9 ms·

Marketing Software, For People Who Would Rather Be Building It

190 points by craigkerstiens 14y ago

patio11 14y ago
I fly out to Microconf 2013 in approximately 20 hours and haven't finished my presentation yet, so I thought I'd procrastinate by finishing the editing on this transcript of my Microconf 2012 talk. Also includes slides/video. Feel free to ask questions if you have them.
- danmaz74 14y ago
  Excellent advice as always. One question: When talking about marketing for internet businesses, I don't remember you mentioning branding much, if at all, mostly direct response marketing stuff. Is this by choice? Have you got an opinion about branding for internet startups - eg how many resources they should devote to it compared to direct response marketing?
  - patio11 14y ago
    Most of my businesses are aggressively unbrandable (with the debatable exception of myself personally). Branding strikes me as not really playing to my strengths and not being maximally compatible with the sort of time and resource constraints most small businesses / startups are operating under. (If I were in a confrontational mood I'd also describe it as "A great way to spend a lot of money while avoiding any responsibility to actually produce meaningful business results.")
    - danmaz74 14y ago
      I suspected something like this :) I come from a technical background too, but I think that not thinking in branding terms is very often a big weakness of us technical founders - one of the reasons why inferior products often have the upper hand. I'm also trying to make a business out of this realization, but I'm not there yet and for now I'll just try to sow the seed of doubt here. By the by, I also think that a lot of what you suggest for direct response marketing also has branding effects - just think about educating people by email for free - so the two things aren't necessarily in contrast. And I don't think that there would be much to debate about the value of your personal brand here (meaning no offence - if you don't like the word brand, just substitute "reputation" to it!).
- klox 14y ago
  You indirectly mentioned this in your talk: You have users enter their CC details whens starting a free trial on AR instead of when the free trial ends. I've heard Rob Walling recommend this approach on his podcast, and noticed you do it for AR, but I've never seen you write about it. I would love to hear just a little more about it and any A/B data you've collected on it. On the one hand it obviously decreases the number of users passing through the sign up stage of the funnel, but on the other hand it's obvious that the customers who do sign up convert a lot more. Thanks!
orangethirty 14y ago
Everyone who has a startup should watch this at least once a day (me included). This is great stuff, Patrick.
- patio11 14y ago
  Thanks, glad you liked it. What would you like to hear more about? (I'm shamelessly fishing for ideas for this year.)
  - orangethirty 14y ago
    I always get questions relating to email. People have a lot of issues with that. They don't seem to get the value of automated email selling. Or even doing it manually. I, for example, make the most money from email marketing. So I know it works. But Hackers and email marketing are a very weird subject. Your insight might get some of them to understand the true value of it.
  - jplewicke 14y ago
    These are a few things off the top of my head that I'd love to read a blog post on: - SAAS Pricing when marginal costs are fairly high. For example, how would you price a service that offered human translation of a company's social media posts into N different languages? - Accounting / corporate structure for bootstrapped SAAS companies: do you use an LLC, and if so things to take into account for cash vs accrual accounting, pass-through vs. corporate taxation, guaranteed payments vs. distributions, finding a good accountant, etc. - The 8,000 word "stake through Bitcoin's heart", or at least the part that talks about how and why banks are going to stop taking Bitcoin exchanges as clients. There is a surprising amount of doublethink going on to allow people simultaneously believe "Bitcoin and traditional banking are natural enemies", "at least one Bitcoin exchange will always be able to access the banking system", and "the nominal price of Bitcoins can only increase in the long run."
    - patio11 14y ago
      Accounting / corporate structure for bootstrapped SAAS companies: do you use an LLC, and if so things to take into account for cash vs accrual accounting, pass-through vs. corporate taxation, guaranteed payments vs. distributions, finding a good accountant, etc. My accountant, Cameron Keng, is giving an attendee talk on this very topic at Microconf this year. I'm going to be taking notes. (The cheapest advice from him I'll get this year, for certain. ;) ) Remind me to post them if he doesn't. Noted on the other two suggestions.
tocomment 14y ago
Could you post your list of the 400 new things you could do with Twilio? It seems like there ought to be a lot but I can't think of any. (Or at least post your process for coming up with them.) I think bitcoin might be another technology that makes big "ripples", no?
- patio11 14y ago
  Or at least post your process for coming up with them. Think of a business. Think of any phone call, incoming or outgoing, which is sufficiently standardized that you could teach any college graduate to execute that. That person can be replaced with a Twilio script, at a fraction of the cost. My wife is sleeping in the room with my business notebooks so I'll hold off on finding and scanning it for the moment, but it was literally as simple as a) write down business, b) write down the calls they make, c) star the ones that sound like money. I think bitcoin might be another technology that makes big "ripples", no? We will have to agree to disagree on that one. Bitcoin's core innovation is the distributed self-organizing boiler room. As a transaction processing system it's technically innovative but wildly inferior to legacy payments for transactions which need to touch the real world. (It's interesting for transactions which don't, but could be replaced with a SQL update statement, which would improve upon it in virtually every way.) As a currency/commodity, the arguments in favor of it having a sustainable value north of zero are not credible to me. The main reason I have not nailed an 8,000 word stake in its rotten heart is that I think there's a non-zero risk that people will use every additional quantum of attention given to it as a reason to convince other people to "invest."
  - euroclydon 14y ago
    Outgoing unsolicited calls, once removed, might lighten the load of what people are imagining here, unless I'm not up to date on Twilio's TOS.
- hiddenfeatures 14y ago
  My gut tells me, that this is not legal (it would not be in Germany), so I don't advise you doing this before consulting with a lawyer first. That being said, I just got a US phone number and I get at least 3-4 calls a week for the previous owner of my phone number. Those calls seem to be revolving around credit loans that she had. To me it seems as if they try to remind her that she should pay those loans back. One could pretty easily build a really annoying twilio-based version of those phone calls...
