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Episode 02: 6 Quick Wins for Self-Serve Revenue

 

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Episode Summary

Samuel and Yohann kick things off with a quick update based on listener feedback, then dive into their most-recommended tips and tricks for impacting your self-serve revenue.

🔑 Prominent Concepts

  • Focus on One Action per Screen (4:49)
  • Actually Go from "Signup" to "Paid" by Yourself (14:15)
  • Reconsider Your Skippable Steps (18:11)
  • Flip Your Monthlies to Annual Subscriptions (24:20)
  • Find the Causal Drivers of Your Revenue (35:13)
  • Experiment with Pricing (aka #ChargeMore) (39:42)
  • Bonus: Lightning Round / Honorable Mention (46:53)

📚 References


🔤 Transcript

Samuel:
Hi, I'm Samuel from UserOnboard.

Yohann:
And I'm Yohann, also from UserOnboard.

Samuel:
And today our episode's theme is Self-Serve Revenue's Quickest Wins. So if you heard the last episode all about covering what is self-serve revenue and why should I care, and you came away thinking "Maybe I should care," then here, we are trying to serve you up with the quickest, easiest ways to go in and possibly have some form of outsized impact with minimal effort involved. Is that roughly correct?

Yohann:
Yeah, that's roughly correct. No brainer changes that will just have a chunk sized impact on your self-serve revenue.

Samuel:
Or could at the very least. No guarantees, but these are the first things that we would look at. If you're buying a house, you got to go check out the foundation. You got to make sure it's got good bones, things like that. These are just the high level recommendations.

Samuel:
But before we get into this, we do have a little bit of an update. In the last episode, we explicitly asked for feedback. After the episode was launched, we received explicit feedback. And it fell into three main categories. One of those categories is that people hated, hated the timers. And so, we will be doing a silent timer version from here moving forward. So fear not friends. You can listen without the hammer of justice coming down upon your ears at the end of any given segment. Feedback point number 2 is that there was a little too much behind the scenes talk that we came across, seeming a little bit unprepared. A little bit more time focusing on the actual material would be better listening experience. Totally understood there. I also realized that there's irony in the fact that we are doing behind the scenes talk about our criticism of having behind the scenes talk, but we will try to minimize it moving forward.

Samuel:
And then point number 3 that was a surprise to both of us, is that the term self-serve revenue itself didn't really seem to click with people. Conceptually speaking, people seemed a little unsure of what it actually referred to. And from our perspective, we've been working together on a growth and revenue framework that we've internally been calling Value Paths for a number of years now. And we thought that a way that we could share the framework that we call Value Paths might be made a little bit conceptually more easy if it was termed self-serve revenue instead. However, we're finding that the term self-serve revenue doesn't seem to carry a lot of meaning or certainly any kind of emotional weight with people. And so for that reason, we're going to rename this podcast mini series Value Paths: The Mini Series, rather than the Self-Serve Rev Cast Mini Series, which admittedly was always an awkward name to begin with. And now we're just calling it by what we want to.

Samuel:
But we aren't going anywhere. We've got plenty more episodes coming. And we are seeing this as an opportunity to just really dive into the stuff that we care the most about, and that hopefully resonates the most with you all as well.

Yohann:
Right. Thank you for all that feedback by the way.

Samuel:
Oh, that's a very good point. I was ready to just do a hard segue, trying to just save behind the scenes talk time, but you're right. Thank you very much to those of you who wrote in, sharing candid feedback. We said that you couldn't hurt our feelings, and our feelings were not hurt. It was just a helpful learning experience. And we're sharing those learnings here and looking to apply them as early as Episode number 2. Well, actually, yeah, Episode number 2 here in this case, because no more timers. That's the UserOnboard promise. No timers from here on forward. So with that out of the way-

Yohann:
Now, I'll just interrupt you, Samuel.

Samuel:
Yeah. Now we'll do the hard segue. With that out of the way, the theme of the episode is Self-Serve Revenues Quickest Wins. And I don't know if this is becoming tradition at this point, but Yohann, if you would like to put the first one out there. I stake no claim on the first turn here.

Yohann:
Okay. So my first quick win is, in bullet point form first, one action per screen. Do you have that on your list, Samuel?

Samuel:
Ooh, not even a little bit. So you are ready to roll my friend.

Yohann:
Okay. So this isn't a rule. It's more of a constraint to help you think better. When you have two calls to action on one particular screen, even if they both are really well-designed, what you're doing is creating two branches in your onboarding flow. And one, that doubles the complexity, because suddenly you've got to think about both of those flows resulting in something meaningful for the user. But also for the user it's confusing, because "Which action am I supposed to be paying attention to?" So my first quick win is to go through your onboarding flow and make sure that each screen-state points users to one action rather than two.

Samuel:
You're looking to shape the user's expectation of how to make progress toward the thing that they care about explicit, from one action to the next, to the next, on their way from where they are to where they want to be.

