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Growth Hacking

Customer Development, Customer Experience, Customer Success, Growth Hacking, Product Management, SaaS

There is no better “growth hack” for SaaS than talking with your customers.

Not just when you’re developing or marketing a product, but through every stage of the customer lifecycle.

It sounds simple — but it’s not easy: talking with your customers through every stage of the customer lifecycle. There’s been a lot said about the value of talking to your customers before you build the product to ensure market fit, but very little said about continuing the conversation past marketing and past the sale.

Why do I know talking with your customer is *the* very best predictor of, and contributor to, SaaS business growth? Because creating a constant flow of customer feedback, input, and conversation makes Customer Experience (CX) better.

Multiple studies show that CX leads to revenue growth.

CX also drives brand advocacy (aka. word of mouth), creating a virtual sales army, which leads to:

Decreased cost-to-acquire.

“Customers with the best past experiences spend 140% more than those with the poorest past experiences.” — Harvard Business Review

Increased customer lifetime value.

“Customers with the best past experiences have a 74% chance of remaining a member for at least another year.” — Harvard Business Review

Plus, qualitative customer research leads to making data-informed decisions that streamline product management, ensure customer success, and make marketing and sales far more efficient.

In short, as Laura Klein, author, VP of product, and co-founder of Users Know says,

“User research saves time. Period. When you actually understand what your user needs before you build things, you have a much lower chance of having to go back and rebuild everything after shipping something that nobody uses.”

But what does “talking with your customer” really mean?

It’s not like you’re inviting them over for tea and cookies every week for a casual catch-up (though that would be awesome, and you should do that and invite me).

When we say “talk to your customers,” or “listen to your customers,” I usually mean getting on the phone with them (or better, meeting up with them in person). But, it can also mean sending surveys that include long-form response fields, or building quicker in-app surveys into your roadmap to uncover moments of friction.

And, of course, if you’re earlier in your business, there’s the Lean approach of interviewing dozens of target customers in person and over the phone — groundwork that helps founders (and product developers and marketers) form better hypotheses around what will deliver the best product-market fit.

There’s also user testing.

These are all valid ways of listening to your customers. But I’d like to advocate for doing all of these things and going several steps further. I’m talking about combining all of the above and adding genuine conversations to the mix.

It’s just not input. It’s just not feedback. It’s getting to know your customers as human beings and building relationships with them that drive positive CX far more powerfully than any of these elements could do alone.

So much has been written about interviewing customers prior to developing products that I’d like to focus on how to keep communication lines open after the launch, after customer acquisition, starting with onboarding.

Track more than actions, during and after onboarding

(This is a chart I created for: “Product Managers: Why You Should Include Customer Success Milestones in Your User Flow”)

The first key to ensuring communication stays clear and open is to observe your customers. We communicate far more by our actions than we do verbally, and tracking the actions of your customers, especially (but not limited to) during onboarding can tell you the truths you need to hear.

Tracking customer behavior during onboarding and throughout product use allows you to see:

  • Time to first value (how long is it taking?)
  • Where customers run into trouble and need tech support
  • When customers typically need Customer Success help to reach their desired outcomes
  • Which customers reach their success milestones (the points in their user journeys where they see real progress towards their ideal outcomes)
  • And which customers don’t reach their success milestones

Yes, you want to track how well your customers accomplish the required tasks outlined in your User Flow, but usually, tracking stops there. If they press the right buttons at the right times, if they input the requested information, if they log in relatively regularly, it’s easy to assume customers are happily using your product.

But that’s not always the case. There may be ‘success gaps’ you can’t see that are causing churn. FYI: A ‘success gap’ is “the gap between what you think represents the customers’ successful use of your product and what they think equates to success,” according to Lincoln Murphy.

This is where aptly timed in-app surveys come in handy, which I’ll get to in the next section.

Tools that can help:

  • Appcues for onboarding
  • Intercom for targeted in-app messaging
  • Segment for easily managing your tools without dev

Check in with event trigger-based surveys

While you’re tracking user behaviors, successes and failures, you’ll also want to check in with your users in an unobtrusive way to get their feedback at specific points in their user journeys.

For example, if you identify a page or prompt during onboarding that tends to ‘lose’ people, have a trigger-based in-app AI chatbot pop up and offer to clarify, or transfer them to an agent. (This, incidentally, would have saved my relationship with more than one app! If you hit a ‘wall’ during onboarding, the odds of completing the process and becoming a successful customer are terrible — unless you get timely help).

You can set up event trigger-based surveys to deploy when users spend too much time on a page, ‘click away’ before completing the action, or when they’ve been ‘dormant’ (not logging in) for a while.

By giving customers opportunities to tell you they’re confused, are experiencing failure, aren’t getting the results they’d hoped for, or are suffering from a lack of time/motivation/technical skills etc., you will know who is really at risk of churning in time to save them, and really impress them with your customer service skills.

Finding friction with customer effort scores

Another place where checking in with your customer can really pay off is after the onboarding sequence is complete. It’s a perfect time to ask “How difficult was this?” (aka. A Customer Effort Score survey). The easier a process is, the less friction people experience, and the more likely they will be to complete your desired actions and reach their desired outcomes.

Then, after your new user has had a chance to put your product to work, you should send out a Net Promoter Score survey (NPS) to find out how they *really* feel about your product. Do they like it enough to recommend it to a friend or colleague? That’s an excellent indicator of how well they’re succeeding. And be sure to send an NPS follow-up question to understand the why behind the score.

