Nonprofits and I value those things. At a certain point, you do have to learn to say “No” to people that you really want to interact with.
[16:21] MIKE: Yeah, I think that most of the time your default answer should be “No” unless there’s a very compelling reason to say “Yes” to that kind of stuff. I think one of the underlying reasons for that is that if you start saying “Yes” to a lot of things, then what tends to happen is that you get asked to do more things. And it’s not to say that those aren’t helpful for other people but, at the same time, at some point you’re probably going to find yourself overcommitted. And when you’re overcommitted, that’s when you start to feel guilty because then things start to fall on the floor. And you feel more guilty about letting other people’s stuff fall on the floor than your own, so what will happen is that you will end up helping other people instead of doing the things that you really need to do, and you’ll start pushing those off.
[16:59] ROB: I also think this depends on where you’re at in your career. I think early on in your career you should say “Yes” to more because you tend to have more time available and you are seeking opportunities. You’re looking for ways to interact, to be around more people, and to build a network and all that stuff. But as time goes on, I see people overcommitting themselves. Actually, most people overcommit themselves in general, both in their personal lives and in their professional lives, and I think that learning to say “No” – I like what you said about making it the default response and then only reconsidering if there’s a compelling reason to do that. And that compelling reason doesn’t just need to be a selfish reason. It could be a compelling reason like, “Wow, this is a really good cause” or “These developers are really going to get a lot of value out of it.” I drove up to Mountain View – which is three hours from Fresno – and I gave a talk at the Googleplex to a Google developer group or something. It was a long drive and stuff, but I realized A) I really wanted to do a talk at the Googleplex, that was kind of fun. B) there were a lot of folks there; like, if there had been twenty-five people there, I wouldn’t have gone, but there wound up being 100-150 people. And the third reason: my parents live up there and my brother, so I was able to tie all that in and convince myself, “You know what, this is a good cause, I’m going to donate my time, it’s going to be fun, people are going to get value out of it, and I’m going to be able to work a family trip into it too.” So there are compelling reasons to do it but, especially as time goes on and your time becomes more and more valuable, I think leading with “No” and figuring out if you should say “Yes” is the right approach.
[18:27] Seventh tactic is to schedule time for Twitter like a mad person. Either don’t do Twitter at all or, if you do it, schedule it and do one, maybe two times a day. Schedule your Tweets in bulk. There’s a bunch of systems and ways for doing this, I’m not going to go into them here, but I find that Twitter can be – just like Facebook – a real time suck and a real default thing. If you’re not able to block yourself from doing it, there are tools you can download that will keep you from doing it. But I’ve found that just getting on there once in the morning and once in the afternoon, looking through, responding to everyone, and then scheduling some Tweets, personally, has been a really good approach for me and it keeps me from thinking about it all the time, it keeps me from interrupting myself with it, but it also keeps me engaged. It’s not like I log in every three days or four days and then people feel like you’re ignoring them.
[19:16] MIKE: Yeah I’m a little bit worse at this than you are, I think. I’ll log onto Twitter kind of when I get bored. Anytime my email hits where it says “So-and-so sent you a message,” that’s when I tend to go and look at Twitter. I like your approach of just hitting it once in the morning and then once in the afternoon, because that way you’ve got scheduled times for it and you can dedicate that time for it. But I know a lot of people will use it for, essentially, conversations back and forth. To me I find that extremely interrupting, I’d rather just use email or just use a phone call or something like that.
[19:46] ROB: Yeah I rarely do the conversation thing. Every once in a while it will happen but, when I schedule time for it, I try to keep it to less than ten minutes – and that’s both for the reading and responding and scheduling stuff. And I’m managing multiple Twitter accounts so I’m moving pretty quickly when I do that.
[20:01] Tactic number eight is to remove the mental burden of remembering things and let the cloud handle it. So this is similar to if you’ve heard of GTD, getting things done. Basically it’s to use a written to-do list of some kind, whether that’s on paper – I recommend using something in the cloud, like Trello, is what we use. Shopping lists I used to have on paper; we did away with that and now we have a doc in Simplenote and it’s shared between the two of us and any time any of us brings up something at the store, one of us adds it. There’s a system in place, basically, to capture that information. Let’s say I’m at dinner, I’m in a conversation and someone mentions something that needs to be an action item for me, they’re like, “Oh hey, did I mention I saw a typo on your website the other day?” or “There’s this fantastic new movie or this new iOS app that you need to download.” I never try to remember it, I always say, “I’m totally going to email that to myself right now.” Pop open email and I just have Trello as the contact name, and that’s my Trello board, and it goes to the top of the board and the next time I go in there I move it to the appropriate board and I actually have an iOS app queue and I have a movie queue and I have all this stuff that I do. One step beyond that is to actually have different email addresses for each of those boards so I don’t have to touch it twice, because realistically I shouldn’t have to touch that issue twice.
[21:14] MIKE: Similar to you, I think you said you use Simplenote? We use a program called AnyList and my wife and I are both signed up for it. That way if we’re at the store or something like that and the other person thinks of something they can add it and it pops up right on the list so that we need to go get whatever it is. So if we’re missing milk, or eggs, or whatever, if for whatever reason it didn’t end up on the list, you can check it and it will show you what is crossed off so you can almost see where in the store somebody is based on what they’ve checked off. We have a process in place where once you’re done shopping, before you go and start adding other things to it, you delete the list so that way you see all the deleted entries get removed as well. It’s just a process and as long as you have that process in place, to manage that information you don’t have to think about it anymore. And that’s the key thing, not having to think about it or try to remember stuff that you really have no business trying to remember.
[22:09] ROB: The ninth and final tactic that we’ll talk about is to eliminate meetings. There’s this concept of the maker’s schedule versus the manager’s schedule, something that Paul Graham talked about in an essay. The idea is that makers need long stretches of quiet productivity and managers tend to chop their day up with a bunch of meetings. And I think salespeople are like that too, they need to have a lot of meetings and they have to work around client schedules, so they will have very interrupted schedules. In my opinion, trying to be both a maker and a manager at the same time is incredibly unproductive and if you can avoid it at all cost, I would do so. This is one of the reasons that I have slowly weaned myself away from development, because as much as I love developing and I love creating and building, you need a maker’s schedule to do that and I just have too much going on with all the projects that I’m working on and everything that I’m doing. So I’ve had to hire people who can have maker’s schedules, and I respect their maker’s schedules. There are no meetings ay our company, the only thing we have a weekly lunch that we all go to and talk, but other than that we interact and we take care of things as they come up. But I never want to time box these guys’ time because I know what it’s like to be a developer and be working on something and realize, “Wow, in fifteen minutes I have a meeting and I have to stop what I’m doing.” It’s incredibly bad for productivity.
[23:27] MIKE: Yeah, I’ve been trying to wean myself away from that as well so that I’m not doing any more of the development tasks. I would say I have more of a manager’s schedule. How do you resolve the discrepancy where you’ve got to do a maker’s schedule in order to do things like Ad Words and things like that? Because, obviously, there’s content creation, there’s website tweaks, and maybe you’re not making anything but you’re doing things that do require some concentration in order to do it.
[23:54] ROB: Absolutely, like writing copy. The long-form homepage on Drip took me an hour to do the first round and then like four hours of revising and then I’ve written a couple of blog posts recently that have been several hours in the making. And when I did those, I basically went off the grid. I turned off all notifications, I blocked out about two hours to get the initial round done, and I did my thing where I drank some caffeine, I turned on loud music in the headphones, and I just went into the zone, and I totally cranked it out really as fast as I possibly could, and I totally blocked things off. If I have any type of call or anything scheduled, I can’t do that because I know that if I’m time boxed on the outside that I’m going to get interrupted, there’s something in the back of my mind that won’t let me get into flow because I’m thinking about it. So when I say I blocked off two hours, what I actually mean is that I put two hours on the calendar, I mentally said, “Alright, I’m going to try to sprint for two hours,” but I had nothing scheduled for three or four so I knew that if I ran over and I kept being in the flow, that I would just continue to crank on that. In fact, one day I got so motivated that I wrote the complete blog post and I still had another thought and I started another one and got a complete draft done, and then I went in and revised my sales letter all in one day. And, typically, I just don’t have enough good glucose that is available to create that much content, but some days you’ll find that if you do, in fact, get in the zone that it can carry over like that.
[25:14] MIKE: So, to clarify, this isn’t necessarily about maintaining a maker’s schedule or a manager’s schedule, it’s being able to interleave them between each other such that maybe on one day you do one and on a different day you do the other. It sounds like it’s not strictly about eliminating one and just doing the other instead.
[25:31] ROB: Yeah, perhaps. If I could help it I would not have meetings ever. I would not do Skype calls, I would not do the podcast interviews and stuff, but I enjoy them and they help me in my business. So I do, In fact, find it a necessary thing that I have to balance. I don’t know that everyone has to, though. I think that, if at all possible, if I didn’t have these podcast interviews and the other stuff that I do via Skype that I would try to have much, much more of a maker’s schedule. But I think if you are forced into it then, yes, it’s the ability to switch between them quickly, because to try to block out that time and to get into the zone quickly is hard, it’s a learned skill and you need to figure out what your triggers are for that. We’ve talked about that a little bit in the past; I’ll often loop a song over and over and over and listen to it straight for two hours and then, for weeks, anytime I play that song it will trigger me into the zone. And that’s the way that I’m able to sometimes get into the zone in three or four minutes, which is kind of unheard of. Typically it takes you fifteen or twenty minutes to really get into the flow, but if you figure out your triggers, you can switch back and forth between makers’ and managers’ schedules faster.
[26:34] MIKE: I like the idea of just scheduling two, three, or four hours or whatever on your calendar so that you’re not interrupted for other things. But obviously that’s also going to take – You have to start turning off your phone and doing various things and schedule that in such a way that you know you’re not going to be interrupted. Because the second you’re interrupted when you’re trying to establish that maker’s schedule, everything just goes right out the window. You take such a hit in your productivity that it almost wasn’t worth even scheduling that time to begin with.
[27:02] ROB: That’s right, that’s exactly right. And you really have to do most of the previous eight tactics we’ve talked about in order for this last one to work, and that’s why I put it last.
[27:10] So to review, our nine tactics that we talked about are to answer email in the morning; number two, to turn off email, Facebook, and Twitter notifications; number three, to stop watching, listening to, reading, or otherwise consuming mainstream news; number four; to put your phone in the other room when you’re with your family; number five, don’t say “Email me” or “Call me” unless you mean it; number six, to say “No” a lot; number seven, schedule time for Twitter; number eight, remove the mental burden of remembering things; and number nine, eliminate meetings and figure out if you’re going to have a maker’s schedule or a manager’s schedule.
[27:39] MIKE: If you have a question for us or a suggestion for a podcast episode, you can call it into our voicemail number at 1-888-801-9690 or you can email it to us at Questions@StartupsfortheRestofUS.com. Our theme music is an excerpt from “We’re out of control” by MoOt used under Creative Commons. Subscribe to us on iTunes by searching for Startups and visit StartupsfortheRestofUs.com for a full transcript of each episode. Thanks for listening; we’ll see you next time.
Episode 203 | How to Build A Marketing Calendar
Show Notes
- MicroConf Europe
- Business of Software Conference
- Rand Fishkin of Moz.com
- Noah Kagan – Quant Based Marketing
Transcript
[00:00] Mike: In this episode of “Startups for the Rest of Us,” Rob and I are going to be talking about how to build a marketing calendar. This is “Startups for the Rest of Us” episode 203.
[00:06] Music
[00:14] Welcome to Startups for the Rest of Us, the podcast that helps developers, designers, and entrepreneurs be awesome at launching software products, whether you’ve built your first product, or you’re just thinking about it. I’m Mike.
[00:22] Rob: And I’m Rob.
[00:22] Mike: And we’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s the word this week, Rob?
[00:26] Rob: You know, things are going well. Just been ramping up Drip, looking to have another good growth month here in September, and I took off in a week for about five weeks on the road in Thailand, and then in Prague for MicroConf Europe. So overall feeling good about things with the ability to still check email and do a little bit of work on the road. I think things should go well while I’m traveling. You know, I have four full-time guys here, aside from me. I did this last year when I went to Prague and then to Italy for a month, and things, frankly, went pretty well. We actually did a launch while I was on the road last year and launched to like 600 people, so this year there’s nothing fancy or exciting like that going on. It’ll just be kind of maintaining the status quo. I got guys here who can handle support really well. Feeling good. Just kind of ready to get on the road at this point.
[01:10] Mike: Well, I went to the Business of Software Conference this week, and I had a really good time. I met quite a few interesting people. A lot of good conversations in the hallways.
[01:18] Rob: Sure. Were there any speakers who were highlights for you?
[01:21] Mike: It was awesome listening to Rand Fishkin from Moz talk about kind of the future of what Google was doing and what directions they were heading and what his thoughts were on what they were doing now and how you could kind of leverage marketing efforts inside of the context of the things that they are doing, because, obviously, they’re shutting down a lot of things. But he also pointed out there were places where he showed an experiment that somebody had run, and they found that a lot of their direct traffic, there was a lot of things that Google was sending them as organic search traffic that was being counted as direct traffic, which I found interesting. It was a very high correlation. Like they did something where they basically turned things off then turned them back on, and a lot of their organic search traffic is actually being counted as direct traffic even though that it’s not.
[02:08] Rob: I have to be honest, with Google Analytics – when they redid the left navs to where it’s like acquisition and behavior and something else now – I have the toughest time finding anything, and with the loss of keywords anyways- it’s been six months or a year since I’ve gotten anything actionable out of Google analytics, and I used to be a big proponent. I used to be in analytics daily. Literally daily, and these days it’s just not worth it. So I’m either looking at advertiser dashboards if I’m running ads, or I’m in a tool like KISSmetrics, which can actually show you some stuff. Or I’m in Drip looking at how my stuff’s going, but I don’t know if that’s common for everyone these days. A couple other founders I’ve talked to are experiencing the same thing, but Google analytics has really A: They’ve made themselves, in my opinion, too complex and too hard to find, and then there’s not a ton of good data coming out of there anymore. You find it similar?
[02:57] Mike: Yeah. I don’t get a lot of it – a lot out of there anyway, because ninety percent of my traffic it says “direct” or “not provided.”
[03:04] Rob: That’s the problem, and so yeah. So there you go. That seventy, eighty, ninety percent that is either direct or not provided, which is like, “This is not helpful at all.” Right?
[03:12] Mike: Yeah, and that sucks. He did talk a little bit about how to use adwords to your advantage and use that for at least a little bit of keyword research. But even some of that’s going away. He said that there’s some upcoming changes where they’re going to be eliminating I think its exact search matching through adwords, so you won’t be able to control it as much and get as much information out of that either.