Yohann:
Right. And you don't want them at any point thinking, "What should I do next?" Because the more time they're spending thinking, the less time they're actually spending doing stuff.

Samuel:
Yeah. But may I put you on the hot seat? Can I throw a curve ball question your way?

Yohann:
Yes.

Samuel:
So a lot of times an onboarding experience will eventually wind up kind of having people arrive at the dashboard of the product, and kind of be left to their own devices from there. Are you saying that even something like that should just not categorically not happen, or that there are times where you should be restricting what people can do and other times when you can be expanding what people can do?

Yohann:
That is a perfect question because it helps me expand on what I meant by this is not a rule, it's a constraint. The constraint part of this is you want to be mindful of the fact that people can only consume one thing at a time. And at least attention wise, my attention can only be on one thing at a time. So you want to bake that assumption into whatever you're designing. So a dashboard will obviously have a bunch of empty states and a whole lot of things going on. But where do you want the attention to go first? Do you want it to be at the red Intercom button at the bottom left? On the Upgrade button that's high contrast on the top-right? Or the to-do list that says Get Started right in the center of the dashboard? When you've got three things competing for attention, this rule of thumb... I think calling it a rule of thumb might be better. This rule of thumb tells you to make one of those things more prominent than the others so that attention goes to one place instead of three.

Samuel:
That is really interesting. And I know from having gone through as many onboarding experiences as I have that a common mistake, in my opinion, along those lines is to have a collision where your new users might land on a dashboard and there might be some sort of a temporary banner mentioned somewhere on the dashboard saying, "Hey, we just released Dark mode. Check it out here," or advertising some sort of new niche feature rather than the main core functionality that a new user would be there to really evaluate and to put into practice. And so, suppressing new feature announcements on the dashboard until new users aren't new users anymore, and then you can tell them about the newness of the feature. And then they'll be like, "Oh, this is new to me." And then that works out much better than starting out by telling people about something.

Samuel:
If you tell them about a new feature as one of the very first things that you do to introduce your offering, you are doing so at the exclusion of all the other possible features, many of which are probably way more relevant to what they're immediately trying to do than that particular new one.

Yohann:
Right.

Samuel:
Everything's a new feature to a new user.

Yohann:
Yeah. Along these lines, another thing that's come up a lot in our work is Getting Started states. Not being given a prominent design treatment, you know? So the Get Started to-do list doesn't look any different from the rest of the interface. It's not until you explore the dashboard that you find it and then say, "Oh, this is where I get started." One of the things I've thought would be really great was, "How can you make this Get Started to-do lists stand out more so that's the first thing that users see?"

Samuel:
Mm-hmm (affirmative). So that there's a clear number one.

Yohann:
Right.

Samuel:
The clear biggest thing to do.

Yohann:
Yeah. So that the Upgrade button and the Get Started list are not competing for attention at the same time, because Upgrade doesn't even come into the picture the first time you're visiting the dashboard. You're just kind of trying to get your bearings instead of upgrading as soon as you get there.

Samuel:
Right. Yeah. Sometimes you land in the dashboard and there's a "Your 14-day trial has 14 days left. Upgrade now."

Yohann:
(laughs)

Samuel:
And the new feature announcement, and there's hotspots over the navigation and there's like a notifications area in the top-right with a red bell with a 1 inside of it, and also a to do list and a bunch of empty states saying that they don't have things inside them. It can be hard to really tell where the company even wants you to proceed next from their ideal user action sequencing strategy, I guess. I don't know if that's... That doesn't seem like a term at all.

Samuel:
But to just round that out, what I mean to say is like, when you're saying do one screen per action, it also forces you to recognize that what you're doing when you're getting people to go through a flow that involves multiple screens, is for them to perform multiple actions in a particular sequence, and to even just be thinking, "It doesn't make the most sense for them to confirm their email address before they even can get into the app. Maybe we can delay that action and have that sequenced later in this flow that we're looking to optimize around." And so, having a tighter screen to action connection also helps you view your self-serve revenue generation process in terms of user actions and less in terms of they go from this screen to this screen, to this screen.

Yohann:
Right. When I was in school, I had this English teacher who told me to stop using the word 'very', which he called a lazy word. And it's not to say that you can never use 'very'. It's not like the best authors out there never used the word 'very'. It's just that trying it out as an exercise helps you think about language in a different way and helps you think about what you're really trying to say instead of defaulting to that crutch of 'very'.

Samuel:
What's the equivalent in the design conversation we're having? What is the 'very' of self-serve revenue?

Yohann:
The 'very' of self-serve revenue is thinking like, "These are the actions I want my users to perform. I'm just going to put them all in this flow" without thinking about the sequence, without really paying attention to... What was the phrase you used? I like it, even though it's not a thing. Sequence something?