Tools that can help:

Wootric: For these types of in-app surveys, I recommend Wootric. Their dashboard makes it very easy to understand what you’re seeing, and they do great work with extrapolating insights from qualitative data questions too.

The Game Changer: Have real conversations in your community

Tracking what customers do and asking them what they think at strategic points is a very good start; the trouble is, that’s where most SaaS companies begin and end. But SaaS businesses are subscription-based. They’re in this for the long-haul. They depend on customers sticking around (customer lifetime value! retention!).

And that means you also have to build relationships with your customers.

This is why I so strongly advocate that SaaS companies build social communities around their products. It’s an opportunity to relate to your customers as people.

The bonuses are many. SaaS product communities give you:

  • An on-tap resource of customers who are delighted to answer your questions and give you real-time feedback on everything you do
  • A straight line to your most engaged customers
  • A real-time capability of helping customers in trouble and creating delightful experiences for them, on a public forum, with everyone else watching (warm fuzzies all around!)
  • An opportunity to cultivate a culture around your brand and a genuine community
  • And… it’s possible — ZERO churn!

The most important thing to remember about building a community is that it’s not a one-sided arrangement. This isn’t a place for you to ‘shout into the void’, post blog posts nobody reads, try to ‘sell’ or advertise. It’s a place where you and your customers can come together around your common interests. Human to human.

Tools that can help:

  • Facebook
  • Slack
  • Your social community of choice!

Bring it all together now!

When you are tracking user behavior in your product, identifying predictive patterns of behaviors/successes/failures, locating trouble-spots and offering timely help, checking in with surveys to ask your customers what they think — in their own words and with numerical ratings, AND forging human-to-human relationships in the casual setting of social media groups, you’ll see a few things happen…

  • Your referrals will skyrocket as more customers achieve success
  • Your retention rates will go through the roof
  • Your acquisition and product development spend with become more efficient (as you target the right prospects, and use customer feedback to guide your iterations)
  • And you will grow — fast

Are you ready for that?

If you thought this was good — Sign up for my newsletter to hear from me on Sundays. I’m also available for SaaS consulting.

Customer Experience, Growth Hacking

CMOs: Don’t Get Replaced by a Growth Marketer in 2018 – Become One

What is “Growth Marketing” and why should CMOs be gunning for a job title change in 2018? It’s not just a shift in nomenclature, it’s filling an important success gap for both companies and consumers. In short – growth marketing is the future. Those who adapt fastest will be poised to succeed, while those who don’t may find their jobs on the line. The stakes are high.

Why the shift? It all hinges upon Customer Experience (CX).

According to a recent report, Forrester predicts:

“30% of companies will see further declines in CX quality and lose a point of growth” in 2018.

Do you smell blood in the water? Because we do. When growth slows, CEOs look to CMOs to fix it – and if they can’t, they’ll find someone who can: A Growth Marketer.

Read More on Wootric
💗 Check out Nichole’s Services for SaaS startups 💗

Content Marketing, Customer Development, Customer Success, Diversity, Growth Hacking, Podcasts, Product Management, SaaS, Startups

#EveryoneHatesMarketers: 4 Vital Things To Do Before Marketing Your New Startup [Podcast]

“Today I’m joined by my guest Nichole Elizabeth DeMeré, an esteemed SaaS consultant, customer service evangelist, writer and community moderator. Her work has been featured in leading industry media such as HubSpot, Moz, Copy Hackers, Forbes, Canva and more.

Nichole is going to walk us through the four things you need to do before you can start marketing your startup or new business. Founders tend to skip the basics of marketing foundations, and this crucial step can make or break your business. Listen in for Nichole’s four most important pre-marketing initiatives that you need to know for your startup or to refresh the marketing of an existing business.”

Topics discussed in this episode:

  • The importance of marketing foundations
  • Growth hacking pitfalls
  • Customer development work
  • Resources to identify ideal customers
  • Creating your first value proposition
  • Filling success gaps
  • Recommended reading

Transcript on Everyone Hates Marketers


Take the growth out of guesswork and get our Playbook to Grow Your Saas Business With Your Customers.

Content Marketing, Growth Hacking

Rise above the noise and get your startup noticed with Rocket Fuel! 🚀

Image created by Yasmine Sedky (@yazsedky).

Announcing a new package for startups!

Competition is fierce, and loud, and… everywhere. To get noticed by early adopters, evangelical customers, tech enthusiasts, investors, thought leaders and Silicon Valley insiders, you need a way to reach them that isn’t over-saturated. Something that pushes you into their radar so you can finally reach the great heights your product deserves.

In my Rocket Fuel Package, I offer a way you can get:

  • Brand recognition – among your ideal audience
  • In front of an engaged audience of thousands of startup enthusiasts
  • Your content shared on cutting-edge tech communities like Growth Hackers, Product Hunt, Inbound.org, SaaS.Community and more
  • Not just more traffic, but qualified traffic who are more likely to convert to leads
  • A quickly growing reputation as a thought leader in your industry

Think of me as an extension of your content marketing team.

Learn More + Fill Out a Form if You’re Interested 


“The value Nichole is offering for this price is unbelievable—the Rocket Fuel Package is a steal!”

– Kiki Schirr, CEO of WeKiki 

Growth Hacking, Guest Posts, Startups, Teams

Why Hiring is the Growth Hack You Never Considered by @OmerMolad

Image created by Yasmine Sedky (@yazsedky).

