Show Notes
- Inspired by Moz.com post from Cam Secore called A Comprehensive Guide to Building Trust Online
- Don’t Make Me Think by Steve Krug
- The Non-Designer’s Design Book
- StackOverflow.com
Transcript
[00:00] Mike: In this episode of “Startups for the Rest of Us,” Rob and I are going to be talking about trust signals for your website. This is “Startups for the Rest of Us,” episode 205.
[00:07] Music
[00:14] Mike: Welcome to “Startups for the Rest of Us.” It’s 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.
[00:23] Mike: And we’re here to share experiences to help you avoid the same mistakes we’ve made. What’s the word this week, Rob?
[00:27] Rob: We have some new iTunes reviews, a couple of five stars, and then we have a comment from a Trevor 1 in the U.S. He says, “Top-shelf knowledge on b-to-b apps. Rob and Mike are very knowledgeable in SaaS in the b-to-b app world. I learn something new from them every episode. Really like the acquisition stuff lately. Great job, fellas – and keep it up.”
[00:43] So, if you haven’t left us a five-star review in iTunes, you don’t even have to leave a comment, you can just click in there and click on the five star. We’d really appreciate it.
[00:52] Mike: I’ve finished the rest of the designs for the upcoming version of AuditShark, and I think that it’s going to resolve most of the issues that people have been complaining about. So, there’re some performance issues with the product if you have a lot of machines that you’re going after or trying to gather information from. I don’t have a good handle on exactly what the underlying issue is. I have some theories about it, but I’m hoping that some of the changes that we’re making are going to solve those performance problems and then add the additional functionality, like the reporting, a better scheduler and things like that that people have been asking for.
[01:21] Rob: And you said the designs for the upcoming version. This is the desktop version. Is that correct?
[01:26] Mike: Yes.
[01:27] Rob: Okay. And so what are the design? Is it like code? It’s, like, mock-ups?
[01:30] Mike: It’s like a functional spec, more or less.
[01:32] Rob: Got it. Okay.
[01:33] Mike: So, say this is the subsystem that needs to be implemented. This is how it’s got to be done. These are the things that you should do, and these are the things to be careful of, and this is how it’s going to interoperate with the rest of the application.
[01:42] Rob: Got it. And these were requested by early-access customers or folks who’ve used the product?
[01:47] Mike: Yeah, people who were using the products and saying, “Hey, how do I do this?” or, “How do I do that?” And it’s like, “Oh, well, that’s coming,” because I’m getting to the point where there’re certain things that are going into the next release that I know are going in there, because we had a release two or three weeks ago, and we’ve got another one slated for the end of September/early October. And there’s stuff that I know is a problem; but, it’s like, okay, I can’t push them off anymore. We’ve got to do this.
[02:11] Rob: You know, I remember several years ago Joel Spolsky had a post, and he said that when customers request features, that they wouldn’t write them down internally because they found that the features that people really wanted were requested so much, that you just remembered them. And I’ve always been kind of fascinated with that. I wouldn’t say I’d take that approach directly. We actually do track everything everybody requests, but then certain ones, it just becomes painfully obvious that the product is not going to serve people’s needs without, you know, this fundamental feature. And so when you hear it over and over and over, that’s when – we have some features that I haven’t wanted to build; and we’ve, you know, finally capitulated when we get a lot of folks who are really into using that.
[02:52] Mike: Yeah, and I think that’s the interesting thing, because you have this vision of what your product is supposed to be, and then there’s reality, what the customers actually want. You have to kind of balance between those two things.
[03:00] Rob: That’s what it is. It’s balance. And, you know, for every feature that we implement, we probably get ten feature requests; and we don’t build a lot of them, because people will see your product in relation to other things, maybe, that they’ve used in the past. But you may not want to build that. You may not want to add a shopping cart to your auditing software. You know? Or, want to add landing page functionality to your email marketing app, which people have requested; and you just have to decide what are we really building. But then hold that loosely enough that you are willing to respond. If you get people who are paying you money, and if you know enough about them, and you know enough about their experience to know that their needs will probably be shared along a large group of people – that’s the root thing you’re looking for. Right? You’re trying to figure out which of these needs are really for this one person – because a lot of feature requests you get, people are just asking for something that no one else will ever use, and that’s where that judgment call comes in really handy to be able to differentiate, “All right. Will a lot of people need this? Or, is this really just a unique snowflake scenario?” I call them “snowflake features” – right? It’s ones that no one else is going to use, and you’re basically going to spend a lot of time – and complicate your UI. It’s not even development time anymore, but it’s like I don’t want to bloat this app with these random features that are not going to be used by at least 20 percent of the users of my app.
[04:16] Mike: The other thing you have to keep in mind is that you have to implement certain things that seem on the surface to be things that would not be used very often, and those are the types of things that are barriers to entry. So, if it’s painful for somebody to get up and running with your application, and that’s why they’re not using it, and that’s why they’re not paying for it, then those are the things that you have to implement, even though they’re only going to probably ever use it once. So, those are the types of things that we’ve been looking at as well. So, part of the application – we implemented like a ping sweep functionality initially just so you could say, “Okay. Let’s scan the network [and] see what’s out there.” And the next level was essentially going directly against active directory and showing them what’s there so that they can drag that into their collections and say, “Okay. Now I’m going to go after all of these machines that active director knows about.” There’s two, different sides of it. There’s what you know about, which is in active director; and then what you don’t know, which is available through ping sweeps and S and P and things like that. It’s taken time to get to that point, but that’s a barrier to entry for some people, because they’re like, “I need to audit everything in active directory. How do I do that?”
[05:16] Rob: Right.
[05:17] Mike: And they haven’t been able to until now.
[05:17] Rob: Right. I think it’s about finding that minimum path to awesome. It’s basically about how we heavily, heavily scripted the onboarding process and how someone getting set up with DRIP is heavily orchestrated; and we spent a lot of time on it. We spent a week or two on it the first time around, and then we redid it when we moved into automation; but it gets our onboarding percentages really high. And it sounds like you’re in the process of that, too. And that’s what you’ve got to figure out – is what’s that first moment where a customer says, “Wow. This is awesome”? They get payback for it. And how can you get them there as quickly as possible?
[05:52] Mike: So, today we’re going to be talking about trust signals for your website. And the idea behind this is that people don’t buy things from websites they don’t trust, and they don’t give information to websites that they don’t trust. When you’re browsing around on the Internet, the “BACK” button is very easy to use, and so many people use it, that even Google measures when somebody clicks on a site and then uses the “BACK” button to go click on another site. And they use that. In analytics, it shows up as your bounce rate, but they look at that and say, “Okay. Well, how useful is this page?” And it’s not necessarily about just how useful it is, but how sketchy the page looks as well.
[06:24] So, this was inspired by a moz.com post from Cam Secore and the idea behind this is you have to establish trust on your website, and there’s a lot of different ways that you can go about it. So, the first question is really, “What does trust mean?” And trust is essentially a state of being where someone exposes some form of vulnerability, or accepts some risk based on their positive expectation of the attentions or behavior of another person. So, if somebody comes to your website, and they trust that you’re not going to spam them, then they might be willing to give you their email address. So, behind this, trust is really grounded in the evaluation of two, different things. The first one is ability, and the second one is your integrity. So, ability is your demonstrated skill, or competence, or knowledge around a particular topic. The second piece is integrity. Do you adhere to your principles, and are those principles known?
[07:15] And a trust violation occurs when either of these things proves to be false. So, if you’re going out, and you are billing yourself as some great conversion expert, and you go in, and you do some work for somebody, or you offer them free advice, and it turns out that they can pretty clearly see that you have absolutely no idea what you’re talking about, then that’s considered a trust violation. Another thing is if you are gathering email addresses on your website, and suddenly they start getting spam. Then their trust has been violated, so they’re not going to trust you as much in the future. So, you really want to be careful about those types of things. But we’re going to be looking today about some of the different, major trust signals for websites and how you can go about addressing them.
[07:56] Rob: Yeah. And I think trust probably falls into two categories, even. There’s instant trust. It’s like I come to a brand new website that I don’t know, and it’s basically a cold look at this website. What are the factors that are going to help me trust or not trust it? And then there’s that long-term trust – right? Once you get to know a company, or a person, or a service, trust builds over time. And then there are thing, like you said, where if they get hacked, or if suddenly they send you spam or whatever, then you get a ding. You get a withdrawal from that trust bank. And, typically, you can withstand a couple of those before people start bailing on you. So, I think there’s really two things. I think we’re going to be talking about that initial impression and building trust quickly when someone comes to your website.
[08:41] Mike: Now, before we get into these things, there are some things that you should keep in mind, which are essentially heuristics about how we recognize and establish or associate trust with people. And there’s a few different mental shortcuts that people take in order to figure out whether or not you’re trustworthy. So, the first one is an authority. If an expert believes in something, then it’s probably what you should believe as well. So, if there’s a Ph.D. from MIT who comes out – he’s a physics expert – and he tells you something that’s related to how the starts are aligned in the galaxy, chances are really good you’re probably going to believe him; because he comes from MIT. He’s got a Ph.D. in physics. He’s an authority on the topic. And if he tells something to someone else, and they tell it to you, the source of the information is that authority, so it becomes more trustworthy just because of that.
[09:27] And the second thing is social proof. If other people like me are doing something, then I should probably do it, too. So, anything on Twitter, Facebook. But at the same time, having some of that social proof behind it is one of the ways that we essentially shortcut some of these things.
[09:43] Rob: Right, and a big way to do that, typically, on a website is to have testimonials, or to have logos of big-name customers that someone might recognize.
[09:51] Mike: Right. And another heuristic that people will use is familiarity with something. So, if you’ve done something before, then chances are that you’re familiar with how to do it, and you’re going to go through the same process again. And people tends to gravitate towards things they are familiar with. So, if somebody comes out and says, “Oh, well, this is the way you should do X, Y and Z,” and you’ve done that before, you are going to inherently trust other things that they tell you because they have proven that they think in the same way that you do; so, [they are] thereby more trustworthy.
[10:21] And then some other ones: things like length. If you write a report, or a white paper, or something like that, if it’s longer, then it has a higher impact on it; because it took a lot more effort to create that. Things that are much shorter tend to have a lot less credibility or a lot less trust associated with them when there’s no external, influencing factors.
[10:41] And then the last one is more of an opposite effect. If other people are publicly bashing something or saying, “Hey, this is a very bad idea,” you essentially get that opposite effect. And, again, that’s just a mental shortcut that a lot of people can take.
[10:54] So, now let’s get into the different trust signals. The first one that I want to talk about is a visual design. So, when you’re looking at a website, the design itself tends to strongly influence what you feel about that website and how trustworthy it is. If it’s a very well-designed website – you know, it uses good color schemes, has a visually appealing layout to it – that’s the type of website that you’re going to gravitate toward and say that it’s more trustworthy. And there’s different security studies out there that have shown that people will inherently trust a website more if it looks nice versus things that, for lack of a better example, look like Craigslist. Wikipedia is another prime example that is more of an exception than anything else, because their designs are not that great. It’s very text-heavy. It doesn’t have a lot of design around it, but you know what you’re getting when you go there, and you expect that because it’s been there for so long. But if you go to, like, a corporate website for, let’s say, Exxon Mobil, and if it looked like something like Wikipedia, you probably wouldn’t trust it nearly as much – except for the fact that it says “Exxon Mobil” on it.
[11:56] Rob: You can overcome the lack of trust that you get if you have a crappy design or kind of just a template design. You can overcome it with the other things we’re going to talk about today, like the social proof and having good content and good architecture and all that stuff. But if you’re at the point where you can get a good theme, or you can hire a designer, you’ll notice that people will trust you more when you come out with something that looks really sharp. I notice this from the old HitTail design. That was in 2011. And then when I relaunched it in 2012 with a new design from Ryan Scherf, that you’ll see today at hittail.com, it is noticeably more trustworthy. It has a higher conversion rate and instantly had a lower bounce rate, because it went from looking like something that was built in the late ’90s, early 2000s to something that was built in this decade. And it’s some anecdotal evidence with a little bit of data, but over and over, I see this happening. And I see it in myself, too. If I landed a blog and it looks really nice, and it’s obviously professional, I instantly will at least give the content a shot. Right? I’ll at least give it a shot. I’ll at least consider subscribing to the email. But if it looks like crap, it’s going to take a lot for me not to just click the “BACK” button.
[13:07] Mike: If it was recommended to you by somebody, or if the reason you ended up there was because you were hearing a podcast talk about it, or if you had received a white paper or something like that that had recommended that site to you, you’d think differently of it than if you randomly landed on it because you clicked on a headline.
[13:23] Rob: Yeah, that’s right. If someone recommended it to you, it’s a piece of social proof. Right? I’m definitely going to give something more benefit of the doubt if someone had told me about it. Or, let’s say I was reading your blog, and you linked over to it and said, “Hey, this is something you should check out.” So, maybe you didn’t tell me directly, but it was just a blog post from someone I trusted, or a tweet, or something like that. You’re instinctively going to work through it a little more, but if you get the combination – you know, the way to really blow it out of the water is to get the social proof and the recommendation and have a good design and have good content – right? Then that’s when you’re going to really maximize the number of people that stick around and start to become engaged with what you’re doing.
[14:03] Mike: So, in addition to the visual design itself, there’s a lot of different aspects of visual design. So, things like making sure that there’s not a lot of white space, or clutter in the design. You have to be consistent among different sections of the website, so between your navigation – like, you don’t want your navigation to change from one page to the next. It just looks terrible; and it doesn’t put a lot of credibility on you to be able to build, for example, a web app or a piece of software, if you can’t even do the basic things required to make your website look consistent from one page to the next.
[14:33] Rob: Yeah. These are kind of fundamental aspects of design and a web design. There’s a couple of books. If you haven’t read these, [they’re] definitely worth it. They’re not too long. One is called “Don’t Make Me Think,” by Steve Krug, and that’s a little bit more about app design, but there’s also some good stuff in there about just architect and websites. The other one is called “The Non-Designer’s Design Book.” While it talks a lot about print, layout and fonts and that kind of stuff, it applies both to web and print design. I found it super helpful, because I never had a design education. When I see something, I can say, “Wow. That looks really good,” or, “That looks crappy”; but I often don’t know why, and I often don’t know how to make it look better. And both of those skills are things that are worth learning, and that’s where a book like “The Non-Designer’s Design Book” can come into play.
[15:16] Mike: [A] couple other things that kind of fall under the idea of visual design are things like ads and stock images. So, if you have a corporate website, and you’re serving up ads on it, ads, I think, are generally expected on news websites; but not on a corporate website. I wouldn’t expect to go to Exxon Mobil’s website, or to the NASDAQ website and see advertisements all over the place. And then in terms of stock images, you really want to be careful about using stock images in place of people who you might actually have pictures of. One of the examples that’s given is the idea of plumbers. And if you have a stock image of, like, a cartoon plumber versus an actual picture of people who are on the team of a plumbing company, the plumbing company that’s using a real photograph of the employees is going to do better than the one that’s using stock photography.
[16:05] Rob: Yeah, absolutely. There’s an example in this article – and they’re right next to each other and you totally get more confidence in the folks when you actually – it says, “The Team,” and it shows everybody there. And it’s like, “Oh, these are real people” – right? It just gives you confidence that they’re not kind of hiding behind this stock cartoon image. This is one of the reasons I think that “About” pages are hit a lot more. If you go look at your Google Analytics and see how many times your “About” page gets hit – and this is one of the reasons that I include head shots of everybody, and on the Drip “About” page, specifically. It’s just one more way to build confidence that there’re real people behind your app.
[16:40] Mike: It’s funny you mentioned that, because I was surprised at that as well – that the “About” pages tend to get a fair amount of traffic, more than I would’ve reasonably expected them to get.
[16:49] So, beyond the visual design, what other sorts of things can affect how people view the website and whether or not they’re going to trust it? Well, the next one is website architecture. So, how easy is it to use the website? How easy is it to get around? How quickly can you find the information that you’re looking for or that you need? And this isn’t necessarily about doing great SEO. It’s about organizing it in a way that, from any page, it only takes a couple of clicks to get to any other page. You know, you go to these massive websites like IBM, and it is impossible to find anything that you’re looking for. And most people try to avoid going to those websites if they can, because they just can’t find anything. And then when you do find the page that you’re looking for, it generally doesn’t tell you what you actually want to know anyway. You have to call somebody and talk to them on the phone. So, from an ease-of-use perspective, those websites just completely fall flat on their face. The only reason that they have trust is because they’re such large companies, and people tend to work with their sales reps. That’s why people go to their websites, is to try to find more information. And then when they can’t find it – maybe that’s a sales strategy that they have. You know, they make their websites intentionally terrible so you have to call them.
[17:55] Rob: I think it’s so easy to make bad websites. It’s so easy to let things get complicated, because if you take an app, for example, if you take every user’s feature request and you build it, your app will suck. You have to be that gatekeeper, and you have to only build certain things that fit your vision. And the same thing happens with a marketing website. You’ll find people saying, “Hey, I couldn’t find your FAQ,” even though you have a link in the footer, and so you move it up into the top navigation. And then someone says, “Oh, well, you know, the about page gets a lot of visits. Let’s move that up into the top navigation.” And then on and on and on, and pretty soon, you have 50 links in your top navigation. Just because someone made a case for it at some point, or some user complained they couldn’t find it, you’ve tried to remedy everything. And that just builds kind of a kluge.
[18:37] And so if you look at a lot of sites that are easiest to navigate, they edit like samurai warriors, basically. They really have a strong sense of what they are, and they’re opinionated about where things go. But, I have my own opinions about, on a SaaS marketing website, what I think should be in the top nav and what I think should be in the footer and what I think should be in a site map somewhere and doesn’t even belong in the footer – you know, that’s kind of buried even beyond that. And, yes, every once in a while, you’ll find someone who can’t find things, but for the most part, the other 99 percent of people who are using it are going to get more benefit out of your site if you choose the things that are important, you put them in the top nav; and then you move everything else down below the fold, into the footer and into other pages.