[03:32] Rob: Awesome. Can’t wait to talk to Dave Collins about that one at MicroConf Europe. Hey, you know I’ve always really respected Rand and enjoyed – I’ve heard him on Mixergy and other interviews. Seems really genuine, you know, and he shares kind of what’s going on with him. Super smart dude. So it’s no surprise to me that he was one of the standouts to BoS.
[03:51] Mike: I would probably say he, almost without a doubt, he was one of the favorite speakers of mine.
[03:56] Rob: Very cool. So we have new iTunes comments. We got a 5-star review from Joris Joppe from Netherlands, and he says “Great source of information. Running a web application myself and there’s so much information in there that I can take on board. Simply not enough time to act on it. Thanks, guys.” Got another 5-star review with the title “Awesome” from Miekeru from the US. He says “Your podcasts were instrumental in growing my SAAS business. Thank you, and keep up the good work.” So we would love a five-star review. If you haven’t given us one in iTunes – you don’t even need to write a comment like these guys did. Can simply log in, hit the five-star button, and we would greatly appreciate it.
[04:31] Mike: Well, I hired a couple of new developers, and I’ve been spending some time on getting them up to speed on our development process, and so far things are going pretty well. They’re following process. Obviously they make some mistakes here and there, but they’re doing really well. It’s nice to be able to kind of give them design documents and have them just take it and run with it, and then do whatever they need to do and not have to worry about the results nearly as much.
[04:53] Rob: Where’d you find them?
[04:54] Mike: Just through oDesk. Just kind of went through the natural process of weeding people out and telling them what is expected and trying to give as good a description as I could of the development process and what was expected of them and how many hours and everything else that I was going to expect. And what the timeline was, because obviously this is something of an initial review process for them, so if it doesn’t work out for them they kind of know that they need to be on par with what my expectations are and adjust. But they’ve been doing great.
[05:21] Rob: Very good. So what are we talking about today?
[05:23] Mike: Well, today we’re going to be talking about how to build a marketing calendar. This kind of came up because I’m starting to switch my efforts over a lot more from the development and, as I mentioned just a few minutes ago, I hired these couple of new developers, and I’m trying to remove myself just completely from writing any code. I’m trying to focus much more on the marketing efforts, and right now I’m in the process of building a marketing calendar to try and figure out what sorts of things I should be focusing on, and not only what I should be focusing on, but what order and when things were going to come out, and what sorts of things are going to come out. Think I mentioned a couple weeks ago that I started scheduling webinars, but that kind of fits into this greater strategy that some things have to be timed, and you want certain things to go out at the same time, and you don’t want to have, for example, too many emails go out in the same week, and if some things get pushed around that’s not really a big deal. But the idea is really to use it to establish a consistent approach to the marketing efforts so that there’s things getting pushed all into one week, and then you’ve got nothing in the next week.
[06:22] Rob: You know before my most recent app, Drip, I was always basically flying off the cuff, and I would wake up one week and say, “What do I want to do this week? Can I – am I going to continue running ads and then maybe I’ll publish a blog post?” but with Drip it’s had to be more orchestrated. One: because I’ve worked with other people, like I had a marketing intern for a while. I’ve had other people helping me with it, and so a calendar is actually necessary. And two: there’s just been so much going on that I’ve felt like I can’t keep it all in my head anymore. I’ve used some of the approaches that you’ve listed in here, but I also think that since I tend to be process-lite, but I am interested to see what some of the heavier process and note-taking stuff you outline in here how people can apply it.
[07:00] Mike: The big thing that I noticed was that a Monday would come around, and I was like, “Okay. What have I got to do this week?” and because it wasn’t planned out I would just kind of shoot from the hip more, and it felt like it wasn’t planned out very well, and it wasn’t. That’s really the bottom line, and that’s kind of what a marketing calendar’s supposed to help out with. It’s to make sure that you’re no longer shooting from the hip, and you know exactly what is supposed to be done that week, and you can work towards it, rather than you get to the beginning of the week and say, “Okay, what am I going to do this week?” and then you have these fires come up, and you kind of run around like a chicken with its head cut off because you just don’t have any consistency from one week to the next.
[07:36] Rob: This is the hard stuff, right? It’s like we all want to be on Twitter and Hacker News. That’s the easy stuff that your brain relaxes. The planning in the morning, if you get up and say, “What are the three things that I need to get done today?” and then you sit there, and you just make transition from one task to another, and you crank on them, and you get them done. That’s putting in the hard slog. Yeah, it’s fun to fly by the seat of your pants, and to just wake up and say, “What marketing parts do I feel like doing?” but it’s just not what professionals do. That’s not the way to develop a consistent approach to this stuff and actually grow a business well.
[08:08] Mike: The key goal behind it is to make sure that you have a consistent approach, but one of the other things that this helps to do is it helps you plan around key events. So there’s things like holidays and product launches, even vacations and birthdays and things like that, you know days that you know you’re probably not going to want to work – you can plan around those things. You can make sure that on your marketing calendar those things show up and you take them into account when you’re doing that. Another thing it lets you do is it lets you identify some of the gaps in your marketing that is going to impact your sales funnel or at least has the potential to impact your sales funnel. You don’t want to have too many of the same function or activity in a single week, but on the flip side you don’t want to have not enough of it either. So if you schedule emails and you decide to work on email marketing for a couple of weeks, what happens if you start neglecting your webinars or your paid advertising and things like that? There’s lots of places where that stuff can fall through the cracks because you just didn’t think about it. Then you get to the end of the week and you’re like, “Oh shoot! I forgot to do that advertising campaign.” Or “I forgot to run that PPC campaign, or have these infographics created.” And then it pushes other things off, and then you end up with these gaps. This is designed to help eliminate some of those gaps.
[09:18] Mike: So to get started with this stuff, it is extremely simple. The quickest way to get started is to just use Google Spreadsheets or Excel. You can, if you want to go for an advanced option, you could use like smartsheet.com where it’s similar to Google Spreadsheets, but it also allows you to do things like Gantt charts and things like that. So if you want to get a little bit more in depth with it and a little bit more process oriented where some things are much more dependent on other things, you can use smartsheet.com. But for the most part Excel or Google Spreadsheets is going to be able to do what it is that you need it to do.
[09:49] Mike: So to get started, the first thing you need to do is you need to write down all the marketing activities that you want to try and engage in or try out in the future, and it should be comprehensive. You’re not really thinking about timeline yet. You’re just listing the possibilities at this point. All the different things that you could possibly do that you might want to try.
[10:07] Rob: Right, so the first note I’ll make is I am a Google Spreadsheet person, although with this marketing activities thing you’re talking about right now I’ve tended to use just a Google Doc and do a bulleted list that’s broken down by category. So there’s the prelaunch, the during launch, the SEO, the content marketing, the personal brand and relationship. There’s the viral, there’s the integration marketing. You know, I break it down into the marketing categories I’m going to do, and then I put some tactics, some ideas, some approaches. It’s more than a brainstorm, because I want to filter it a little bit. I don’t just want it to be a big mess of things, but I definitely want a large list to draw from that I can then build a tighter list and actually start putting dates and date ranges on things.
[10:50] Mike: Yeah. And to be clear, this step doesn’t need to be done in a spreadsheet. You can absolutely do it in a Google Doc.
[10:55] Rob: Frankly, if I had my druthers I would do this part hand written in a notebook, but there’s a bunch of drawbacks to that. Number one is this document, this marketing game plan, this thing needs to live for a long, long time. Like several years as you’re marketing this app, and so having it in a notebook just doesn’t tend to be practical, because then you wind up – you’re traveling, you’re on an airplane, you’re somewhere and you just don’t have access to it. So that’s a bummer. The other thing is this thing is living and breathing, and you’re going to be adding, editing, you’re going to be deleting, crossing things out, and it becomes a real mess if it’s on paper and you can’t to the dynamic stuff that these fancy computer these days allow you to do. So that’s why I do make this electronic, even though personally I prefer to brainstorm it on paper, but as you’re listening to a podcast, you’re reading a book, you’re listening to an audio book, you hear a talk, and you take some notes from that, I will then take those and apply them to this master kind of marketing game plan doc, and then later I will draw off that to build my one to three month calendar from.
[11:53] Mike: So that’s step one. Brainstorm your marketing activities. Now step two is to identify between one and five target audiences. I don’t think I would actually go over three, but you want to be a little bit specific. You wouldn’t want to just say people who are in technology. You’d want to say IT administrators. You’d want to say software development freelancers. Try and narrow it down as much as you possibly can. And even in something like IT administrators, you might want to say IT administrators who are managers or who have been in that field for X number of years. But the idea is to make it as specific as possible so that you know exactly who you’re marketing to. What that’s going to do is that’s going to help you when you’re actually trying to develop your messages so that you can target your copy at that type of person, and you know exactly what type of problems they have, because there’s a difference between an IT administrator and a senior IT administrator because they have different problems. They have slightly different job functions, but the senior guys tend to have additional responsibilities. So they may have management functions that they also have to do.
[12:54] The lower level IT guys may not care nearly as much about reports, for example, but the senior IT guys – they’re the ones that have to interface with management and provide them the information. Do have to niche it down as much as you possibly can so that when you’re writing your copy and writing any sort of marketing materials for those people, you’re able to speak directly to the pain points that they’re having.
[13:15] Rob: And at the beginning this is going to be a guess because you just don’t know until users start using your app. But once people start using it, it becomes pretty obviously quickly what they’re up to and how they’re using it, and you’ll notice that the IT administrator versus the IT administrator’s boss versus the software development freelancer versus the blogger how differently they use your app, and you’ll suddenly hear them using different words and different verbiage to describe what they’re doing. And they get different value out of it. So that’s where you can start refining this message, so I would consider this definitely a 0.5 at this point until you actually start having interactions with customers, and you can refine and update this list.
[13:57] Mike: So, that’s step two is defining the target audience that you’re going after. Step three is to decide on a timeline, and for this I’d recommend at least three months, but probably no more than six. If you don’t have enough of a timeline, then it’s going to be hard to measure some of the things that you’re doing, and if it’s too much then you’re trying to plan so far in the future that it’s really just going to mess up the timeline for anything that you identify during this process that works really well that you want to double down on.
[14:21] Rob: So I typically plan this marketing calendar ninety days out, but then I kind of micro-plan the next thirty days, because I found that things change so quickly month to month that if I try to plan six months out, that last two or three months is just completely shattered. It’s so different by the time I get there. So I think it depends on how quickly you’re moving, how quickly you’re iterating, and at what phase of your product. If you’re before product market fit, you may only want to plan a month or two out, and if you’re at scale, and you’re starting to really scale up, and you know your audience, and you know your message I could see planning three to six months out, although the latter three months I would do it just a little looser, and not put exact dates on everything.
[15:02] Mike: So step four is to go back to the list of marketing strategies that you came up with and essentially order them in either a top five or top ten format. And starting at number one for each marketing strategy, break that strategy down into its component tasks. We talked about this a little bit in a previous podcast episode where you really want to include the build to deploy, measure and fix timelines for each one. Once you’ve ranked these things, you want to go into your spreadsheet, whether it’s a Google spreadsheet or and Excel spreadsheet, and you want to put the weeks on the left-hand side and the target audiences along the top, and those marketing activities that you picked out, you want to fill in the marketing and the component tasks that need to be done essentially using the dates as the Y axis and the target audiences across the top as the X axis.
[15:48] So what that does is it essentially gives you the ability to say, “Well, okay. These are all the things that I’m going to do, and these are the rough time periods that I’m going to do them.” Yeah, it’s going to take a little bit of tweaking because some things are going to take longer than others, but what this is going to do is it’s going to give you the ability to see at a glance where some of your marketing activities are happening and give you the ability to kind of eyeball things and say, “Am I going to be able to do this in this approximate time period? Are there places where I’m going to have giant gaps? Are there places where there’s overlaps between these things?” and you can take a look at those things, and you can fix them as needed. You can either add things, or move them around, change them. And there are definitely places where you’re going to have to start something, and then you’re going to have to come back to it later on, because maybe you’re outsourcing some of the email campaigns or the content generation, and you hand it off to somebody else, and you don’t expect it back for a week or two weeks. Those schedules need to be taken into account here.
[16:43] Rob: Yeah, and this is big because without this high-level view you really can’t anticipate when you’re going to run into something where you either have too much marketing going on in one week, like you said you’re sending your lists five emails, or where you have big gaps where you have multiple weeks where you’re not producing anything. It’s just hard to play it by ear and wing it and make it even. When you step back and you plan out ninety days or 180 days it’s a lot easier to do it.
[17:08] I think one other thing I’ll mention is how to prioritize. You said brainstorm the marketing strategies, and then pick the five or the top ten. A bunch of different ways to do that, and if you recall a couple episodes ago we had Gabriel Weinberg on the show, and he co-wrote a book called Traction. If you read his book he talks a little bit about how to prioritize in there, and there’s another approach from Noah Kagan. If you search for Noah Kagan Quant Marketing, and it’s Q-U-A-N-T he does it quantitatively. He actually uses an approach very similar to what I’ve done for years. It’s similar. You put it in spreadsheets, and you figure out what you want to do. I’ve often gone with, “What’s in my tool belt that I know I can execute on?” and “What do I think is going to work for this ad based on my previous experience?” and that’s typically where I start, and then as that stuff fails, or succeeds, then I’ll pick off the next thing that maybe I haven’t done, and that’s how I’ve always expanded my marketing tool belt. So there’s not no science to prioritizing these, but it is a bit of art, and a bit of science, and a bit of choosing what motivates you, and what you’re excited to do in prioritizing these things and getting them into the spreadsheet.
[18:10] Mike: And keep in mind, the other thing that you need to do when you’re doing this is take into account where in your sales funnel some of these marketing activities fall because obviously you need to get people into the beginning of your sales funnel, and doing things at the end of it is not going to help you very much if you’ve got nobody in your funnel at all. So you do want to spread things out a little bit based on where some of these marketing activities are going to impact your sales funnel, but just keep it in mind when you’re putting these things together.
[18:36] Rob: Yeah. I think that’s a really good point is a lot of people will look too far down the funnel too early, and until I have a really high visitor to trial conversion rate, then I know that my marketing’s – either my value prepetition or my marketing site is not cutting the mustard. And then once that’s done, now I need to work on trial to paid conversion, right? And that’ going to be done with on-boarding and with emails, and that kind of stuff. Then once people are in there I wouldn’t go back and start marketing before I got my churn way down, and that’s one of the ways you can define product-market fit is that people are sticking around, getting on-boarded, and then not churning out. And so that’s the path I would take, then I circle back. Then if you drive traffic through an optimized funnel, that’s when you’re getting the most value out of your marketing spend, right out of your marketing time, because until that point you’re basically bleeding people out of the bottom of your funnel as they churn out either during their trial or after they’ve paid you one or two payments.