“Growth hacking is about running smart experiments to drive growth within your business.” – Sean Ellis

If you’re reading this, you’re probably familiar with the term “growth hacking”, which seems to be everywhere at the moment. Everyone I meet is a growth hacker all of a sudden. But despite a little bit of froth on the milkshake, the hype is very real and it’s here to stay. Here’s why.

First, people will do almost anything to grow their business. For a small business or startup, growth is the difference between life and death.
For a small business or startup, growth is the difference between life and death. Click To Tweet

Second, it’s in our nature to experiment. We try different foods until we figure out what we like and we date different people until we find “the one”. By and large we live life through trial and error and we learn through our experiences.

Experimenting across different traction channels or, in “human language”, trying to find customers in different ways, is a smart way to drive growth. It’s time to take this one step further and create a culture of experimentation by applying a “growth (hacking) mindset throughout the entire business.

The obvious place to start is people – building and growing teams – because there is no better growth engine than a great team.

It’s A People Game

“Great vision without great people is irrelevant.” – Jim Collins

Ask any investor about the first thing they look for when making an investment decision. It’s the team.

Ask any lender what will always be a deal breaker, regardless of cash flow quality. They’ll say management.

What’s the single biggest factor in job satisfaction? Quality of co-workers.

We’re just humans building products for other humans, either to ease pain or give pleasure.  Everything else is a means to an end.

Yet, while we use words like “obsessed” and evangelist” about getting customers, we don’t tend to think of hiring people in that way. We use very sophisticated methods to find and win customers but tend to be stuck in neutral when it comes to building teams.

At Vervoe, we’re changing that.
At @VervoeHQ, we're changing evangelism around hiring the right team. Click To Tweet

Just like experiments have proven to drive growth, they will also help you hack hiring. You just need to cast aside any long-held views and embrace experimentation.

Here are four dead simple ways to apply a growth (hacking) mindset to hiring and immediately make your business more valuable.

Four Easy Hiring Hacks You Should Start Using

Hiring Hack #1: Ditch the Résumé

Ditch the résumé. Résumés are not required to make a hiring decision.

 

“I think, to me, reality is better than being fake.” – Ice Cube

Hypothesis: Résumés are not required to make a hiring decision.

Still asking candidates for résumés? Go résumé-free for one role.

Résumés are typically used to decide who to interview. Instead, don’t decide, just give everyone a chance. Sound like a waste of time? Actually, it’s faster if you use automated interviews.

This delays the first impression we form about people to after we see them perform. It allows us to focus on what people can do and who they really are, as opposed to what they’ve done previously, which school they went to or how weird their name sounds. Because, honestly, who cares about that stuff.

After you pick the best performers in the interviews, go over their backgrounds and ask yourself whether you would have picked those people out of the résumé pile. Then go over the ones you rejected and see if any of them have fancy résumés that would have made you choose them for an interview.

Be honest.
Hiring Hack: Résumés are not required to make a hiring decision. Click To Tweet

Hiring Hack #2: Don’t Outsource Your Most Sacred Activity

Don’t outsource your more sacred activity.

 

“Social media is the ultimate equalizer. It gives a voice and a platform to anyone willing to engage.” – Amy Jo Martin

Hypothesis: There is no value in outsourcing your recruitment.

Do you use a recruitment agency or a headhunter? We’re going to put an end to that and see if it makes any difference.

External recruiters, like most brokers, are the product of information asymmetry. You assume that they have access to better information than you so you pay for that information.

But the internet has made the world flat, we just need to know where to look and how to make it easy for people to find us. You can share your job ad on every social network and ask your own personal and professional network to refer people. Reaching people has never been easier.

If you incorporate hiring hack #1, you won’t need to worry about deciding who to interview, a service traditionally performed by recruitment agencies. All you need to do is get your job in front of enough eyeballs, which is pure marketing.

Now, here’s the real hack. Work out the commission you would have paid the recruitment agency. Let’s say it’s a 20% fee and the role pays $100,000. Now spend every cent of the $20,000 you saved on promoting your job on every major job board, industry board and social network.

Is it money well spent? How many applicants did you get? What about for $2,000? What about for $200?

Sound insane spending that much money to get access to candidates who will all automatically be interviewed anyway? There’s your answer.
Hiring Hack: There is no value in outsourcing your recruitment. Click To Tweet

Hiring Hack #3: Expert Questions Are Better Than Yours

Expert questions are better than yours.

 

“The art and science of asking questions is the source of all knowledge.” – Thomas Berger

Hypothesis: Other people ask better interview questions than you.

Wait, what?

If you’re running a business, there is a good chance you’ll have to hire someone into a role you’re not an expert in.

Next time you’re trying to hire someone, use interview questions written by an expert instead of your own. To learn more about how to hire for a role you’re not an expert in, read this.

If you want to do it all online, you can easily choose an interview script from Vervoe’s library.

But the concept is equally applicable offline. Call a friend who’s an expert and pick their brain on how they would hire for the role. Then create a process that aligns with the expert’s recommendation. If the expert thinks the best way to hire a chef is to spend a day in the kitchen together, then that’s what you should do. Speaking of cooking, here’s an omelette story that illustrates this exact point.