[19:19] I think the other thing you touched on is page load times, and it’s a big one – not just for SEO, but there’ve been tons of studies that find that people will bail on websites. Subconsciously, they will bail on websites that are taking more than a second for pages to load, because they just feel like it’s too much effort, and their subconscious just kind of takes them out of it really quickly. And so getting your page load times down is super important. It’s something that I don’t know that people spend enough time on. It’s something I always respected about Jeff Atwood with Stack Overflow when they were building it. They spent a ton of time optimizing it, and it really shows. When you use Stack Overflow, you never once think about how slow the pages are. And, in fact, I think that’s an interesting thing. If you’re using a website, you never think, “Wow. Look how fast this is loading.” You never think that. But you will think, “Wow. Look how slow this is loading.”
[20:07] Mike: Yeah, I read something that essentially had Google quantifying how much money they would lose if they were to increase the page loads by, like, half a second. They actually tested it. They could prove kind of beyond a shadow of a doubt they were losing money, and they could quantify exactly how much money they were losing based on how much they increased the load time for different pages. It was kind of crazy to see that kind of detail.
[20:29] If there’s broken links on your website, those are killer. If there’s internal pages where you’ve got crosslinks and stuff – and, sure, it’s easy to screw some of them up, but there’s tools out there you can use to essentially crawl your website and look for those broken links. Those are the ones that you[‘ve] got to find. And if you haven’t put together, like, a custom 404 page – I actually heard the other day that using your 404 page as essentially a landing page: “Oh, we’re sorry. We screwed up; but, hey, here’s a free giveaway” – that’s an option. I haven’t actually pursued that, but I thought it was an interesting idea to use a custom 404 page as something of a landing page as well. But I think, in most cases, you could also use a 404 page to log that information back someplace. On my websites, there’s a log-in mechanism that, if you ever try to go to a page that doesn’t exist, there’s a log-in mechanism that logs that stuff to a database and says, “This is the page that somebody was trying to go to. This is where it was referred to.” And that way, you can hopefully cut down on those. So, if there’s other people linking to material of yours that is – you’ve moved it, or it doesn’t exist anymore, you can redirect them under the covers so that the end user doesn’t have to see that experience of clicking on a link, and they end up at a 404 page.
[21:39] Rob: Yeah, that’s a big one. Everything that you just mentioned, I think, is something people should do. The reporting of the 404’s is important as well, because even if you crawl your site internally and you take out all the 404 links, and you fix everything, people can still be finding you through Google at old pages. And you want a notification when someone hits that page so that you’re able to either get a redirect or get the page back there, because you don’t want to lose that Google traffic that you’ve worked so hard to get.
[22:04] Mike: And just because you go onto Google and you search for a specific page and you don’t see it, it doesn’t mean that one of Google’s other data centers doesn’t have a link to that page. So, that’s the one thing that you kind of have to keep in mind, because different Google data centers have different data about your site. And it’s kind of screwy that you have to even deal with it, but having a mechanism in place that can log any sort of 404 pages is really critical when you’re trying to eliminate those types of errors.
[22:29] I think one of the other things that, whenever I got to a website that just kills me is if you go there and there’s popups that try to get you to give them information right away; or, if you try to scroll up and down, and they just throw something up in your face and say, “Hey, would you like to subscribe to this?” And it’s like, “Yeah, I was already leaving because I wasn’t interested in what you have. You’re not going to get me with an email popup at this point.” And then there’s those websites where you go to them, and they just automatically start playing music or videos in the background. Sometimes, it’s even hard to find where to turn them off because there’s so much stuff all over on the page.
[23:05] Rob: I’ve never been a fan of either of those. The popovers over and over – people say they get more email sign-ups, but I’ve never been a fan, and I’ve never used one myself. But that’s one of the reasons we developed the DRIP Toaster widget that’s down in the lower right, and it’s just much less intrusive. I also am not a fan of the exit intent stuff, you know, when your mouse moves up to hit the back button, or to close the tab, or whatever, that it jumps out and tries to get you to subscribe. I’ve never once – I’m not saying they don’t work, because I know they do. But I’ve never once entered my email after that. It’s almost a principle thing at that point.
[23:41] Mike: So, let’s move on to the next section and discuss the written content itself. One thing I see: using ambiguous messaging in terms of trying to get your customers to work their way through your website. If you’re not direct about what it is that you’re trying to get them to do, or why they should stick around, people are going to leave. They’re not going to stick around and try to figure out what it is that you’re trying to say. And that’s one of those big things where you come to a website, and there’s this wall of text – neglecting blog posts, because I think those are in a different category. But if you’re going to a product website and you look at the website and you’re really not sure what it’s even for, that messaging really needs to be tightened up. You can figure that out. You can figure out whether your website is having issues there if you show it to some random person that you meet at a conference and say, “Hey, can you take a look at my website?” Don’t even explain to them what you do. Just have them look at your website and see if they can figure it out. And if they can’t figure it out from the home page, then chances are you’ve got to rework that home page a little bit.
[24:38] Rob: Yeah, you have to think about all your content as if new visitors – first-time visitors – are looking at it, because I see some sites that cater more towards their return visitors, and they do it on the home page. And, typically, you have an enormously higher ratio of new visitors hitting a lot of your pages than you do returning. And so one home page that I saw, the headline was “V3.4 Now Released.” And it’s funny, because if you just arrive at that as a brand new user, you have no idea what you’re talking about. “V3.4 of what? And what does it do? And why do I care?” and all that stuff. Now, V3.4 release could be a subject line sent in an email out to your existing customers, because then they’ll have some idea of your app and what it does. They have some indication. But doing that on your home page is a big mistake, and I think it’s not only ambiguous, but you’re leaving a lot of potential on the floor when you’re doing that.
[25:29] The other thing that you should think about is you should have a lot of you’s and your’s in your web page – right? So, you don’t want to say, “We are this,” “We are that,” “Our app does this.” You want to show the person who’s there that you understand them. And so if you go to getdrip.com and you look at the first five paragraphs, almost all of it talks about “you,” “you” and “you.” And you’ll see it, and it’s me being in the head of people who potentially want to use DRIP, and it’s me understanding them and showing that I understand them. You know, it’s an age-old copywriting technique, and then they’re just more likely to follow your logic and listen to you as you continue to talk. But if you start off with “we,” “we,” “we” and “I” and “me” and “my product and this and that, it’s not that it never works; but it works much less often.
[26:17] Mike: And that kind of leads into the language and the claims that you’re making about the product as well and about the problem space itself. And if you say, “You can save a lot of money,” or, “This is trusted by thousands of customers,” it doesn’t necessarily break trust; but if you make very specific claims, those things are a lot more compelling than when you’re more generic about what it is that you’re claiming.
[26:38] Rob: I agree. if it said, “Our average customer saved $3,420 last month,” or, “Our average customer saved 8.2 hours of time for every dollar they spent,” or something like that, it really has a lot more impact than just throwing out platitudes and clichés that a lot of people – “We are the best email marketing software on the market.” It’s just a such a big difference.
[27:03] Mike: Yeah. And along those lines, the specifics of it are really what get people. So, if you say “under ten hours” versus “8.2 hours,” 8.2 is almost certainly not made up. I mean nobody’s going to say “8.2.” But if you say “under 10,” it’s not to say that it’s a deal breaker; but if you just say “under 10,” it seems, “Well, okay. Somebody just kind of estimated.” But 8.2 seems like a real number that somebody had to measure. I think you also have to be careful about typos and grammatical errors and things like that, because if you have grammatical errors or spelling errors, any sort of careless typo – especially when you are tasked with building software that addresses critical data or sensitive data – then if you’re not careful about the copy that’s on your website, it kind of invokes a little bit less trust in your products; because if you can’t keep spelling errors out of your website, how are you going to keep bugs out of the product? How are you going to keep that data secure? How can they trust you to do a good job with the software itself if you can’t even write good copy for your website?
[28:04] Rob: Yeah, and it sounds petty, but I do think it’s a subconscious thing. I think that if I see typos, instantly there’s a little ding. It’s not that I’m going to bail on it, but there’s a little ding to their credibility. And the more that I see, the more of an issue it becomes. And I’ve, frankly, had a couple typos pointed out. There’s one in the FAQ of DRIP, and I fixed them right away. Now, if there are typos on my blog, and it’s more of personal brand stuff, I don’t mind that as much. It’s me writing on my blog. It’s a little more casual. But in corporate stuff, where you’re trying to sell software, trying to sell an app, I do think that it’s worth the effort to make sure that your grammar and your spelling are really in line.
[28:45] Mike: I think the last two categories are essentially independent verification and then self-verification. So, in terms of self-verification, talking about the type of audience that you serve, or the experience that you have, any sort of guarantees or commitments that you have to people. Those are the types of things that are essentially the self- or first-party verification type. You know, you can tell people about what it is that you do, how many people you’ve helped – those types of things. And then in terms of third-part verification, you can think of things like reviews, testimonials, comparisons between you and other competitors, where you’ve been seen, any sort of affiliations you have.
[29:22] Security seals. For example, one of the things that a lot of people will do is they’ll put Visa, or Master Card, or American Express logos on their websites and say, “Hey, we accept these credit cards.” But in addition to just letting people know that you are accepting those credit cards, you’re also essentially borrowing trust from those symbols; because Visa and Master Card and Discover have presumably given you permission to accept their cards, so clearly you must’ve gone through some sort of approval process to be able to do it. And that’s a way that you can essentially borrow trust from those organizations to help boost your own.
[29:54] So, when you’re looking at a website and trying to figure out whether or not it’s going to be trustworthy, especially when you’re trying to evaluate your own website, you need to look at it through the eyes of the customer. And the first thing that you look at is the core tenets of trust. The first one is, are you credible? Is there any sort of social proof? Can you prove that the information that is out there is up-to-date? So, for example, if your copyright at the bottom says “2010,” and it’s 2014, that’s probably going to be a problem to people, because they’re just going to say, “Well, this information is old and outdated.” Are you transparent? Are you showing contact information for your company, ways to get in touch with you, any sort of disclosures or privacy policies? Are you telling them flat out, “Hey, we will not spam you. We do not share your email address” – those types of things? Are you talking to the customer and letting them know how they should expect to be treated?
[30:42] And then the third thing is, is your site easy to use? Does it load fast? Is it easy to navigate? Does the user have a clear set of expectations on any given page where they should go next?
[30:54] So, those are the things that you need to keep in mind when you’re looking at a website and trying to evaluate whether or not it’s trustworthy. And those are the types of things that we’re trying to really harp on for this particular episode so that people look at their websites with a little bit more of a critical eye.
[31:09] Rob: And, realistically, you only have a couple of seconds before people make that snap judgment, and I think visual design is a big part of that. And then I think that the tone of your written content, which we touched on a little bit – that’s one of the other, biggest stumbling blocks I see; because it’s so easy to write generic, crap, marketing speak that you kind of feel like you should write, and that’s very safe to write.
[31:31] And, typically, if it feels very safe to write, it’s junk. And trying to break out of that mindset and write something that’s really risky, that feels risky, tends to be what’s successful. And I would challenge you, if you’re going to sit down to try to write copy for your website, that you don’t start thinking about what your product is and what it does; but that you start by thinking about who your prospect is and who the person is that’s going to buy your software. Try to get into their mindset and then talk directly to them.
[31:56] I would also say go look at some websites that you feel like have done an exceptional job of communicating their value proposition. So, look at copyhackers.com, and you can go and read the tips in the blog and everything; but look at the home page. Do you feel like a person wrote that and you get a pretty quick feel for who that person is and what her voice is? And the answer is probably you do. You know, there’s personality there. And there’s a number of other examples, but go to, you know, a Patio11. Go to his home page of his blog. It’s not a blog post, but right away you feel like there’s a person there writing behind it. You can use that same tactic to write a marketing website – and I’ve done this with my own apps as well – to where it doesn’t feel like someone recycling the same, old, marketing jargon and platitudes and clichés; because none of that works. And you may as well not be doing it. Trying to find our own voice and writing like you speak and trying to identify with people as another person, instead of as a corporation, I think, is a really big step towards making this all work.
[32:57] If you have a question for us, call our voicemail number at 888.801.9690, or email us at questios@startupsfortherestofus.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,” and visit Startupsfortherestofus.com for a full transcript of each episode. Thanks for listening. We’ll see you next time.
Episode 204 | 9 Tactics for Aggressive Time Management
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.
Episode 199 | Traction: A Startup Guide to Getting Customers (with Guest Gabriel Weinberg)
Show Notes
The 19 traction channels:
- Viral Marketing
- Public Relations (PR)
- Unconventional PR
- Search Engine Marketing (SEM)
- Social and Display Ads
- Offline Ads
- Search Engine Optimization (SEO)
- Content Marketing
- Email Marketing
- Engineering as Marketing
- Target Market Blogs
- Business Development (BD)
- Sales
- Affiliate Programs
- Existing Platforms
- Trade Shows
- Offline Events
- Speaking Engagements
- Community Building
Transcript
[00:00] Rob: In this episode of Startups for the Rest of Us, Mike and I discuss Traction: A Startup Guide to Getting Customers with special guest Gabriel Weinberg. This is Startups for the Rest of Us episode 199.
[00:11] Music
[00:19]Welcome to Startups for the Rest of Us, the podcast that helps developers, designers and entrepreneurs be awesome at launching startups, whether you’ve built your first product or you’re just thinking about it. I’m Rob.
[00:27] Mike: And I’m Mike.
[00:28] 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?
[00:33] Mike: I have essentially scheduled a personal retreat for Labor Day weekend. Something that’s been on my list of things to do. I’m going to head up to my cottage in the Adirondacks. My plan is to just kind of sit down and think about the business that I’m working on.
[00:45] Rob: That sounds really cool. Do you have any type of outline for the retreat? Remember when Sherry did a MicroConf talk last year, she threw out some questions that you could ask during that time.
[00:54] Mike: Yeah, I haven’t really put together anything.
[00:56] Rob: I think it’s a good move. I think everyone should take one at least once a year where they can get 48 hours away from their family or significant other and their work and their house. Just get out of town in somewhere fairly isolated and you can just sit and think without electronic devices and then ask yourself some questions about your business. We’ve talked about this before, and then Sherry’s MicroConf talk will be out on video here pretty soon. For me I try to do it twice a year, and it is some of the most focused and rejuvenating time of my year because it just makes me look ahead and say, alright this is my plan for the next six to twelve months, and it really helps guide that process.
[01:35] Mike: So what’s up with you?
[01:36] Rob: I really kicked up Drip’s marketing effort about twenty days ago. That was when Drip 2.0 launched all the automation rules and such. We have a twenty one day trial, so basically the next week to ten days are going to be really interesting because all those trials end. I of course have an innate sense of what’s going to happen but it’s always cautious optimism. I’m excited about the potential growth over the next ten days but if people don’t convert, I’m not going to be very happy. We’ll know by probably the next podcast recording. At least I’ll have a sense of how many people are sticking around and whether our trial to paid conversion rate is staying in line.
[02:14] I do have a sense, and it should be the best month of growth ever. In fact, if it’s not the best month of growth ever, I will be disappointed. I guess that sounds kind of optimistic, but the interesting thing I’ve really been noodling on this concept of medium touch sales. We talk a lot about low touch sales or no touch sales. No touch is when people just come and they buy the ebook and they never email you. Low touch is when you might do an email here or there but you have a support person handling it. And then high touch is more of what I consider enterprise sales, where you’re probably going to be doing phone calls, maybe Skype demos, webinars, that kind of stuff. I’m working with this concept of medium touch sales that I kind of just stumbled into. And it’s become worth it with certain price points in Drip. So for me, it’s translating into one on one emails with me, the founder. So it’s not a support person, but it’s actual interactions of how do I get this done, can Drip do this, but not just one-off questions. I’m actually recording some short custom screencasts for people when they ask me how to do something. And I’m recording a lot of them. I’m recording probably a half dozen a day right now. The conversion rate to people who are uprooting themselves and changing email providers with tens of thousands of subscribers is shockingly high and I don’t know how long this will last. I don’t know if it’s just because it’s the early days or because people know me or what it is, although several of the people don’t know me which bodes well.
[03:31] This obviously can’t scale infinitely or anything like that, but doing things that don’t scale at this point is kind of where I’m at with Drip. So, I’m just trying to find out how to prequalify people early because for a $50 a month plan, it’s not worth doing this. But when someone is at 150, 200 bucks a month and up it’s obviously worth me spending some time on it. I’ve been doing it for about three weeks pretty intently, and I’m spending quite a bit of time on it, but it’s directly related to revenue so at this point it’s working for me.
[04:01] Mike: I think that it depends obviously on the price point but also on the lifetime value of whoever that customer happens to be because depending on the price point, they may stick around for a longer time or shorter time. When you’re talking to people one on one, there’s a much higher sense of interest from the other party, just because they are working one on one with the same person. So, if you send an email in to a support line or something like that and you hear back from Joe and then next you hear back from Dave, you don’t get any sort of a relationship built up with the person. There’s no investment. I find that if you have that single point of contact on the other side consistently it helps, but I’m curious to know whether or not you’re getting that solely because you’re the founder or if it’s more the one on one relationship.
[04:44] Rob: I agree. I have the same thought in the back of my mind. If I hired a really good sales rep who handled this and they were very knowledgable about the product and doing similar things that I am, I’m curious to see if it would translate.
[04:55] Mike: Very cool.
[04:56] Music
[05:00] Rob: Today we welcome Gabriel Weinberg. He’s here to talk about his book that releases today. It’s called Traction: A Startup Guide to Getting Customers. So today Mike and I have the pleasure of having Gabriel Weinberg on the podcast. Gabriel is the founder of DuckDuckGo, which is a search engine that got more than a billion searches last year and it’s growing. He’s essentially trying to take on Google and Bing and the rest of the search engine companies around. He was previously the co-founder and CEO of Opobox which sold for ten million dollars in 2006, and now he’s doing a bit of angel investing trying to grow DuckDuckGo which he launched in 2008. So Gabriel, welcome to the show.
[05:39] Gabriel Weinberg: Thanks, pleasure to be here.