[19:28] Mike: And that’s another reason why you don’t want to make your timeline too long because if it is months then you can iterate through some of these cycles very, very quickly, and you get a lot of traffic, but it’s all falling out the bottom of the funnel, and you’re not paying attention to it because you’re trying to execute on your marketing plan. So it is kind of a balance that you have to strike. As I said, too much and you’re doing all these marketing activities you’re really not taking a look at your entire sales funnel, and if it’s not enough then you don’t give it enough time for these marketing activities to work.
[19:56] So at the end of this process, essentially what you end up with is a targeted activity list in a timeline of when those things need to be accomplished. And there’s a lot of benefits to this. The first one, and I think this is probably the best one is that you don’t have to think, “What do I do?” either every day, or even every week. You have your spreadsheet to work from. That’s the battle plan that you’re operating from. This is the strategic document that you’re going to move forward with, and sure it’s going to change over time. You’re going to adjust a little bit. You’re going to tweak things based on the information you’re getting back and the measurements that you’re taking, but you generally know what it is that needs to be accomplished and roughly when, and you can adjust from there.
[20:33] Rob: Yeah, I think that’s a big thing to remember is there’s a lot of adjustment that goes on. I was just in my content calendar yesterday. I have a separate spreadsheet for what content is going to be published when, and I realized that I screwed up last week. I either published the wrong one, or I missed a week or something, and so sure enough you edit the doc, you move things around. I had committed a post as a guest post somewhere else, that’s why I had to, not un-publish, but I had to remove it as a draft in my blog. I mean there’s stuff that’s going to happen, and this having a content calendar and a marketing calendar like this helps you catch those things, but also don’t be married to it that it’s this rigid document that’s set in stone, because once a week I’m going in there and moving things around, and either moving dates, changing titles, committing things elsewhere. It really is a fluid document. It’s more of, “I’m just trying to track what’s going on so that I have a high-level view.” But this view it as a fluid, moving, living, breathing doc.
[21:29] Mike: So the next advantage is that when you’re using a weekly format like this with the dates along the left it automatically separates the activities from one another, and it gives you time to implement them. And it’s not like a bug-tracking system where you’re giving each thing a number of hours or anything. You’re really just setting kind of the high-level tasks that need to be accomplished that week, and which of the weeks during that three-month timeline that you’re trying to implement them. Make sure that you’re building all of the different stages into your marketing plan. So for example, the measure and fix stages – make sure you’re separating those, because it’s going to prevent them from being dropped on the floor. If you’re doing a lot of content marketing or pay-per-click advertising, those things can cost a lot of time and money to put in place, and if you’re not paying attention to them some of those things are going to get thrown on the floor, and especially with PPC ads. If you’re doing those types of things, you can definitely be flushing a lot of money if you’re not paying close attention to them and actually doing the measurement stages. So you have to make sure that you’re building in time to do the measurements and fixing the things that are not working.
[22:30] Rob: Yeah, and that’s why you need this calendar so that you can block out time because if I’m running paid acquisition, and I’m doing it heavy, I am probably in there – it depends on the day – but I maybe average thirty minutes a day, and on heavier days I’ll do a full hour swapping out adds and stuff. And I’m always tracking what my cost per acquisition is and really looking at the funnel, and so it’s a time intensive thing. If you think that content marketing is definitely time intensive, right? Even just managing writers if you’re not doing it yourself. If you’re doing it yourself it’s incredibly time intensive. But paid acquisition, while maybe it doesn’t require as much time, it still requires a lot of your focus, and you can’t just set and forget. Any of these things. The way to set it and forget it is to find someone knowledgeable in it who you can pay to run it, or to train someone up to use your approach to doing it, and that’s where knowing how to do it is helpful. But very, very few marketing approaches aside from ranking in a search engine, very few of them don’t require some type of ongoing work.
[23:31] Mike: So once this plan is in place, you could theoretically outsource some of the specific implementations, and then manage the process. I mean obviously you can outsource the whole thing. If you have enough money, you can hire somebody dedicated to do full-time marketing you could. But for most of us, we don’t really have that budget, but there are certain things that you can outsource. So for example, writing articles. You don’t need to write the articles, for example. You could outsource that, and then as part of your job for that particular piece, you can then post them. And as I said you would have the time so that you hire somebody to write the article, and then you pad the time, and then you have another task in there where you have to post the article. So you have to make sure that you’re getting that information back or anything that you’re outsourcing. Make sure that you’re putting in leeway times in order to get that work back, but you’re essentially removing that from one of your lists of tasks so that you can focus on other things and get more done quickly.
[24:25] Rob: Yeah, and I think this is the goal is to get to the point where you’ve developed a process well enough that someone who is not a founder can do it, right? So whether that is content marketing, hiring a couple writers, and you become the editor first, and then you hire someone to basically be the editor and kind of the person who’s creating the content calendar and driving the writers and kind of managing that whole process. Same thing with paid acquisition. It’s like at first, yeah, you’re probably going to have to manage it and get in there, figure out what works, figure out your process for swapping things out, but then you look for someone who has the skills and the analytical ability to sit there and do what you’ve done. And it takes you out of the loop, so you can build that flywheel so you can step away to take care of more important parts of your business.
[25:07] Mike: So we’ve talked a lot about some of the benefits. What’s one of the biggest drawbacks to this kind of thing?
[25:12] Rob: So one of the biggest drawback I see is it might impinge on your flexibility, right? It might feel like, “Oh, I’m building big company process, even though I want to be a small agile founder.” So I could see it feeling like that. Like you want less process if you’re just one person doing something. I of course have a counter to that. I guess we’ve already talked about that, why you should do it, but I can imagine someone feeling like, “Yeah, creating another document, putting a bunch of stuff in it. It’s going to take all the fun out of this.”
[25:39] Mike: Another thing I can see is that it’s time consuming to actually do the work, and essentially what you’re doing is you’re creating a schedule of all the additional work that you need to do.
[25:48] Rob: And that’s depressing. I think another one is that that feedback is not immediate. So you’re going to spend time, you’re going to create this doc, you’re going to lay all this stuff out, and then it’s going to take months, right? To run the ads, and to create the content, and to gather your results, and for those of us who are impatient, which is probably almost all of us as founders who want stuff immediately, it does basically lay out that you are not going to find out about these things for several months. So I could see that being frustrating to folks who aren’t used to this type of thing.
[26:17] Mike: Another frustrating thing is that some of these things are just not going to work. I mean you’re going to put these things on your calendar, and you’re going to try and go execute on them, and some of them are just not going to work out at all, and you’re going to say, “Well I just wasted three, four, five weeks trying to do something, and it’s just not moving the needle. It’s not doing anything.” And that’s a process that you’re going to have to go through. There’s different things that you’re going to have to try that they’re not going to work today. They might not work tomorrow or even six months from now. They may never work. It depends on what your product is, but there is the chance that right now it’s not working, but in six months you’re going to be in a different spot, and it will work.
[26:50] Rob: I think another drawback to this approach is that really it’s just a starting point, and that if you do have a really complex marketing calendar, that it isn’t going to cut it for you, right? So you can go significantly further with this, and it can get a lot more complicated. So that could be another drawback to the approach we played out here, is it may not be able to handle the most complex scenarios.
[27:10] Mike: And one thing I do want to add before we kind of wrap things up is that when Rand Fishkin was giving his talk at Business of Software, he actually mentioned a little bit about marketing calendars. And one of the things that he kind of cautioned people was that if you have a content calendar that you’re following, for example, and you’re trying to push out content on a regular basis, he pointed out that there’s less than ten percent of the content that gets created which gets greater than eighty percent of the traffic. So if you’re pushing out bad content just because you have a content calendar, it’s probably not worth it. I mean you really need to focus on creating good stuff, and if you’re not, you’re wasting your time. You’re wasting your effort.
[27:48] Rob: That wraps us up for today. If you have questions for us call our voicemail number at (888) 801-9690 or email us at questions@startupsfortherestofus.com. Our theme music is an excerpt from “We’re Out of Control” by Moot used under creative commons. You can subscribe to us in iTunes by searching for “startups” or by RSS at startupsfortherestofus.com where you’ll also find a full transcript of each episode. Thanks for listening. We’ll see you next time.
Episode 202 | Outbound Sales for Startups with Guest Steli Efti
Show Notes
- Steli’s outbound sales book
- Use Code awesomesauce for 50% off
- MicroConf Europe
Transcript
[00:00] Rob: In this episode of “Startups For The Rest of Us” Mike and I discuss outbound sales for startups with special guest Stelli Efty. This is “Startups For The Rest Of Us” episode 202.
[00:09] Music
[00:16] Rob: Welcome to “Startups For The Rest of Us”, the podcast that helps developers, designer and entrepreneurs be awesome at launching software products. Whether you’ve built your first product or you’re just thinking about it, I’m Rob –
[00:25] Mike: And I’m Mike.
[00:26] Rob: And we’re here to share our experiences to help you avoid the same mistakes we’ve made. So what’s the word this week, Mike.
[00:31] Mike: Well, I totally forgot that I’m going to the “Business of Software” conference next week.
[00:35] Rob: And are you going downtown and staying in a hotel, or are you driving in from your house?
[00:39] Mike: I’m just going to stay at a hotel nearby, so that makes it easier.
[00:42] Rob: Any speakers, in particular, you are looking forward to seeing?
[00:45] Mike: You know, I haven’t even looked.
[00:46] Rob: I’m feeling a little bit the same way. In two weeks I fly to Thailand with my family, so my two sons and my wife and I jump on an airplane. We’re going to Thailand for four weeks and that’s culminating with Dan and Ian’s DC meetup in Bangkok, where I’m doing a talk. Then my family flies home and I go to Prague and meet you so we can pull off Microconf Europe at the end of October.
[01:12] Mike: Very cool. Hopefully, the political unrest won’t get to you.
[01:15] Rob: Indeed.
[01:17] Mike: Well, the other thing going on is that I’ve started doing some webinars. I signed up for a “Go To Meeting” account. I send out some emails today, some Tweets. At least do some testing around that area and see if using some webinars is going to help push AuditShark out there and kind of fill the sales funnel a little bit. That’s kind of what I’m working on right now, for the most part, is just making sure that I’m stuffing as many leads into that sales funnel as I possibly can, and making sure that I’m following up with everybody.
[01:41] Rob: Very cool. I’ve heard a lot of good things about webinars. It’s been on my list forever to do, and I just haven’t had the bandwidth to do it. From what I’ve heard, the results you get from them are exceptional. This is from people I know who are in the same space that we are. And there is just a lot of value there. And this is just based on my experience recording screencasts, without even the interactivity of a webinar. Those have really made a difference in my sales effort for “Drip”. So, I’m definitely interested to hear how it goes for you.
[02:07] Mike: Yeah, I’ll definitely keep you posted. My first one isn’t until next week, so it will be after the “Business of Software” conference. That’s how I even realized that the Business of Software conference was next week, because I went to schedule that and said, “Oh, shoot! I can’t do it Monday, Tuesday, or Wednesday.”
[02:19] Rob: Nice. We’re rounding out our Microconf Europe speaker list. We’ve landed Brennan Dunn, Ryan Delk from GumRoad – he’s been on the docket for a while, but I’m really excited about his talk. He has so much data from all the launches that Gumroad has seen and he’s bringing that into his talk. Then we just landed Jane Portman from “UI Breakfast”. Jane is a UX designer and developer from Russia. She came to MicroConf Vegas. She’s done some pretty amazing UI work. She worked with Joanna Weeb on their new “Disco” product. I don’t know it you’ve seen that UI, but it’s really impressive. I’m excited to hear from Jane. She’s going to be talking about design for founders, and how to minimize the effort of getting a good design out and not breaking the bank while you’re doing it. So, I’m excited about that. We still do have a few tickets left for Microconf Europe which is in a little over a month in Prague. And if you go to MicroconfEurope.com you can find out more details.
[03:13] So today Mike and I have the pleasure of having Steli Efty with us. Steli is the cofounder of Close.IO, which started as a sales-as-a-service company called “ElasticSales” and pivoted into the SaaS company that many of us have heard today called “Close.io”. Steli, welcome to the podcast.
[03:31] Steli: Hey Rob and Mike, it’s a pleasure and an honor.
[03:33] Rob: Awesome. So both Mike and I have read your book, “Ultimate Startup Guide to Outbound Sales : How to Turn Cold Leads Into Hot Customers”. We will include a link to that in our show notes, and folks can use promo code “awesomesauce” for half off of that book. So you’ve done a lot. I was telling you before we started recording that I hadn’t heard of you before a month or two ago when someone Tweeted us and said, “Hey, you should have Steli in our podcast.” So I put you in our list – I have a big list of people who want to come on the show – but right away, after I heard your name, suddenly you’re everywhere, I see a bunch of talks, you’ve written this book, you’ve done Close.io – which I started hearing about Close.io from people like Brennan Dunn.
[04:10] You are kind of building yourself a really good name – a good personal brand in this outbound sales world. I guess I want to kick it off by saying, ” Why outbound instead of inbound?” It feels like a lot of the world – in our web SaaS world – a lot of people are doing inbound – myself included. But you’re a proponent of outbound, and you’re obviously making it work. So talk to us a little bit about that.
[04:31] Steli: That’s an excellent questions, because I’m not really a pro-inbound or pro-outbound kind of guy. I’m not religious or rigid about this. I’m a “whatever works” kind of guy. We’re actually writing a 2nd volume of “Startup Sales” book, and it’s going to be about inbound sales. Because with elastic sales, primarily what we were doing for Startup, we basically didn’t work for over 200 venture-based startups – most of them, if not all of them were SaaS businesses. And the majority of our work there was outbound sales. So we just built a lot of knowledge, a lot of expertise, a lot of do’s and don’ts, and wanted to share that with the world. But with Close.io today we actually do zero outbound sales. It’s all inbound – our growth today. Not to say that we will never do outbound – we will. But up to this point we’ve been growing quite dramatically purely through inbound sales. So I like both.
[05:25] Every time I give an audience of founders the choice of what to talk about, I’m surprised that people always vote outbound sales as something. I think it’s because we all struggle with it. A lot of technical founders and engineers have kind of – the whole cold-calling and cold-emailing has a lot of stigma to it. I think it’s just a topic people struggle a lot more with than the inbound one, and that’s why we started focusing on teaching that first.
[05:52] Rob: You probably have an idea of our audience. You’ve said you’ve listened to the podcast. It’s a lot of single founders, web, mobile, WordPress plug-ins, a lot of software guys. There are some info product guys, but the specialty is software in terms of the audience. By nature, as a software developer myself, outbound is a little intimidating. How have you approached that? How have you helped bridge that gap for folks who say, “Boy, I don’t know that I’m cut out for it. I don’t know if I have the personality, or I don’t know if I can pull this off”?