You can A/B test within the role itself by randomly interviewing half the candidates using your own questions and half using an expert’s. But I suspect the benefits will be evident even before candidates do the interviews. You’ll know from the quality of the questions whether the expert is improving your approach.
Hiring Hack: Other people ask better interview questions than you. Click To Tweet

Hiring Hack #4: Don’t Ask People to Fit In

Don’t ask people to fit in – cultural fit is overrated.

 

“Culture is the widening of the mind and of the spirit.” – Jawaharlal Nehru

Hypothesis: Cultural fit is overrated.

Talking about your company’s vision, values and culture in your job description is a great way to proactively qualify candidates.

However, instead of asking people to fit in with your culture, look for people who will add to your culture. Ask for cultural contribution and look for people who can improve your team’s cultural fitness.  

The result of this experiment can only be verified after several months of working together. But you’ll see glimpses during the hiring journey. Encourage candidates to tell you what they’ll be bringing to the table. Get creative with your interview questions. And more of all, be open to being challenged.
Hiring Hack: Cultural fit is overrated. Click To Tweet

Time to Start Experimenting

What you do with the results of each experiment is up to you. But I guarantee you’ll learn a lot about hiring and gain insight into the mindset of your candidates, and perhaps even your own.

Let me know how it goes.

Growth Hacking

10 Ways to Retain Clients and Grow Like Crazy by @NikkiElizDeMere

10 Ways to Retain Clients

In 2011, Treehouse, an online educational platform for web design, web dev, and entrepreneurship, exploded onto the scene and, within a single week, increased its revenue by 38%, and number of paying members by 46%. Just two years later, the company reported making $1.7 million in revenue from 49,000 users. And that’s just one of hundreds of jaw-dropping growth hacking success stories. It’s no wonder businesses of all sizes want in on this. From the outside, it looks like there must be some magician or techie wunderkind behind the scenes. Nope, it’s just us. Growth marketers.

Growth marketing does have the power to transform small and mid-sized businesses into scalable enterprises, but it’s not mysterious. Growth hackers leverage creativity, data, analytical thinking and metrics to develop low-cost marketing techniques that are more relevant and more effective than traditional means.

But, amazing stories aside, be warned: If you’re looking for “growth marketing quick wins,” you’ll either be disappointed, or you’ll be sold a bill of goods by someone looking to make you their “quick win.”

While growth marketing will help you grow faster, it’s more about finding better, smarter, data-driven ways of reaching and converting your target audience and retaining them. It’s about figuring out what works, what doesn’t, and iterating from there as efficiently as possible.

Read more on GetApp


Let’s Get SaaSsy – I’m offering a limited number of SaaS consulting engagements.

Curation, Growth Hacking

10 Inspirational Growth Marketers ft. @Everette, @grayj_, @MorganB, & More

inspirational-marketers

Image created by Yasmine Sedky (@yazsedky).
People who have helped shape how I think about Growth Marketing.

Not only are these Growth Marketers inspirational because of their contributions to online businesses, but also because of their contributions in a larger sense — they are just great people to know. I am continuously humbled by everything I’m learning from them, whether it’s about Growth Marketing or not.


1. Everette Taylor

Everette Taylor currently serves as Chief Marketing Officer for the popular e-commerce brand Sticker Mule, the maker of custom stickers for brands such as Facebook, Twitter, Microsoft, Google, Instagram, Apple, Walmart, ESPN, etc. He also recently helped launched the new brand Button Frog, the fastest and easiest way to order custom buttons/pins.

Other current projects include MilliSense, a marketing firm in which Everette founded that dedicates itself to growing companies and brands through data-driven digital marketing. Also, he partners with NFL Player Brandian Ross on the clothing Unity Over Self which raises money for children with autism.

Previously Everette was an integral member of the team that started GrowthHackers.com and served as Head of Growth. Other notable brands include United Way, Qualaroo, Hired, and celebrity author Neil Strauss.

Everette says he’s happier than ever, professionally and personally. His primary focus is continuing to push the growth of Sticker Mule and new brand Button Frog while maintaining a healthy work life balance. Diversity in the tech industry is something he’s passionate about and he plans to continue advocating on its behalf.

Follow Everette on Twitter.

 

 


2. Hiten Shah

Hiten is the co-founder of KISSmetrics and Crazy Egg.He helped coin the term “growth hacker” with Sean Ellis and Patrick Vlaskovits.

He loves starting and growing businesses and is eager to help others do the same.

Follow Hiten on Twitter.

 

 


3. Jim Gray

Jim is an engineer and data scientist, specializing in marketing automation. He provides consulting in technological marketing, the effects of UX on growth, email marketing, and integrated marketing strategies.

He writes about designing and marketing products using customer success thinking at grayj.co, although you’ll have to subscribe to his newsletter to see most of his content.

Follow Jim on Twitter.

 

 


4. Lincoln Murphy

Lincoln goes by many fun titles  —  but his current focus is on being a Customer Success Evangelist at Gainsight. Since 2006, he’s directly helped over 600 SaaS companies optimize their growth.

He’s contributed to, written for, or been featured in Inc. Magazine, Fast Company, Sandhill.com, GrowthHacker.tv, OpenView Labs, Read Write, SoftwareCEO, Venture Beat, Venture Hacks, and ZDNet.

He also keeps an up-to-date blog at Sixteen Ventures. In his free time you’ll find him enjoying yoga and bubble tea.

Follow Lincoln on Twitter.