[05:41] Rob: The reason we wanted to have you on is you’ve written a book. It’s called Traction: A Startup Guide to Getting Customers. You co-wrote it with Justin Mares. And Traction actually launches today, the day this podcast goes live. So if folks are interested in checking this out, it’s all about how to find customers and get traction in your startup, it’s at tractionbook.com. For more info there’s a sample chapter and you can obviously search for it on Amazon. I guess I’ll give a little background. For the book you interviewed more than forty founders, people like Darmesh Shah, Andrew Chen, Noah Kagan, Rand Fishkin, Patrick McKenzie, Jason Cohen, myself, and you and Justin pulled out traction approaches that people have used to get traction in their businesses. And you basically distilled it down to nineteen different traction channels.
[06:29] Gabriel: That all sounds correct. It’s a long time in the making. I started working on this project five years ago, when I started angel investing and tried to get traction for DuckDuckGo and realized there just wasn’t a great process for doing so, and just started doing interviews and five years later I ended up with this book.
[06:46] Rob: Nice. One of the statements in the book is that traction trumps everything. So how are you defining traction?
[06:52] Gabriel: What we mean is really sustainable customer growth. Generally you could even boil it down to just traction is growth. And if you don’t have growth in a startup, you essentially don’t have a startup, that’s why it trumps everything. Because if you’re growing, then everything becomes easy in a startup including some of the hardest things like getting more customers, getting fundraising and getting acquired, things like that.
[07:16] Rob: Right. And so traction could be seen as a combination of having low churn, having a lot of people coming in through the funnel, using the product and then sticking around and using it over time, and then having more people coming in through the funnel over time.
[07:29] Gabriel: That’s right. You can look at whatever core metric it is for your business that is a meaningful metric, like revenue or active customers or time on your site. Whatever that thing is, it should be growing up into the right. That’s essentially what traction is.
[07:44] Rob: Very good. Opobox was a sort of social network and DuckDuckGo is a search engine, these are more B2C plays, but you interviewed a lot of B2B founders as well. So I’m curious who is this book intended for.
[07:57] Gabriel: It really spans everything. I’ve angel invested in B2B stuff, as you mentioned a lot of my person experience in my company is B2C. Justin’s is the opposite. He’s done a bunch of B2B startups. We basically looked out and saw, okay companies now have some decent methodologies for product development luckily in startup, but they don’t have methodologies for how to get traction. And that was the big hole we were trying to address. And from doing the interviews and extracting our bullseye method, we found it’s just generally applicable and that B2B companies and B2C companies often get traction from the same mechanism. It’s just applied to their particular kind of company.
[08:35] Rob: You mention in the book, and obvious in the interview now, how Lean focuses so much on the product and that’s actually been one of my key concerns with it is that there’s a missing piece there. I don’t feel like Lean has emphasized marketing enough. There’s growth engines mentioned in maybe one chapter of Eric’s book. Engineers already have a predisposition to focus on the product.
[08:55]Gabriel: Here’s the basic story that we see, and that I saw with angel investing is, say you follow Lean to the T and you do good customer development. You launch a product that these customers actually want, which is great, but then you still have no idea how to get a more steady stream of those customers coming in the door. So what we see happens is people launch, they don’t have that immediate traction and they run out of money and die. And the saddest part about that is that the product was actually good. Those initial customers wanted it so the product development piece actually did work. It’s just as you said, it needs something to go hand in hand to actually address more of the marketing piece so when you do launch you know exactly what to do and how to get more customers.
[09:36] Mike: So one of the things you talk about in your book is called the bullseye framework. Can you talk a little about what the bullseye framework is and relate it to the listeners?
[09:45] Gabriel: Basically what we did was interview all these different people and saw the same traction channels, as we call them, coming up again and again. Those are things that everyone is familiar with like search engine marketing, SEO, PR, but then there’s a bunch of ones that people don’t usually use like business development, sales, speaking at trade shows or other conferences. Different startups, widely across the map, were getting traction through each of these different verticals but usually only one dominated at any one time. So keep that in mind. There’s nineteen channels; usually a startup gets traction through one of them. On the other side, you have startups and their founders’ bias towards their previous experience. You mentioned my startups. I came into DuckDuckGo from NamesDatabase or Opobox where there’s a lot of SEO and so I first set out to get traction for DuckDuckGo using SEO, but that was not a good choice. The only reason I did it was because I knew SEO and I was biased toward it. So what the framework really does, it tries to get you to take all these nineteen channels seriously and really consider them when you wouldn’t maybe have otherwise. And so the first step really is a brainstorming step and the whole process after that, a few more steps, the reason it’s called bullseye is it’s meant to hone in on to one channel that’s really going to make you take off for your startup.
[11:09] Rob: What I like about the book is, I’ve had this idea that I either wanted someone to write this book or I was going to write this book. This was going to be my second book, was to try to figure out a bunch of marketing channels and list them out and list some of the ways that people had approached them, list the results, just to have this reference. Because when I sit down either to advise someone or even to start a new idea, I’m always going back to this old marketing plan and trying to say, well which of these ideas is going to work now. And to have something that’s this comprehensive and that tries to boil it down into these channels I think is going to be really helpful moving forward as a reference for all of us.
[11:46] Gabriel: And that’s exactly why I wrote it. I just felt there was a need and I personally wanted to use it. And I’ve used the process at DuckDuckGo over the past five years. One of the other take-aways is that any good marketing channel eventually saturates for you. You’re using adwords, they get more expensive, you usually get priced out of it eventually. Or the volume gets too high. Your company is bigger and it just doesn’t move the needle for you anymore. The problem with that is you have to go back to the drawing board every eighteen months if you’re getting a lot of traction. And that’s what’s happened for DuckDuckGo so I’ve repeatedly gone back and looked at these nineteen channels, done the brainstorming, run tests, and we’ve switched channels with which we’ve gotten traction at DuckDuckGo about five times.
[12:27] Rob: Wow. So another concept in the book, you talk about the fifty percent rule. Mind telling us what that is?
[12:34] Gabriel: Sure. This relates to our discussion earlier about Lean, doing the marketing portion that’s missing from Lean. And if you wait until the end and try to start getting traction after you launch, then you’re in the situation that I was talking about earlier where you don’t have a lot of runway to figure this out. Whereas if you start a lot earlier, two things happen. One, you might be able to figure out when you launch what actually to do to get traction so you might figure out what channel you should use, how much that might cost, what niche you should focus on, what the marketing message actually will be that will resonate with potential customers. So you can figure all those things out, and then two, you are building this list over time from actually trying to get traction so when you actually launch you can immediately use this stuff and take off. We use an example in the book from Marketo marketing platform company that IPOed last year, and they started blogging right away and that was their initial traction channel. Way more blogging that you would normally do if you were just doing customer development. As a result they ended up collecting fourteen thousand emails for an email list and essentially took off right from the moment they launched.
[13:45]The other thing you get from this, and the fifty percent rule just means spend fifty percent of your time getting traction, really meaning it’s just as important as product development so you should be spending half your time doing it. But the other kind of non-intuitive benefit of it is that oftentimes people launch, they go try to get traction, and then they end up having to redo product development cycles because the market feedback tells them that it’s not quite right. They made it for these few customers, but to get a wider audience they have to change a bunch of things. If you actually do traction, spend fifty percent of your time doing it before you launch you often spend both less time on the product but also get to market faster with a good product. You’re actually just making a better product because you’re getting market feedback sooner.
[14:31] Mike: So when you talk about some of the different traction channels, one of the things you say is that a lot of the startups are all using the same ones. What are some of the ones that are less commonly used that you would consider essentially low-hanging fruit that people can go after. And because people don’t go after them as much they might work a little bit better for them because they’re not essentially saturated with people trying to leverage them.
[14:51] Gabriel: So there’s two aspects to this. One is, oftentimes people think oh I’m a B2B company so I’ve got to use these B2B traction channels. Or, I’m a B2C so I have to work on social traction channels. I think that’s actually nonsense. You want to go where your competition isn’t, because that’s where you’re going to have to compete less for customers. So there’s one question of, look at your competitors and see what they’re doing and maybe try to use some of these traction channels that aren’t being utilized for that particular type of company. The second piece is that there are channels which are just generally underutilized. So a good example of that is this one that we actually had to name because there wasn’t even a good name for it, which we termed engineering as marketing. And what this one is building essentially free tools that are complementary to your product, putting them out on the internet, they get independent traction because there’s such a need for it. But it’s a feature it’s not really a company, but the amount of usage from them enables you to get customers funneling off of that.
[15:50]HubSpot has done a great job of this with their marketing grader website. You go there and type in your domain name and they tell you how well you’re doing and they can upsell you on HubSpot. SEOmoz is another good example with their followerwonk tool. But it’s actually pretty generally applicable. Another set of ones that are generally underutilized are the offline ones. So, offline ads like in podcasts, or radio or even billboards which DuckDuckGo actually used one time, and speaking at different conferences and things like that, or hosting your own events. Those are all ones that are underutilized.
[16:26] Rob: I’m a big fan of repeatable and predictable channels. I’m always looking for stuff that is repeatable and predictable. And that’s why I have stuck to things like content marketing, SEO, search engine marketing, paid acquisition, that kind of stuff. Because I know what the numbers should be, and it feels like it’s less lightening in a bottle then maybe something like unconventional PR where you do a big stunt. I’m wondering which of the nineteen that you feel are the most predictable and repeatable.
[16:57] Gabriel: I would actually argue they all can be repeatable and predictable. We have examples in the book. I would say that some are definitely more than others. But take unconventional PR. Yes, there are the big stunts and it’s hard to do those again and again. But in unconventional PR, there are other things that people have done repeatedly like doing a series of viral videos. An example is the Will It Blend? channel; a blender company just starts blending things and they made hundreds of videos. Another version of that is doing unconventional things for your customers that end up becoming your company lore and getting good press as a result of that. Zappos customer service is one of those. And Alexis Ohanian from reddit, Hipmunk has done really well just running giveaways and contests around holidays and sending stickers and other stuff around to their customers. Just going above and beyond ends up getting a big word of mouth share going. I’d push back and say that there are ways to make these repeatable. It’s a little harder in some cases than others. I’ve seen it work in all the cases.
[18:05] Rob: Sure. Which of these nineteen have you used at DuckDuckGo? It seems like that would be kind of a hard business to market because it’s so unconventional.
[18:15] Gabriel: It is definitely hard. DuckDuckGo faces a couple of challenges. One is the general distribution mechanisms that people use for search engines, which is it’s in your browser already or in your operating system, are generally locked out to startups because there are bid up and very lucrative contracts from Bing and Google. So that kind of forces us to go around and do other things. Additionally, the traditional paid ones are similarly bid up and expensive to acquire users. So we’ve had to do some of the less paid ones if you will. We started out in SEO and then moved to social and display ads a lot of Reddit, 4chan even, that was kind of early In our growth. Then we did content marketing. We put out a series of microsites and blog posts, that brought in a bunch of traffic. And like I was mentioning earlier, each of these things worked up to a point, at which point they didn’t move the needle for us anymore. Our volume kept growing. We were growing about three to five hundred percent a year and so we had to keep switching.
[19:14]So then we moved to print PR, and then we moved to TV PR, and then that recently topped out for us and now we’re at business development. We’ve kind of come full circle back to that distribution and we just got a deal with Apple to be in Safari in iOS 8 and OS X. That comes out next month actually and so we’re hoping that is the next one that moves the needle for us. And then we’ll be coming back to the drawing board again.
[19:37] Rob: Wow, congratulations on that deal. That sounds like it’s a big jump for you guys.
[19:41] Gabriel: Thank you. To put another point on that, some of these for different companies won’t work for different phases of your company. We were never going to be able to get that deal early on until we were a little bit bigger and were obviously differentiated in the marketplace to allow them to want to include us. So some things won’t work in phase one of your startup, they might work in phase two or phase three.
[20:05] Mike: I think that’s kind of an exclamation point on this whole book that kind of needs to be there. But then you also had a blog article that you wrote a couple years ago called Moving the Needle and you kind of talked about this where there are certain channels that work really really well for you when you are a certain size, and then once you exceed some threshold that channel will no longer move the needle for you so you essentially have to find something new. And you’re always trying to look for what is the next thing that’s going to take your business to the next level. These nineteen different areas that you call out is a great starting point, but obviously which one is going to work for your business is going to be very dependent on what your business is, what your customer base looks like, and what you’re good at quite frankly. That’s something that I think really needs to be called out. You need to figure out which one of these is going to work for the stage that your business is in right now, because just because it doesn’t work now doesn’t mean that it won’t work down the road or that it could have worked for you six months ago but will no longer work for you in the future.
[21:00] Gabriel: Absolutely right. That’s why we like this process. Everything starts in the brainstorming session, trying to think about what you could use this channel for ideally in any way. You write down all these things, you pick the most promising one, you run some tests, you find one that’s working and you focus on it for a while. And then like you said, it stops working right? But the beauty of it is, if you did this successfully, you have all your old data, you have all your old ideas, you have all your old tests and you’re keeping those around. So the second time around you can say, oh hey, remember that idea we had eighteen months ago? That might actually apply now. That might actually work given the uniqueness of our current situation. We’ve done that a lot. We’ve gone back to old tests and lo and behold, sometimes they work.
[21:41] Rob: So in the book you listed nineteen traction channels. It’s probably not worth looking at SEO, SEM, paid acquisition on this podcast because we talk about it so much, but there were a few that were off my radar for sure. You brought up engineering as marketing which I think is a great idea and I’ve been watching Darmesh do that at HubSpot for a while. So I think people, when they get the book, should pay special attention to that one. The other one that caught my attention was existing platforms, and the summary of that is that focusing on existing platforms means focusing your growth on a mega platform like Facebook, Twitter, or an app store so you get some of the hundreds of millions of users to use your product. You talk about Alex Pachikov, the co-founder of Evernote and how he explains their focus on Apple’s app store generated millions of customers. Could you talk a little more about that? About existing platforms, who’s going after that, and how to properly do it?
[22:31] Gabriel: This idea has kind of broke out in the last five years and it basically says wow, a lot of users are just congregating on these places like Facebook and Twitter and the app stores, like you mentioned, and also browser extension add on stores like Chrome and Firefox. And there are people there everyday, millions and millions of people downloading apps and trying things. Those platforms are exposing those users to new products. Through certain strategies you can jump on that platform and get traction just by virtue of focusing on the platform. And so there’s essentially two approaches to this. One is for every platform, even new platforms, there’s usually a company that emerges or multiple companies that emerge solving things on that platform that the parent platform company didn’t really do themselves. Bitly is a good example on Twitter, Zynga is a good example on Facebook. Pretty much every one, you can see companies forming out of that ecosystem. So that’s one very platform-specific approach. Another approach, the one that Evernote took, is to say let’s focus on optimizing our apps for these platforms and getting noticed. And the best approach to that is getting the attention of the platform and getting featured because the platforms themselves, they made these platforms and they want people to make apps and use them. So they want to promote the best apps to showcase and get people to come to the platform. Evernote really has been the leader in this strategy. They’ve gone to almost every new platform you can imagine, there’s an Evernote app, not just the app stores but browser extension stores, almost every kind of phone version. But they do a couple things to really optimize it. One, they show up first. They’re one of the first apps to launch anywhere, and that really gets the platform’s attention because they want to showcase new stuff for their platform. And it’s not just, oh the app store already exists so that will never happen again. It’s new versions of the app store or the iPhone in this case too. I have an example in the book when the smart cover came out on the iPad, they were one of the first apps to use it. They made an app specifically for it, and then they were promoted on the TV commercial because of that. So really that strategy is about getting featured, getting listed in these top lists, and if you can do that it drives consistent downloads over and over again.
[24:53] Rob: I like this approach. It reminds me of Dan Martel, spoke at MicroConf a couple years ago and he used the phrase OPN which is other people’s networks. And he talked about this approach and how he’s seen a lot of startups grow quickly doing this. I’ve tried to dispel the myth that SEO and search engine marketing is Google and Bing, it’s not just the top two. Because you have search engines like Youtube that are massive, and the iOS app store, the Android app store, the WordPress plug in store essentially is an ecosystem with millions if not tens of millions of searches going on all the time, Amazon. I listed this whole list of things that if you can get in the way of any of those searches, they’re actually less competitive than Google because everybody is trying to target them.
[25:38] Gabriel: That’s actually a really good point and we make this in the book. You mentioned just now, there are niche platforms. If you’re in a startup in a niche, there’s often smaller platforms that have users that you can ride on, if you’re in a design space like Dribbble and Behance, those kinds of things. If you’re really going to make a list for all these different niches, there’s probably hundreds of different sites that you could really get traction from. It’s just a matter of finding out where these users are hanging out and then trying to figure out ways to get promoted on the platform.
[26:06] Mike: And that’s one of the things that we advocate, is that you use a VA or somebody like that to help identify those things because those could be extremely lengthy searches that you have to do, and if you can provide somebody with parameters to go out and do those searches then you can get back an excel spreadsheet or a list of some kind that someone has run a lot of these searches that almost take a human to eyeball stuff and say, is this reasonable to look at or not or is this worth somebody’s time, and then essentially filter that down to a point where the founder or the marketing team or whatever can go and take a look at those things and really determine whether or not they want to go after them or not.
[26:44] Gabriel: Yeah, I use virtual assistants all the time. Another good strategy is to, either through the customer development process if you’re pre-launch or through surveys if you’ve already launched of your existing users, just to ask them directly what sites they visit, where they’re hanging out online, if they’re subscribing to newsletters or podcasts, and just try to see if there’s any kind of patterns there, if people are congregating.
[27:07] Rob: Very good. Well, Gabriel thanks a lot for your time today. If folks want to find out more about the book they can go to tractionbook.com and download a sample chapter. They can obviously go to Amazon and search for it there. And if people want to keep up with you and communicate with you online, whereabouts do you hang out?
[27:24] Gabriel: Twitter, @yegg
[27:27]Rob: Very good. Thanks again for your time, it was a pleasure having you today.
[27:30]Mike: Thanks Gabriel.
[27:30] Gabriel: Thank you both.