Samuel:
I honestly don't recall. The choreography of the user actions, essentially?

Yohann:
Yeah. Yeah. Oh, that's even better. Think about the choreography.

Samuel:
Yeah, exactly. They're going to perform action A and then action B and then action C, and fundamentally, that rationale needs to prove out to be reasonable and useful. If people do A, B, C, D, and E, then they're going to result in where you're trying to get them to go.

Samuel:
All right. So in a nutshell, that is recommendation number 1 of having one action per screen and the benefits and constraints thereof. Roughly correct?

Yohann:
Yes, roughly correct. And over to you.

Samuel:
All right, over to me. There was no hesitance in my list-making. As soon as I was starting to make the quickest win list, I knew immediately what my number 1 was going to be, which is to actually go through the process of generating revenue, going from a fresh signup all the way to a paying customer, to actually on a practical level, personally do those actions that we're talking about. Did that make your list?

Yohann:
It didn't, but that's such a good point. When was the last time that you actually did that?

Samuel:
Yes. Without naming names, I was onsite working with a multi-billion dollar company, and they realized that they had put out some sort of CSS change that just happened to have the unintended side effect of moving all of their tooltips in their tooltip tour down 40 pixels. And this is a company that's receiving tens of thousands, if not hundreds of thousands of sign-ups every day, I think, or something close to that, just insane amount of volume. And so thousands and thousands and thousands of people. Even though it took them a short amount of time to recognize the issue and fix it, it had already been seen by probably hundreds of thousands of people who were like, "Why do none of the tooltips point to where they're supposed to?" So it's very easy to let those sorts of things lapse and for people to not be in the habit of repeatedly signing up for their own product, because maybe they're dogfooding their product, or maybe they are active users of your own product.

Samuel:
It's hard to remember what it's like to be a totally new signup, but even just repeating the processes and just saying on a functional level, "I'm going to download this app and I'm going to go through every single step I have to until I have officially become a paying customer," or, "I'm going to sign into my desktop, SaaS offering or browser-based offering, and actually enter in my credit card details and actually go through the billing flow and actually see what that looks like." I can virtually guarantee that there will be things where you're like, "Ooh, we did not realize that this was an issue." So that's my quick win. Yohann, what are your thoughts on that?

Yohann:
My thoughts are, you need to really think about your starting point and resulting point beforehand, and define those before you actually go through this flow. Because it being a flow means one touch point leads onto the other, leads onto the next, leads onto the next. And it's only when you have your resulting point defined that you can evaluate whether the flow actually gets you there.

Samuel:
I concur. In this case, just to be clear, the resulting point would be very clearly defined, which is officially being a paying customer, officially having moved money from your account into the company's coffers.

Yohann:
Right. That's a great resulting point. So you can evaluate whether touch points actually lead you there. Or for example, if they lead you to the dashboard and then kind of you're left to your own devices and you can go in three different directions, how are you supposed to get to that resulting point? You've identified a place where the flow breaks down. Those are the things you want to make a note of because any point that the flow breaks down is a place you could possibly be losing users.

Samuel:
That may make an appearance later in this episode, in fact. We are treading dangerously closely to another one of my items. So I will just leave it at that.

Yohann:
Okay. Shall I move on to point number 3?

Samuel:
Absolutely, sir. I am ready to hear it out.

Yohann:
Okay. It's kind of related ironically to what we were just talking about. But in bullet point form, it's really think about skippable steps, really give them a hard look and figure out whether you actually want to include skippable steps in your work.

Samuel:
Ooh, I don't have it, but I love it. Sir, you have the floor.

Yohann:
Here is the logic. If there is a step in your workflow that users can safely skip and not impact their experience, why include that step in your onboarding workflow at all? And on the other hand, if it's necessary and skipping it would in fact impact their experience, then why make it skippable to begin with?

Samuel:
Are you asking these rhetorically or do you want me to try to feel some sort of a potential theory on why that's the case?

Yohann:
A little bit of both. I can keep going, unless you want to chime in.

Samuel:
Okay. Well, the general gist is that I agree with you. If anything, I guess I would be playing devil's advocate a little bit here. But my source of agreement is in the sense that if you have elements in your onboarding flow that are skippable, you need to design the rest of the flow, and especially the ensuing remaining flow with the assumption that somebody did skip whatever the skippable stuff was. So whatever it is that you're covering in the skippable material is something that you're going to need to address in a non-skippable fashion at some point. Or, if the skippable stuff isn't really that important, so important that you need to address it for real later, then to your point, why are you cluttering up the experience with not super relevant stuff?

Yohann:
Right.

Samuel:
Is that roughly correct?

Yohann:
Yeah. You want to lead with value, and having anything skippable to begin with or to start off that experience with is not valuable.