 

 


5. Morgan Brown

A full-stack marketer focused on growth, Morgan has spent the last 14 years building audiences for startups and brands alike on the Web.

He’s part of the GrowthHackers.com and Qualaroo team, and leads growth efforts for Inman News.

You can follow him on Twitter, or learn more about what he does at FullStack.it.

When he’s not tied to his computer he loves spending time with his wife and two kids who he adores more than anything. In his rare spare time he loves reading and learning as much as he can.

Follow Morgan on Twitter.

 

 


6. Kiki Schirr

Kiki Schirr is the marketer for Fittr and in her spare time is a contributor at {grow} and for The Craft, which is a collaboration with Violeta Nedkova and Nichole Elizabeth DeMeré.

Recently she’s started a series of comics on Medium, but usually her creative efforts are focused on painting or writing.

She wrote the Product Hunt Manual and is working on a second edition, and on starting her blog (eventually).

She loves meeting new people through Twitter, and thinks she has the silliest professional bio of any tweep.

Follow Kiki on Twitter.

 

 


7. Ryan Hoover

Ryan got his first taste of entrepreneurship as a pre-teen managing gum-ball machines at his father’s video game store.

Then he grew up, worked at a failed gaming startup after college, moved to Silicon Valley to join a 10-person team that grew to 120, and experimented with his own startup ideas along the way, one of which seems to be working.

He’s the founder of Product Hunt, a daily leader board of the best new products, and an EIR at Tradecraft where his team trains smart people in sales/BD, UX, and growth.

He also writes about startups and product design with essays featured inTechCrunch, The Next Web, Forbes, and Fast Company.

Follow Ryan on Twitter.

 

 


8. Sean Ellis

Sean is the CEO and Founder of Qualaroo and GrowthHackers.com, and the first marketer at Dropbox, Lookout, LogMeIn (IPO), and Uproar (IPO).

He coined the term “growth hacker”, and devised the startup pyramid which is widely recognized and referred to as an industry standard.

Follow Sean on Twitter.

 

 


9. Shana Carp

Shana is a product marketer specializing in products that deal with data. She has a deep love for conversion optimization techniques, and using Python as an Excel replacement.

In her spare time she likes to cook and bake.

Follow Shana on Twitter.

 

 


10. Violeta Nedkova

Violeta Nedkova likes to say she’s always hacking things. Her focus is on social media, content marketing, and community, and her blog is a plethora of topics, such as marketing, startups, and psychology.

She was previously co-founder of Amazemeet, but currently enjoys consulting and curating The Craft with her best friends Nichole Elizabeth DeMeré and Kiki Schirr.

She can be found on twitter or her favorite communities: Product Hunt, Somewhere, and Inbound.

Follow Violeta on Twitter.

 

 


Let’s Get SaaSsy – I’m offering a limited number of SaaS consulting engagements.

Growth Hacking

Have You Heard About The Growth Hacking Skill No One’s Talking About? ft. @SeanEllis

Have-You-Heard-About-The-Growth-Hacking-Skill-No-Ones-Talking-About

Image created by Yasmine Sedky (‏@yazsedky).

Ok, some people are talking about it, clearly, but it’s a vital step that doesn’t get nearly as much press as it should. Without this step, Growth Hackers couldn’t achieve any of their results. So why are we not having daily discussions about Goal Setting?

Goal Setting – Growth Hackers Do It Differently

Yes, just like those hundreds of self-help books tell you, setting goals is important. Unlike those hundreds of self-help books, the goal setting approach used by Growth Hackers means you win whether you succeed or fail. In January, Sean Ellis and Morgan Brown of GrowthHackers.com devoted 42.44 minutes of their time to explaining the glory of goals:

  • Why goals are so effective (sounds simple, but they bring it to a whole new level)
  • Where goals go wrong
  • How to Goal like a Growth Hacker

Failure to Meet Goals Can Be Even Better Than Success

The team at Qualaroo had a goal: To drive distribution and get more people to adopt the software. To meet this goal, they came up with a plan to “beef up” the free version.

That totally flopped.

Their freebie offer wasn’t turning heads like they thought it would, but even though they didn’t reach their goal, they did reach a conclusion that was even more valuable: Their consumer wasn’t price-sensitive, which meant they would pay more. They found an opportunity to grow revenue more effectively by raising the price (and adding a few new features).

But Failure is Scary

Let us acknowledge that people get freaked out by goal setting for good reason. Often, goals are handed down by the higher-ups, and when they’re not met, there are consequences – like losing your job, or not getting that promotion. But that’s not the only approach to setting goals. When a Growth Hacker, like Sean Ellis or Morgan Brown, sets a goal, it’s like setting up a hypothesis (an educated guess) which provides a framework for the experiment. Success is determined by how much you learned.

Goal Setting – Not Just for the Self-Help Crowd

There are a million things you can do every day, many of which fly across your desktop in emails labeled “URGENT!” What’s urgent is rarely what’s most important, but they can sure take up the majority of your time and distract you from your real purpose. Having your goals listed in plain sight can get you back in touch with what matters most.

So how do you set a really great goal?

Goals need to be:

  • Specific
  • Measurable
  • Challenging (but not impossible)

Having “baby-step” goals are good since they can give your team quick wins along the way, keeping everyone motivated on their way to the big goal. Motivation management is a big factor in who succeeds and who doesn’t. Sean and Morgan call this “Hacking your brain.”