[27:33] Mike: 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 of We’re Outta Control by MoOt used under Creative Commons. You can subscribe to us in iTunes by searching for Startups or 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 198 | How to Perform an SEO Health Check on Your Website
Show Notes
- OpenStack
- Puppet
- Chef
- FinalBuilder
- Software Promotions
- Dave Collins
- Automated Website Health Check
- http://www.lunametrics.com/blog/2013/04/08/fifteen-minute-seo-health-check/
- Moz.com Search Ranking Factors
- Open Site Explorer
Transcript
[00:00] Mike: In today’s episode, Rob and I are going to be talking about how to perform an SEO health check on your website. This is Startups For The Rest of Us, episode 198.
[00:07] Music
[00:16]Welcome to Startups For The Rest of Us, the podcast that helps developers, designers and entrepreneurs be awesome at launching new software products. Whether you’re building your first project or just thinking about it. I’m Mike:.
[00:24] Rob: And I’m Rob.
[00:25] 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?
[00:28] Rob: So we got an e-mail from Paul Rudderman and he has asked several questions in the past. He actually asked us the question about which LEAN startup methodologies we didn’t find helpful a few months back in a pre-show recorded whole episode around that. So, he wrote in and said I wanted to comment slash respond to a recent episode and the topic you guys were focused on. It was episode 193 where you and I talked about solutions for managing remote teams. And he says you mentioned TRELO and some other approaches.
[00:56]My startup Update Zen is a very different solution but good for remote teams if you are not a micro-manager, but what we are calling a macro-manager. So Paul is calling it light weight task management and he says we only allow for 250 character updates. It’s high level, simple status reporting for executives, entrepreneurs, business owners, etcetera. Thank you guys for everything. I really do appreciate the incredible insights, professional and personal, that you share on Startups For The Rest of Us. Be sure to checkout Update Zen and I’d like to thank Paul for writing in. How about you, what have you been up to the past couple of weeks?
[01:28] Mike: Over the past couple of days, I mean wasted the past couple of days, migrating from 1 server to another. But the purpose of it was to essentially document the server configurations so that in the future I can just like outsource management of it and the whole infrastructure to somebody else. But, it was just sort of a mess because everything kind of accumulates over time. It was kind of like a desktop when you’ve had a single server for so long things get messy after a while because you try something out and it doesn’t work. You try something else and maybe you change the way you’ve done things a couple of times. You’ve got 2 or 3 different pieces of software in there that are kind of doing the same thing and, unless you know what’s going on and have it documented, anyone who comes in after the fact is going to have no idea. And, they are going to look at it and say, what is going on? I have no idea how to work with this –
[02:10] Rob: I despise having to move servers. I just feel like it such a waste of time.
[02:14] Mike: It’s my build server but I also use it as my web server.
[02:18] Rob: Okay.
[02:19] Mike: So it’s a RackSpace. Unfortunately it was their first generation web server, so because of that it wasn’t used in like the Openstack framer that just kind of came out in the past couple of years and I couldn’t just do an upgrade of it. Because, with the new system that they have, you could bring a server down, do an upgrade of it and bring it back up, but all of your stuff would be there still. Unfortunately, because mine was a first generation server I couldn’t do that. There were lots of things that I couldn’t do with it so, I had to manually move stuff from one server to another. So I got two servers running at this point and I’m almost done moving everything over and documented everything but it’s been such a nightmare.
[02:57] Rob: Yeah, that’s tough. I don’t know if you’ve thought about using one of the build scripts like, there’s Puppet and Chef and there’s a few others. I haven’t actually used them but my team uses Puppet to configure our EC2 instances. The first one is painful because you script everything out and it’s so hard to get working. But from there, then you just click a button and Puppet will build your whole server and install your whatever, your database and install rails and install all that stuff. And, there’s got to be an equivalent for what you’re looking at.
[03:25] Mike: There would be for certain things, so like the websites themselves but I have like, my build server. I was using FinalBuilder and I’m converting it over because it was FinalBuilder server and now I’m going to be using Continua CI which is their continuous integration product which is kind of like the next level up. It didn’t exist back when I first installed it. So, there’s just lots of stuff there that there’s no way I would be able to do that stuff.
[03:51] Rob: Alright, so we have several new comments in iTunes. In fact, too many for me to read, but I’ll read a couple of them. We have one from Adrenaline from in Austria and he says, “Changed my life, following the advice in this podcast I built a successful software business. I look forward to every new episode, thanks.” And then we have one from Daniel B Nelson, five star review and he says, “This review is long overdue. In fact, I previously typed up a review which iTunes didn’t save. I’ve since gone through and listened to almost all the episodes. Now I save episodes and listen when I really need a jolt of knowledge and inspiration.” And he goes on to talk about how he’s worked for VC backed startups, had his own startups and just the difference our podcasts have made for him. So, thank you guys so much for the reviews and I really do hope you get value out of the podcasts so you can log into iTunes and give us a five star.
[04:38] Music
[04:41] Mike: Today we’re going to be talking about how to do a SEO health check on your website. I think the idea for this originally came from a blog post that was put out by Dave Collins of Software Promotions. He’s talked at a couple of different Microconfs in the past as well. He kind of sparked my interest in going out and doing a SEO health check and I kind of figured out what was going to go into it. What you should be looking for and Dave had some great ideas in his blog post, and I kind of took it a little bit further and went out and did some research and looked at a bunch of other stuff as well.
[05:09] Rob: Speaking of Dave, he’s actually gearing up to do what I think is going to be a really interesting talk on SEO and analytics at Microconf Europe and that will be in Prague. We do still have some tickets left and if you’re interested in seeing Dave and of course Mike and I, come to Microconfeurope.com and there’s a button right there you can click and buy a ticket.
[05:27] Mike: So there’s obviously a bunch of tools that need to be used in order to do a SEO health check of any kind. And the first one we’re going to start off with is Google Webmaster tools. And one of I think, the first things you’ll want to go look at, is go in and look under search traffic and there’s a section for manual actions. And what manual actions is is a place where Google goes in and puts updates in that say, hey we’ve taken a manual action against your website and degraded it for some reason in our search indexes. So if you’ve done any sort of black hat stuff or, even if it is gray hat and you didn’t know what you were doing and they flagged your site and removed it from their indexes – any of the messages that say they did those things would show up in that area.
[06:08] Rob: Yeah, you’ve screwed up pretty bad if you’re looking at manual actions because even back in the day I was doing more gray hat stuff. This is a couple of years ago before Panda and Penguin and when it was working really well still. Even when once that all came through I didn’t have anything that was manual actions or penalties. The algorithm itself obviously had an impact on ranking for some of my sites. But you need to seriously look at what you’re doing if you find yourself with manual actions in this area. It’s like the red alert zone.
[06:36] Mike: The next thing you do in Google Webmaster tools, go underneath the crawl and look at the crawl errors and essentially what these are, anything that is coming up from the Google robots that are saying that they’re having problems crawling your site. And they’ll list out any of the different errors. They don’t necessarily give you all the information that you need in order to fix them but they will give you kind of an indication of a broad statement that says these are the types of problems that we are running into. And can give you at least some clues as to how to go in and fix those problems. But the idea is that if Google’s, robots aren’t able to search your site and crawl it, then they’re not going to be able to index it either. So, there not going to show up in any of the searches.
[07:13] Rob: Yeah. I found this page quite helpful and Google will show you where you have 404s and where you have pages that are erroring out, 500 errors. I was using this a lot when I moved HitTail from the old servers and I moved both the HitTail marketing website and the blog, this is about three years ago, there were a ton of 404s. It allowed me to either put in 301 redirects to maintain that traffic or to actually replace the page and have multiple places where you could find it so that I wasn’t getting these 404s and wasn’t losing that traffic. So, crawl errors is something that I think you should be reviewing on a monthly or maybe on a quarterly basis for all of your sites. It’s just traffic that essentially will likely just go away. You’ve worked so hard to get the traffic to your site it’s a bummer to have people 404ing on your site.
[08:02] Mike: The next thing you want to look at under crawl is sitemaps. If you’re not familiar with what a sitemap is, it’s essentially an xml file that describes what your website looks like. My inclination on this is that if you don’t have a fairly extensive website, if you only have 10 or 15 web pages on your site, then sitemaps is not probably going to do a lot for you. But if you have a lot of them or you’re auto-generating pages of any kind, then a sitemap can really help you. It allows Google to just download that site map and they’ll know exactly where to go on that website for different types of content and it should all be listed inside of that sitemap. Otherwise, the robots need to crawl your entire site and there’s almost a limit to how much they are going to crawl your site. So, it’s like they crawl your site for a little while, but it almost times out. They don’t completely do the whole thing so they’ll get it in spurts and they won’t crawl your entire site all at once.
[08:54] Rob: Yeah, there are several sitemap generators. I think if you’re using a tool like WordPress and you get a good SEO sitemap generator, then it can look at all of your posts, all of your pages and spit out a decent sitemap. And I think with blogs it’s important because you can often have hundreds and hundreds of pages in that blog. So like you said, if you only have 15 pages of content, probably not as necessary. What I found interesting is there are sitemap generators that are just websites and you type in your website URL and it goes and crawls that and spits out a sitemap of your site. And this sitemap is an xml file that Google then can read. I’m not convinced that that is actually beneficial having that xml sitemap auto-generated. What I’ve always done is, if I have a site that isn’t WordPress and that I am going to need to create one manually, then I would go to these websites. I’ll enter in the domain name. I’ll have it crawl, I’ll go in and spot check or I’ll have like a virtual assistant spot check and try to find out if there are any files in my web tree. Like on my web server, any routes or any paths that are not in that sitemap and then add them in manually. Because, those are the ones, that if they are missed by this automated crawler, that you have the potential of Google missing it as well. And it’s only worth it on high value sites. If you have a little niche site with some adcents on it, it’s not worth doing. But if you have a site where getting every person into your funnel, a SaaS app or something that’s selling well and making you money, then that’s the only point at which that level of effort becomes warranted.
[10:23] Mike: Cool, thing the next thing that you’d look at is the Google index. And underneath the Google index you’re going to take a look at the index status. And here you want to make sure you click on the advance button. This is where you’re going to see any pages that are being blocked by a robot’s txt file or any pages where Google think it’s getting blocked. Underneath there you will see the number of pages that are being indexed and you want to make sure that index roughly matches the number of pages you expect to see on your site. So if you only got 10 or 15 pages it’s a lot easier to do this than if you have 300 or 500 pages on your website.
[10:59] Rob: Oh man, a friend of mine had a development version of the site, like a staging version they were working on. So they had the robot’s txt set block everything and they deployed this to production and they forgot to change it and Google –
[11:11] Mike: Oh no.
[11:12]Rob: – stopped indexing everything. In Analytics you can set up traffic alerts and if your traffic drops by more than x percent – and you can even specify. Like SEO traffic drops by more than X percent send me an email. I think he had one of those in and so he went in and removed it and Google re-indexed pretty quickly. But I’ve seen stuff like this happen. I’ve actually moderately done it, moved a staging or development robot txt in there. I haven’t blocked an entire set like that but I have blocked directories that should not have been.
[11:42] Mike: The next thing you want to review is any site messages that are coming up. Along with the site messages you’re going to want to take a look at security issues. And site messages and security issues, I’m going to kind of lump them together even though they are in different places, essentially places where Google could put in messages to you about your site so if they are having any sort of issues connecting or if they identify any security problems with your site so if you’re running specific software that they have been told about and they’ve added it into their crawlers to be able to recognize when there are security issues. Because there are people out there who will use Google to search for sites that are vulnerable to specific vulnerabilities. So whether it’s WordPress and they say, oh well if you’re using this version of a WordPress plug in, I want to know about it then I can go out and exploit it. And Google knows that people use their search engine for this kind of thing so they do put stuff in there that will try and identify that stuff. But it you don’t have Google Webmaster tools installed and running, it’s not going to be able to notify you of these types of things.
[12:38] Rob: Last week Google announced that they are now going to be using SSL as a ranking factor and I’d imagine that would be added to Google Webmaster tools at some point. Whether you have SSL or how that’s impacting you. There’s a really good look at that on the Software Promotions blog. That’s softwarepromotions.com slash news. Dave has a blog post called SSL and SEO don’t panic. The nice part is that if you have SSL then you’re ahead of the game. The bummer part is, like I have SSL on HitTail and Drip but, it’s on the marketing site and everything but they want like 2048 bit SSL and I don’t have that industrial strength stuff in place so I’m going to have to buy new certs.
[13:18] Mike: Well 2048 bit SSL is going to be mandated but I think there is a date where they are cutting it off and after that they are only issuing the 2048 bit SSL search indicates.
[13:29] Rob: Yeah. Got it. So, VeriSign and GoDaddy and all those SSL cert vendors, I’ll bet they’re making a mint on this as everyone comes in and re-buys or buys new ones. And I do feel bad if you’re selling a WordPress blog and you have a SaaS website and you don’t have all your links set up to do this, it’s kind of a pain to retrofit a site and go through and make sure everything is relative.
[13:51] Mike: Yeah, most of the certificate vendors offer free re-issues of certificates. So if you have a certificate that doesn’t expire for another six months or a year or something like that, usually you can go back to them and re-issue the certificate and you should be able to get a higher level of encryption. But I think it might depend on the vendor and kind of how much of a discount vendor they are.
[14:09] Rob: Yeah, well that’s good. I didn’t know that at all, I’ll have to look into that.
[14:12] Mike: Did you know there was a thing called Bing Webmaster tools?
[14:15] Rob: I did.
[14:16] Mike: So, apparently Bing has their own Bing Webmaster Tools. There’s a variety of information in there that you can get. The one thing to keep in mind when we’re talking through the Bing Webmaster tools piece of it is they only have about 15 percent of the searches as opposed to the 65 percent of the market that Google has. So they have significantly less data that they’re going off of but there’s still some key pieces in here that people can take away. So the first one is to use their SEO reports and using those you can automatically scan your website every two weeks. And, they will report back to you what they feel are the 15 SEO best practices for on page optimization. And these are the types of things you can get from MOZ or a variety of other tools as well, but they will essentially do it every two weeks. And they’ll show you the severity of the problems that they identified, the number of errors, page counts, the pages themselves and it will even show you highlighted html snip-its of those problem pages – so it directs you to exactly where you need to go to fix any of the problems it finds.
[15:16]The second thing you can do in there is use there link explorer to find backlinks and if you’re not already paying for a tool like MOZ it will provide you up to one thousand backlinks. Paid tools offer you obviously a lot more than this but if you’re not quite to that level yet, then using something like link explorer can kind of get you to part of the way until you’re at the point where your site is making enough money that you can justify putting money in on a monthly basis to justify paying for a tool that starts tracking all your backlinks. The third thing that you can use it for is use the Bing key research tool and the main difference between this Google’s Keyword tool is that the Bing keyword tool gives you actual organic search queries, rather than just the number of queries that trigger the key word if it’s used in ad words –
[15:58] Rob: Can you imagine that? Actually giving us useful information? This is crazy. What is Bing doing?
[16:02] Mike: Well, they only got 15 percent of the market, they’ve got to do something.
[16:05] Rob: We’re number two, we try harder.
[16:07] Mike: That’s the big deal here, is that they give you the actual search queries in the Bing engine. Obviously it’s not worldwide or anything but you can kind of extrapolate that and say well if it’s 15 percent here then multiply it by what, seven and a half, something like that to figure out what the worldwide traffic is for those things. So I think that is a reasonable extrapolation, I’m sure there are cases where it completely falls down based on certain markets or the types of people who use Bing versus Google etcetera. But it can at least get you in the ballpark.
[16:36]And then the last thing in the Bing Webmaster tools is compare what you’re seeing in Bing against Google for a quick sanity check. Because there is always going to be things that Bing sees that Google doesn’t or that Google sees but Bing doesn’t. In the cases where they are showing you similar information, you want to be able to get some sort of a sanity check between them to figure out kind of what direction you should be going in and what you should listen to. And, whether or not one of them is completely off base or not because they might show you wildly different numbers and you have to read between the lines a little bit to figure out why Google is saying one thing and Bing is saying something else.
[17:09] Rob: Right and the idea here is that there are paid tools that can do some of this stuff but having two free tools that are actually pretty powerful and can give you insights to your website’s health is kind of nice to have. If you’re super limited on time then yes, only use Google’s. But if SEO is a huge part of your strategy then having both a Google and Bing Webmaster tools account and making it a point, putting even a 30 minute calendar reminder even if it’s once a month or once a quarter, for you to log into both of these skim through everything. I would say, if SEO is a critical part of your business then this should be a once a month thing. It may only take you five minutes for each of these webmaster tools accounts to zip through if nothing is wrong. But when you find something that is wrong, you’re going to be able to preemptively fight it and if you just have that recurring thing on your calendar it is going to save you time at some point and you’re going to be thankful that you are investing that time.
[18:01] Mike: So let’s move on to the next one. The next one is Google Analytics and what you want to use Google Analytics for at the very least to review your landing pages traffic levels. One thing I found is pretty helpful is that if you compare last week to the last month. And essentially what it does is it allows you to identify some sort of trends within the traffic levels and whether or not your landing pages are gaining traffic or losing traffic. Within the last week it will help you gauge whether or not you’re getting any kind of traffic spikes or when those traffic spikes were based on some of the different marketing campaigns that you’ve done. And if you don’t have landing pages, you need to make some. Because this is where you can get a lot of your targeted leads. Landing pages are where you typically capture an email address from people and then use it to follow up on them either with a newsletter or direct email campaigns and things like that.
[18:49] Rob: But landing pages in analytics is different. It’s actually just saying these are the pages that people first landed on in your website. So sometimes it may just be a blog post. However someone first found you during this time period.
[19:03] Mike: Yeah, that’s true. You could use it for that too. But I was referring specifically to looking at the traffic levels for the landing pages that you set up and whether or not you’re driving traffic to those. Obviously if you’re doing paid adwords campaign or paid advertising of any kind and driving traffic to those pages, it may very well be that you decided to stop doing something like that and maybe something got turned on and you didn’t realize it and you’re still paying for something that you wanted to turn off. So, at least by reviewing the landing pages that you are actively trying to push people to then you get more of that information and you get a bigger picture of what’s going on. And as Rob said earlier you can also set up custom alerts inside Google analytics to notify you of traffic spikes or traffic nose dives because it looks at the data and keeps an eye on it notifies you when it recognizes things that match certain criteria that you set up.