[06:19] Steli: First of all, I think it is about de-mything the whole topic, and just killing a few bad idea or misconceptions which have been around for way too long. I do think that the first thing we have to kill is the idea of what a salesperson is, or what makes good salespeople and bad salespeople. I’m not a sales guy. This is not my thing. I can’t do sales. I think most people think sales is all about talking. Are you the type of person who loves to hear yourself talk? Are you super outgoing? Are you a super charismatic personality that loves the limelight and loves to be charming, and talk people into doing things they don’t want to do? Honestly, it sounds like a douchbag to me, and I don’t want to be that person, and I don’t think most people, most founders, most product people ultimately want to be like that. You don’t have to. Sales is really not about talking. Sales is a lot more about asking questions, and practically listening, and actually truly understanding who is the customer and what are their needs. Can I, with the solution I’m building, actually solve their problems in an effective manner? Once you truly understand somebody, ask the right questions, you listen really carefully – then selling is easy. All you have to do is, now that they’ve convinced you that your solution is the right one, you have to tell them why they convinced you of that.
[07:38] Typically, it’s easy to get them on board and actually close the deal. We’ve built our sales software by having engineers sitting next to sales people and actually watching over their shoulder what they are doing and saying, “Well this is stupid. Why do we have to do this all day long?” But also just listening in on conversations and things that are going on. I’ve discovered that engineers are pretty good at asking questions. They’re pretty good at not staying at the surface level of information, but going really deep. Not just taking the first answer at it’s surface, but saying, “Well, why do you want that? What are you trying to accomplish with this?” And actually really asking questions until they arrive at a good understanding. Once you recognize that it’s more about asking the good and right questions and truly understanding somebody and then telling them that you can help them. Then sales is not this big mythical, difficult thing. It’s just asking questions, trying to understand your customers, and then servicing them in a really good way.
[08:35] Now, having said that, there are things that are really hard about sales – especially if you want to do outbound as a single founder. The hard things are more psychologically hard – you don’t have to do anything that is truly, physically hard. It is all just mental. It’s all just emotional. The hard things are the showing up piece. When you do cold sales, what that means is you are proactively reaching out to people who didn’t ask about you or your solution, and you tell them, “Hey, I have something that might be of value to you and I need a few minutes of you time and a little of your attention so both of us can explore weather this will work or not. This is uncomfortable because there is a high chance of rejection. A lot of times people are going to tell you “No,” or they’re not even going to respond to you if you send them an email. People take that really personally, and I think that there are ways for all of us to learn to deal with rejection, embrace it, and understand that it is part of trying to build something of value.
[09:33] The second thing is going for the close. For the exact same reason, people a lot of the times have good conversations. They understand the potential customer prospect really well. They do believe their solution would be really great, and they talk about it a little bit, but they are just afraid to pull the trigger and ask, “Hey, would you buy this? Hey, do you want to be one of my first customers? Hey, can I have your credit card number?” They are just afraid of pulling the trigger. Again, for the same reason. We don’t like to be rejected. We don’t like to here “no”. We’re afraid of it and try to avoid it. When you do sales, you can’t avoid it. You have to embrace that. I think the emotional piece is really hard. I think that’s the reason why most of us don’t do as much as we could. Then there is this ideal myth, “Yeah, sales is this thing that I am not. You have to be a certain personality type to be great at sales.” I truly don’t believe that. Patio11 is a really good example of somebody many people might know of somebody who is not a salesperson – he doesn’t look or walk or talk like one – but he is pretty dangerous. He gets the basics of sales, and he can do that really effectively in his business and it’s propelled his consulting and all his other businesses forward. So I think everybody can learn the basics of sales, and then we all have to relearn to manage the rejection that comes with that.
[10:50] Mike: One of the things you talked about very early on there was the idea that it can be scary for people to go out there and start making those outbound calls. I listened to the podcast where you were on with Patrick McKenzie talking about outbound sales a little bit. I think one of the techniques you talked about is something that I definitely want to highlight to some of our listeners. One of the things that you had said was, “Don’t focus on all of the rejections.” Obviously, when you start focusing on all the negatives it can drag you down. It really wears on your mental abilities to continue. And what you had said was that although you maybe you’re only getting one sale out of a hundred, your metrics should not really be tied to that one sale. It should be tied to those one hundred calls. Could you talk a little bit more about that?
[11:33] Steli: You know, there’s many different little hacks. This is one of them — to try to reprogram myself on how I felt about the outcomes that I produced. Early on when I started doing sales with my first business, I realized, “Hey, I’ve arrived at a point where I’m able to create pretty predictable outcomes.” When I call 100 people, I get to talk to 20, and out of those 20 I get five new customers and another 5 tell me “Not now, but it was a good conversation” and 10 of them tell me no in one way or another. So once I realized that out of a hundred I’ll closed five deals, I made the math – how much money does that mean, and is it really that productive? – then I realized that, yeah, this is really productive and really profitable for me.
[12:17] What I realized also was that if I focus on those five closes, sales is not really – there’s highs and lows – not every single day are you going to create the exact same outcome. On the average you are, but not every single day. So what happened was, when I had good days maybe the first five calls I made I made five sales. That felt amazing, right? I was like, “This is amazing. This is awesome. I already accomplished my goal.” So what did I do? I stopped making calls, because I was like, “I accomplished my goal today.” But if I had continued I might have made another five sales during the day. Then the next day – the bad day – I would make my hundred calls and have zero sales, and I would be devastated and destroyed emotionally. And maybe even the next day it would have moved my mood to actually not want to make any calls, and kind of mess with my head. So I realized that when I focus on success, number one, it kind of influences how consistent I am in putting in the work. And I realized that every time I got failure, or I got rejection – which was a lot more than I got success it would make me feel really bad – like a failure, like I’m not accomplishing anything, I’m not worthy, my business is failing.
[13:25] So I tried to come up with a way to make myself feel good by creating failure, and one hack of doing that was to actually make the goal every day to get rejected 15 times. So, I would show up in my office and my goal was not to close five deals. My goal was to get 15 people to tell me no, that I can’t convince otherwise. Because I knew that if I could actually endure that, on average I’ll get my five closes. But I’m actually going to feel like I’m accomplishing things when I hear “no”, and I’m going to be able to check that off my list. I have a little list and I’ve put on there 15 “nos”, and I would know that once I had checked off all these 15 nos I’d got my job done for the day. It kind of made me feel good when I got rejected and reprogrammed the way that I was emotionally able to handle it, and it made me more productive at the end of the day. So yeah, that’s one way to hack your own brain and make yourself feel like you are accomplishing something when you are actually getting rejected, versus feeling like you are failing at what you are trying to accomplish.
[14:21] Mike: Yeah, I thought it was very insightful to see that you’re tying your success to the wrong metric in that case. You want to be able to say, “Check off the 99 boxes or 100 boxes a day and say I made a hundred calls.” versus “I made five sales.” The sales will come as a result of making those 100 calls, and you shouldn’t be tying your success metrics to the sales themselves – back it off a little bit.
[14:43] Steli: Absolutely
[14:44] Rob: It seems like a cold email as an outbound sales tools has become more and more popular. I’ve been hearing about it from folks. “Predictable Revenue”, the book from the Salesforce.com guys, talked a lot about cold email. There is also cold calling, and we know that there are two different levels of effort and two different markets where that works. But someone listening to this podcast right now is probably thinking, “Should I cold email? At what point is it worth it?” If I’m selling a $20 ebook obviously it’s not worth cold emailing. If I’m selling a $20/month SaaS app, I don’t know if it is. If it’s $200/month then it probably is. In your experience, what is the metric? Is it a customer lifetime value? Where is it that cold email is worth exploring for you or your company.
[15:52] Steli: There’s two distinct stages of a business, and depending on which stage you’re in the answer is different. In the very early days, when you are pre-product market fit, when you’re still trying to figure out your idea, and you’re still trying to figure out how to market your idea successfully or not. I actually believe that at that phase you want to go through all the available channels to actually interact with potential customers and learn from them. So in the very early days I would actually drive to customers, and actually show up at people’s offices or businesses or wherever, and try to interact with people in person, because that’s not really scalable. Even if you have a $20 ebook, you know that this is not the way we want to grow this business forever. But in the early days it’s more about learning, and if you can actually look somebody in the eye and get the context of the business and see how not just what they are telling you on the surface, but how they react, their body language and tonality, the other people they work with , their challenges at work, their environment. That can teach you so much that can go back into the way you write that ebook or develop that software. So in the early days I would try to be as close to the customer as possible and actually go and meet some and just show up at some businesses to get feedback. One level that scales a little further, but gives you a little less context, is cold calling. So after you’ve visited a bunch of businesses and learned a bunch of things, you might want to talk to a few more people and a few more business and scale it up a little bit. Then you start calling people, and there again you have not just the content, but also a little more context through tonality in what they are saying and how they are saying things. Then one level further that scales a bit better, but again is missing some more information, is actually emailing a lot of people. I would go visit a bunch of people, cold call a bunch of people and the email.
[17:09] Ramp up the volume. It’s different things you are going to learn through these different channels, different feedback you are going to get from individuals. With email you may more metrics : open rates, click-through rates, you can experiment more with the wording and copy. On the call you can interact, ask more follow up questions, keep people engaged. Then when you actually visit them you learn more about who they are, their challenges, and their natural habitat. In the early days I wouldn’t worry about what does scale or not, or what are channels that I’m going to be using forever for my business. I would focus more on how I can learn as much as humanely possible about my customer.
[17:44] And I do think that cold email plays a role there. You can cold email a lot of people. You can pick a lot of people on LinkedIn and just cold email them, or even Tweet them or whatever it is. Reach out to people as much as possible electronically and see what they tell you. You can use that to either schedule calls or in-person meetings, or just to ask them to fill out a survey or just reply and tell you what they think about something. So that’s that. That’s more of the exploration phase. When it comes to, ” I have a business that works, a product that’s launched, a customer base I understand, and now it’s about how can I scale? When does cold email then play a role? I think that cold email in a more established business that has some product market fit, usually works best for companies that are selling either to large organizations – if you are selling SaaS to an enterprise. Your goal is not necessarily using cold email to sell or convince somebody to buy, but to actually get connected with the right individual in the organization and then schedule a call or demo or something like that. There it is almost an inevitable tool to success.
[18:47] Everything that’s below the enterprise – everything that is maybe not an enterprise client, but still a customer lifetime value that is in the thousands and not the hundreds. It may or may not make sense, but it gets harder and harder. So cold email, to scale a business is usually a really good tool when you do large customers with high customer lifetime value. If you are in the middle market it may or may not work, you want to play around with it. And if you’re in the very small market – like if my customers bring in $20, $25, or even $100 customer lifetime value- it’s going to be probably not a sustainable channel to keep cold emailing people. Then again, you might not want to cold email people to buy your ebook. You might want to cold email people to get on their podcast, or get some press, or do a joint venture promotion deal, or something else. You might still use that channel for partnerships that are more multiplication factors. But you probably will not want to send individual cold emails to people who may or may not buy your $20 ebook. That probably will not make sense, and will not scale really.
[19:52] Rob: That makes sense. In terms of cold calling, would you say it is a similar kind of metric you use? Or is it less scalable?
[19:59] Steli: I would say cold calling actually works better sometimes in the “S and B” market than in the enterprise market, funny enough. It’s just so hard to cold call into Coca-Cola and route your way into the VP of Marketing department. That’s just never going to work. But you can easily cold call a restaurant and get the manager or the owner on the phone, or something like that. So in the “S & B” market I’ve seen a lot of companies succeed to various degrees with cold calls. But I still think if you are doing cold calling, you don’t have to have hundreds of thousands or millions of customer lifetime value. But it should be $2000, $3000, $4000. At a minimum it should be a few thousand dollars in customer lifetime value. It’s going to be really hard if it is just a few hundred to ever make the economics work. It’s going to be brutally hard. So, that’s the way I would think about it when it comes to when would cold calling be a sustainable channel for you to grow.
[20:58] Mike: What I’ve found in doing some cold calling is that even if a business is several hundred employees, depending on the type of business, you can still get pretty far up in the chain to the VP of Sales and the VP of Engineering and people like that very very quickly, because they’re the ones inbound calls are directed to. So if you email somebody and say, “Hey, how do I get in touch with so-and-so?” you’re going to be able to do that pretty easily because they’re willing to just say, “Hey, you’re supposed to go talk to my boss.” Because they don’t want to talk to you. Whoever that tech is – so they’re more than happy to turn you over to their boss.
[21:30] Steli: It really heavily depends on the industry. Sometimes you can actually just call somebody and they will pick up the phone. Sometimes it’s the type of business where the decision maker is either used to picking up the phone or it is so rare that somebody calls that they pick up the phone. All kinds of different combinations can work. Some people have figured out a way into the industry and vertical that they are selling into. They truly understand the gatekeepers. They have gotten to the point where they really understand that when the secretary picks up, how do I sell her on why this is valuable to her (or his) boss, and they really make that work. And many times in Fortune 500 setups the larger the organization the harder it is a lot of times for people to even know who would be the right person for this. Then you end up at calling trees and voicemails that people don’t listen to. So it really depends on your vertical.
[22:19] I would always test a few hundred calls, or maybe fifty calls today, to see if I can validate what I just heard in a podcast, or read in a book, or heard from some other person. I would always just go out and try it myself and see if the market you are selling to, if it is truly that vertical that market, mirrors what you’ve learned or heard from somebody else. So I’m telling people a lot of the times large organizations, you may not want to do cold calling. But then there are always exceptions to that rule so we always test it out.
[22:46] Mike: So one of the things you talk about is essentially having an “objection management document”. Can you talk a little about this and what its purpose is? I really think this will be helpful for some of the listeners.
[22:57] Steli: Oh yeah. I love that, because it’s such a simple thing to do but it can have a really profound impact on how you interact with people. So with most/all businesses, the objections that you will face, the things people will tell you as reasons why they are not yet sure if they want to buy your solution or your product, or why they’re against it. It’s not going to be a list of tens of thousands of very individual objections. It’s going to be a list of 10 to 20 objections you hear every single day. There’s going to be a top ten list of the main things you hear again and again and again. A simple thing that you can do that anybody can do is just sit down take 20 minutes and write down what are the core objections I hear again and again. “It’s too expensive.”, “We don’t have the time.”, “We already have a solution like this.”, “It doesn’t do HTML email.”, “It doesn’t have this feature or functionality we want.” Whatever it is for your business. You know best. Just write down, the top ten questions or ten objects that I hear a lot. Then once you have written down these 10 objections what you do is take another 10 or 15 minutes and write down an answer to each and every one of them. That answer doesn’t have to be perfect. You don’t have to stress yourself out by thinking, “Oh, I need to write the perfect answer.” No, just write an answer. The only restriction or goal that you should have with that answer is that it should be short – two sentences or three sentences max. Answer to each or reaction to each objection you have. Write them down, and do it quick, don’t over-think things, but just write them down. Once you have that, you basically have a document that you can reuse and edit and have different versions with, that is going to help you increase your effectiveness when you deal with customers, when you are trying to close deals, when you’re interacting even with investors or the press or whoever. This “objection management doc” can work in any kind of setting where you have to interact other people and influence them.