Samuel:
It's sort of like putting TLDR in front of your article. It's just a crushing level of lack of confidence to just be like, "I'm assuming you're not going to read this. So here's just a sentence for you to read and decide if you want to move on." Just write a hook. Learn how to get people to just be like, "Ooh, whoa. Hey, this has my interest. I don't need to read that too long; didn't read summary." Same thing. With the skippable stuff, if it's too long; didn't read, then change it so that people read it. Don't just make a TLDR at the beginning, you know?

Yohann:
Yeah. That's such a great point.

Samuel:
All right. So here's my devil's advocate theory as to actually answer your questions and make it not just rhetorical.

Yohann:
Okay. I'm ready.

Samuel:
Why are designers and product people drawn to producing skippable content or experiences or whatever you want to call it? My assumption would be that the designers or product people or whoever are wanting to get kind of the best of both worlds. Or maybe if you were to put it negatively, have their cake and eat it too, where they are really excited to tell you about the product and they're not sure which parts are relevant, and so you get a little bit of a shotgun approach where you just try to tell people about the top six features that you think are the most important and then hope that the people remember what it was that you said in the thing by the time that they can actually... You can hear my bias really creeping in. I'm not doing a good job of playing devil's advocate here. But the idea being that if somebody wants to have more of a catered kind of experience, then it's available. And if somebody wants to plow through all of that, then they have that as well.

Samuel:
So in theory, you are offering more capability rather than detracting from the experience. But according to you/us, there's a distinction between serving up relevant content in the moment that it's desired, versus spraying a bunch of stuff out there and cluttering up the experience with a bunch of things that people are probably just going to skip anyway.

Yohann:
If users are enthusiastic, then going through this material will only better tee them up for success. That's the nutshell?

Samuel:
That would be the theory of... Yeah, that for people who want to have a slow scenic route to getting up to speed process, then the skippable content would be available to those people.

Yohann:
Right. Right. Right. So just to respond to that and critique the rationale a little bit, is that the majority of your users? Even if it is the majority of your users going through that flow, you could have some really quick wins by catering to the people who aren't.

Samuel:
You're saying that's an underserved market.

Yohann:
Yes. Even if a lot of people are going through the skippable stuff, the people who aren't going through the skippable stuff, like catering to them and giving them all the education and ability points that you're giving to the other users with the skippable flow, giving it to them could create a really big Delta in your self-serve revenue.

Samuel:
Democratize it.

Yohann:
Yeah.

Samuel:
Power to the people.

Yohann:
Yeah.

Samuel:
Topic number 4, which again, when I was writing this list out, no brainer things. No brainer number 2 would be to think about annual upsells. And this is not necessarily an onboarding concept, so if you're like, "Man, everything they're saying is about onboarding," this one's purely self-serve revenue kind of a thing, which is the idea that when people sign up and when they become paying customers in month 1, you lose a particular percentage of those people by month 2. And then you lose another particular percentage of those people by month 3, and then you lose another one by month 4, and so on and so forth.

Samuel:
And so, when you have the opportunity to sell people on an annual subscription instead of a monthly subscription, you are locking them in for being a person who doesn't drop out for a minimum of 12 months. And you're also getting that cash in upfront, which lets you more quickly reinvest that money in your acquisition efforts or growth or product or wherever you want to put that money to try to grow your company. And so, the general idea here is that sometimes you'll see companies doing something like offering an annual plan at a discount. That's actually pretty common at this point I would say. So if this product is $50 per month with the annual discount, it's actually cost $600 to check out, versus having to pay $57 a month or whatever the difference there would be, right?

Yohann:
Right. Right.

Samuel:
However, you don't only have to incentivize people by offering a discount and making it cheaper. Another tactic that I would generally... I don't think there are any silver bullets, but a tactic that I would implement with any company where we were like, "Let's just see if we can move the needle on self-serve revenue," would be reaching out to people who are on the monthly plan on month 2, like when it's time to renew for the first time, or maybe by month 3 and saying, "Hey..." We're targeting people with healthy engagement and things like that, a message before their monthly renewal is coming up, saying, "Hey, we noticed that this is really working out for you. If you'd like to save some money, we can offer a light discount. Upgrade to annual now."

Samuel:
I would be sending that email out to people one to two months after they become customers, like absolute no brainer, probably should just print money like an ATM for you in the sense of anybody who you're sending that email to who converts and goes off of your monthly plans and onto your annual plans not only locks themselves in for the long haul, but also is giving you all of that money upfront, which is a double win there.

Samuel:
And then one other thing I will add while I'm pontificating about this is that you can offer more than one year at a time. I have seen some software companies offer, "Hey, you want to do two years? You want to do three years?" and it's offered at a more significant discount. I personally very nearly paid... I remember signing up for some sort of offering and entering into some sort of trial and being given an aggressive, like you can renew it for one year, two year, three years, and they're at more and more of a discount as you go and thinking, "Yeah, I bet I'm going to be continuing to use this three years from now" and being really close to pulling the trigger. And I do not use that product at all anymore, and that was just like a couple of months ago.