todd3834 14y ago
The video was great! It would be nice to hear about how you get people into the funnel so that we could do a lot of the things you recommend. You already covered SEO, do you have any other customer acquisition techniques?
- patio11 14y ago
  SEO and AdWords are my mainstays for my software businesses. This year I'm going to be dipping my toes into a bit of offline marketing, like e.g. going to the (without loss of generality) Omaha Conference For Orthodontics Practice Managers and just talking to people. Given what I currently surmise about the per-account LTVs for higher-end customers of Appointment Reminder, at many plausible guesses for how many conversations I can have per day and how many people I can convert, it might be worth my time to do that. (Step 1: Do it. Step 2: Do it systematically with predictable ROI. Step 3: Pay someone to execute on Step 2.)
ambiate 14y ago
I've followed/stalked you for years Patrick. Thank you so much for sharing your knowledge. You helped transition me from grey to white. On a side note, if your Vimeo account is Pro/Plus, please check the 'make accessible for mobile devices' option in account settings.
k3n 14y ago
I'm not trying to take anything away from you at all, because what you've provided is very good. However, I'd like to say something about marketing vs sales, in that it seems like your material is more geared towards sales than marketing. I'm going to go off on a tangent here somewhat, bear with me... To explain in my eyes, I see marketing as everything you do to promote your project (i.e. brand/product/etc.), which may not always have a direct financial payout tied to it. For instance, FOSS projects have their own motivations for gaining usage and popularity, and revenue may be tied to that, but they're not explicitly selling anything. But, they do wish to get noticed, to have people try them out, etc. and so they are selling the idea of their project even though they're not actually ringing anything up at the register. On the other hand, "sales" is much more closely coupled with driving a user to purchase (or maybe even just 'sign-up' for) your service or product. This is what I'm mostly seeing in the slides: pricing, email campaigns, conversion rates, etc. These are all pretty exclusive to making a sale, and while they do embody marketing concepts, there's a lot more to marketing than simply corralling the customer to the register. Why am I droning on about this? I'll admit that it's for selfish reasons; I was hoping to see some marketing guidance for the page itself. I review lots of projects, and a majority of them that are created by engineers fall into one of the following buckets: * zero marketing whatsoever, possibly only a github page with a couple sentences in a readme * poorly-constructed marketing, such as using lots of buzzwords and generic phrases without actually telling me anything at all about what the project actually is or does; for instance, many times the only blurb given is akin to "cures what ails you" Now there are some that get it right, though I suspect that many of these either have someone with marketing skills on the team, or they've had an actual marketing guru help them out. That, or they're generally really observant and pick-up on it without having to study. Either way, when I review a project, it's a shame that the basics are so often neglected: * problem definition: in explicit terms, what problem(s) does your project solve? * product differentiation: if yours is "the best", "an alternative", "the new way", etc., then why do you think that? Why should I choose yours over X? If you can provide some concrete examples here, all the better. * product demo: if it can be demo'd, then please at least create a simple working demo. Note: I don't consider projects that include demos as a part of the source code, which must be downloaded, built, and configured as a proper demo. I also don't consider any that require you to register or provide an email address as a proper demo, either. Unless it's a very pressing need that I have, I'm not going to spend 5-15m fiddling with your source or giving away my info. Just host it somewhere so that I -- and possibly my CTO/CEO/purchasing agent -- can see it in action. * licensing, terms and conditions, etc.: make them prominent enough that I don't need to browse your source files or open a support request to find out if I can even use it. Sorry, this got longer than I anticipated...
mdlthree 14y ago
I am having trouble processing some cognitive dissonance when comparing your parable of the "Crazy Egg Enterprise Edition" but then using pricing strategies to take advantage of the sane kind of managers. While, I understand the concept of feature segmentation, I supposed should not be concerned with how other people run their business. I only need to focus on my profitability and not being a sucker.
- coopdog 14y ago
  I suppose it's all in the wording. Have the cheaper options but don't call them enterprise, and then have the really expensive enterprise option for managers for who the pain of being called anything but is more than a slight blip in the budget. Giving them ways to pad their budget was also an eye opener for me. The idea that they might not even be conforming to our rational actor model of balancing cost and value opens up new pricing considerations. I wonder if a monthly 'flex' option where they can temporarily boost their budget to some ridiculous figure would work. The engineer in me does cringe at the thought of it though
ComputerGuru 14y ago
I'm super sorry to have just learned about microconf only to find that it is completely, totally sold out for this year (plus being only a few days away). Any other good conferences like this one? From what I can see, this is all content and zero fluff, not cheap but not outrageously expensive either. I'm more than ready and willing to book even if it's a few hours from now for something like this. Share your thoughts, guys!
- patio11 14y ago
  BaconBizConf and Business of Software are the other two software business conferences that I'd fly to America to attend even when not speaking.
  - deleted 14y ago
    [deleted]
- krallja 14y ago
  I can recommend Business of Software. patio11 has spoken there, as have many other HNers, Seth Godin, Richard Stallman, etc.
biot 14y ago
My $0.02 worth: For many of you, assistance directly from the CEO in integration is a really compelling offer, because wow, you can’t get that anywhere else. [...] We’ll do the copy‑pasting for you ... and it will actually be done by a freelancer that we’ve hired and told them how to FTP stuff. If one claims "assistance directly from the CEO", I would be disappointed to learn that access credentials to my website were handed out to some third-party freelancer who performs the integration rather than being handled directly by the engineer-owner. If you mean something different such as "our CEO ensures the job gets done to exacting standards" then that's freelancer-compatible as the statement makes no claims about who provides the assistance.