[24:51] You have something that you can use to have clarity and be able to respond and react in a really professional and effective way with people. You can do all kinds of things with it. Once you have the first version, why don’t you send it to five of your friends, or five of your best people you admire or people who are really good at what they do and ask for feedback. Why don’t you send it to your five best customers and say, “Hey, here’s the objections I deal with everyday. Here is the way I would respond to them today. Do you think these are good answers? What do you think?”. You try to improve it over time. The core thing is to have simple, concise answers to the main objections. Because here’s the thing, too many times we as founders we know everything about our business and we don’t think we need to write down anything or create a script or anything like that. So what happens is that every single day when we interact with customers – or potential customers – we compute answers to their objects in real time, and that’s just stupid. The problem with that is that the quality of your answers and responses will heavily depend on your daily performance, mood, state of mind. Are you having a good day or bad day? On a bad day your answers will suck, and on a good day your answers may be brilliant but you are not going to be consistent.
[25:58] The other thing is that usually when we compute answers in real time we tend to speak for way too long, because we’re not editing. We’re thinking on the fly, and when you think and talk on the fly you usually talk for way too long. All that does is it wastes time, it’s inconsistent performance, and usually when people take way too long to answer an objection that a customer has, it doesn’t leave the customer with a high level of confidence that this is something that’s simple and easy and that they feel confident about it. The cool thing when you have a two sentence answer to any objection you face is that you can actually answer in a very concise way, with a high level of clarity. If you’re in an in-person meeting, even by keeping eye contact. It’s not just what you say – the way that you respond to that objection will make the other person feel like, “Oh my god, this guy or gal seems pretty confident and comfortable in responding to my big objection.
[26:50] Maybe I should also get comfortable with the idea of buying.” People like confident people. People like people who have clarity. It kind of suggests that you are smart, that you are an expert. People want to buy from businesses like that. So just by having the top ten objections written down. Write two sentence answers to them. Even if they’re not the best answers in the world, just by having that level of clarity so that you are able to answer these objections with a certain level or certitude will actually make a big difference.
[27:17] Rob: One of the questions that we get asked on the show fairly regularly is, “Should I outsource sales?” In your opinion, do you think a startup can outsource sales. I know there are different stages. There are different stages to the startup : before the product market fit, then after. In addition, there is just this cold prospecting that is used to set appointments. Then there is the actual sales effort. So what have you seen work and not work, in those scenarios in terms of startups trying to outsource them?
[27:47] Steli: That’s a question I get asked a lot, because I was running a very larger – probably the biggest SaaS outsourcing sales business that existed up to this point. So my answer is “Yes”, but only if it is about replicating results you have already, in a predictable way, delivered yourself. So what I mean by that is, a lot people want to outsource sales because they don’t know how to do it, or because they’re not seeing success with it. That’s kind of like saying, “I want to outsource engineering for my product. Can I outsource and find some developer or company in the world, or a bunch of freelancers to build me something?” Of course you can, but what is not a good idea is to say, “Well, I’m going to find this developer, and I’m going to tell him or her, “Hey I want to do this app. It should be a SaaS app, and it’s in the analytics space, but I don’t really know what it looks like, I don’t have any specs, I don’t have any ideas that seem to be good. So why don’t you just write me a SaaS app in the analytics space that’s awesome?”
[28:46] How good of an idea does that sound to the developer audience out there? No developer will think that’s a good idea. That will never work. So what you have to do when you want to outsource the development of your product is you have to have a very high level of clarity of what that should be. You have to have specs, and user stories, and you really need to know exactly what you want. When you can tell them exactly what you want, step-by-step, then an outsourced team might do a really good job for you. It’s the same thing with sales. If you want to outsource your entire sales process – or even just parts of it – it can work. But it only will work, and it only makes sense for you as a your business, to do that once you have actually mastered that part of the sale. Once you can in a repeatable and predictable fashion generate high quality leads and prospects, then you can go to a outsourcing firm and say, “Hey, here’s what we’re doing. Here’s how we’re doing it. Can you replicate these results at a lower cost or at a higher scale?” You have now the knowledge, you have control of your business. If at any point it does not work out with that outsourcing firm you can bring it back internally. You know how to do it. You don’t outsource the actual core knowledge of how to run your business. And you can tell that company exactly what to do and you know how to actually judge their performance.
[29:59] What’s never going to work, and what has never worked in my experience with my own business and our clients, as well as all the other outsource sales businesses I see, is when you say, “Hey, we struggle with sales – or this specific part of sales. Can you fix our problem? Can you find a solution to that?” That’s usually not what outsourcing sales firms are good at. They will tell you they can, but more often than not they can’t. It’s not a good idea. So, once you figure things out you can outsource, but not before.
[30:29] Rob: Very good. Well thanks so much for coming on the show today, Steli. We really appreciate it. We have another half a dozen questions at least, along with bullet points about how to cold email. You have your “Pitchology 101” framework. There’s a lot of stuff that we didn’t get to that is in your book : “Ultimate Startup Guide to Outbound Sales”. And as I said I said, if people want to check it out we will link it up in the show notes and they can use the code “awesome sauce” for 50% off.
[30:54] Steli: Awesome. Hey guys, it was a pleasure. And one other thing to people who are listening. As I said, I’m a huge fan of the show, and so I super-empathize with the audience. If anyone reads the book, or reads any of the blog posts or anything else that I write about and wants to connect, say hi , ask a follow-up question. Whatever it is, just send me an email. It’s steli@close.io . I am more than happy to help anyone I can with anything that I know. So feel free to reach out and say hi.
[31:20] Rob: Perfect
[31:21] Steli: Thank you so much.
[31:22] Mike: Well, I think that wraps us up. If you have a question for us, you can call it in to our voicemail number at 1-888-801-9690. Or you can email it to us at questions@startupsfortherestofus.com . Our theme music is an excerpt from “We’re Out of Control” by Moot, used under Creative Commons. You can subscribe to us in iTunes by searching for “startups” or by RSS at startupsfortherestofus.com where you’ll also find a full transcript of each episode. Thanks for listening and we’ll see you next time.
Episode 201 | Dealing with Crunch-Time Stress, Balancing Life and Work and More Listener Questions
Show Notes
- My DBA, Creston from Ruby Tree Software
- Thanks to @allanbranch, @earthlingworks and @tosbourn for questions asked via Twitter
Lifehacks (from Michał Domański):
- Buy food online – saves time and money
- Don’t buy sugared soda – try finding soda sweetened with xylitol or stevia, if not possible go for 0 calorie options. Saves about 400 – 800 kcal a day depending on your consumption.
- Try short, high intensity workouts like Tabata method or Prison workout from http://trinitytraining.blogspot.com
- Kettlebells are a proved way of delivering short workouts and functional strength (focus on technique, go light on weights)
- Have a daily meal plan, buy food accordingly. If you work from home, have everything ready before you start working, if you work from office have it packed and take it with you. Saves a ton of time and money on lunch + you eat healthier
- Have a bottle of mineral water near, developers consume a lot of caffeine and that flushes minerals and dehydrates you. Replenish yourself 🙂
Supplements (from Michał Domański):
- Multivitamin stack, choose one that suits your age and gender
- Brain supplements – ones that work (proven scientifically): huperzine, vinpocetine, caffeine, bacopa monniera. Try taking them together in the morning and see what happens 🙂
- Sleep: melatonin – people working with glowing screens are low on melatonin, try supplementing yourself, starting from 5mg and see if you sleep better
- Brain food: MCT oil (healthy fats), this is very beneficial but start slowly as body has to adjust with increased lipase production
Stuff that works for me, but may not for you (from Michał Domański):
- Low carb diet
- Meditation – simple mindfulness for 10minutes daily
Transcript
[00:00] Rob: In this episode of Startups For The Rest of Us, Mike and I discuss dealing with crunch time stress, balancing life and work and more listener questions. This is Startups For The Rest of Us, episode 201.
[00:10] Music
[00:18] Rob: Welcome to Startups For The Rest of Us the podcast that helps developers, designers and entrepreneurs be awesome at launching software products – whether you’ve built your first product or your just thinking about it. I’m Rob.
[00:26] Mike: And I’m Mike.
[00:27] Rob: And we’re here to share our experiences to help you avoid the same mistakes we’ve made. So what’s the word this week sir?
[00:32] Mike: Well I’m getting back on track after taking the weekend off and going on my personal retreat. I spent the weekend in my cottage up in the Adirondacks. The weather was kind of crappy so I came home a day early and spent the rest of my retreat in the basement.
[00:44] Rob: What came out of that? Did you find it enlightening because this is the first one you’ve done. I imagine it takes a little while to get into it, and I’m wondering if anything came out of it.
[00:53]Mike: It didn’t take me very long to get into it at all. I started on Friday night. I started making notes and stuff right away. I separated it out into 3 different things. I had a Google Doc that I was working form, to at least start off with. I had a list of questions to ask myself. Then I had a bunch of tips during the retreat for myself. I was like, okay I need to have something that comes out of this, so beyond my notes I want to have some sort of action list. What I found was, first of all notebooks don’t work for me. My writing skills just do not keep up with what I’m thinking about. So I ditched it and went to the iPad and was just banging out notes left and right and that really helped move things along. The other thing that came out of it was my action list actually spawned off other action lists. I’ve got different action lists for different projects and different goals and things like that.
[01:43]Rob: Nice, so you have a personal side and a business side to it?
[01:46] Mike: I have some action lists for personal stuff and some that are directly related to specific aspects of the business. For example, AuditShark Marketing just had 1 action list unto itself. Then there were other things that were ancillary.
[02:02] Rob: Right, that makes sense. The reason notebooks work me, is that I don’t take word for word notes. I do a lot more thinking than I do writing. So I will spend 30 minutes not writing anything and just in deep, deep thought and try to mull through a topic and maybe sketching or drawing to get the more creative side of my brain going as I’m thinking through this. Maybe do a little bit research here and there, but I come to an epiphany and I’ll jot that down or I’ll come to a conclusion. It’s rare that I am thinking out loud like it’s a journal or something. Because, you’re right, if I was doing that I would want to type because you think faster than you can write these days.
[02:42] Mike: What I found is that I would just write out brief thoughts and then go back and take a look at them, re-read them and that was really where my epiphanies started to come from. I would write down a bunch of my thoughts then go back and re-read them and that’s when I would have those insights that I needed to have.
[02:59] Rob: Very cool. So was it worth it? Are you planning to do another one?
[03:03] Mike: Definitely. I’m going to regularly start to schedule them.
[03:06] Rob: I think annual. Annual is the minimum for me. Every 6 months is more ideal.
[03:11] Mike: I did find one thing though, camping is not the ideal situation for going on a personal retreat. Having to stop and do the dishes, and cook and things like that, it just totally blows apart some of your schedule.
[03:24] Rob: Yeah! How interesting. I’ve never done it. It kills your flow.
[03:27] Mike: Yeah, I didn’t really think about that before I went but in retrospect, certain times of the day I wasn’t productive at all. And, there are other times, early evening, after I’ve eaten dinner, I was very productive.
[03:39] Rob: Right. Right. So, I had a bit of a rocky start to my Labor Day weekend on Friday. I really need to give special thanks to my DBA, his name Creston Jamison and he runs Ruby Tree Software. He basically was doing a restore to test, just to test database backups. And our previous DBA had stopped testing the restores a few months ago. Friday night he emails me and says we have a problem, the restorer is not working – it’s not working as we would expect. He spent that night, an hour or two, he really came up in a clutch for me and got everything working again. But I don’t, how long that can go on and you have an issue and you go to restore it and it’s not there. I highly recommend this guy, it’s Rubytreessoftware.com and his name is Creston. He’s a rails developer, he does performance tuning and he also a postgres DBA. I just wanted to give him a shout out and a thanks for working on a Friday night of a 3-day weekend for us.
[04:36] Mike: Yeah, that’s kind of scary to have stuff like that running in the background and if you didn’t test it, how would you know it’s not working? Your entire business is hinging on that stuff working and if there is ever a problem –
[04:47] Rob: Seriously. These background processes – and you get so many of them – and as your app grows, I find it really hard to just keep tabs on all of them. With tools like New Relic, Monet and there’s other stuff that can look at it, but really getting down to the nuts and bolts at a certain point, you just have to have someone on a recurring basis actually getting in there and doing some things to verify that everything is in fact functioning.
[05:09] Music
[05:12] Rob: We have a bunch of listener questions. We have several have been emailed to us and then we have several from Twitter that I just asked for questions and we have some good ones. Let’s kick us off with the first one it’s about whether to build a fresh solution for an existing market and it’s from Bill Eisenhower and he says, “Hi, I’ve run across a couple of niche markets recently where there are SaaS apps that look fairly crufty by todays standards. It seems like a reasonable assumption to conclude that there’s money in those spaces. My question is, what do you think about entering in those types of markets? You have the advantage of being able to offer a potentially fresher solution but you definitely begin life fighting well established others for market share. Any advice or thoughts?”
[05:54] Mike: I think that the fact that there are other SaaS apps in that area is partly a good sign because it means there are people willing to pay for that. That essentially takes away one of the things you need to worry about when you’re building a new application. The thing you do have to wonder about is where are they currently getting their traffic from and where are they getting their customers from. What are their price points? Do they have sales reps who are talking to people? How far behind are you? Is there a way for you to take whatever the solution is they’re offering and break it apart and only solve a very small piece of the problem that’s big enough that people are actually willing to pay for. Those are the things I would probably keep in mind but you definitely want to test to figure out, what are the types of sales channels that are going to work for you? Because I think that is the bigger piece of the problem that you need to be able to resolve before you start writing code and figure out a lot of that stuff.
[06:42] Rob: I have some doubts that a market is proven just because there’s a SaaS app in the space. I think you want to go one step further and try to figure out how much revenue they have. Try to do some search, whether it’s Compete.com to figure out how much traffic. Do online research, look at CrunchBase, whatever you can to try and figure out how big they are because there are a lot of SaaS apps and a lot of spaces and they may or may not have ever really hit critical mass. If an app is built, it looks crufty, maybe they only got to 5000 in recurring revenue and that’s how big the market is. I think that’s the first thing I would be careful of is assuming that there is a market just because they’re there. The second thing, my initial inclination is if there’s a crufty SaaS app would be to buy it rather than to try and build one. Here’s why, if they are doing well then they already have enough traffic. They have Google authority, they have in-house knowledge, they’ve probably learned a ton about this market and the marketing – there’s a lot of stuff there. So even if you have to wind up re-writing a lot of the app, or doing a lot of improvements to it, like I did with HitTail a few years ago, you’re going to be so far ahead if you were to acquire their traffic and acquire their existing customer base and acquire as much of that knowledge as you can garner rather than trying to build it from scratch. It’s literally a 1 to 2 year jump. Obviously it depends on if you can afford it and if that’s something you want to do. But that would be my initial inclination going into an existing market.