[19:54] Rob: Yeah, I have these on several of my sites. You have to tweak with them a bit because you’d be surprised how much your traffic goes up and down. And so I think I set a threshold of ten percent when I first started but then every week or every day I was getting this email when it was down. So if you’re getting it every day then you start to ignore it, then I had to move it up to 25 percent swing week over week. You have to find out what number works for you. You don’t want to make it too big because then you lose too much traffic before you get notified. But if you make it too small you kind of become numb to the number of emails they send you.
[20:24] Mike: The other thing you can do is you can set it up so that those are small enough so they are riding on the edge and have those emails go to a VA who logs in an looks at them for you and then if it’s really out of whack they notify you – kind of like an escalation.
[20:38]The fourth item on our list is to disavow shady inbound links and both Google and Bing support this ability. So if there are websites that are linking to you which are collectively shady websites they might be linking to you and bringing down your page ranks. If that’s the case or there are things that you’ve done in the past where they were definitely black hat and you’re trying to right the ship, so to speak. You can go in and you can disavow those links. I’ve never had to do this, Rob have you ever had to do this before?
[21:07] Rob: No, I haven’t either.
[21:08] Mike: Okay.
[21:09] Rob: When I acquire HitTail and then Panda and Penquin came out, there were links that were built under Google’s guidelines that suddenly became, quote, unquote bad links. People used to have contests back in the days and they would say put our badge on your website, right? And so from every page of your site you get all these backlinks and that created value for you. And HitTail had something like that like a badge or widget that people could visually put on. And once Panda and Penguin came out, that started negatively impacting it. But they didn’t offer the disavowed shady inbound links at that point. It was another 6 months or 12 months before you could do it. I would have gone in an disavowed a bunch of them but what I did is, I talked to a SEO guy and then I tried to find places that were linking to me and I thought were negatively impacting the signal and we manually contacted them and asked them to remove the widget. And enough people did and I guess I built enough healthy links or authority links after that that it just kind of went away. There was a warning for a little while, it wasn’t a manual action but it was basically saying, in webmaster tools that you have too many links from these multi-page blogs that were negatively impacting stuff. So while I haven’t disavowed anything I would have at that point were it available.
[22:20]Now I also heard anecdotally that you really want to use this with caution. I think it’s easy to over do it and panic and think that every link is bad and then disavow a bunch of links that can have a real negative impact on your ranking so I would use this with caution. Probably consult with someone who knows what they are doing before doing this.
[22:36] Mike: So the fifth item in our list is to review the MOZ ranking factors. And what those are, every 2 years MOZ will go out and they survey 120 leading search marketers and they provide their opinions on what the different ranking factors are that are used by search engines. So they essentially come up with this list and compile it and kind of aggregate between the different people about what their opinions are and what Google and Bing and other search engines are using as the ranking factors for people’s websites.
[23:06]And if you go out to the MOZ.com/search/ranking/factors you’ll see this list and it’s a list of about 80 different things and they are weighted as well. So the very first one is the page authority followed by number of Google plus ones and the number of unique C blocks that are linking to the page etcetera. And you just go down this list and start looking at the first 20 to 30 things to see if you’re concentrating on the wrong things in your marketing effort, because really you want to concentrate on the things that are going to give you the most value, the biggest boost for your page rank. If you’re not concentrating on the top 20 or 30 things then obviously you can go down to the bottom of the list and there are some things that will negatively impact your website. For example the response time of the web page in seconds. If it’s too low then Google will actually start dinging you for those types of things. So you do want to be careful about what sorts of things you are paying attention to and which ranking factors you’re not.
[24:00] Rob: Did you notice the URL length in characters can also have a negative impact. And, total length of your full domain can have a negative impact. Pretty crazy stuff. And this is stuff that Google never talks about and in fact, when people have brought it up specifically because they will look at the MOZ list which is from MOz’s own research, people will bring this up and Google will say no, that’s not true or that doesn’t work, but that’s how the stats are showing. So, I don’t know what to make of that.
[24:27] Mike: Yeah, I do wonder about that, because I have a lot of auto-generated content where the page URLs tend to be fairly lengthy and I’ve actually gotten into some trouble here and there just because I’ve run into cases where the URL length ends up being 250 characters long and it got too big and the application crashed and said windows barfed on it and we’re not going to allow you to create a file more than this number of characters long, it’s like whoops. So I can see how Google would go in and say we’re not going to pay as much attention to these web pages that have a URL that’s too long.
[25:02] Rob: Right. You have to take this list with a grain of salt because it’s all correlation rather than causation, it’s hard to prove that but MOZ has been doing this for a lot of years and they have more data than anybody I know of on this. So it’s definitely useful to see the factors that impact both positive and negative aspects of ranking.
[25:21] Mike: And the last thing on our list is check your domain authority using something like Moz’s open site explorer. It used to be at opensiteexplorer.org but I think they moved it on to the moz.com domain. So using the opensiteexplorer it’ll give you an idea of what your domain authority is. You can even plug it in and have it go to specific pages and tell you what the page authority is all this information is also embedded inside of Moz, so if you have a Moz account you can get a lot more information on it. But they also link back to things like social metrics, like Facebook, Twitter and Google plus information that is linked back to your website. There’s a lot of good information that is embedded in there, obviously this informations free its an attempt to get you to buy in to a Moz subscription which I have one, Rob, I think you have one as well. They do have a lot of good information that is freely available on the opensiteexplorer, but you do get a heck of a lot more once you subscribe to Moz.
[26:15]And I think the last thing I wanted to bring up is, I wasn’t going to mention this because it is listed as the very last thing on the Moz ranking factors but I did realize it’s listed there as a negative. If you have a low website speed they will actually ding you for it, it’s not as if it’s slow they are going to give you a zero. They are actually going to take away points from your website ranking for this. If you have a slow website, it’s definitely something you want to take a look at. There’s a free tool out there. You can go to tools.pingdom.com, plug in your website and it will show you all of the different things that are on your website that are loading and it will tell you the time that it takes to request that from the server. It’ll tell you the time it takes to download it and then display it. It’s got a very lengthy graph if you’ve got a lot of elements on your website. Take a look at it, it’s free, it allows you to drill in and figure out what sorts of things are taking the most time on your website and give you at least an idea of how to fix those things.
[27:10] Rob: Yeah and be careful when you’re going through and fixing based on their suggestions. I did this about a year ago, based on some advice from my SEO guy and some of the compression and stuff that they ask you to do can break things. They asked for some gzip compression and there was some Javascript that worked fine but there was CSS compression and things started looking quirky but only in a weird mobile browser. Suddenly we started having issues so I had to back a bunch of it out – it was kind of a pain. You just can’t take this advice that they give you whether it’s from Pingdom or from any tool telling you how to speed up your website. Sometimes it’s not without cost. All the tools that are improving time are not necessarily being aware of not breaking your site in some UIs.
[27:57] Mike: There’s definitely a difference between something that’s more of an optimization than something else that is fixing an error or some kind. So if you’re getting 404 errors for elements that are on your page because it’s requesting CSS files that don’t exist, or anything like that, obviously those things will make it easier for that site to be pulled down to the client, but then there’s are other things like you said the Gzip stuff that could out right break your site just because it’s not able to pull that in. So if you listen to all this and you’re still a little bit strapped for time. If you don’t want to go through a lot of these steps – for the truly lazy there are 2 websites you can go to. There’s SEOsitecheckup.com and quicksprout.com. And both of those you can plug in your website and get a free SEO check up report. And they give you a lot of helpful information that tells you the sorts of things that you should pay attention to. If you haven’t really done very much website optimization and you’re looking for a very quick checkup to give you some ideas of what areas you should focus on go to both of those tools. Try to match up between them what things overlap and those are probably the things you should pay attention to first and then you can go back and take a look at the other things they recommend and decide if they whether or not they make sense for your site or not.
[29:06] Rob: The nice part about running a bunch of these tools, especially the free ones, is there’s always something new you don’t know about and that’s the nice part and not nice part. Because the nice part is you can then go fix it but of course it’s adding something else to your to do list. And you have to weigh all this stuff. If you’re not getting much traffic from SEO or organic traffic doesn’t convert very well for you, then you’re going to want to spend a lot less time doing this. And you’re going to want to do the 80 20 of the stuff, right. Cause you can go off forever and kill hours, weeks of time on this. But taking the low hanging fruit out is going to accomplish the majority of your goals and seriously help improve your rankings. Not just for your head keywords and your home page but your overall – if you put out a lot of content it kind of lifts your entire domain authority if you can improve some of these issues.
[29:55]And that wraps us up for today. If you have a question 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. Subscribe to us in iTunes by searching for startups or by our RSS startupsfortherestofus.com where you’ll also find a full transcript of each episode. Thanks for listening, we’ll see you next time.
Episode 197 | How to Sell a Web Application (with Guest Thomas Smale)
Show Notes
- Thomas’ company, FE International
- Thomas’ guest post on Rob’s blog on how to build a SaaS business you can sell
- The post Thomas referenced on how to value an online business
Transcript
[00:00] Rob: In this episode of Startups for the Rest of Us Mike and I discuss how to sell a web application with guest Thomas Smale. This is Start-ups for the Rest of Us, episode 197.
[00:09] Music
[00:17] 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 build your first product or you’re 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. What’s the word this week, sir?
[00:31] Mike: Just before we got on this podcast I was interviewing somebody on oDesk to hire them to do some development on AuditShark. Get to the end of the interview and I was like, “Okay. So explain this all to you. Do you have any questions for me?” “No, no questions.” “Is this something that you’re interested in?” and he’s like, “Well, not really.”
[00:49] Rob: Wow, so he just turned it down?
[00:51] Mike: I hadn’t even gotten to the point where I was actually selecting a candidate, but yeah. He just said, “Yeah, it just sounds like I’m not really interested in doing the work that you want.” I’m like, “Alright.”
[00:58] Rob: Saves you time.
[00:59] Mike: Normally there’s people who’d be upset over that, but I was just like, “Man, thank you so much for saying you’re not interested, because you just saved me so much time and effort that I probably would have had to sink into this ongoing relationship.” I’m thankful he was upfront and just said, “Yeah, I’m not interested.” Move on.
[01:13] Rob: Rather than leading you on and then dropping off the map and not responding to your emails, you know, which is typically what happens.
[01:19] Mike: So I’ve learned to start asking that question though, because it really helps weed people out. Because if they’re not interested, that’s fine.
[01:26] Rob: Right. So Drip 2.0 is what I’m calling it. That’s all launched now, and that’s basically Drip with all the light-weight marketing automation built in. So Drip is now becoming a tool that is, I’m considering it it’s like an above MailChimp and Aweber in terms of power, and it’s below the Infusionsoft and the OfficeAutopilots. It’s gotten a lot of really good publicity. I published a couple blog posts in the past week.
[01:50] One on the Drip blog that’s about how marketing automation is the future of email marketing, and the other one that I was surprised as much uptake it got is called the Biggest Gamble of Your Career. It’s over on softwarebyrob.com. It’s the first real blog post that I’ve done on my journey, because I tend to now document what I’m doing on this podcast. I really stopped blogging like I used to maybe 18 months ago, two years, I really slowed it down.
[02:13] This is kind of the first revealing of what’s been going on behind the scenes that I’ve done in a long time, and it sure seemed to strike a nerve with folks. It got a lot of shares and sent quite a lot of interested folks to try out Drip, so it feels really good. I mean this is something we’ve been working on since January, and finally to get it live last month and then really be able to start promoting it. Feels like we’ve hit another milestone with Drip.
[02:36] Mike: Very cool. What else you got going on?
[02:38] Rob: We got a tweet from My Egg Noodles, and he says, “A question I’d love to see you address on your podcast. Should your first hire focus on sales or marketing, or on product? The founder is comfortable with both. It would be good to get your thoughts on all product types.” What do you think about that?
[02:54] Mike: Well, I guess it depends on whether you’re- by comfortable, what does that really mean? Are you much better at one or the other? I think I’d look for the things that you procrastinate on doing and find somebody to do those.
[03:06] Rob: That’s a good way to look at it. The other thing- the other it depends is how far along is your app? Because some apps, or products as he said, because it may not necessarily be software, some products they become done. They become mature after a while. They may only be a single feature, and they just do it really well, and you don’t need to build much else. So if you hit that point then there’s really not a lot of ongoing development on it, whereas other products become more complicated and you branch into new audiences and they need a lot of development.
[03:37] I think if you’re in a market where you have competitors, and you’re trying to stay ahead of them in terms of product development, or you just know you have a lot feature requests from serious customers and you need to build a lot of stuff, I would have to say that I would lean towards hiring someone to do product while the founder does the sales and marketing. Of course it’s not the case in every case. I think like with HitTail, as an example, after I fixed a bunch of bugs couple years ago after I first acquired it, it didn’t need a ton of new features. So if I would have hired anyone, it would have been sales and marketing, because it just didn’t have that dire need of product development. I think product development for product development’s sake is a big mistake that some founders make. They just want to build more features because, well, that’s what we do, right? We’re creators, and a lot of times if you’re satisfying a market and you have that fit, you don’t necessarily need that new feature. It’s not actually going to move the needle for you at all.
[04:28] Mike: Yeah, I mean sometimes those new features can just cause more problems for you than anything else, because then it creates confusion over what the product does. I would almost say that in some ways MailChimp falls into this category for marketing automation. They’re great as an email service provider, but they came out with Mandrill, I think it was, for sending out transactional emails, and I never even looked at it, because I knew that I was just like, “Oh, well it’s MailChimp. That’s what they do is they do mass emails.” So it wasn’t to me their core focus. They may very well do it perfectly fine and maybe even better than other people at it, but I never even gave them a second look because that’s not what I knew them for.
[05:08] Music
[05:11] Rob: Today we interviewed Thomas Smale. He’s a website broker who runs FE International. Very pleased today to have Thomas Smale with us on the line. Thomas, thanks so much for staying up late there in the UK to join us on the podcast.
[05:26] Thomas: Yeah, hey. Thanks so much.
[05:27] Rob: So Thomas is a website broker. He runs FE International. They broker the purchases and sales of SaaS apps, downloadable software, WordPress plugins. Thomas, I’m assuming you also do niche sites, e-commerce, the whole gamut of web properties. Is that right?
[05:46] Thomas: Yeah we do all sorts if it’s online, we’ll do it. But we’ve done quite a lot of SaaS related apps recently.
[05:52] Rob: I really like the way Thomas operates. He’s very knowledgeable in terms of the buying and selling process. I like that he’s, unlike some other brokers that I’ve dealt with, he is very upfront with his thoughts and just seem to be very knowledgeable when I’ve dealt with him. I have looked at a few things that he’s had for sale. I haven’t acquired anything recently. I’ve also referred a few friends of the show will email and say, “Hey, I’m in a… and I need to sell an app. What should I do?” and I typically refer them over to Thomas, just because I do trust that he’s going to handle everybody with kid gloves. So that’s why I wanted to have him on was to lend deeper insight, because though I’ve bought and sold a lot of apps and sites over the past several years, Thomas does this every day, and he has a company with six employees. Thomas you said you have six employees in London alone. Tell us where you have offices now.
[06:38] Thomas: Yes, we’ve got an office in London. We’ve got a couple of guys who work out of Europe. They work from home. We’ve got a small office in San Diego, and we’re also in the process of setting up an office in Boston. So there’s eight, nine of us at the moment, and we’re kind of actively hiring probably to fifteen within the next six months or so.
[06:57] Rob: Right, so you’re still quite a bit- I mean, you’re a start-up.
[06:59] Thomas: I guess with an advisory business you don’t necessarily need tons of staff. It’s more of a high-end service, I guess, rather than man-hours.
[07:09] Rob: Right. I kind of want to limit the conversation since our audience tends to focus on software. Like talk about SaaS, downloadable software, WordPress plugins, add-ons, that type of thing and not talk so much about e-commerce, niche sites and info products. I’d like to take it from a couple perspectives. I think we’ll start off with someone who is thinking about selling an app, because I get so many more of those requests than I do of people who are thinking about buying apps. But I think I’d like to maybe start off with, I guess, your credentials in terms of like, how many apps do you broker in a year buying and selling? Or how many total have you brokered? What numbers do you have to give us an idea of your experience level?
[07:48] Thomas: Yeah, sure. We’ve been around around four years now. I think the company’s been focused on brokerage for the last two, at least, maybe three. I’ve always brokered prior to that, and currently we also run a few of our own sites. I’ve run software products apps myself, so kind of got a wide range of experience. In terms of deal experience, last year I believe we did 78 transactions, but I’m generally speaking the size of those should be anywhere from 20, 30 thousand all the way up to the low 7 figure range. This year-to-date I believe we’ve done around 40 sales, total volume around 4 million. So we’re probably tracking by the end of the year 7, 8 million in sales, maybe 10, depending on how we get on. Then I would say of that 25 to 35% would be SaaS or apps, or whatever, and then the rest is quite evenly distributed across niche sites and e-commerce. So I’d probably say 20 apps a year.
[08:50] Rob: Couple apps a month, which is quite a bit a volume, because, you know, when I first got into this buying and selling I felt like, “Oh, this is such a liquid market, and there’s all this stuff moving all the time.” But there really aren’t that many sales when you get up above the $20,000 range.
[09:03] Thomas: Yeah, certainly when it comes to apps. I know across, well we were speaking just before the show about the other brokers out there, there aren’t all that many established brokers in the space we operate would be 50,000 to a million is 95% of our business and the same for other business brokers in the space. I know that we, of all the businesses we do, we are quite specialist in apps, so the market really isn’t that liquid, especially when it comes to brokerage sales, whether there’s a bigger market privately, I don’t know. But I would certainly say you’re correct in saying that there’s not hundreds of thousands of apps selling every year, especially through brokers.