Samuel:
So I would had no complaints, no leverage, no reason to be put out if I was like, "Yeah, I think I'm going to use this for three years and I'm going to pay them X amount of money upfront based off of my own speculation and good vibes because here I am signing up for the product and hoping for the best and expecting whatever project that I'm going to be using on to go really well" and all these different things. So when you do the annual upsell, it doesn't even have to just be for one year. So that's a double recommendation, the one or two months after annual upsell email and possibly offering people more than one year. See what happens.

Yohann:
So I have a tough question to ask here.

Samuel:
Excellent. Well, because we're out of time. All right. We'll make time for that tough question. I won't back down from it. I'm ready.

Yohann:
Okay. So if you are prioritizing an annual plan, that puts a lot of pressure on your self-serve flow, right? Or your sales process in general. Because the ticket value being that much higher and the lock-in period being that much longer means that users have to really make a considered decision. One, that puts pressure on the whole thing. Two, it delays it. You have to deal with a lot of other considerations that you wouldn't have to if you are pushing a monthly plan with a smaller ticket value and a smaller commitment.

Samuel:
Mm-hmm (affirmative). You really got to wow them. You need to provide more value.

Yohann:
Yeah. Yeah.

Samuel:
I'm with you on that. I don't think that it has to be a binary thing. I know that some companies only offer annual subscriptions. And other companies, many SaaS companies historically have offered monthly subscriptions just by default without even having the option of incentivizing an annual upgrade. So to me it's a question of right now money is more valuable than future money, and the more that we can have people give us right now money even if it's at a discount, it's going to have more of an impact on our company's growth than trying to stick with the lower price plans and hope that people stick around long enough to pay off the cost that it took to even receive them. The CAC Payback that we were talking about in the last episode, you're going to cross your fingers that they're even going to make good on the "loan" that you've given them, much less pay you off and start producing profits. So to be able to have that just guaranteed upfront, if you can make that compelling and you can make a nice user experience around that, definitely a recommendation.

Yohann:
Right. And the pressure might be a good thing because it will force you to think about the evaluation process. It will force you to answer the question of how are users deciding to commit at the moment, whether it's for a month or for a year. What goes into that consideration and how can I front load, how can I choreograph that evaluation better?

Samuel:
Mm-hmm (affirmative). I agree. And that also, when you're thinking about it from a process standpoint of a sequence of actions, you're thinking along of a timeline. And part of the recommendation here is to be thinking of maybe somebody is not prepared to bite the bullet, isn't prepared to bite on your annual discount sight unseen when they're just going through your onboarding flow or when they're beginning to become a customer. But maybe after a month or two, they have received value. And that's why I was saying if they have healthy engagement. And by that, I mean really, regardless of how much engagement they have, like, just whether good things have happened in their life based off of having brought your product into their life.

Samuel:
But if that's the case and they're showing signs of vitality, send them an email saying, "Hey, this looks like we got a good thing going. If you want to save money now on that annual upgrade, the deal is still on the table, 20% off. Click this link and it's a done deal." I imagine that that would convert at some percentage. And whatever that percentage is, would be basically just almost free money in a sense. So, recommendation there. But again, we've already run over. So I'm going to have to regrettably cut myself off to give you the floor to put out another, I guess this is our fifth, our penultimate recommendation. What have you got for me, Yohann?

Yohann:
I'd like to go into mindset territory. I do consider this a quick win because you can change your mindset about something immediately. There's this funny story... I forget who tells it, but there's this funny story of... You know how you go to a Zen monastery and you're interested in enlightenment, and these Zen masters make you run up and down the steps a hundred times and they slap you in the face and they make you starve for three days? Have you heard those kinds of stories of Zen monasteries being really hard on people in this way?

Samuel:
Yeah. It's like S&M kind of stuff.

Yohann:
Yeah. Yeah. I heard this Zen master talk about it and he was like, "We don't want to do these things. We have to do these things because that's what people believe it takes to achieve enlightenment. You could get enlightenment this very second, you know? Just realize that you don't have a self, and you're golden. It takes one minute to shift your mindset. But okay, if you come in with this expectation of having to run 70 miles, fine, we'll make you do it run 70 miles."

Samuel:
20 years of chopping wood and carrying water, then you finally-

Yohann:
Yeah. If you insist.

Samuel:
Then you're like, "Oh, there's no point to any of this."

Yohann:
Yeah.

Samuel:
It's like, "Oh, there is no point to anything. Okay, cool. I got it figured out. Thanks, guys."

Yohann:
So, if you're interested-

Samuel:
Yeah, what's the self-serve revenue takeaway here?

Yohann:
The self-serve- (laughs)

Samuel:
Yeah, I have to admit, I'm a little lost.