[08:07] Mike: The other thing, is that by starting that discussion about acquiring them you can probably get some more information about them.
[08:12] Rob: Yeah, that’s interesting, but if you are genuinely interested in acquiring them then it’s not like you’re doing it in bad faith. Right? You actually are interested in figuring out if you guys can work out.
[08:23] Mike: Yeah that depends a lot on whether or not you have the money and how good your estimation skills are in terms of how big they are. If you look at them and you’re not real sure and you make an offer of, I don’t know, say 10 or 15 thousand dollars or something like that and they say, “Yeah we make that in a week”, then they just told you that they make 10 to 15 thousand dollars a week. It may give you an idea of what the market is like.
[08:46] Rob: So thanks for the question Bill, I hope that was helpful. Our next question comes from JJ and he says. “Hi Rob and Mike. I’d love to hear about dealing with crunch time stress. The stress of short, intense required work like an initial roll out, major upgrades and transitions. Some things that come to mind are making lists, decreasing caffeine, dry runs and test environments. By now I’ve listened to every show of your podcasts. Although I’m in a small enterprise environment I find your podcast useful to promote my work within the organization, thanks.”
[09:12] Mike: I think of anything, decreasing your caffeine levels, is probably a bad thing during that crunch time. That’s my first thought. But as you get closer to those types of things you start to realize that there are some things that you are looking at or trying to do that simply not nearly as important, or not as critical to whatever that time deadline is. As you get closer to a rollout, you may decide there’s a lot of work you can just push off. Whether it’s features or certain types of testing or certain designs and things like that. There are always things you can cut and push off to the future. From a work management standpoint you always have that option available to you.
[09:51] The second thing is unless you’ve publically made those deadlines available to everybody and told people, “Hey this is coming out on Saturday”, who is to say that that work effort has to be done by that time. You can push it out if you need to. Not to say that you want to, but if you need to in order to de-stress a little bit then certainly you should use that as an option. Because the last thing you want to do is get into a situation where you work really hard on the initial roll out and you’re doing all these major upgrades and code restructuring and things like that, and you launch it to people and you may mistakenly think, “Oh the hard work is over, I get to go out and do marketing stuff and work with customers”. In reality that is where the work begins. Telling yourself that it’s the other way around, that you’re going to take a break is not the ideal scenario. You want to be able to manage that long term.
[10:38] Rob: Yeah, I agree with Mike. It’s interesting that JJ brought up caffeine, like decreasing caffeine, because if you’re naturally an anxious person then caffeine can increase anxiety but I find it also makes you tend to preform – you’re more focused and you’re able to get things done. I tend to increase my caffeine during these crunch times. Now, if your crunch time is 3 months long then that’s obviously not a good thing. You need to figure out what you’re doing wrong so that your crunch time is not that long. When you have a few days – we pulled an all nighter about a month and a half ago. I went to bed fairly early. One developer stayed up most of the night rolling out HitTail from ASP and moving into the Rails version during a data base migration and, frankly we had this by the minute account of what it was going to be. I learned to do this from when I was an electrician and we would do shutdowns of data centers. You had to have this shut down check list and you had to have this thing mapped out by the minute to make sure that anything didn’t mess up. You had multiple supervisors essentially approve this and walk through it and offer feedback and all that stuff. It sounds like a bunch of stuff by committee, which I hate. But when you’re doing something that is time critical it is so much better to – literally we had it in a Google Doc. It ran by the letter and we could tell when we were ahead or behind. And we could tell if this thing was going to take until 7 in the morning or if it was going to take until 4 in the morning because we could tell if we were ahead or behind in the schedule. Lists are not necessarily it but it’s kind of having a well documented process for something that is super intense and then having a – we had a testing checklist of everything I wanted to test once we rolled out. It just gave me the confidence that I wasn’t thinking about this at 3 in the morning or 4 in the morning when your head isn’t clear. I had thought about it 2 weeks prior and had a few read it, we revised it, we worked on it together. I think it was pretty rock solid by the time we were done. It’s the advance preparation that will help you with that major upgrade or transition.
[12:32] Mike: Yeah, as you pointed out the last thing you want to be doing is making major decisions at 3am.
[12:37] Rob: So thanks for that question JJ, I hope that helps. Our next email is actually not a question – it’s a comment with some really good insights. It’s about episode 186, life hacks for entrepreneurs. This email is from Mihao Dumansky. He’s a long time listener. He said he wanted to share some of his own simple life hacks. I won’t be able to share them all but we’ll add them into the show notes for this episode. Here’s several things that he suggested that he’s been using to hack his life essentially. One is to buy food online, it saves time and money. Don’t buy sugared soda, try to find something sweetened with xylitol or stevia, if not possible go for zero calorie options because it saves between 400 and 800 calories a day if you drink a lot of soda.
[13:18] Mike: Real quick to go back to that last one buying food online – saving time and money. It definitely saves time but most people say it will probably cost you more money because you have to have it delivered and everything else.
[13:28] Rob: Another couple he has is to try short, high intensity workouts like Tabata method or prison workout and he gives us a link there. The last one that I like, is to have a bottle of mineral water nearby. Developers consume a lot of caffeine and it flushes minerals and dehydrates you. So, replenishing yourself with water doesn’t replace minerals.
[13:45] Mike: What’s next on the list?
[13:46] Rob: Next, we haven’t done this before, but I went to Twitter this afternoon and just asked if people had any questions for us to discuss on the podcast. And the first question came back from Allen Branch of Less Everything. He said, I’m interested on hearing your thoughts on balancing life and work and what a typical day’s schedule looks like.
[14:04] Mike: For me, balancing life and work has a lot to do with bouncing back and forth between them. So depending on the day of the week and what’s going on that day, I might do a lot more work stuff or I might do a lot more life stuff. Tuesdays, for example, are a complete mess just because of the way the schedule works out. My wife teaches Zumba classes so I’m constantly bouncing back and forth on Tuesdays. Wednesdays are a lot more open, Mondays are a lot more open but Tuesdays are a nightmare in terms of having to bounce back and forth. And being able to make sure you set aside specific times where you are going to stop working. I try not to work on the weekends. I do on occasion but it usually depends on if I had a Monday that gets blown apart because of a holiday and something comes up and I have to get off schedule, then I might have to reserve a Saturday or Sunday.
[14:50] It’s just a matter of re-arranging and knowing what my schedule is and my wife’s schedule. We actually have our calendars shared so I can pull up my calendar and I’ll look at it and I’ll see when she’s busy and see when I’m busy and, see what the overlaps are, and see where one of us is going to have to deal with the kids or attend something we may not have planned on. When my kids are in karate, they’re both in soccer – those things have to be taken into account.
[15:13] Rob: In terms of balancing life and work for me it’s the same way. I was at my son’s school today for 30 minutes helping out because he had an issue going on. So, I walked over from work. I find that the two overlap a lot. A lot more than I thought they would, and frankly a lot more than I hoped they would. I don’t do well with interruptions and I’m interrupted once or twice a day with something – with the school calling or my wife saying, “Hey, I need you to pick this up because this person didn’t show up.” We just have a lot of moving parts with two full time working parents. But with that said, I feel like balancing life and work involves a couple of things. One, when I’m working I try to be really, really focused and work, so I don’t sit around the water cooler and talk to people and waste time, at least I try not to. I put on music, I drink some caffeine and I get very intense about what I’m doing and I just roll with it and just try to be highly productive.
[16:07] Then when I’m done, I try as much as I can to shut that off – to completely walk away from email and walk away from social media and try not to work while I’m with my kids. I’ll do stuff like leave my phone in a certain place in the house and just not check it for several hours which means that I can focus on playing games with my kids and hanging out and practice instruments. So I find that I want to do one thing really well at a time and I almost never try to work when my kids are at home because I find that it means I’m not be doing a good job at work and I may be getting irritated. And it feels to the kids, like you’re paying more attention to something else. The one other thing is I try to take some time for myself everyday. Now that I have a 15 minute drive each way to the office, that’s a perfect time, I listen to podcasts. I also do that when I’m doing the dishes in the evening, when I’m cooking. That’s really my time so when I’m doing that I actually will tell people “can you go into the other room and do something?”
[17:03] Because, me sitting there in my own head with the podcast playing, that is where I am able to have some time to myself. We all need that. You can’t just be at work then be with other people all the time. It’s really hard especially for introverts like a lot of us get exhausted with that. That’s where I feel I’m balancing both work and my family and my own life. Trying to balance those 3 things. In terms of a typical days schedule – I don’t know that there is a typical day. I guess if I’m not traveling – I typically work about 9 to 4 then I do a few hours in the evening if needed.
[17:35] Mike: It’s interesting that you bought up listening to podcasts and stuff while you’re doing the dishes. I listen to podcasts while I’m at the gym working out because it’s a perfect time to do both and I don’t really have to concentrate on lifting weights or anything.
[17:47] Rob: The next question is a follow-up. Rueben Gomez from Bidsketch chimed in. He said, “when do you decide to temporarily change your normal schedule to work more or less – and the trade offs that come with that.” This is a really good question actually. I’ve done this a lot, I’ll ramp up my schedule and I will make a concerted effort. I’m intentional about it, I will talk to my wife and those around me and say, “I’m going to be working nights” and put in a couple of 50 or 60 hours weeks because we are ramping up and we need to deploy something, or it’s just a really big push time for us. And, other times I will back completely off. When we had our second child a few years ago, I worked about 12 to 16 hours a week for 10 months. At other times, I’m going to Thailand for a month here in a couple of weeks and I’m going to back way off obviously because of the travel and I want to be able to do things with the family and hang out.
[18:38] I think another point that people would expect less is at a certain point with development of Drip, so much needed to get done and I couldn’t help with it. I backed my hours off on Drip. No more marketing, no more sales was going to help it because churn was too high and we weren’t at product market fit. I backed my hours off and put them towards other things – basically towards, Microconf, HitTail and I even took some time to myself and took some time off work. Those are the kinds of instances where I will ramp up or ramp down. Reuben had asked about the trade offs. I don’t know that I really had a big negative impact from any of those things.
[19:19] Mike: The thing that comes to mind for me is that you intentionally do that. And I do as well. I think that’s the key to being able to change your schedule to work more or less is that when you do it, it needs to be intentional. If you’re gradually ramping up and you keep going up and up and you don’t necessarily realize it. You can find yourself in a bad situation because you’re not doing it intentionally. Things are probably going wrong at that point especially if you’re ramping up. If you’re ramping down, maybe you’re just getting burnt out. I think that either ramping up or down, it has to be done intentionally. You have to think about what it is that you’re doing and why you’re doing it and what those trade off are. When you do that, consciously making that decision to perform those trade off, then at that point, because you made the decision, it’s not a big deal at that point those trade offs. You kind of mentally made those decisions.
[20:10] Rob: Yeah, I like that. I don’t know if I’d put it in those terms but the intentionality is a big piece of it. When I was salaried employee I remember when other people would make the choice for me, meaning they would force me to work more, really, really got to me. As soon as I was able to control that it doesn’t bother me nearly as much especially when I know that it’s a short season. If I’m going to work more it’s going to be for a few weeks here and there and I need to keep myself accountable to that and not try to work 60 hour weeks for 4 months because it’s just not a sustainable lifestyle. Cool. Our next question is from Toby Osborne also from Twitter. He says, “What do you both do to completely relax away from startups? Things like video games, sports, etcetera?”
[20:53] Mike: For me it’s a combination of 3 different things. One, I’ll play video games. Second thing is I’ll read books and then the third one is watching movies. So those are the 3 things I like to do outside of startups. Even the books that I read, they are all fiction. They have nothing to do with business or anything like that. I basically just put my brain in another world and then the same thing with movies.
[21:16] Rob: Nice, I really enjoy good television. I’ll watch Game of Thrones. I was watching Breaking Bad, Walking Dead, Mad Men really solid, episodic, long running television that’s well done. I also listen to a lot of podcasts and I enjoy that. That’s not completely away from startups but I do listen to a lot of stuff on the Twit Network which is a just a tech network and then all the podcasts from Tom Merritt, some of them are about Cord Killing and there’s Daily Tech News and that kind of news. That’s not really about startups. It doesn’t really help me at work but it is entertaining and it allows me to be in my own head for awhile each day. I find it really relaxing.
[21:52] I also play music. I’ve been playing the guitar since I was in college. I haven’t written a song in a while, I was in a couple of bands but I find it very relaxing to sit back and play old tunes that I’m familiar with – whether they’re things that I wrote or music from other people. Then I think lastly, frankly, being with my family. We go to the coast of California quite often. A couple of times a month at least. And that time there allows me to completely relax as long as I don’t fill it with thinking about work. Brainstorming about work. Getting emails about work and all that kind of stuff. I find that I can really unwind there.
[22:25] The one other thing is that I’ve been backing a lot of games on Kick Starter like board games and card games. There’s been a resurgence in my desire to play those. I’ve been playing them with my son now 8, and we’ve been playing them like all the time. They’re either pretty simple role playing games or adventure games with cards and strategy games like Lord of the Rings, RISK and all that kind of stuff. That’s been really fascinating to me lately. We played Chess a lot this weekend too. I remember playing it as a kid then at a certain point then you get quote-unquote too busy to do this kind of stuff. I guess, having a kid, for me, is an excuse to be able to do that. Because I would never carve out time, I would just work more. But, it allows me to be forced into carving out that time to have some fun and relax.
[23:12] Mike: Yeah my kids are always bugging me to play a card game called Boss Monster. It was available at Think Geek for a while but I don’t know if it’s available anywhere else right now. That’s kind of a fun game, they like that.
[23:22] Rob: Very cool. Our last question of the day comes from Craig V.N. and it was from the Bootstrap.fm forums. He says, “Our SaaS pricing is basically done on a user level basis, 2, 8 or unlimited users. I’m considering changing this to 1, 5, 10 and unlimited but for now that is what we have. It is not uncommon for clients who have 3 users to ask for a discount or be able to go on a lower level plan. What is your strategy for dealing with this? Do you just give them the discount out of good will? One thing that I’m considering is that if I give them the discount – asking for a testimonial in exchange.”
[24:02] Mike: I kind of like the idea of asking them for a testimonial in exchange. The problem I think with that is that they are asking for a discount and they probably haven’t used the product yet. I guess if they are using the free trial then that’s a great time to get a testimonial from them because they are still in the honeymoon phase. But I think it depends on why they are asking for the discount. I would take a look at the pricing itself and say is there a massive difference between the 2 user and the 8 user plan? Yeah, if there’s a big pricing difference and they’re only a 3 person company then it could be a problem. Like if their Bootstraped, if they still don’t have anybody working full time then that could be an issue. I think you really need to understand why it is that they are asking for this discount and try to cater to them a little bit. Another option that you would have is, you can say 2 users, 8 users then unlimited, but if you want to go from 2 users to 3 users then it costs an extra 10 dollars a month something like that. So you can kind of ramp it up a little bit and say your kind of allowing them to do it a la cart but you’re not basically pushing them all the way to that next pricing plan.