[09:42] Rob: Which side is weaker, the demand or the supply side? Meaning are there a lot of apps out there and not enough buyers, or there a lot of buyers and not enough apps?
[09:50] Thomas: Yeah, I would definitely say, especially in the last twelve months or so, we’ve seen a lot of demand for- with buyers that is- for apps, especially SaaS in particular, and there’s a recurring element popular with buyers, I guess that the cash flow is slightly easier to predict. Macro tend to kind of if you go up to being, it’s like public companies and SaaS companies are trading at high multiples, so I guess it’s attracting people down the scale. I guess on the supply side there is certainly a lack of quality supply. There’s certainly supply there, but whether or not there any good or not is kind of a different matter. I think my reasoning on there not being that many is there’s a little bit of a grey area between- our average business will have anywhere from 100,000 to, say, 2 million a year in revenue, which is a kind of area that attracts a broker is too small for a merger and acquisition, small advisory firm.
[10:43] Anything smaller than that, it’s just not really big enough for a broker by the time you’ve gone through the process. As soon as you’ve got anything off the ground, once you start scaling through the process you can get to the stage where you might be looking to raise funding. So maybe as soon as you hit, say, a million dollars in revenue you might want to start raising funding. I think a lot of people as well, if you get to the stage where you’re making, let’s say, a couple of hundred thousand a year net, the exit isn’t always necessarily that attractive, because you tend to find with SaaS or software products in particular there’s a lot of burden on development up front. You can put two years into development before it’s even ready to go. So actually letting go of it- if you compare it to a niche site, where you might put 50 pages of content, build some links, and then it could be quite profitable, certainly wouldn’t really require any upfront work. It’s quite hard to let a business go for three times multiple, or whatever they’re selling for.
[11:37] So overall there’s definitely some solid and strong consistent buyer demand, and it think increasing as well. But then on the sales side there’s definitely a lack of quality supply. There’s certainly out there people looking to sell apps, but they might not be profitable, and that’s not really what I deal with. There may well be a more liquid market lower end, kind of a starter pathway. Where you’ve built the software, but it’s not profitable yet.
[12:02] Mike: It seems like there would be this large number of people who build an app, but they don’t really have an audience or they’re not able to get the sales, so they’ve got almost nothing to show for it. There’s no revenue there, so as you said, it’s not attractive to a broker. But if they can get things rolling, if it is a SaaS app and they’re able to get to a certain point it seems like if they’re able to 100, 200 thousand dollars a year in revenue then the inclination for people would be to grow that as high as they possibly can, which may very well take it kind of out of that brokerage space. I wonder if that’s some of the issue that you’re running into there.
[12:34] Thomas: Yeah, exactly. That some of what I was trying to explain. I think you get to a little bit of a grey area where it’s sort of a smaller, not profitable, so a least for a broker it’s not particularly attractive. And then beyond that, if you’re growing year on year and the business is going well why sell? Probably the most common reason we’ve seen people sell perfectly profitable businesses lately, I’d say the first reason would be the general time of commitment. They might have a full-time job, they might have another business, or they got other personal issue, whatever you want to call it. Then the other one, which is quite common, especially with people with a technical background, is they get it to a certain level, we tend to see maybe 100 to 500 thousand in revenue, so not insignificant, but not multimillion dollar exit stage. But because they have a software, financial background they don’t have that sales ability, so pushing it beyond the initial 100 to 200 customers is beyond their expertise, and you’re in that little bit of a grey area outside the “sell it” or “figure out a way to sell”. For a lot of people, especially technical founders, they tend to find that selling it and then starting something new is what they prefer to do.
[13:42] Rob: Yeah. That’s interesting. There’s a couple points that you raised that I’d like to touch on. One is you mention valuations. You mentioned like a 3 X valuation. Talk us through what types of valuations you see things selling at, and that includes- I’m actually interested to hear the difference between the SaaS and software stuff versus the e-commerce and niche side and info product stuff.
[14:02] Thomas: Yeah, so valuation is, especially from the broker side, is one of those consistently debated topics. We do enough sales now that I’ve got a pretty good grasp on valuation of where business come in. Generally speaking, this is where a lot of confusion, because a lot of brokers or individuals do it in a different way, but generally a business is sold on a multiple of- this is a small business, whereas you get larger you tend to have a multiple of EBITDAR, which is a slightly different calculation. But for small businesses, so if you’re going for a business broker sub 2 or 3 million, it’s generally a multiple of SD or SDC, which is Seller Discretionary Earnings or Discretionary Cash-flow.
[14:41] That is effectively a calculation of the net profit of the business. So taking into account all your revenue and then take off your operating expenses and everything like that. Then you add back, which is kind of a financial way of representing how much the earner’s benefiting from the business, you add back in what the earner’s getting paid. So let’s say you have 500,000 a year in revenue, and then you’ve got 200,000 a year in costs. That might be payment processer, hosting, affiliates, refunds. Then you pay yourself 200,000 a year as an owner. That then get added back so the actual profit is higher than whatever. So obviously with a small business, generally speaking, again I’m not a tax accountant or a lawyer, but generally speaking the administer made the business look the least amount profitable as possible when it comes to taxes.
[15:29] So owners tend to pay themselves more than they need to, or they will takes some benefits in the business. So you might if you’re 500,000 take off 300,000 in genuine costs so you get to a net of 200,000, but also 300,000 in costs 100,000 is your own pay, your insurance, your car, so it increases to 300,000 in that case. That’s your baseline number, and that’s generally where, at least a good broker, should help you wouldn’t expect to do that calculation yourself. Generally you’d expect to send your broker your profit and loss account, whether that’s QuickBooks or whatever accounting you use, especially you’ve got bigger sidings at least 100,000 in revenue you would hope you’re doing your account properly in that respect. Then from there, you have the financials, which is obviously number one variable is your underlying SD number or the SDC, or whatever. Then that is multiplied by a number, and that number is determined by- the main factors would the sustainability of the business, so is it growing? Is it in decline? As a rule of thumb if the business is in decline you’d expect to get a lower multiple than a business that’s growing.
[16:39] Is the business really hands-on and personalized? So if I owned thomassmale.com and thomassmale.com was a software product that let people sell their businesses in an easier way, than that’s going to be a lot harder to sell than if I had sellmybusiness.com, which is a software product not attached to me about selling a business. So if there’s a personalized element to it, it can be a little bit more difficult, or if it’s got any particular alliance. So especially with technical founders you tend to find they are the ones doing all the programming, so if they developed it all themselves and there’s no backup program or thing like that, then that can restrict the multiple.
[17:15] Although I’ve certainly seen recently that’s becoming less of an issues, and the kind of buyers we’re seeing at least, tend to be quite happy with the technical burden, and they tend to know what they’re doing on that front. We would come to that as a broker, I would come to the multiple number. You certainly wouldn’t expect to do that yourself, and if you are hiring a broker it’s certainly worth asking around and making sure that whatever valuation you’re given is actually based on some form of precedent. The number we use is based on sales we’ve done, so we have an internal database for the deals we have done, and we track all the different variable in that deal to figure out what the multiple’s going to be. It’s a somewhat scientific approach, yet with a little bit of gut feeling. It might be I think it’s worth 3 times the SD number, but expect to be offered 2.5 times, for whatever reason, or maybe expect the cash-down number to be a 2 times level. We do it based off the transactions we’ve done recently. There are other methodologies. I just tend to find that I like to be honest to people and give them a number I actually think it’s going to sell at. There’s no point in quoting a number that I’ve never seen before. Then when you actually get to the number itself, I mean it’s very difficult to give it a blanket multiple, because it really does depend on the business. But all variables being equal with SaaS app, recently we’ve been seeing multiples of almost exactly 3 times, very rarely goes much above that, and it rarely goes below that.
[18:44] In the range of, say, 2 and a half to 3 times, and that’s of the SD number. What a lot of people don’t realize is that you do add back your own salary, so a lot of people think their business isn’t actually profitable, then their net might actually be zero, but they pay themselves 200,000 a year. So that business could actually be worth 600,000. One thing that some people get a little bit confused with, a bit of a misconception, is that any kind of underlying IP doesn’t add value, it’s literally just a multiple of your SD, SDC number. If you’ve got just any sort of IP generally does not add any value at all. A lot of people think you can take a multiple and then go, “Oh yeah, and the software source code is worth 100,000, the domain is worth 50,000.” I have seen people try that methodology, but in my experience that’s not how buyers work, at least.
[19:31] Rob: Right. Yeah, that’s something I’ve been trying to explain to people for a long, long time, because back in- as I started acquiring stuff in 2007, 8, and 9 is really when I started diving into it, quickly realized that money talks. Right? It’s the revenue, it’s the net profit that really speaks to it. As developers we might spend six months of our nights and weekends and then feel like we have something that’s worth something, and unfortunately, until you hit a point where you’re actually making a profit, it’s not. What I find interesting is I’ve- historically when people ask, “What’s the range of what a SaaS app or downloadable software might sell for?” and this is over the past several years, I always say between 1 and 3 X. 1 and 3 times net profit is what I’d say. I find it interesting that it’s up closer to 3. That actually feels like a decent multiple. That’s not a bad amount of money to get for your app.
[20:20] Thomas: Yeah, I mean one caviat I’d say is- I guess as far as brokers go, we’re very fussy what we take on. I like to keep a success rate that’s almost 100%. It’s very rare for us to take on something that doesn’t sell. So generally speaking, we’re not going to be talking on the lower quality apps that might sell for 1 time. There certainly are apps out there that would sell for 1 times, but that just wouldn’t be through us. I guess we’re somewhat spoiled in that anything we do list is going to be good quality, and it’s in our best interests obviously. Good buyers want to buy good businesses. It’s not to say that they don’t sell for 1 time to 1 and a half times, but if you sell in the right place, we generally expect to get 2 and a half to 3 times of all the verticals we look at. When we’re looking through our present transactions- we put together a blog post recently on comparables, so niche sites, e-commerce sites, service-based businesses, SaaS apps, are the highest multiples of all the different verticals we sell. We’ve got a reasonably good sample size, so I say that that with a high degree of confidence.
[21:22] Butmy thought on that is mainly because the recurring revenue factor, I think especially for buyers who are new to the space, if you’re looking at a worst case scenario and you’ve got the recurring revenues in there, even if you can’t grow the business at all, you’re still going to get a returner investment after X number of years just from the current clients, minus the churn. Whereas if you buy a niche sit that has all it’s traffic from search engines and it just relies on 50 articles, if your ranking drops, say, 50% overnight, you get hit by a Panda update or a Penguin update, or whatever, might even drop more than that. You’re then pretty much down to zero. Whereas at least for SaaS you’ve always got that client baseline. I’m borrowing any technical disasters, and assuming the quality is decent you should get quite a decent ROI without even having to grow it.
[22:10] Rob: Right. Your blog is at feinternation.com/blog and we’ll link that up in the show notes, because it’s a very in-depth article. I actually tweeted it when it came out, and it got a lot of attention on Twitter, because you do have data, right? You have data that nobody else does.
[22:27] Thomas: Yeah, it’s based off our data. Other brokers with other people might have different experiences, but that’s based on our internal data. Like I said, I think we’ve done enough sales that we have quite a high degree of confidence in that.
[22:38] Rob: Yeah, it’s kind of cool you have an example. You have a travel blog that sold at 1.5 X. You have photography software that sold at 3.7 X. Do you have multiples here based on category?
[22:49] Thomas: No, we don’t publish the multiples. What we published was an index, just because the multiples [crosstalk] don’t like to publicize, because if I started saying every SaaS business will sell at 3 times, and then I speak to someone and it’s actually worth 2 times because the product is their name and it’s on a bit of decline then it becomes a little bit of an issue. So we’ve used an index, and if you look at the index you can see that SaaS sells the highest.
[23:13] Rob: SaaS is highest. E-commerce is just below it. Membership and subscriptions is very close to e-commerce. Then you have content and media, which I’m assuming is like blogs and –
[23:23] Thomas: Yeah, and niche sites.
[23:24] Rob: Niche sites. Okay, and then lead gen is below that.
[23:25] Thomas: Yeah, one caveat is you have with that is, obviously, we’ve had to categorize it into the different things, and there is some crossover. But the way it’s categorized, if you read the post, kind of hopefully should make sense.
[23:36] Rob: Sure.
[23:38] Mike: So one of the things that you mentioned is the low-quality apps that people have. Obviously you’ve touched on a couple of different things as to why it would kind of drive the multiple down. What sorts of things should people address to help clean up their app if they’re looking to sell it, because obviously you want to sell it at the best possible rate that you can? So what are some of the things that people can, essentially, focus their efforts on to help improve the amount of money that they’re going to get from selling their app?
[24:04] Thomas: Yeah, that’s a good question. That’s actually, I don’t know if all of you read Rob’s blog, but that’s what I guest posted about a few months ago over there. It’s actually what I spend a lot of my time doing. I tend to be a first protocol for sellers when they come in the door inquiring about selling their business, so I like to spend a lot of time dealing with people who want to sell but aren’t necessarily quite ready. I might help them put together a plan for making it more sellable. I’m not necessarily going to sit there on the phones trying to sell more product for them, but I help them in getting to a position where it’s sellable. If you go through some of the key points, there’s actually tons of different things you can do, but if you want to focus on a few, the first one is transferability, how transferrable is everything. For example, payment processor, you can to go really down to the technical side of code, so if you’re a technical founder. You built it all yourself, you might have taught yourself programming, if you haven’t documented your code properly then that’s going to be difficult to transfer.
[25:03] Again, that’s the whole personalized side of things. If you’ve got your name all over it then it’s going to be a little bit harder to sell, and so look to depersonalize. We’ve done a few sales recently where people might get a lot of sales from their own blog or their own reputation, or whatever, so that’s something that will be into consideration when it comes to multiple. So depersonalize it as much as you can. Make sure if things transferrable so payment process kind of keep it clean. Try and keep the business consistent. A lot of people have this misconception that when you’re coming up to sale because your underlying net number is the most important, they try and bump it with fire sales, or trying to sell a load of annual subscriptions, or anything like that. So the actually worst thing you can do prior to sale is sell everybody on a 3 year subscription, because obviously when the buyer takes it over that’s not cash-flow they’re going to benefit from, and you tend to be expected to rebate that. So try and avoid selling really long annual subscriptions, because it can quite problematic, and just try and keep the business consistent. It’s good to see a business is on a general incline, but you don’t want to see anything that’s drastically jumped up. It just looks suspicious, and it’s very rare for that to be genuine.
[26:14] And vice versa don’t do anything stupid that will lose revenue. So if you’ve been meaning to do anything for a while, get it out the way. Just don’t try and sell it in a period when you’re in the middle of redesigning, or anything like that. Probably one of the biggest headaches for brokers is general documentation. When it comes to accounts, make sure your accounts in line. Ideally have them- something like QuickBooks or something similar. Hopefully you’ve got an accountant, or whatever, who can help you prepare those. Having your books in order is absolutely essential. We certainly don’t take on anything if you can’t provide accounts, and if you can’t prove those numbers. There’s no point in saying, “Hey, Oh! I make a million dollars a year.” But you can only prove 500,000. So make sure you can prove it all. Make sure it’s properly documented in an easy-to-understand way. It’s easier for a broker and easier for a buyer to understand if you’ve kept clean records. Then keep track of all your data, it’s something that you tend to find technical founders are quite good at. They might struggle on the sales side, if I’m making generalizations, but on the flip side when it comes to general data and metric tracking, they tend to be quite good. Simple things, like make sure you’ve got Google analytics on the site, or whatever analytics you want to use.
[27:24] Make sure you track conversions, track goals, track your financials properly, like what I was just saying, and track all your metrics. This is something that quite a few, especially smaller apps don’t seem to do, and that’s make sure you track your things like- a buyer will always want to know- we tend to provide a table, almost a page of general questions people are going to ask, particularly about SaaS businesses. That’s just basic things like know what your churn rate is, know what your customer lifetime value is, how long does the customer stay in months. There’s absolutely tons of things in there. Make sure you know. This is where a business that is a little bit older helps. If you’ve got a business that’s only 6 months old, it’s impossible for you to know lifetime value of your client. You got no idea how long anyone stays around. So the older it is and the more dates you’ve got the more likely you are to get a higher multiple, because it’s a little bit more predictable. You don’t necessarily need to be able to calculate that number yourself, but at least be able to provide that data to the broker.
[28:23] We spend a lot of time playing around with Excel, trying to like figure out these numbers, but it’s definitely important you can at least provide it. So don’t necessarily worry if you can’t work it out yourself, but track everything, and generally just try and be as transparent as possible. Don’t hold things back or try and hide things, because that really is something that can completely kill a sale. Probably the number one reason don’t sell is because its been so misrepresented. If you’re honest and upfront with the broker or with the buyer or whoever, you can generally find creative ways around problems. But if you try and hide things, that’s probably the number one reason it’s not going to sell.
[28:58] Rob: I like one of the other points you mentioned in that blog post on my blog was to build and utilize a mailing list. Since I own Drip, which is obviously a mailing list manager, I thought that was an interesting point. Having a mailing list is- I know it’s an asset, right? I’ve banked a lot on newsletters and having a list of folks over the years, but I guess I hadn’t thought that a potential buyer would necessarily value that.
[29:24] Thomas: Yeah, a mailing list can be quite a valuable asset. When you’re looking at mailing lists in general, just any sustainable part of the business, people say whether that’s a mailing list, whether it’s, I don’t know, say, a weekly webinar with your subscribers. Anything that kind of keeps people coming back or provides a sales funnel, so when it comes to mailing lists if you do a free trial, or whatever, if you’ve got a great process in place to convert people from a free trial to a paid account then that’s great. Whether that’s through a mailing list, whether it’s through webinars, whether it’s through telly sales, or whatever, just have things sustainable. I mentioned mailing lists as something that most people have but don’t really use very well. It’s surprising how many people have thousands of customers, but they’ve never emailed them. So even if you’re not the best salesman in the world at least email them once a month, even if you’re just linking out to general industry news, because people- buyers especially- if you’ve got an active mailing list it tends to be a positive signal that the product’s good. I would always be a little suspicious as a buyer if you say, “Hey, look. Yeah, everyone loves the product. We got a thousand customers, and they all love it.” But no one speaks to you, no one replies, you don’t email them. That’s where you can kind of get a few difficulties.