Yohann:
The self-serve revenue takeaway here is it takes nothing to change your mindset about some of these things. And mindset changes can be really quick, impactful wins if you just lean into them. So I'm going to talk about-

Samuel:
Are we talking about a user mindset or a product-person mindset?

Yohann:
Product-person mindset.

Samuel:
Okay.

Yohann:
Yeah. I want to change some product people mindsets at this point. And I think it could result in quick wins.

Samuel:
So the quick win is to look at this differently. That's what you're saying?

Yohann:
Yes.

Samuel:
Shift your perspective. All right.

Yohann:
Shift your perspective.

Samuel:
I did not have that on my list so you've got the floor.

Yohann:
Stop thinking of revenue as overdetermined. And I will explain what that means. Overdetermined first. Overdetermination is this concept...I'll illustrate it with a story. Just imagine there are two kids, Billy and Suzie, and they're throwing rocks at a window. It just so happens that both of them throw a rock at the exact same time and it hits the window at the exact same time. It's impossible to tell which rock caused the breaking of the window. In these kinds of situations, you say that the breaking of the window is overdetermined causally. Both the rocks caused it to break.

Samuel:
Okay. Gotcha. So we're talking about causality and the explanation for why something happens, and overdetermined means that we have a redundant amount of explanations for why it happened? Is that roughly correct?

Yohann:
Yes.

Samuel:
Okay.

Yohann:
And what I'm trying to shift mindsets about is to stop thinking that revenue is overdetermined, you know? The marketing people think that if they get more leads in this month, the revenue will go up. The customer success people think that if they support people better this month, the revenue will go up, you know?

Samuel:
Mm-hmm (affirmative)

Yohann:
Everybody who's working on a problem, thinks that their efforts will result in revenue going up.

Samuel:
So we're talking attribution here in a sense. You couldn't derive the attribution for which kid broke the window. And in a similar way, it's difficult to attribute which department's efforts actually move the needle. Is this the correct comparison here?

Yohann:
Yes, absolutely.

Samuel:
Okay. All right.

Yohann:
We're talking about attribution.

Samuel:
All right. I'm locked in it.

Yohann:
When you're looking at a flow and thinking about the sequence of touchpoints that domino upon each other to result in revenue, just focus on that flow and draw causal lines between revenue and that flow. Don't think of revenue as overdetermined. Everybody has-

Samuel:
I think... All right. I got to interrupt.

Yohann:
Okay.

Samuel:
I think people at home are going, "Okay. Well, that sounds great. How do I draw these causal lines?"

Yohann:
Yeah, that's a great question. I think actually going through your flow. And not just going through the first session of your onboarding experience, but starting at a Google search for example and actually going through the flow all the way up to revenue will help you draw some of these causal lines and will help you identify the gaps where a flow doesn't even exist. Like, if I'm dropped into a dashboard and the upgrade button is just sitting there for my entire trial and the evaluation period isn't choreographed, that's a gap. How are you going to draw causal lines there?

Samuel:
So the idea here being that the company, whether they realize it or not, that a software business has an underlying assumption that if we have this strategic sequence of user actions, well strategic or otherwise I guess, a sequence of user actions leads to revenue being produced. And if they're thinking about it in product terms, they're thinking of, "How can we change the qualities and aspects of our product to make revenue go up?" But really, if you just look at the behavior of the people and seeing which user results and actions most strongly correlate with revenue production, and then think about how you can support more users arriving at those sorts of results, then that's really the name of the game. Is that correct?

Yohann:
Yes, that's correct. Look at your set of payment screens and the set of screens that immediately precede those payments screens. What needs to happen in order for more people to be successful there? Revenue is not over-determined. It is these causal lines in the floor that are causing it to come about.

Samuel:
All right, that's point number 5. We got point number 6 locked in here, ready to roll. I would have a hard time thinking of quickest self-serve revenue wins without my main man and inspiration, patio11, Mr. Patrick McKenzie, who is known for a hashtag or a term more than any other, which is #chargemore. So if you are thinking about how you can generate self-serve revenue and how you can have a meaningful impact on that and your plans are $5 a month, $10 a month, and $20 a month, you are going to be working it with vastly different and vastly differently scalable unit economics than if you weren't looking at $50 a month, $100 a month, $150 a month. And a lot of times, software developers or the people who are closest to the business are so familiar with it...

Samuel:
Okay. Let me give an analogy. My next door neighbor, his name is Phil. He spends more time on his yard, his lawn than anyone I've ever met. He literally mows it every day. He keeps it like a golf course, and we live in drought territory. So this is his big thing. And I was talking to him about it the other day and saying, "Boy, you've got one of the nicest lawns that I've ever seen. You put so much work into it. You can tell how much care goes into it." And he's like, "Yeah, all I see is there's one of the couple of blades that are uneven over in the far corner. And then there's that little brown patch that I'm trying to figure out." And all he sees are the flaws.

