MARKETING FOR PEOPLE WHO WOULD RATHER BE BUILDING STUFF

Patrick McKenzie

Bingo Cards… Who Knew, Right?

A Quick Update On The Bingo Story

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Maintenance Mode Sales for BCC

Year Before Last MicroconfYear Before This Microconf

A job is a system which turns time into money. A business is a system which turns other systems into money.

A job is a system which turns time into money. A business is a system which turns other systems into money.

We build systems. Heck yeah.

Updates On The Other Stuff

My Newest Business

Why Did You Pick That Problem?

+

How Did You Know It Would Sell?

A Brief Interlude On Pricing

How To Read A Pricing Grid

Most revenue: 33% to 50% of total revenue comes from most expensive plan.Most users: Either the plan called out or the second cheapest plan.Highest support costs: free customers or, alternatively, the ones on the cheapest plan. Biggest surprise: There is probably a “call us” option which is arbitrarily expensive even if none is actually listed.

SaaS Mathematics 101

Per-customer margins: very high (80~95%)

Low fixed costs (~$500) Many founders would like $8,000 ~

$12,000 a month: $9 plan: 1,000 to 1,500 customers $29 plan: 300 to 450 customers $79 plan: 115 to 175 customers $249 plan: 35 to 50 customers Enterprise pricing: 1 to 2 customers

How To Price Stuff?

Align plans with customer success. Names matter. Feature segmentation can work, particularly

where $$$$ customers have particular must haves (HIPAA, etc).

Charge. More. You are ridiculously underpriced. Your software costs less than 10% of the fully-

loaded cost of their cheapest full-time employee. Avoid pathological customers – they’re

cheapskates.

Charge. More.

Drip Email Marketing

“My biggest business mistake was waiting so long to start building an email list.” – Ramit Sethi (and me)

Email Is Like RSS That Actually Works

Email actually gets read. Email actually gets read by normal

people, too. Email is “necessary time” rather than

“luxury time.” The psychological framing for your email

will be “surrounded by important work” not “surrounded by 56,000 items of unimportant, meaningless Internet chaff.”

Email For Fun & Profit

Collect: offer an incentive for email + permission to content

Educate: send pre-scripted content series to your users, with goal of establishing trust and educating about problem domain

Sell: give them option to buy something which solves their problem

Tips For Successful Email Capture

Ask for as little information as possible: name & email

Have an attractive, boldly colored button which promises value not pain

Minimize distractions – works best on landing pages

Include a compelling offer.

Quid Pro Quo: Ask At Trial

• Add an email opt-in to trials.

• More opt-in than you would expect: 25%+

• Modestly depresses conversion rate to trial. (e.g. 45% to 42% on my AdWords pages)

• Mostly a good option because it is stupidly easy to do.

P.S. Consider using the “one free email” you get on signup to do some light marketing.

Quid Pro Quo: One-Off Resource

• Gate a download on opt-in.

• Incredibly high conversion rates – much higher than to trial.

• Fairly low cost: creating one beautiful PDF not really that hard.

Quid Pro Quo: One-Off Tool

• Break out your programming chops and do a mini-project, gated by email.

• Opt-in rates around that of trial through much higher (for high touch).

• Can provide very qualified, valuable leads.

• High cost: do one of the others as a placeholder first, then extend to this if results warrant it.

Educate, Then Sell

Aggre

ssiveness o

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Time

Three Simple Ways To Put Out That Fire In Your Hair

Hiya $NAME,

Your hair is on fire, which is why you signed up for this handy emailed course on Firefighting: Hair Edition at doesyourscalpburn.com. This is your second out of six emails. You can unsubscribe at any time.

Water: Why The Obvious Choice Is All Wet

Many people have tried extinguishing the fires in their hair with water. You may have yourself. If so, you know that it doesn’t work, because oil-based hair care products like shampoos and waxes don’t mix with water. Thus, the fire just spreads even more. When we surveyed our customers over 72% reported failure with water.

Repeat two more times.

Continued on next slide…

Three Simple Ways To Put Out That Fire In Your Hair　 (cont…)

Have a question about your hair’s fire?

We love hearing from folks. Do you have a question about your particular fire? We’ve probably put one similar out. Feel free to ask us a question. All emails are read by our Chief Firefighter, who has personally squashed 6,312 fires in the last 18 months. We try to respond to everyone within 24 hours.

Regards,

BobChief Firefighter

P.S. Got this far? Great, I’ve got a gift for you. Go here to download a free 15 page guide on extinguishing fire on necks.

More Salesy Stuff To Do

Pick the right plan for them. Make it decently expensive. (e.g. Suggest column 3 out of 4.)

Offer a time-limited bonus if they pull the trigger in the near future. (Free consulting services for onboarding = Total. Win.)

Pre-answer all their objections. “Pointy” customer testimonials directly

focused on these issues.

Learn from the Masters

Ramit Sethi (iwillteachyoutoberich.com) Motley Fool Whoever is outbidding everyone else in

any high-money vertical with a liquid affiliate market, like e.g. mortgages or online nursing degrees, since they’re probably not stupid.

First Run Experience

Does This Remind You Of Anything?

Three Steps To Improving FRE Script their first 5 minutes like invasion

of Normandy. Measure all user activity in first 5

minutes. Implement and test engineering /

marketing efforts to change behavior in those 5 minutes.

Instrument A Funnel for Your FRE

Fix Weak Spots In The Funnel

Bingo Card Creator Add more activities for users to use. Surface relevant activities on dashboard

immediately. (+10% activation) Restructure complicated preferences. (+10%

activation) Dan Martell’s app

Add suggested tweets (7% -> 65% activation) Appointment Reminder

Tour mode… oh, goodness, tour mode

In-app, Functional Tours

A Deep Topic But In General

Try to get people all the way to “activation” Tell them they got there! Just like Vegas,

you’re not having fun unless people tell you so constantly!

If there is a social / viral component, put it in here and obsess over it This builds companies. c.f. Zynga (boo),

Dropbox (yay!) If the software requires lots of data entry

/ analytics / etc to work right fake it for now

For more details

http://training.kalzumeus.com – I’ll swap you your email address for a 45 minute video teardown of the FREs for both of my apps plus a few others I rather like.

Special bonus for Microconf folks: I don’t presently sell anything, but when I do, it’s yours. Send me an email.

Thanks for Listening

Blog at http://www.kalzumeus.com Slides will be posted. See @patio11 Send me email. I love chatting about

this. patrick@kalzumeus.com