[30:34] Mike: So Thomas, when people are going through this process, roughly how long does it take to broker a sale, between the time that somebody first talks to you and the time that the application, or the product, is actually sold to a buyer?
[30:47] Thomas: The biggest headaches for me is that the actual process can be all over the place. So we’ve split into two parts, getting it ready for sale is where there’s all sorts of variants. It could be, if everything’s in order, and people have hopefully read that post I’ve put on Rob’s blog, and they’ve got everything in order it can take us two weeks to prep. Quite often people will come to me, and it might not be ready to sell at all, and there might be a two year gap. I was speaking to people four years ago who are coming back now saying, “Hey, look. I’ve gotten everything you’ve said.” Once you’re at the stage that it is sellable, so we’ll make that assumption, it generally takes us with SaaS businesses usually two weeks to prepare everything, so getting through the financials and getting through some initial questions, so like a kind of discovery phase. I tend to say to people, “We’ll work as fast as you do.” So if you provide everything, get through all the basic due diligence process before we list anything. So generally two weeks to get it to the sell stage.
[31:41] Depending on the size of it, how quickly you get offers kind of really depends where you sell. We would expect to see offers come in, assuming it’s not a huge business where they can take a little bit longer, you’d expect to see some offers within the first month. You’d generally expect to accept an offer by the end of month 2. That’s why there’s quite a big range. Sometimes you could get an offer within a week, other times it might take 6 weeks. The process from there, so let’s assume you’ve got an offer and taken it to the next stage, assuming you’ve qualified the buyer properly, or your broker has hopefully qualified the buyer properly to make sure they can actually complete on the sale, they’ve got the cash.
[32:20] They’re not going to run off scared or anything. You then get to a due diligence phase, which for, let’s say a $300,000 business, you would expect that to take 3 to 4 weeks, maybe a little bit less. It depends, again, on how well documented you are, and that’s just things like verifying your income, verifying your traffic, verifying your metrics, verifying your code base. All those kind of things, so expect due diligence to take 3 weeks, 4 weeks. It can be a lot quicker, but it’s definitely not a stage of the transaction you want to rush. Then from there you get into contract negotiations and hopefully if you’ve done everything properly, the vast majority of the major terms will be outlined in the initial LOI, which is a Letter of Intent, we use as kind of a formal offer. So you submit an LOI and then it’d be accepted as an offer, and this is where we would- we got an internal team full of legal experience who would draft a purchase agreement. Then we’re not lawyers, and you certainly not rely on your broker to say the contract is fine. Always speak to an independent legal, and then however long that takes. Generally not too long. We’ll get contracts out pretty quickly, depending on the complexity of it. Obviously some contracts can take longer than others. Assuming the broker’s done their job properly up-front, that process shouldn’t take too long. The transfer process with SaaS businesses, they tend to be one of the longest in terms of transfer time, just because they can be quite complicated. You’ve got recurring subscriptions in there, so sometimes it can take some time to transfer the payment process to get up to speed with everything.
[33:50] But that process, on average, I would say 2 weeks, and then from there you would obviously at that stage hopefully get paid. Then there’s generally going to be a support period. My general rule of thumb is 3 months, especially with technical SaaS products in the 6-figure range, but that’s really something that’s negotiated up-front. Generally you wouldn’t want to stay along much longer than that for free. It’s quite common to negotiate in a consulting period, be on that at a fixed rate. If you’re a technical founder you might agree to an hourly rate for technical work. You might say, “Hey, look. I want to sell the business because I haven’t got any time, but I’ll happily commit to coding future features for you at 100 bucks an hour.” So hopefully that’s sort of agreed up-front. The process on average is 3 to 4 months, but that’s a realistic average if you want to do everything properly. It certainly can be done quicker, but we tend to find that if we stick to a consistent process there are no nasty surprises along the way, which can happen if you try and rush it through in, say, 2 weeks.
[34:48] Mike: So it sounds like 6 months is really not all that bad, considering you hear about some of these larger acquisitions for multiple millions of dollars, and they take a year at least, sometimes 2 to figure out before it even comes to the public.
[35:02] Thomas: Yeah, absolutely. We would generally hope to get it sold quick in the 6 months, but if you bank for 6 months, that should be more than reasonable. I tend to say to people if that hasn’t sold in that time, which is quite rare with how fussy I am, but if something hasn’t sold in that time, it’s probably not going to sell at all, at least through that particular broker or sales channel.
[35:21] Rob: Very cool. Really appreciate your time today, Thomas. Where can folks get in touch with you if they want to find you on the web?
[35:30] Thomas: Yeah, so if you can go direct to our website, you got feinternational.com we’ve got a blog that you mentioned which is forward slash blog. My direct email now is Thomas, T-H-O-M-A-S, at FE International, but then if you go on our site you’ll see pages if you want to buy a site, we’ve got pages there, sell a site, the same if you generally want to contact. But if you email me I’m always happy to help people if they’re looking to kind of prepare for a sale, whether it’s 6 months, 12 months down the line. There’s no obligation. I don’t charge for that initial advice, and I’m generally, I like to think, quite friendly and responsive.
[36:03] Rob: Indeed. That’s what I’ve enjoyed about you. You respond to email at odd times of the day because you work until late.
[36:11] Thomas: Yeah, tend to have quite an international client base. I guess one of the problems for being an entrepreneur is you tend to be available 24/7.
[36:17] Rob: Yep, exactly. Well thanks again for coming on, Thomas, and I hope some folks get in touch with you.
[36:23] Thomas: Yeah, thanks very much.
[36:24] Mike: 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 at 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 196 | How to Use a VA in Your Startup
Show Notes
- Rob’s Drip Explainer Video for SaaS
- Rob’s Startup VA Course
- Episode 68: How to Hire and Manage a Virtual Assistant
- Tier 1 email support
- Chat support
- Filtering your email
- Calendar mgmt and appointment scheduling
- Travel arrangement or planning
- Data entry
- competitor research
- lead generation / prospect research
- transcribe audio or video
- (HT) article approval
- audio/video editing (screencast editing, marketing vs documentation)
- Publish audio/video to blog
- Blog publishing management
- Twitter/Facebook/social media presence
- Turn blog posts into emails
- moderate blog comments
- find images for blog posts
- slide presentations
- proofreading/editing
- checking voicemail
- sending client invoices
- Upload videos to youtube or other
- Create slideshare presentations
- Migrating from one software tool to another (MailChimp to Drip, InDinero to Outright)
- Member management for membership website
- Concierge service for your app (installing tracking code for free, 5-day email mini course compilation)
Transcript
[00:00] Rob: In this episode of Startups for the Rest of Us, Mike and I discuss how to use a VA in your start-up. This is Startups for the Rest of Us, episode 196.
[00:08] Music
[00:15] 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 you’re 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?
[00:30] Mike: I’m getting ready to go on vacation next week. It kind of sucks because I’ve got a new version of the website for AuditShark that kind of really focuses on the desktop edition that I want to push live; but I don’t really want to push it live and then go on vacation for a week.
[00:43] Rob: Yeah, and you could potentially introduce 404’s or introduce something that Google – if it misindexes it and you’re not there and you don’t notice it. Because anytime I push a new site live, I’m going to be in Webmaster Tools once a day, just to kind of give it a once over and be like do I have any errors going on or anything like that, so. I probably wouldn’t do it, either.
[01:01] Mike: The thing is my build process pushes everything to a development area and then if everything is okay it copies it over to production; and right now my development area is having DLL issues. It just can’t figure out what’s what. I’m concerned about fixing it and then pushing it over to the live server because who knows what the heck’s going to happen there.
[01:20] Rob: I have a couple updates. One is, you know, we’ve rewritten HitTail and Rails but namely I couldn’t find developers to do classic ASP; so I wound up doing all the changes. You don’t have time and so stuff that needed to get fixed wasn’t getting fixed because it would sit in my queue and I have, frankly, more important things to do. So, couldn’t find developers; the servers were expensive and now I have three Rails dev’s, so it just made sense. It took just about two months of code time to completely rewrite it in Rails, which I was pleased with, that was the estimate. Then it took about another three to four weeks of other detail stuff, like getting the migration going, because you remember the database is really high IO and it’s about 200 gigs in size, so very hard to move. You know you can’t just back it up and put it across the wire. What do you think the fastest way is? We literally spent probably two weeks trying all these different ways to move that across the wire because we didn’t want to put it on a hard drive and FedEx it again. So what do you think the fastest way is to accomplish that?
[02:23] Mike: Do you have to move everything over, all at the same time? Is that the issue?
[02:27] Rob: Yeah. We do. We did it last night. So, yeah, we had about, let’s say a 10-hour window to move it all.
[02:33] Mike: I don’t know what you actually did. I probably would have thought about maybe writing some sort of little extension or something like that that runs on the current server so that you could call to it from the other one and make your queries from there, until you get all the data moved over.
[02:47] Rob: Yeah.
[02:48] Mike: That’s probably what I would have tried. I don’t know how well it would have worked, though, because you are using ASP. You probably could have thrown like a .net handler or something like that on there and it probably wouldn’t have been a big deal.
[02:57] Rob: We tried that. Yeah, we did that.
[02:58] Mike: Did you?
[02:59] Rob: We did that. And I did it in .net. Yeah, essentially that and it wasn’t fast enough, but that was the first thing we tried as well. We started doing exports and trying to figure out a way to get the data out because the biggest bulk of the 200 gigs is indexes, and it’s all the stuff that comes with the database and since we’re moving it from SQL Server into PostGres, you don’t need that, right? You’re not just going to copy it across and restore it. You just need the data out of it so we tried the remote copy, like you said, across the wire. Then I started writing a little thing to basically do a dump of insert statements, kind of like when you do a MySQL dump, how it just writes out insert statements into a text file? I did that and there’s about 180 million rows in one of the tables so we did that and tried to break it up into 10 million rows at a time and then Zip those files and then FTP them and then import them and that was taking a really long time to run so we kept honing on that and in the end we found that the biggest hang up was on the insert side, right? Inserting into PostGres, not actually getting it out of the database. So we found out that PostGres has just a basic copy to function, right? So it’s just a bulk import and you have to put it in a certain CSV format and in the end that was it. The end file for the biggest table was 150 million rows in CSV file,15 gigs CSV, and the punch line is that Zipping it would have taken longer than just copying it across the wire because the connection between Amazon EC2 and our old host was so fast, because they’re both in Virginia and they must both be on trunk lines. It took like six minutes to copy a 15 gig file across. So it’s crazy. So we didn’t even have to zip it and then it took 30 minutes to copy it in. So, it was cool.
[04:42] Mike: Interesting. Yeah, I know that if you’re inserting into a transactional database and if you can get away without the indexes, then you’re golden. I mean, it’s the indexes that take so long when you’re building those tables.
[04:55] Rob: That’s right.
[04:56] Mike: One of the things that I’ve found is, some of the enterprise software that I install, it just creates these one megabyte databases and then it expands it and it adds in like two or three gigs-worth of stuff, but in doing so it creates like 2 or 3 thousand chunks that are only one meg in size because of the way SQL Server is usually set up out of the box, and you have to do all this extra waiting time, and what I have found the easiest thing to do is pre-create the database and you allocate several gigs-worth of space more than you need. Then you just run the install and it will just push things in faster because it doesn’t have to reallocate space on disk.
[05:28] Rob: Right. Yeah. And we did, we actually dropped the indexes before inserting, just dumped it all in and then we had to recreate the indexes. So inserting took 20 minutes and creating the indexes took like six hours. That was my adventure last night, so by the time this goes live, which is about a week and a half away, we should have all the kinks worked out, still have a few minor issues, but it feels good to be closing down on the days of classic ASP. The other thing I did yesterday is I recorded an explainer video, you know one that kind of explains how your app works and what it does. It’s for the homepage of Drip, and I’ll link it up in the show notes. I did it with the figures that you move on and off and the hands are actually in the video. It was pretty fun, actually. It took a while. I need five of these videos because I’m creating a different one for each kind of niche or market I’m going after and I didn’t want to pay the bazillion dollars. After getting the first one done I kind of have a script that I can reuse and paper that I can reuse and all that stuff. I was shocked at how hard it was to find good artwork. That was probably the most time-consuming thing. Aside from the actual recording.
[06:28] Mike: I watched a preview of that video. It’s really well done. It was very seamless, first of all. It very clearly explained, in what? It was like a minute and 25 seconds, exactly what the problem was that it solved and it was very clear because you didn’t have to scan a wall of text and try and figure out if it was applicable to you because it was just like the first 15-20 seconds it really talked exactly to the pain point and it gives you that ability to clearly push your message in a much shorter time frame. As video, I think that it will capture people’s attention.
[07:01] Rob: Yeah, cool, thanks. I appreciate that. That was the intent. I have a long-form sales page now in Drip, but I was trying to figure out how to convey that Drip now handles marketing and trial emails and post-sample download emails, if you’re letting people download a sample chapter, and customer emails. It’s across that whole spectrum, trying to figure out the best way to communicate it. What I’ve noticed is that as I’ve talked one on one with people who are coming on with Drip, a lot of folks in my network – I’ll explain it to them via email and they’re kind of lukewarm, but then I’ll show them a screen cast of what it does and I’ll just kind of walk through a five-minute, seven-minute look at their specific use case and how I would implement it in Drip and almost every time people are like, oh my gosh, I’m leaving Mail Chimp or whatever other provider I’m on and I’m coming to Drip because of that. So I realized that there’s something about the actual demo and showing the concepts that I needed to do and I feel like screen casts are just a little bit too boring, right, for your home page? 80 seconds was my goal. I told the story instead and I’m pretty pleased with the way it turned out so far.
[08:04] Music
[08:07] Rob: We got an email from Jacob Norton, and he says, “Have you guys done an episode talking about how to use virtual assistants and when to get one? I’m thinking I’ll need one in the future, but I’m not sure what exactly I’d have them do or when I’d need one. I get the feeling I’d want to do too much on my own to make it worth it. I know you’ve done an episode on how to hire them, but I don’t recall this being discussed.”
[08:25] So, he’s referring back to episode 68, we talked about how to hire and manage a virtual assistant. Then I also created a video course, it’s up on Udemy, and that’s at startupvacourse.com, and there’s a lot in there about how to hire and there’s some in there about why you would need one and how to manage and how to delegate and all that kind of stuff.
[08:49] But today I wanted to talk through, basically some ideas of how to use a virtual assistant in your startups, specifically. If there’s one article I could recommend it’s chrisducker.com. You’ve heard of Chris Ducker, he’s an expert in the VA space. He runs a big virtual assistant staffing firm. He has a couple good ones. One is called “101 Ways to Use a Virtual Assistant”. I actually took some ideas from his as well; but frankly, most of the ideas in this episode are from my experience, and I’m sure, Mike, I know that you share a lot of these as well. It’s my experience using virtual assistants and how, the ways that I’ve found I’ve gotten the most benefit out of them as a startup founder.
[09:28] So we have 26 ways total. I was thinking that maybe first we’d start off, you know we had one question that was kind of parallel to this and he says, “when should you get one?” Do you have an opinion or thoughts on at what point you should think about getting a virtual assistant?
[09:43] Mike: I think it depends a lot on your situation. I think the inclination, for me, would be to start looking for one when you feel like you’re doing a lot of busy work. Whether that’s answering emails, looking at some of your different stats, if you’re going back and forth between a bunch of different platforms. What you can have a VA do is kind of aggregate some of that data. Anything that’s labor-intensive where you could theoretically write an application to do all that stuff for you but it’s not cost-effective to do it. Especially if it’s stuff that you’re only going to do once. So, for example, if you’re trying to gather data or do research of any kind. Those are all things that, yes, they take time, but they’re definitely things that you could outsource to a VA and have them do it. I would look to see what sorts of things you’re doing and wait until you get to a point where you’re going to probably regularly need one. I think that if you try and hire somebody and you bring them on, you have them do one or two tasks and then you never use them again or you don’t use them for six or eight weeks or something like that, your chances are really good that you’re going to experience a lot of turnover with those people. That’s good in the respect that it gets you experience delegating some of that stuff, but it’s bad in that you don’t necessarily get experience delegating to the same person over and over again.
[10:57]So you’re almost restarting the relationship every time you have to hire somebody for it. Then you get into the situation where you are spending so much time doing hiring that you’re not actually delegating enough stuff to them to make it worth your time investment. So part of it’s a learning experience and part of it is saving you time. And you kind of have to balance between the two.
[11:15] Rob: That’s a big part of it, I think, is finding someone that you can work with on an ongoing basis, even if it’s one or two hours a week, which is how I started with my very first virtual assistant. It was very low commitment, and it worked great. I didn’t have a ton of tasks at the time. I had enough money that it didn’t really matter to pay someone $5 or $10 an hour. I think it’s hard to be too early unless you have nothing that you could hand off to someone; but if you look at your task list, like Mike said, and you find that you have anything that you feel like someone else could do, especially someone who has kind of knowledge and administrative knowledge, I think that’s the time to start thinking about doing it because your time is limited, especially if you’re launching something on the side and so you need to try to take as much advantage of your hours as you can.
[12:00]I think the other thing I’ll say before we dive into the actual tasks that you can delegate is when I say virtual assistant, I don’t mean a specialist. I don’t mean a developer. I don’t mean a designer. I don’t mean a really, really good audio or video editor. I mean a general administrative virtual assistant, kind of like someone you would have working for you in an office, like an administrative assistant. Maybe a little more technical skill than that, but as soon as you get into someone writing code for you, then I call them a developer, I don’t call them a VA anymore and as soon as someone’s doing heavy design work for you, then in my mind they’re a designer. So, while I do have some light technical tasks in this list that we’ll cover, most of them do involve things that just a light technical person could do. If I’m going to hire a VA, it’s going to be for recurring tasks. That’s where you’re going to get the most value out of it because you can explain the task once and then every week, every month, it’s done for you.