Samuel:
I think in a similar way, when you're so close to the product that you're making and the offering that you're trying to provide your users or your customer-base, it's easy to devalue the work that you provide, especially if you're not intimately acquainted with exactly what value looks like from your user's perspective. Both of those things can really lead you to under pricing your product.

Samuel:
If there's one thing that I could recommend, I don't know if it would be the number 1 thing, but it would be on the Mount Rushmore of recommendations, which would be from the earliest point in your company's life possible, make testing pricing really easy. Because the bigger you get, the harder it becomes. And you're going to always be wanting to see how different plans perform in comparison with each other and which features are most important to get people to unlock bigger plans and thus go onto bigger priced subscriptions. And being able to experiment with the lever of the actual amount of money that people are paying you is something that you do not want to be trying to do with one hand tied behind your back. So big recommendation is baked in pricing experimentation from the beginning. And when in doubt, follow Mr. Patrick McKenzie's advice and #chargemore.

Yohann:
Relatedly, I like Jason Cohen's advice here too, where he says, "How do you know you're charging too much? You get the hint." Just a few complaints coming in from here and there that your pricing is a little uncomfortable and expensive. That's when you know you've hit the right price. If no one's complaining about your prices right now, double them."

Samuel:
That's basic business advice in general, whether you're selling diced tomatoes or freelancing or anything. If you're not hearing people say no, that means you are not charging enough for sure.

Yohann:
Right.

Samuel:
And you could try just by doubling them or by adding a zero and seeing what happens. Legitimately, you want to feel in tune with where that edge is, and you ultimately want to be forming your pricing model and your plans and strategy around that with an intimate familiarity with where those inflection points are, I guess you could say.

Samuel:
There's a great lecture that he gave at Business of Software. I think we're referring to the same anecdote where he was talking about working with a company and they literally doubled their prices and nobody complained. And they checked back in with Jason Cohen and told them of the good news. And he was like, "Oh, what are you going to do now?" And they're like, "I don't know. Maybe we'll invest that extra money in ad words, or maybe a hire another customer support person." Jason Cohen was like, "No, double it again." Let's just keep moving up until you have a feeling of where that threshold is, and then you're not operating in naivety about where that is.

Samuel:
I find that when we talk about conversions and retention and self-serve revenue, a lot of these are based off of different levers that people really don't know how flexible they are until they actually try to work it. Like if you see that if you have a credit card step where you're asking people to enter their credit card information, and you're converting 30% of the people who arrive at that step, you don't know if you could be converting 80% or 31%. Like, you could work for a year to try to bring that number up and you might be wildly successful, or it might be really hard to move.

Samuel:
And so, having an idea of which things are hard to move or which things where, "Wow, if we change our monthly pricing from $100 to $499, conversion stays exactly the same, maybe we should just be parking an extra $399 per month." You don't get to know that kind of thing until you hit that point where people are starting to push back. Exactly like you said. I just rambled... If you wanted a rambling, like the opposite of cliff notes where somebody says something succinctly, and then you get like the longer garbage or less to the point version, then that's what I just brought to the table.

Yohann:
I enjoyed it.

Samuel:
Well, thanks, Yohann. You've always got my back, buddy. All right. So that's the end of point number 6. Time to do the episode recap. I thought that one thing that we could also do... I know that you had one or two other items on your list and I've got some on mine as well. I thought we could maybe do like a-

Yohann:
A lightning round?

Samuel:
Lightning round. Lightning round, yeah, exactly. So do you have anything that's lightning round compatible?

Yohann:
I do.

Samuel:
All right, let's hear it, Yohann.

Yohann:
Okay. Number 7.

Samuel:
Honor roll mention number 7.

Yohann:
Use more microcopy. Microcopy is such a useful tool to help people get their bearings and learn new terms and figure out what they're supposed to do in a particular screen. And it's very easy to put into the interface because you're not changing anything big. You're just adding a small, helpful line under a form field for example. I also want to give-

Samuel:
Or-

Yohann:
Sorry. Sorry.

Samuel:
Or changing existing microcopy to actually be helpful.

Yohann:
Right.

Samuel:
A lot of times microcopy is written by engineers, like, "Error. Email does not match regular expression," whatever. You don't want your users to see that. You want to really curate your microcopy. So even if you're not adding more and you feel good about it, go back and revisit and think, "Does this really encapsulate the value that we're trying to get people to pursue here?", right?

Yohann:
Right. On the one hand, the value, for sure. But on the other, just being helpful at that particular stage. Speaking to what users are thinking at that moment can be really helpful. Let me give a quick example here. If you've ever played a game, you've come across this line when you're trying to quit that says, "All unsaved progress will be lost." Happened to you, Samuel?