Bad Goals, and How to Recognize Them

There are bad goals – and you’ve probably made them (how often have you kept your New Year’s Resolutions?).

This is what a bad goal-setting looks like:

  • Setting fuzzy & poorly defined goals.
  • Too goal driven – Your goal may come with a downside that you don’t see. Spend some time asking “If we achieve this goal, what is the worst thing that could happen?” and creating a second goal to address that possibility.
  • Too rigid – You have to adjust your methods as new data comes in.
  • Too many goals – Some people think that setting a goal will magically generate motivation. It doesn’t. Better to focus on one or two attainable goals at a time.
  • Setting impossible goals – The object is to motivate, but the effect is the opposite. There’s a difference between setting big, audacious goals and impossible goals. You want to stretch with challenging goals, but you don’t want to set yourself up for failure.
  • Measuring success with vanity metrics – You want metrics that are tied to specifics. Define failure as clearly as you define success.

Growth Hacker Goal Setting Looks Like This

Growth Hacker Goal setting framework:

  • Form Hypothesis
  • Select KPI (Key Performance Indicator)
  • Set Goal
  • Execute
  • Track Progress (adjust execution as necessary)
  • Socialize/Iterate (let everyone know how it worked)

The last step on the Goal Setting To-Do List is to socialize your wins and findings, good or bad. Let the whole company in on it through Slack/HipChat, weekly emails, internal dashboards, office posters, lunch and learns, or by ringing a cowbell every time progress is made. (Who doesn’t want more cowbell?)

Growth works best when everyone is aligned around the goal, but 35 percent of marketers don’t share testing or growth wins with their teams. Share everything to align and motivate everyone towards a common goal.

When you set a really good goal, one that’s specific, measurable, and challenging yet attainable, you’ll discover more about your company and your target clients than you ever could have known without it. So set that goal, get everyone involved, and remember: It’s an experiment. If it fails, you’ve still learned something valuable.


Let’s Get SaaSsy – I’m offering a limited number of SaaS consulting engagements.

Customer Success, Growth Hacking, Metrics, Sales

Customer Success Has a Quantifiable Impact on Revenue ft. @KateLeggett

customer-success-has-a-quantifiable-impact

Image created by Yasmine Sedky (‏@yazsedky).

“You can grow through massive Customer Acquisition, but the best companies out there are growing through Customer Success.”

—  Lincoln Murphy

Customer Success is a topic that every Growth Hacker, Marketer and Startup Founder needs to know about in order to take advantage of the most effective methodologies for reducing churn and increasing retention for SaaS companies.

For that reason, I took the time to dissect the content of the very impressive webinar by Kate Leggett: ‘The Economic Value of Customer Success.’ This is, by far, the best webinar I attended in 2014.

I hope you find these notes useful.


Main topics:

  • History
  • What does all this have to do with Customer Success?
  • The Three Dimensions of Customer Success Management
  • First Dimension: Reduce Churn (& How to Calculate It)
  • Second Dimension: Increase Existing Revenue
  • Third Dimension: Influence New Sales
  • Customer Success Drives Team Performance
  • Conclusion
  • Bonus Video: Reduce Churn and Drive Revenue With Customer Success Management
  • Bonus Video: How to Drive Growth With Customer Success Metrics

History

Social media has ushered in the age of the customer.

Customers now control the conversation due to a shift to user-generated content. This means that businesses must become more focused on delivering experiences that are in line with customer expectations.

Our world is moving to a subscription-based economy.

Instead of buying products, we’re subscribing to services on a monthly basis. Examples: Netflix, Amazon Prime, Spotify, and so on.

This means that industries are transforming their business models to embrace the subscription economy.

This business model is prevalent among enterprise companies:

  • 13%of enterprises will be implementing SaaS within the next year
  • 14%of enterprises have implemented SaaS
  • 21%of enterprises will be expanding their existing SaaS implementation

There’s a whole set of software categories that are rapidly moving to a SaaS delivery mode

and some have already seen significant success — learning and talent, sales automation, HRMS, and e-purchasing.


What does all this have to do with Customer Success?

Because of the subscription-based economy, relationships are becoming more important.

In this economy, businesses are required to build long-term relationships with their customers. These relationships are validated every month as customers renew their subscriptions. Because it’s more expensive to acquire new customers than retain them,

making customers successful is the most strategic approach to business growth in the new economy.

Good relationships have business value.

A customer that is happy with your products is a loyal customer.

Loyal customers:

  • Are willing to spend a larger wallet share, leading to increased CLV
  • Are more willing to consider additional products and services
  • Are less likely to churn
  • Will serve as a brand advocate

Revenue uplift due to customer loyalty can be quantified, which is the basis for Customer Success Management. As well, good relationships help reduce costs.

Because managing customer relationships has a quantifiable revenue impact, businesses are now investing in Customer Success.

(In fact, according to Jason Lemkin, Co-Founder and CEO of EchoSign, 80% of growth comes from existing customers.)


The Three Dimensions of Customer Success Management (CSM)

Customer Success Managers actively:

  1. Manage customer relationships to reduce churn
  2. Increase existing revenue
  3. Influence new sales

Customer Success Managers help businesses get greater economic value out of their current customer base.

First Dimension of CSM: Reduce Churn

Customer Success Management helps reduce churn.