[12:54]So, the number one item on my list is tier one e-mail support. That’s if you have an app or you sell an e-book or you have a membership website or a WordPress plugin, if you’re still handing your own support after maybe, let’s say a month or two after you go live, then, even if it’s only a trickle of e-mail, it’s not the time that you’re giving, it’s the distraction, right? The distraction is what you can’t afford to give to this stuff. So, that’s a point where I encourage a lot of people to get VA’s to help them with email support. And every time I’ve done it the person, I’ve heard this so many times, well, no I only get like an email a day or a few emails a week, it’s not that big of a deal and then as soon as they hire someone and it’s off their plate and they’re not answering the same questions over and over and doing non-founder activities, it’s always the same thing, it’s like wow I should have done that sooner.
[13:40] Mike: A lot of these tasks, you look at them and, at a glance you might think that you’re the only one who can do them because, especially when it comes to some of the e-mail support, for example. If you’ve got a very technical product, especially if you’re marketing to people and saying, hey, you get to talk directly to the developers, that’s something that you kind of have to not do when you’re outsourcing your tier one email support to a VA because they’re not a developer, so they’re not going to be able to answer some of those questions. As Rob said, anything where you’ve got this repetitive process in place, that is manually labor-intensive, and that can be data entry or it can be something where you have to have somebody interacting with your customers, either one of those it doesn’t matter, there’s obviously different skill levels involved, but you still have to have a human doing it. You can’t delegate it to a computer. That’s definitely a place where you can leverage a virtual assistant for answering some of those support e-mails.
[14:31] Rob: We used to do support for The Micropreneur Academy several years ago, and I hung on to that for a while because I felt like, man, this is our community, these are our people, how can I possibly find anyone who’s going to care as much about this as I do and answer these questions well; and we found someone. Andy is our support guy, and if you’ve emailed Academy support you’ve talked to Andy. And you know what, Andy does a better job than we’d do because he’s focused on it and that’s what he does all day is handle support. He handles support for that, Drip, and HitTail and he’s now a core part of my team. I wouldn’t have given him all that responsibility from day one, until I got to know him, but what you’ll find is that if you find someone who does a decent job, they’re probably going to do a better job than you will as a founder because you’re in so much of a hurry all the time that you can’t do the focused, step-by-step stuff that a virtual assistant, a trained one who’s actually focusing on things, can do probably better than you can.
[15:25] Mike: Well, the other thing is they can also afford to spend an extra five or ten minutes polishing up an email to send it to somebody who’s emailed in to support because they have the time to do it, whereas you’re distracted. I mean any time you’re answering those support emails you probably, not only have you got it in the back of your mind, “oh I’ve got to answer these support e-mails”, but then you go into start answering them and you have it in the back of your mind, “oh, I’ve got all these other things to do.” So you’re continually distracted when you’re trying to respond to these customers. So, you’re right, a virtual assistant is going to do it a lot better than you will, just because they’re not distracted.
[15:56] Rob: The second task you can think about delegating is chat support. So if you have like a chat widget on your website, this is another no-brainer one. You’ve got to train your VA and teach them how to answer questions, and answer questions specific to your app so they don’t always have to say, “well, we’ll have someone contact you”. If you get someone decent then they can definitely monitor this during business hours.
[16:17]The third task is filtering through your e-mail. This is one I haven’t done. I’m thinking not support e-mail but actually going into your G-mail account and deleting stuff that’s irrelevant and taking a lot of the work off your plate. Have you done this, Mike?
[16:30] Mike: I have, in a way. So I’ll argue that you actually have. So, you subscribe to a service called Unroll Me.
[16:38] Rob: That’s right.
[16:39] Mike: So that’s essentially Unroll Me going in and automatically figuring out what it should roll up and aggregate and present to you in a list that basically shows you a bunch of e-mails that are probably not nearly as important as a lot of the other ones. And if you think about it, in a way, you’ve outsourced part of your email in that mechanism.
[16:57] Rob: All right. Good point. I know folks who actually have virtual assistants who, you know, in Gmail you can give someone non-administrative access to your G-mail. So they can’t do all the settings, but that they can log in and filter and label and reply and do that kind of stuff. I have absolutely toyed with this idea many, many times but every time I do I go through my inbox and I realize I don’t know how I would delegate any of these emails that are left’ but every year around the first of January when we do our goals episode and I do the retreat, I try to think about how I can make this work. And so I think one of these years it’s going to be something I dive into. Another thing you can outsource to VA’s is calendar management and appointment scheduling. I know a lot of people who do this, especially if they run podcasts where they have to coordinate with guests.
[17:42] Mike: Yeah, I outsource this to a service called Doodle Me.
[17:45] Rob: So you’re finding software replacements.
[17:47] Mike: It’s actually called Doodle.com, I believe, but basically it just integrates with my G-mail calendar and just shows people when I’m available and lets them pick a couple of different times, that way I don’t have to go back and forth with them and I can say, “hey, here’s a link to my calendar. Set up a couple of times that work for you and I’ll pick one that also works for me” because there’s probably stuff that’s not quite on my schedule. Like, if I want to go to the gym I don’t necessarily put it on my calendar but it also integrates and allows me to combine my wife’s calendar and any other shared calendars in there; so it blocks off all those times that I’m not available, which is really kind of nice.
[18:19] Rob: Right. The next one is travel arrangement or planning and I’ve definitely had a couple of different virtual assistants help with some fairly complex travel stuff that I had when me and the family were going oversees. I had him investigate visas and look at passport stuff and then try to get the best plane flights for the best times and then look at some Airbnbs because we were going to four or five different cities. And put together a short list. It was pretty complicated. But, you know, he spent several hours and kind of put together a Google doc together for us that turned out to be useful in the end. So, I think if I’m just doing a straight-ahead flight and I just need to book a ticket, it’s going to take me longer to explain to a virtual assistant than it is to actually do it. As soon as it gets complicated that’s the kind of thing that I would see outsourcing.
[18:59] Mike: Yeah, I think that kind of ties in to the next one, which is competitor research. When I was targeting banks I hired somebody to go out and look for all the banks that were within 50 miles of me. And they came back with a list and it cost me I think $18 or something like that. And I just got a Google docs spreadsheet, which was kind of nice.
[19:17] Rob: Yeah, that is cool. I think another thing that ties into that is number 8, which is lead generation. It’s kind of like prospect research, right. It’s trying to put together a list of people who you’re going to be targeting. Put together a list of potential customers that you’re either going to cold call, cold email, somehow get in touch with.
[19:34] Mike: Yeah, and that’s all just data aggregation but it’s time consuming to actually go do it. You just give them some parameters, say this is generally what I’m looking for. The thing is, you can use it as an iterative process, too. You can say, okay, here’s what I want you to do and do five of them, or ten of them or something like that, and then come back to me and let me take a look at them, kind of validate the quality. And then you can give feedback. Then they can go back and keep going so that way you don’t have this span of 20 hours that you don’t know what they’re doing and they come back and everything’s wrong because you didn’t correct very early on in the process.
[20:05] Rob: Yeah. Another thing I’ve outsourced is data-entry. And whether you have hard copies of something, I’ve had that before where I’ve only had a hard copy and OCR wasn’t doing a good job and I just scanned it and sent it to the virtual assistant and I was like, “look, I’m sorry to do this to you but can you please type this out? Can you get it into a format that I can actually use?” Then I think you do this with a bookkeeper, right? You have physical paper coming to you and she’s essentially paying your bills and entering that into your bookkeeping system.
[20:34] Mike: Yeah, I have her go log in to my different bank accounts and everything. People find this weird that I give my bookkeeper complete access to my bank account as well. She’s got PIN numbers, she’s got signatory authority, so she could actually go into my bank, ask them to open up an account and they’ll do it because she’s on the paperwork and authorized to do it.
[20:55] Rob: People think it’s weird because they’re scared? They think that she could steal from you, I guess?
[20:57] Mike: Yeah.
[20:58] Rob: Next item you can outsource is transcribing audio or video. Now we’ve tended to use a transcription service, but I have had a VA transcribe a couple things for me. I think if they’re not a specialist in this they’re kind of slow at it, so it may or may not be worth it to you, but I’ve definitely known some folks who’ve done that. Something that piggybacks on that is audio and video editing. We heavily utilize that with our podcast, obviously we don’t do the audio editing. In fact our editor both edits and then spits out the MP3 file, puts the metadata into it, uploads it to the server, schedules the WordPress post to go live at the right date and time, and gets the transcript done. She sends it out to a service and then posts it for us. So, it’s not just editing, it’s like the full life cycle, and that’s the only way that we’ve been able to put out a podcast every week because if we had to do those steps they just wouldn’t get done because we’re too busy.
[21:52] Mike: Yeah and in a way she’s essentially outsourcing that part because she doesn’t want to do the transcription, either, which I can’t say I blame her. But, you know, she’s turning around and hiring somebody else to do that. It’s great the way that that whole process works and it gives us the ability to put these out every week.
[22:06] Rob: Right. As long as we don’t have to deal with it. I don’t think we really care how it gets done, you know, as long as it’s done well. Another way,a kind of a unique one within HitTail, we have articles that people can order, right? They’re one-click articles. And they go out to this group of writers, the writers write them, and then they submit them. Early on the articles were going straight back to our customers. Well, some of them weren’t of very high quality. So, I talked to you know my tier one support guy, virtual assistant and said would you be willing to vet these articles and do a little bit of editing if needed or to request rewrites as needed and to basically be an editor, right? It’s kind of like copy-editing and checking to make sure this stuff is decent. And with a little bit of training he’s done a fantastic job. It saves us money because the service that we use to get all the writers, they were going to do it for us, but it was pretty expensive so he’s able to do it at much less cost, we’re able to maintain the control, and he’s really committed to maintaining control because if he misreads an article or it isn’t very good, he’s going to hear about it. So it’s interesting that the motivation is tied, for him, to keeping it high quality so that he doesn’t have to deal with more support requests.
[23:13] Mike: I’ve actually gone out and ordered things to put out on some of my different product websites and have had to have written and then published and then had my assistant go in and take a look at those things that are coming back and essentially critique them and do the back and forth on my behalf so that I don’t have to do it. If something is below a certain level of quality, it’s pretty obvious to anyone and you don’t necessarily need a lot of training to be able to recognize that. So that’s definitely something you could also outsource if you wanted to.
[23:40] Rob: Yeah, I agree, Like proofreading slash editing. All right another one is I put blog publishing management. Basically the idea is I will often go into HitTail and I will see a bunch of keyword suggestions and I will order like 10 articles all at once and I’ll just spend the time to figure out the titles and the keywords that I want and I’ll order them all. Then I’ll let my virtual assistant know, as those articles come in, because they’re going out to writers who are going to write them, once they come in take them all and put them in WordPress in our articles section and schedule them out so that one goes out every week for the next five or ten weeks. Then I’m able to walk away from it and forget about it and he does a good job of it. He goes in and finds an image on, Creative Commons, Flickr, and credits the author, and does all that stuff and takes care of it and as a result I’m able to build this nice footprint of content and all I had to do was just go in and specify article titles and keywords based on suggestions that it gave me.
[24:37] Mike: I used to do this for my personal blog. If I were writing a new article, I’d have somebody go in and take a look at it and do all the publishing and then submit it to a bunch of different websites where it would get at least a little bit of publicity. And back links and things like that, but I haven’t really kept track of that stuff lately. I’ve really got to do a better job of that.
[24:57] Rob: Another thing I’ve seen outsourced from startups who have VA’s to basically manage their social media presence like to do their Twitter and their Facebook stuff and they’re either writing original thoughts or a lot of times they’re link aggregating based on a topic and as long as you give them enough knowledge and they understand your business, it’s not that hard to get this kind of thing going.
[25:16] Mike: Yeah I have this set up for my AuditShark Twitter account. Mostly just automated and I have somebody go in and aggregate a bunch of stories from a bunch of different sites and then put them through and just schedule them out into the future and it works pretty well.
[25:29] Rob: Another thing I’ve seen people do, and I actually do this as well, is you know there’s this RSS to email thing where it’s software that will take your RSS feed and then put it in emails and send it out in order to keep your list warm and talk to people on your newsletter. I don’t like those things because I don’t think they make the e-mails look very good. I don’t think they do a good job of kind of teasing and putting the image there and then making people click through to your blog. It really requires, typically requires, a human’s involvement to do it. And so that’s a really good task for a virtual assistant. If you train them where the cliff hanger is, you know where the point is at which point the email should leave off. This is kind of a no-brainer task for them to do this every week as blog posts go live.
[26:09] Mike: Yeah, and that kind of falls back into the blog publishing management because you could just add that in as part of your process and say, “okay, here are the 10 different steps that you do as part of posting something to the blog”. Then step number 9 might be to take it and turn it into an e-mail that goes out to a different set of subscribers.
[26:26] Rob: Exactly, and relating to that is moderating blog comments. As soon as you get any type of traction you’re going to start getting a lot of comments and that’s something that’s just enough of a distraction that it can be a pain and it’s a no-brainer to outsource that. Something you referenced earlier is finding images for blog posts, that’s an item I had here. Now there’s also one, slide presentations. It’s funny, I found a guy who called himself a virtual assistant but he had some good Keynote skills, so I used him to help put together my last couple of Microconf talks and he did a great job of finding images and getting just enough animations in there. I tweaked stuff at the end but he probably saved me 10 hours of work, each year. So for me that was just a total no-brainer.
[27:09] Mike: Yeah, that’s a huge time saver. And what I find is that it’s really helpful to have it done far enough in advance of any presentation that you have to do so that you can get used to what those animations are and then tweak them; because what you’re really trying to do is, you really want a VA to get you at least 80% of the way there. So in this particular case you create the content, you hand it off to somebody, and you can even create it in Word, which is what I’ve done. Hand it off to somebody, they give you back a mostly finished presentation and then you essentially tweak it from there. So if there’s animations that you don’t like, you can rip them out or put different ones in and it still gives you time to work with the content a little bit, but the reality is that they probably saved you 10-15 hours worth of work of putting together that presentation and you don’t have to do all the little tiny toggles and stuff that they had to in working everything together.
[28:01] Rob: Exactly, and so number 20 on our list, if you’re still dealing with voicemail, have your VA check it and just take the message down. Last few here. One is sending client invoices. I think that’s a no-brainer, right, if you’re still invoicing your own clients. Something’s wrong. Uploading videos to either Youtube or other video hosting. I do this all the time, holy cow, I’ve been recording screencasts lately. A lot of the screencasts I record are for training purposes, internal, and so I never edit those and I just use screencast.com. The hosting is not that great, but it works. Recently I’ve been creating a bunch of documentation screencasts for Drip, so I’ll walk through a concept and I need it to be edited pretty tight. It doesn’t have to be as tight as a marketing screencast, where it just has to shine and everything has to be polished but it has to be good enough that it’s respectable and professional. So what I’ve been doing is recording it and then giving that source file over to my virtual assistant and then he edits out the little bleeps and the um’s and the ah’s and stuff and then he uploads it to the video hosting and gives me the embed code. Next step I’m posting it to the knowledge base but the next step is to train them how to post it all the way to the knowledge base. Then it’ll be pretty much me recording and then magically seeing that go into the knowledge base a day or two later. That’s a great feeling. It really is a great feeling to be able to know that if you have to create a new knowledge base article that it’s you sitting down and recording for five minutes instead of the five minute of that and then 30 to 45 minutes of editing and then the upload. I mean, just all that stuff together, you save yourself a lot of time at that point.
[29:40] Mike: Yeah, I think people underestimate how much time you lose in doing all the context switching or just getting interrupted. And it’s easier just to outsource a lot of that stuff and just put a process in place and hand that off to a VA.
[29:53] Rob: Another thing I’ve seen Startups use VA’s for is to create SlideShare presentations from existing content. SlideShare is a pretty good marketing platform if you publish decent slides on a decent topic. If you already have good content on your blog or in an Infographic and you just need that translated into SlideShare, that’s kind of an easy way to do that. Another way I’ve seen them used I’ve actually used them is migrating from software tool to another. Do you remember when you moved from Indinero to Outright?
[30:20] Mike: Yes.
[30:21] Rob: I think you had a VA do it for you, didn’t you?
[30:22] Mike: Yes, I did.
[30:24] Rob: Yeah. Also, you know I moved from Mail Chimp into Drip and now that we’re moving more and more people I’m using the same virtual assistant to do that. So if you have a SaaS App there’s always that switching cost, but what’s interesting is you can cut some of the sting out of that if you have someone who you can show how to do that and then let them do the repetitive steps. Last two here, number 25 is member management for your membership website. Realistically it’s close to tier one support if you have a membership website, but especially with our software, WishList Member, which let’s just say it leaves a lot to be desired, there’s a lot of manual processes that have to happen so there’s some intense stuff that our virtual assistant has had to learn in order to keep that going well. There’s a lot of manual processes and some repetitive things that need to get done every month and even every week. So that’s something that I would think about outsourcing to someone.
[31:14] Mike: Yeah, the interesting thing is if you take a look at the Micropreneur Academy and how everything’s set up in there, the vast majority of the things that happen, most of them are systemized and outsourced to somebody because they’re labor intensive. It’s not just that they’re repetitive tasks, but it’s also that there are decisions that need to be made while performing those tasks. So you might need to process a payment or an email or something like that but there’s all these little things that factor into it and it’s very difficult to write code that’s actually going to take all those things into account. It’s easier to just give somebody some guidelines and say, “hey, if this happens then do this, but generally just use your best judgment about what to do in these specific cases.”
[31:56] Rob: And the 26th way to utilize a VA in your startup is to have them do the concierge service in your app. So, with HitTail we need tracking code installed or we used to need tracking code installed, and that was no-brainer for me to have the virtual assistant do it for free in order get people using the app and same thing with all of the five-day mini-course compilations and creations that we’re doing with Drip. I did those very, very early on. I did both of these things just to get enough experience with it to learn how to teach someone and then it was a no-brainer to hand it off. I am a big fan of concierge services in general. I think it sets you apart from your competitors and getting someone in there to help you with it and like a VA is a great way to do it.
[32:40] Mike: Well, Jacob, hopefully this episode helped answer your question. If anyone else has 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.