Samuel:
Mm-hmm (affirmative). It has happened to me.

Yohann:
Yeah. And it's just like it's a-

Samuel:
Tragically at times.

Yohann:
It's a statement. I mean, it's, "Okay. Fine. Cool. And then I quit." But you know, what if that line said something that spoke to what was going through my head in the moment, which was, "You will be able to pick up from here next time"?

Samuel:
Right.

Yohann:
That's the kind of [crosstalk 00:48:53]-

Samuel:
Same thing, just the difference of positioning. In that case, framing.

Yohann:
Yes. It's just framing. It's just thinking, "What is the user going through at this moment? How can I help them?"

Samuel:
And different wording is a very easy change to engineer for sure as well.

Yohann:
Yes.

Samuel:
You don't need a lot of developers on that "feature". That comes almost free.

Yohann:
Okay. So lightning round number 8.

Samuel:
Okay. Ooh, you're going for two in a row.

Yohann:
Two in a row.

Samuel:
I love it. Let's hear it.

Yohann:
Okay. My next one is, try and make your onboarding support persistent. It's usually the case that onboarding is, like, this quick tooltip tour that you just go through and then it's gone forever. And all of the help that you received, either it stops too soon or you can't find it after it's over. And you can remedy both of these situations by just being, one, a little more persistent with your communication, and two, just keeping that communication going for a longer period of time instead of just focusing on the first session and engineering it to the point of optimization. Think about that whole flow, like we were talking about drawing causal lines. Think about beyond onboarding all the way up to that first revenue event. How can you continue to be helpful? Even beyond the first revenue event actually. But scope wise, keeping it shot for this conversation.

Samuel:
Right.

Yohann:
Just think about how you can continue to be helpful over time rather than optimizing that first session.

Samuel:
I love it. I agree. That's a very... It makes for a silky smooth segue to bonus item number 9 that I would like to throw out there, which is the term is resurrection emails or resurrection messaging or a resurrection campaign. Resurrection is the key term here, which is the idea of taking all of your churned users. I mean, I've worked with companies who are getting, let's say a 100,000 signups per week. And some of those companies are converting 30% of those signups and some of those companies are converting 1% of those signups.

Samuel:
And so, if you're converting 1% of a 100,000 people, after not that long, you're sitting on millions and millions of people who were close enough in their life to adopting your product, that they took time out of their day, that, A, you just made it onto their radar at all. And B, they actually invested at least something in getting close to working with you. And if you can reach out to that market of what might be for some companies, literally millions of users, I guess you would call them users still, retired users something like that, then that's a marketing campaign that could work quite well. And a lot of times I don't see people sending out any kind of messaging too deep on retained people, rather than, "Hey, your trial is about to expire. We miss you. Come back." That we see, but we don't see messaging that's targeting the hundreds of thousands of people who are just piling up in your Didn't Work Out bucket.

Yohann:
All right.

Samuel:
And then last bonus idea is the idea of credit card transactions and the management thereof. For example, if somebody's credit card fails, do you send them an email letting them know that their account is about to go away? Because that might be pretty motivational for them to go in and make sure that the credit card gets updated. Whereas, if it just silently starts failing and it's up to them to realize what's happening, less likely that they're going to take action on it.

Samuel:
Another way that you can be proactive here is instead of waiting for people to have their credit cards expire, you can do what's I believe a process called dunning, which means that you are reaching out to them proactively saying, "Hey, based off of the information we have, your expiration date of your credit card is coming up. We don't want you to lose any service. We recommend entering a new credit card number" or something along those lines.

Yohann:
Right.

Samuel:
So keeping the transactions going along seamlessly is another relative no-brainer when it comes to self-serve revenue quick wins in my opinion.

Yohann:
And all of these things are really easy to set up with a billing system. So not just a payment gateway, or if you're using Stripe or you have a subscription layer on top of Stripe, that works. But you'd be able to do deep customization like this with a billing system. It's definitely worth thinking about /investing in. There's some great ones out there.

Samuel:
All right. And so with that, Yohann, I am grateful for your time. I'm grateful for anybody's time who has followed us along in this journey thus far and has listened through to this point of Episode 2. Next episode will be under the branding of Value Paths. And the episode theme will be what is Value Paths, and Why Should I Care? Very similar to Episode 1, except this time we're just hitting the reset button and we're doing it under the name that we believe in the most.

Yohann:
Keep your feedback coming in, please. We really enjoyed reading through it. And we would love for you to be more involved with these episodes going forward. So if you have questions or if there's anything on your mind about anything we talked about, please let us know.

Samuel:
You can reach us at podcast@useronboard.com. And I promise that you will not hurt our feelings no matter how critical it is. We love to learn.

Yohann:
Thank you, everyone. And thank you, Samuel.

Samuel:
Ooh, thank you, Yohann. All right. Keep fighting the good fight.







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