Companies follow a standard growth trajectory. When a company is starting out, all of its energy goes into acquiring customers. As it grows, there’s a focuses on retaining customers and minimizing churn. Once the company is established, there’s a focus on expansion through cross-selling and up-selling to customers. And during optimization and transformation, time and resources are spent on engaging with the most profitable customers and defining standardization for engagement.

During business growth, CSMs tier customers.

For each tier, there will be different engagement strategies.

Along the way, churn becomes increasingly important because a larger percentage of revenue comes from existing customers.

To calculate the impact of churn:

Net New MRR/ACV = New MRR/ACV (New Customers) + Expansion MRR/ACV (Existing Customers) – Churned MRR/ACV (Lost Customers)

MRR = Monthly Recurring Revenue
ACV = Annual Contract Value

The negative impact of churn can be quantified.

In the chart below, all else the same, the company that follows the green trajectory has a 95% retention rate and the company that follows the orange trajectory has an 80% retention rate. Five years later, the green company has only lost 30 customers but the orange company has lost 120 customers. This leads to a difference in two-million dollars in revenue.

Churn is dependent on deal size.

There’s a correlation between average deal size and retention rate. (This data is based on a study of over 200 SaaS companies.)

Second Dimension of CSM: Increase Existing Revenue

Customer Success Managers help customers realize the economic value of the products and services they’ve bought.

They have all the information about how customers are using the product. They understand their customers’ business goals and how the solutions that they’ve bought are helping them maintain a need-to-use business goal.

Using this data, Customer Success Managers help both the customers and the business to quantify the economic value of a purchase.

Third Dimension of CSM: Influence New Revenue

Customer Success Managers influence new sales by increasing advocacy.

Brand advocates are highly satisfied customers and are more valuable than average customers. Advocacy activity — such as positive ratings and reviews— have a positive quantifiable impact.

Brand advocates will also buy your products and services again.

They spend close to twice as much or more on products and services than the average customer and they act as a virtual sales force, driving new sales.

In the chart below:

Blue — Original purchase
Red — Upgrade bought in the second year
Yellow — Upgrade bought in the third year
Green — An advocate moving to another company and buying your product again
Purple — Revenue generated from advocacy activities


Customer Success Management Drives Team Performance

A hidden benefit of CSM is that it drives team performance.

To be successful at CSM you need to have discipline in four areas —

engagement strategy, engagement process, engagers, and engagement levers.


Conclusion

We’ve moved to a subscription-based economy — products and services are being consumed as SaaS. In this business model, being able to manage customer relationships to drive greater economic value is becoming even more important. Good relationships will increase customer loyalty, decrease churn, increase CLV, and help customers become brand advocates to influence new sales.


Let’s Get SaaSsy – I’m offering a limited number of SaaS consulting engagements.

Content Marketing, Conversion Rate Optimization, Customer Success, Growth Hacking

10 Growth Hacking Epiphanies From a Customer Success Genius ft. @LincolnMurphy

10-growth-hacking-spiphanies

Image created by Yasmine Sedky (‏@yazsedky).

On January 13th at Inbound.org, Lincoln Murphy, Founder at Sixteen Ventures, said “Ask me anything.”

The four things that he LOVES to talk about (“won’t shut up about, actually,” as he puts it) are the same four things I LOVE to talk about:

  1. Customer Success
  2. Growth Hacking
  3. Content Marketing
  4. Conversion Optimization

If you missed Lincoln’s AMA, then I’ll wrap up the session’s highlights for you.

Lincoln Murphy’s January 13th Ask Me Anything on Inbound.org — Highlights

First, why you want to ask Lincoln Murphy anything:

In the past nine years, he’s helped more than 300 SaaS companies grow faster than duckweed (a pond-dwelling plant with superlative reproductive skills) by optimizing the Customer Lifecycle. Lincoln Murphy is also one of the top thought-leaders in Customer Success and Growth Hacking for the SaaS industry, and his Twitter feed contains a Master Class in web marketing. Recent Twitter gems include “You keep saying ‘price point’ … Just say ‘price.’” Right? Stuff of genius.

Note. These are not all the questions and answers, and some questions and answers listed here have been shortened. To read the full text, click here.


Pricing

Q. What are some good indicators you’re undercharging?

A. It’s hard to know for sure, but…

  • You aren’t making money
  • You can’t afford marketing
  • Everything seems expensive
  • You’re charging less that all of your competitors
  • Your market refers to you as a toy or otherwise doesn’t take you seriously
  • You’re eating ramen noodles in a shared dorm in a non-ironic way and you’re 35 years old
  • You don’t know what your product is worth to your customers
  • You want to be low-touch
  • You complain about not having money, even though you have a lot of customers
  • Your churn is 0%
  • Your sales cycle is 3 minutes
  • You’ve never had anyone complain about the price& ever

Q. Should you do a pricing page on its [sic] own or put the pricing on the homepage with the rest of your SaaS product details?

A. The general rule for me is the less complex your product and the more your customers are already sold on what you do — the quicker you can present a price to them AND expect that they’ll take action on that.

Q. How important is it to nail your price proposition before launch? Is it safe to best guess and adjust based on feedback/onboarding metrics?

A. Try to get pricing as right as possible out of the gate. That said, pricing is not a set it and forget it event. . . . Whether it’s to better align with your customers (always a good reason), or because you left money on the table (most companies start out by pricing too low, not too high), or because you want to segment your pricing tiers to reflect more accurate use cases, your pricing will evolve over time.