[25:05] But I wouldn’t offer that to everybody. I would really just do it as a one off thing when people ask. Because you don’t really want to make your pricing pages too complicated or make people make too many decisions. But the people who are coming to you and asking for that kind of thing are essentially going out of their way. So those are the types of things I would think about just because I don’t know how frequently these requests come in and what the pricing difference is between the different levels and things like that. Those are the types of things I would think about. The other thing I would think about is whether or not you are devaluing the higher tier plan by giving them more users. Maybe you take your users and shift them around a little bit. You said you’ve been thinking about changing 1 to 5 to 10 and unlimited. Maybe you offer your software on a flat term per user plan. Something along those lines might work.
[25:48] There are some SaaS applications that might make it work well and there are some that don’t work as well for. Because tier pricing sounds great on the surface – generally I would say the evidence points to it as being better, but I would say it’s also a case by case on each SaaS product. Just because that’s a general rule that tiered pricing works better doesn’t mean that it applies across the board and that it’s going to work better in every situation.
[26:11] Rob: First thing I’ll say is that I wouldn’t give them a discount for a testimonial in exchange. That feels weird to me and I’ve never done that. Like Mike said that might not want to use the product and it sounds like you’re trying to do a one for one or something. It seems odd. Personally I would seriously consider moving to simpler pricing. If you’re having this much trouble with it, why not charge per user? Flat per user rate and when they get over 10, there’s a slight discount. Over 50 there’s a slight more discount. But your tiers, 2, 8 and unlimited is funky. Is there a very specific reason why it should be broken up there? But unlimited doesn’t make any sense. You’re basically saying someone with 9 users should pay the same as someone with 500 users and that doesn’t make any sense. Someone with 9 users can be a small little agency. Someone with 500 is like an enterprise corporation and they should be paying 30, 40 times more than that little enterprise, because they are getting so much more value out of it.
[27:06] So, I would never offer unlimited users with a SaaS app. Those are my two thoughts. Try to go per user pricing – it makes your page way simpler. Say “Look it’s 9 bucks a month per user or 10 bucks a month per user”. And if people say “can I get a volume discount?” Say “yeah it starts at 50 users” and then you deal with them and most people won’t be there. Frankly people are emailing you and asking for discounts when they only have 3 users – hey if you’re going to stick with this, your original question. I would say no in general. No, that’s not how the pricing works. The pricing is tiered and that’s how the tiers work. There is no discount just because you’re not using all the seats.
[27:41] Mike: I think that wraps us up. If you have a question for us you can call it into our voicemail number at 1-888-801-9690. Or you can email it to us at questions@startupsfortherestofus.com. Our theme music is an excerpt from Where Out of Control by Mute used under creative comments. You can subscribe to us on iTunes by searching for us by Startups For the Rest of Us or at startupsfortherestofus.com where you can also find full transcripts of each episode. Thanks for listening and we’ll see you next time.
Episode 200 | Customer Acquisition Plans for Bootstrappers
Show Notes
- DigMyData
- Cyfe
- Episode 152: Strategies for Loading Up Your Pre-Launch Email List
- Traction book by Gabriel Weinberg and Justin Mares
- 13 Pre-Launch Traffic Strategies (3 part series)
Transcript
[00:00] Mike: This is “Startups For the Rest of Us,” Episode 200.
[00:02] Music
[00:10] Mike: Welcome to “Startups For the Rest of Us,” the podcast that [puts?] developers, designers, and entrepreneurs be awesome at launching software products whether you do it your first product, or you’re just thinking about it. I’m Mike.
[00:18] Rob: So, on our two-hundredth episode, you flubbed the intro –
[00:21] Mike: [Laugh]
[00:22] Rob: – two, different ways [laugh]. Let’s go back. Number one –
[00:25] Mike: Whoa.
[00:27] Rob: – you didn’t say the title of it before – you know, what we’re going to talk about today. And then I think you said, “helppels” or “heps” or something? [Laugh]
[00:33] Mike: Yeah, I don’t know. I just lost my train of thought. I know!
[00:36] Rob: All right.
[00:37] Mike: I know.
[00:38] Rob: Well, it’s 200 episodes, man. And we were just chatting about how we did not do anything extra special for today. We didn’t pull any interviews in like we did for our hundredth episode. We didn’t do a wives episode, but I think we have some good stuff in store today. We’re going to be talking about customer acquisition plans for bootstrappers.
[00:54] Mike: What’s up with you these days?
[00:56] Rob: Well, you know, you put together the outline for today about acquiring customers. And, you know, we talk about marketing and stuff. And I am basically bouncing back and forth. I’m finding myself on Drip bouncing back and forth from product to marketing, then back to product, then back to marketing. And as I put my attention on one, it goes really well. I invest a lot of time, and we catch up. And then I look to the other one, and I notice that things are starting to fall off the rails. You know, new feature requests are kind of just sitting in a queue and not being prioritized, not being assigned. There’s not enough trials in the funnel, because I haven’t gone and updated our ads. Or, I’m continuing to find this difficult to balance, and as soon as there’s a budget, we’ll probably be hiring someone to assist; but I think it’s a fitting problem I’m running into, given what we’re talking about today.
[01:40] Mike: Yeah, I’m kind of having some of those issues myself. I just recently stood up a continuous integration server, so I don’t have to micromanage on the development side as much. So, that’s kind of working itself out right now, so it’s helpful; but I’m sure that your guys probably have that in place. But you’ve also got more developers working on it than I do.
[01:58] Rob: That’s right. Yeah, I’m moving three full-time on Drip here by the end of the week. What’s coming up for you?
[02:05] Mike: Well, I’ve got my personal retreat coming up this weekend. I think you’d asked me if I’d done any work, or put together an outline for it, and I finally got a chance to do that a couple days ago. So, I’ve mapped out quite a bit of it so far and wrote down a lot of questions that I want to answer and some just general ideas about what I want to do for the future. And it’s not necessarily things that I want to do, but things that I need to think about – how I’m going to structure things, moving forward; different areas that I’m going to personally focus on versus the areas that I could focus on, but I’m not necessarily the right person for that. Not that I don’t have the skills for them, just that that’s not a productive area for me to be spending my time on. So, I want to sit down and identify all of those so that I can figure out what I should be working on versus what I could be, because I think a lot of times I spend time working on things that I think are necessary, but they’re really not necessary for me to do. So, I’m trying to fire myself, I guess, [laugh] if you could call it.
[03:00] Rob: Yeah, I think that’s a good way to do it. On my retreats, I typically spend just a little bit of time thinking about my personal goals and things that I want to improve personally, like working out; and then I do spend the bulk of the time thinking about, business-wise and professionally, what I want to do. And so I think that’s probably a good way to balance it – is depending on how intense your business is right now, you can spend more or less time thinking about it, and then balance that with the time that you’re spending thinking about your home, your family life and personal improvements that you want to make.
[03:30] Mike: Also along those lines, my unit test developer’s working out really, really well so far. I hired him a couple of weeks ago, and he’s done really well. He’s actually found a bunch of bugs that I would not have found otherwise, and he’s done stuff where I’m just like, “What would possess you to even do that?” But, you know, the application just runs into problems, and I’m just like, “Okay. Yeah, we’ve got to fix that.”
[03:50] Rob: That’s really cool, well: a) that you found a developer that’s working out; but, b) that he’s finding bugs like that, because that is so invaluable. That’s what I love about having a unit test suite in my apps – is that you have so much more confidence to make bold changes when they need to be made. We’ve refactored the database twice, and I would even consider that is because we have thousands of unit tests that help us figure out what’s breaking when we do that.
[04:15] Mike: Yeah, just to give you a couple of quick examples, there were places where he pulled up the application, and he went in, created a rule. And then there are places where you’re required to enter certain data; and he put in, like, a space, and it just crashed. And I’m just like, “Why would you put a space in there?” I get you’re supposed to put in, like, an account name or something like that; but he’s like, “I wonder what happens.” Just throw in a space, and it just crashed. I’m like, “Okay.”
[04:38] Rob: And what’s nice is then he’s going to learn the app inside and out, doing this, so that, you know, you can bring him on as an actual app developer.
[04:44] Mike: Yeah, and that’s actually the plan. My plan was to have him take a lot of the unit tests that had already been built, and we kind of set them aside for a while because we were changing way too many things, basically in the way the product worked. So, in an effort to kind of move that along, we kind of set those things to the side. And now, I’m coming back to them and saying, “Hey, I need you to put these back in. We’ll integrate them into the build process.” And then by having him go in and work on these unit tests, it helps him to understand how the underlying engine works. And then from there, I can put him into product development as well. But I’m having him put together plans on, you know, how are other people going to be writing unit tests, and what are the recommendations for them, what’s the structure going to look like, naming conventions – that kind of stuff – so that everybody’s on the same page and following all the same style guidelines and things like that.
[05:30] Rob: We have several, new, five-star reviews in iTunes. We’re up to 356 worldwide reviews. Thanks to Justin McGill, who called us “great insights for SaaS entrepreneurs.”
UC-23 said, “I just started listening a few days ago, and I’m completely hooked. Whether you’re a founder, a barista, an IOS developer, or investment maker, this podcast will change the way you work and live.”
And then Kevin Horgan whose name I recognize – hi, Kevin – he says, “Really easy to listen to and full of good advice for self-funded or bootstrapped entrepreneurs.”
And then long-time listener Emil Hajric from Help Juice says, “I absolutely love this podcast. Been listening for a complete year now. The thing I love the most is it’s not just boring, olde podcast. You also get an insight into the life of the founders and the day-to-day struggles.”
So, thanks again. And you don’t need to write a full review like this. If you want to give us five-star, that’s the best way to help us out. You log into iTunes, and you can just hit “five stars” when you’re logged in. You don’t have to write anything. That’ll help us maintain our top 3 ranking for startups in iTunes.
[06:30] Music
[06:33] Mike: Today we’re going to be talking about customer acquisition plans for bootstrappers. And if you look around out there, there’s lots of different types of plans. There are business plans. There are marketing plans, customer acquisition plans; but they’re not necessarily focused on the bootstrapper audience. And we talk a lot about tactics on this podcast, but not necessarily a lot of strategy. So, today we’re going to delve into a little bit more of a strategy discussion on how to engineer your business using a customer acquisition plan.
[07:02] If you take a look at things like business plans in general, most of them are crap. And, you know, you go out and search for “how to write a business plan” on the Internet, and you’ll come up with tons and tons of links, and most of them are not very helpful. They’re either not realistic, or they’re not actionable. And I’m talking about the general advice about how to put together a business plan or a customer acquisition plan. They mostly talk about what you should be doing, but not how or why, and they don’t really have what I’ll call a basis in reality. They haven’t actually done it. So, usually their guidance is just a little bit too generalized.
[07:36] And I wanted to shift the focus a little bit and address specifically how a bootstrapper should be using a customer acquisition plan. And this idea started out from, you know, how would a bootstrapper put together a business plan and really focus just on the customer acquisition side of things; because there‘s essentially four pillars to a business plan. So, we’re only going to really focus on one of them, and those four pillars are: acquiring customers, product development, engineering and infrastructure, and then business overhead.
[08:05] Rob: Right. And at the top of the episode, I talked about how right now I’m bouncing back and fourth between acquiring customers and product development, and those are going to be the two most important things that you do as you bootstrap. That’s where you should spend as much of your time as possible, 99+ percent of your time; because engineering and infrastructure, which are things like your web hosting, maintaining whatever it is – mail servers; general maintenance dev ops; you know, keeping servers patched – all that stuff, it really is overhead. And at a certain point, you’re going to hire someone, and they’re going to handle it; but for now, you want to run as fast as you can. And you want to spend as little time as you can on that.
[08:40] The other one you mentioned is business overhead, which is accounting and invoicing; payroll taxes; you know, handling payroll – all that stuff – general costs of doing business. And that, again, does not move your business forward. So, that’s the reason we didn’t want to include them in this discussion – because they’re the things you just take care of as quickly as possible and then move on; whereas, acquiring customers and product development are the critical ones. So, we’re going to spend most of today talking about acquiring customers.
[09:08] We titled today’s episode “Customer Acquisition Plans” instead of “Marketing Plans” because, as you said, marketing plans are more like really MBA. Right? I’ve read marketing plans, and they suck. They don’t tell you what anyone’s going to do. They’re super high-level, and it’s a 50-page treatise, and there’s no tactics, and it’s all this discussion of “market channels” and “penetration” and this and that. It just has to be something different. And so we chose the phrase “customer acquisition,” because we’re going to be looking at marketing and then funnels and metrics and all that stuff that it really is a different thing than the marketing plans I’ve seen. In general, when you create this document, it’s going to be more tactical and more boots-on-the-ground than the typical marketing plan that you may have seen or heard about.
[09:52] Mike: So, the general strategy for any of those four pillars that I talked about is you build, test, deploy, measure, fix what’s broken and then repeat. And that’s a general process that you need to follow for those things. So, if it’s product development, you write the code, you test it, you deploy it, you measure how many bugs you’re getting in the field and measure customer feedback. Fix anything that’s broken, and then you essentially go back and you repeat that process. Well, acquiring customers is exactly the same thing. Essentially, what you’re trying to do there is you’re not engineering a product. You’re engineering a sales funnel, so you have to build your sales funnel. You have to test the different things. You put it out in the market and see what’s working and what’s not. You measure those things. And then you fix what’s broken and repeat the process. So, those are the things that you’re trying to do with this, and if you’re not growing the business, then you’re probably trying to optimize things. And if the business is not growing, then that optimization is very likely to be premature.
[10:50] So, to give a couple of examples of that, you know, if you have a lot of support calls, there are different things that you can do to alleviate some of those pains. And a lot of people are trying to say, “Okay. Well, what’s the single best thing that I can do there?” And sometimes there’s only one thing. Sometimes there’s a lot of things. If you’re having a lot of support calls, you can fix the product. You can hire a support person. You can add knowledge bases. You can add support videos to the website. You can provide additional training or on-boarding to users, personalized webinars to get them on board and using the products. A lot of the options that you have available depend heavily upon things like price points, who’s using your product. The level of the value chain [is] very heavily tied to how much you’re charging them on a monthly basis. But all those things are options, and you have to decide what is the best option for your business. Sometimes, it’s just one thing, and sometimes it’s many things because there [are] lots of ways to solve and optimize all those different areas.
[11:44] Rob: Yeah, I want to touch back on the iteration cycle you just outlined: build, test, deploy, measure, fix what’s broken and repeat. And you can view your sales funnel as one, large funnel. Or, you can view it as a bunch of smaller funnels. And if you look at your marketing website in general, then you do want to build that. And then you want to test certain, key pages that get a lot of traffic. And then you want to obviously split-test those, measure and then iterate on it. You want to fix what’s broke [and] try to improve upon it.
[12:10] You can only take that so far: a) you need enough traffic to be able to do it, and b) you can only optimize a page so far. So, then you have to think about, “All right. Now I want to create multiple landing pages, and I’m going to send traffic to those landing pages from SEO content marketing, paid acquisition, cold calling, cold emailing” – whatever it is. Each of those is then an individual funnel, and you have to think about building, deploying, measuring and fixing each of those individually. And so don’t think of this as one, monolithic process. It’s like you can take off one marketing approach at a time, send it through the funnel and use this general iteration strategy that you outlined earlier.
[12:46] Mike: So, there [are] a bunch of things that you need to keep in mind when you’re looking at what your customer acquisition is going to look like. And the very first thing that I think you need to do is you need to set a schedule for how often you’re going to go in and review this plan, because you can’t just create a plan and then execute on it and then never come back to it; because these things evolve over time. So, you might have one strategy that you’re going to test out. You put it into the plan. You execute on it. You iterate through that process, and then you get to the end of it, and you have to ask yourself the question, “Do I go back and repeat this process, or do I try something else?” And you may need to iterate through the exact, same strategy [a] couple of times before you figure out whether or not it works, but there are times where you need to review that and figure out whether it’s working or not at all. And if it’s not, you may need to switch to a completely different customer acquisition strategy.
[13:34] Rob: Yeah, the thing to keep in mind here is that you’re going to generate a ton of data as you do this, because you’re going to have – you know, Google Analytics. You may use DigMyData. You may use Cyph. There’s a bunch of things that you can use – Drip. There’s a lot of analytics packages that you can use to look at different parts of it – to look at conversions and all that stuff. The intent is not to bring that back into the plan. The plan is just your framework or your outline that you’re then going to use to go out and implement. And then, you know, you could feasibly link out to stuff; but I never even do that. I just have the plan in place; and as I go down, I have a bookmarked folder in my browser toolbar that I can get to all the analytics for a particular push, or a particular section of iteration. So, if I’m writing a split-test, and I’m running ads, and I have landing pages, and I have Google Analytics, I literally will have four bookmarks all in the same folder. And I can right-click and open all four of those tabs at once, and I can do that a couple times a day. And I’ll typically review what’s going on, and then I’ll make tweaks to things as I need to.
[14:31] And so if you’re trying to drive a lot of traffic via SEO, then maybe you’re going to be reviewing things once a week, or once a month because it’s slow-moving. If you’re running paid acquisition and you’re spending 500 bucks a day, then that’s the kind of thing that you’re going to need to monitor more closely, because you want to see when your ads burn out, how your split tests are running – that kind of stuff.
[14:50] Mike: Along those lines in terms of not keeping all of the data there is use your high-level goals as bullet points. You don’t want to go into a great deal of detail about the specifics or the implementation of some of that stuff in your customer acquisition strategy. Really, what you do is you take those, and you link to them into another document. Or, you have them in another document. And that way, if you ever switch your strategy, you don’t necessarily need to pull out a huge section of text from your customer acquisition plan. You can essentially just change the link, and then you’ll be linking to a different strategy that you’re working on elsewhere. I find that this is extremely helpful if you’re doing it in Google Docs; but obviously, depending on the tool that you have, the exact mechanism that you use might be a little bit different.
[15:30] So, with each of these bullet points that you put in your customer acquisition plan, you want to determine what the milestones that exist for each of those high-level goals are. Are you trying to drive traffic? Are there specific sales metrics that you’re trying to reach? The fact is most of the time, you’re going to have at least one or two key metrics for each of these things, and you need to be able to measure your progress towards each of these high-level goals and towards the milestones along the way. So, your milestones are going to be intermediate steps along the way towards that long-term goal, and you need to be able to measure those – essentially, your progress towards each of those milestones – to figure out whether or not the strategy that you’re working on is being effective, or whether it’s not, and if you’re able to match up different snapshots of time back to those milestones, since you can figure out which of those customer acquisition strategies are working better or worse than others.
[16:20] Rob: The way I’ve done this in the past is I’ll have two levels. The first one will be on a product level. So, if I’m going to launch new product, I’ll say, “All right. What’s my goal for this? Where do I think I can reasonably get?” you know, maybe three months after launch, or six months after launch. With Drip, I said six months after launch, I want to be at X-thousand dollars per month of recurring revenue. And I picked the number not out of the air, but it was an aggressive number that I wanted to hit and I knew could pay for a number of employees that I figured would be working on it by that point. Then I went backwards. Like you said, I started looking at what numbers do I need to get to that point. And for me, since I do mostly online marketing, then I know that I need about this many new trials per month, because I have an idea of what trial to paid when you ask for a credit card up front is. So, then I said, “Well, if I need to” – and trials, I know that about let’s just say 1 percent are going to convert to trial – 1 percent of visitors. So, then back it up. Well, then, how many quality, unique visitors do I need? Well, I need X-thousand per month, and then I calculated in churn.
[17:17] And I had this whole analysis, and it’s just a series of bullet points. And I’m using rules of thumb that I’ve learned over the years. I ran it by a couple of friends of mine as well. Just said, you know, “Is this within the realm of possibility,” knowing that once I launch, those numbers may vary or deviate; but at least I have something that I’m kind of tweaking the direction of.
[17:33] And so that’s typically how I do it at a high level. And then with each, individual approach – like, let’s say I’m going to do Facebook ads. Or, I’m going to do SEO. I’ll pull it up on a spreadsheet; and I’ll estimate how much traffic I’ll get from that, how well it will convert, what the costs will be. And I’ll put the numbers in there as well. If I’m going to do an analysis like that, I don’t typically keep it in the same document, but I do have expectations of where I need to be; because if you’re doing that, you know, you’re going to start getting an idea of what your lifetime value of a customer is and how much you’re going to make per month from each customer. And that pretty quickly will tell you how much you are able to pay for any given traffic strategy. So, you’re going to know pretty quickly, once you start running ads, whether something is going to work or not.
[18:14] Mike: Yeah, I’ve found that essentially reverse-engineering your sales funnel from what your goals are is extremely helpful by working from, you know, what is it that you want your ultimate goal to be and then figuring out, “Okay, if I need this amount of revenue, how many sales do I need? And what does that translate to in terms of the website traffic and uniques” Reverse-engineering it that way – I’ve found it to be extremely helpful; because otherwise, you’re kind of guessing. You’re saying, “Oh, well, how many website visitors do I want?” And you know that you want to increase your traffic, but you don’t necessarily know what levels you need to get to, so you don’t really know what strategies to use either. And that’s kind of a big problem.
[18:52] Rob: Right. And let’s say you come up with a number. You say, “I want $50,000 a month in recurring revenue.” Okay. In what time frame? “Well, 12 months.” So, now you’ve got to look back, and you’re going to say, well, where do you have to be at each month, then? And you’ll notice you need a lot of, lot of traffic during that time, and you need high monthly revenue per customer in order to hit that in 12 months, if you’re going from a standing stop. So, it gives you a very realistic view pretty quickly if you’re going to be able to accomplish that.
[19:22] Mike: So, we’ve kind of touched on some of the different KPIs, or key performance indicators, about your marketing engine. And these are some things that you’re going to want to be able to get data for any arbitrary time period with regard to your sales funnel. You’ll need to be able to get your website traffic, the number of email addresses or leads that you’ve acquired, the number of customer contacts that you’ve made, and the number of new customers acquired. And from those numbers, you can calculate what the revenue you’ve received is, what the customer acquisition cost is, their lifetime value. And to kind of step back a little bit, when I say the number of customer contacts made, when you take a look at those four things I mentioned, the website traffic is essentially the entry point to your sales funnel. Email addresses acquired is essentially your first point of contact with them so that you know who that person is. The next step down is the number of customer contacts made. That’s essentially the number of emails you’ve sent that they have actually opened, because you can send emails to people, and they may not open them. So, you have to be very conscious of the fact that just because you have an email address doesn’t mean that it’s a good contact or a good lead. It could be a garbage lead, but it’s a critical part of your sales funnel to understand that if you’re reaching out to people and they’re not opening your emails, then there’s something wrong with your sales funnel, and you need to address that. You know, maybe your email service provider got thrown on a blacklist or something along those lines. And if that’s the case, that means your sales funnel is fundamentally broken at one of those stages. And by measuring all of these different things – and I think that KISSmetrics is a great way to measure a lot of this stuff. But it shows you where your sales funnel is broken.
[20:57] Rob: Yeah, I think it’s important to call out what you did. Gathering emails in a marketing campaign – it’s a great first step, but it isn’t that valuable in terms of the sales process. Building a big list if you have a low-price-point product and you can email the list and have them buy right away – that’s great. If you’re actually doing medium-touch sales and you’re touching base with people individually before they buy, then the size of that list is less relevant. It’s always better to have a big list as long as it’s quality, but getting 5 or 10,000 people on that list isn’t as valuable as having 100 people at a time who you’re engaging with and you’re actively contacting and actively in conversation with; because they’re so, so much more likely to convert and to actually become customers.
[21:40] So, there’s a balance here, and I guess the real definition is “qualified.” Right? It’s how qualified are people who are coming either to your site, or who are getting on your list, or who you’re emailing with individually. And there are products. Let’s take a lower-price product. HitTail is 10 bucks a month to start. People are pretty qualified when they come to the site. There’s a really high visitor-to-sign-up-rate at HitTail because of the low price point, and there’s not a ton of direct competition; whereas, an email marketing app that may be more expensive – it’s going to be a different scenario, where you can build up a lot bigger list, and you’re just gonna get a lot fewer trials. And so the just sheerly the number or the volume of people on an email list like that is less important the further your price goes up. It has to be how qualified are they.
[22:27] Mike: So, one of the things that we’re doing here is that we’re essentially calling out that you need to understand what your sales funnel looks like. And the reason we’re calling this out is knowing what your sales funnel looks like is extremely important, and it’s very often neglected by people because they don’t necessarily know what they should be looking at. Or, they don’t understand what their sales funnel looks like. If you don’t understand what your sales funnel looks like, it’s very hard to troubleshoot it and figure out where things are not working. So, you can’t go back and fix stuff.
[22:54] So, once you’ve understood what your sales funnel looks like and you have everything in your customer acquisition plan, one of the things you need to do is go back on a regular basis and update it. I feel like once a month is probably a good rule of thumb; but it really depends a lot on what the different customer acquisition strategies and plans you’re executing on is, because some of them are only going to be a week or two long. You know, if you’re running some paid advertisements or something like that, maybe you run them for a week and you’re just analyzing the data afterwards. So, maybe you update it after a week. But then there [are] other things where it’s going to take you a month or two to execute on it, so in those cases, it may take you quite a bit longer to come back and update it. But the fact is you have to come back and update it.
[23:34] And everything is going to be relative. You want to be able to make sure that your customer acquisition plan is not so far ahead of your software development, or so far behind your software development, that it throws your entire business out of whack. I mean remember we talked about those four, different pillars of what a business plan are: acquiring customers, product development, engineering and infrastructure and business overhead. If you go too far in any one of those four directions, then it essentially puts your business at risk because you’re doing too much in one area that is not necessarily going to benefit any of the others. You want to balance that out. It’s important to understand when you’re not going far enough in terms of acquiring customers and you’re going too far into product development.
[24:14] Rob: Right. And I would guess if you’re listening to the podcast, you probably lean towards going to far in terms of product development and that you just want to build, build, and you think features are going to be a fix for everything. I think it’s a good point you raise, Mike, of it’s easy to get too far out in one or the other direction; because your marketing can get ahead of your product. Right? You can start driving way too many leads. And if your funnel is leaky, or if you don’t have the features that people want, then you’re just going to leak people out of the bottom of the funnel. You churn them out, and you are wasting enormous amounts of time. And then if your product development gets too far ahead, then that means your product is this really advanced thing. You haven’t got enough customers in it to actually pay for the development resources, or to pay for your time, and so you just burn out because you don’t have any revenue. Or, your product gets so far ahead, that no one has any input in it. So, your customers aren’t giving you feedback on it. So, it’s a real danger. It’s a place that I think we’re all struggling to balance all the time. I know that I am. I know one gets ahead of the other in my businesses all the time.
[25:12] The other thing I want to touch base on that you mentioned was going back and updating your marketing or your customer acquisition plan on a regular basis. I absolutely do this, but what’s funny is I don’t do it on a regular basis. I don’t have a calendar reminder that tells me. What I’ve done is I will typically go into the plan, and I’ll pull out a couple of marketing approaches that I really want to dive into. And, typically, a marketing approach in my customer acquisition plan is very high-level – right? So, it might say “content marketing” and then have a few bullet points below that. Well, that breaks out into a ton of tasks that I then put into Trello. Typically, it’s like: “find a writer,” “find a guy who creates infographics,” “do some key word research [and] figure out what I want to do.” You know, it’s all these steps. So, then I throw them all into Trello, and so it may be a month or two that I really invest much time in that, and I kind of get that flywheel going. And then at a certain point, I’ll look through my Trello board, and I’ll realize, “Wait. I don’t have any more marketing going on.” Like, everything’s product here. I still have stuff to do, but I don’t have anything that’s going to drive customers.
[26:08] So, that’s my cue to then go back into my customer acquisition plan. I then typically do a strike-through on all the things that I’ve done since then that are already going. Whether they’ve worked or not, I just strike them through because I’m not going to do them again right now. And then I start looking through, and I reread the whole plan. And every couple of months, I find myself doing that. And it’s really nice to have that long list, because it strikes new ideas, or even rekindles old ideas that I’ve had, because I captured them over the past several years. Every idea that I’ve heard goes into that plan that I think could actually feasibly market one of my businesses.
[26:42] So, some examples. If you listen to this whole thing, and you’re thinking, “Well, how do I put the plan together? What are the actual approaches that I should throw in there?” go back and listen to episode 152 of this podcast. It’s called “Strategies for Loading Up Your Pre-Launch Email List.” Read the “Traction” book by Gabriel Weinberg and Justin Mares. We interviewed Gabriel last week. You go to tractionbook.com to find out more about that. That has 19 traction approaches, and a lot of those should go in your customer acquisition plan. A lot of them are in mine. And then there’s a really good blog series on my blog softwarebyrob.com. It was written by Dan Norris. It was a series of guest posts, and it’s called “13 Pre-Launch Traffic Strategies.” And if you Google that, it’ll be the number one. If you just take that and you start there and then expand as you listen to new podcasts and expand your customer acquisition plan – you know, everything we’ve said here applies to all of those strategies. And you’re going to be way far ahead of someone who isn’t taking this approach.
[27:36] Music
Rob: If you have a question for us, call our voicemail number at: 888-801-9690. Or, email us at questions@startusfortherestofus.com. Our theme music is an excerpt from “We’re Outta Control” by MoOt, used under Creative Commons. Subscribe to us on iTunes by searching for “startups,” or by RSS at startupsfortherestofus.com, where you’ll also find a full transcript of each episode. Thanks for listening.