Q. Price changes — Your feeling on grandfathering clients forever in to their current price point or giving them a window of time until they are moved to the new pricing based on their current plans?

A. If you raise prices, you grandfather current customers in at the current rate. If they ever stop being a customer and want to come back, they’ll come back at the new rate.

If you lower prices, you should lower prices of existing customers, too, unless you want some sort of revolt. Never underestimate spite as a driver of business decisions! That means if you lower prices for new customers but not existing customers, some customers may leave — even if they’re happy with the service and otherwise have no complaints and regardless of switching costs… because they hate you now. So keep your current customers in mind when you do things like change your public pricing.

When it comes to grandfathering, though, one thing I try to do is have a way to eventually get people off of grandfathered plans… usually, that involves some incentive to move to the new plan (maybe a big, but time-limited discount)… it’s not required, but I like dealing with as few grandfathered folks as possible. Something to think about at least.


Growth Hacking

Q. What are some channels someone can look into to really get engrossed in and learn about growth hacking?

A. Join http://growthhackers.com and just start absorbing all of the content there. And then as quickly as you can find something to grow. Go to work for a company in a GH capacity, join a startup, start a startup, start a website and sell something and use GH tactics to grow it. Volunteer to GH a charity campaign. I don’t know how to become fully engrossed in Growth Hacking without actually doing it at some point.


Leveraging Content

Q. How can you use content and social media and generate traffic and generate more leads over time?

A.

  1. Content and Social are two different things and — while thats obvious — it helps to keep that in mind.
  2. Think of it more like Content and Distribution, where social media is the distribution modality if thats what makes sense for your audience. Use the appropriate distribution channels to reach your customers. That’s all that matters when it comes to distribution (vs. leveraging a channel that you’re used to or good at).
  3. If content is part of distribution — guest blog posts, email drops on other peoples lists, etc. — then you want to have pillar content that those pieces link back to on your owned properties.
  4. Your owned content is key. No algorithm changes at Google can change that. No policy changes on social media channels can change that.
  5. Everything you do should revolve around that content in some way.
  6. And that content should be surrounded by Calls to Action to opt-in to your email list, sign-up for your Free Trial, request a Demo, sign-up for your email course, etc. etc. Whatever the appropriate CTA is, that content should drive people to take that action.
  7. Use social channels that are where your audience is to distribute and amplify that content, but ultimately drive people back to your content.
  8. And also use your email list to drive people back to your content.
  9. But a good rule of thumb is to spend 90% of your time promoting content and only 10% of the time creating the content& regardless of the channels you use.

Q. Do newsletters still work, or is it best to stick with blog posts?

A. Most blogs that have a ton of traffic (and social shares) do so because they have a newsletter that they use to promote their content. Yeah, maybe they didn’t start out that way, but they used the blog (and still) do to grow the list, and then used the list to promote the blog. Circular.


Lead Conversion

Q. What kind of identifiers/actions can we use to qualify leads which come through our blog (pre signup)?

A. Look at the topic of the post they signed-up on and use that to infer where they are on the awareness ladder (or in the buying cycle, sales funnel, etc.) If it was tactical and product-centric, that might mean they’re later-stage and you maybe reach out or put them into a lower-level nurture track.

If it’s earlier-stage content — more higher-level stuff that’s not tied to your product or even taking tactical action — they may be too early so you put them into an earlier-stage nurture track to get them to a point where they become interested in solving the problem with your product.


Customer Success

Q. What are the MOST important aspects of user experience that affect overall conversions?

A. Everything we do should help the customer toward their Desired Outcome, which itself has two inputs: Required Outcome and Appropriate Experience. The Required Outcome is the thing they have to achieve/accomplish/do/etc. … but how they do that is also important. What the “doing that” feels like to them, how they’re emotionally affected by the process, etc. All of that matters. Just allowing them to achieve their Required Outcome but with an inappropriate experience will not lead to a feeling of success. So the most important aspect of a good UX is understanding and solving for their Desired Outcome.

Q. If you had to narrow it down, what specific data/metrics do you think are most crucial for SaaS companies to look at when making decisions about how to improve conversion and customer success?

A. This is one of those annoying answers that starts with “it depends.”

But it does… it depends on the maturity of the company, the goals of the company at whatever stage of maturity they are, etc.

In the early days you may be more focused only on net new customer acquisition. Later, you may realize you need to keep your customers. Then you may realize it’s not just about keeping them, but growing their use and expanding their revenue. Then you may discover that getting your customers to be advocates for you is the thing you should focus on.

That said, two metrics that are almost always something to keep in mind are:

Customer Acquisition Cost and how efficient it is.

Churn and measuring it the right way. Separating avoidable from unavoidable churn, figuring in only customers that could churn to get your actual churn rate (those that can’t churn due to contracts shouldn’t count), and keeping customer and revenue churn separate (but measuring and acting on both).

Want more?

This AMA session with Lincoln Murphy was packed with excellent questions — no dumb questions in this crowd! To find out the answers to such brain teasers as “What are the first steps a SaaS company should take when creating a Customer Success initiative?” and for Lincoln Murphy’s super simple, yet detailed answer to “Give me a roadmap for B2C lead conversion best practices” — you’ll just have to read the thread yourself.

I hope these highlights help you on your Inbound Marketing journey! But if you’ve got more questions, stay tuned for the next AMA we host at Inbound.org.


Let’s Get SaaSsy – I’m offering a limited number of SaaS consulting engagements.