190 points by craigkerstiens 14y ago

I fly out to Microconf 2013 in approximately 20 hours and haven't finished my presentation yet, so I thought I'd procrastinate by finishing the editing on this transcript of my Microconf 2012 talk. Also includes slides/video. Feel free to ask questions if you have them.

danmaz74 14y ago
Excellent advice as always. One question: When talking about marketing for internet businesses, I don't remember you mentioning branding much, if at all, mostly direct response marketing stuff. Is this by choice? Have you got an opinion about branding for internet startups - eg how many resources they should devote to it compared to direct response marketing?
- patio11 14y ago
  Most of my businesses are aggressively unbrandable (with the debatable exception of myself personally). Branding strikes me as not really playing to my strengths and not being maximally compatible with the sort of time and resource constraints most small businesses / startups are operating under. (If I were in a confrontational mood I'd also describe it as "A great way to spend a lot of money while avoiding any responsibility to actually produce meaningful business results.")
  - danmaz74 14y ago
    I suspected something like this :) I come from a technical background too, but I think that not thinking in branding terms is very often a big weakness of us technical founders - one of the reasons why inferior products often have the upper hand. I'm also trying to make a business out of this realization, but I'm not there yet and for now I'll just try to sow the seed of doubt here. By the by, I also think that a lot of what you suggest for direct response marketing also has branding effects - just think about educating people by email for free - so the two things aren't necessarily in contrast. And I don't think that there would be much to debate about the value of your personal brand here (meaning no offence - if you don't like the word brand, just substitute "reputation" to it!).
klox 14y ago
You indirectly mentioned this in your talk: You have users enter their CC details whens starting a free trial on AR instead of when the free trial ends. I've heard Rob Walling recommend this approach on his podcast, and noticed you do it for AR, but I've never seen you write about it. I would love to hear just a little more about it and any A/B data you've collected on it. On the one hand it obviously decreases the number of users passing through the sign up stage of the funnel, but on the other hand it's obvious that the customers who do sign up convert a lot more. Thanks!

orangethirty 14y ago

Everyone who has a startup should watch this at least once a day (me included). This is great stuff, Patrick.

patio11 14y ago
Thanks, glad you liked it. What would you like to hear more about? (I'm shamelessly fishing for ideas for this year.)
- orangethirty 14y ago
  I always get questions relating to email. People have a lot of issues with that. They don't seem to get the value of automated email selling. Or even doing it manually. I, for example, make the most money from email marketing. So I know it works. But Hackers and email marketing are a very weird subject. Your insight might get some of them to understand the true value of it.
- jplewicke 14y ago
  These are a few things off the top of my head that I'd love to read a blog post on: - SAAS Pricing when marginal costs are fairly high. For example, how would you price a service that offered human translation of a company's social media posts into N different languages? - Accounting / corporate structure for bootstrapped SAAS companies: do you use an LLC, and if so things to take into account for cash vs accrual accounting, pass-through vs. corporate taxation, guaranteed payments vs. distributions, finding a good accountant, etc. - The 8,000 word "stake through Bitcoin's heart", or at least the part that talks about how and why banks are going to stop taking Bitcoin exchanges as clients. There is a surprising amount of doublethink going on to allow people simultaneously believe "Bitcoin and traditional banking are natural enemies", "at least one Bitcoin exchange will always be able to access the banking system", and "the nominal price of Bitcoins can only increase in the long run."
  - patio11 14y ago
    Accounting / corporate structure for bootstrapped SAAS companies: do you use an LLC, and if so things to take into account for cash vs accrual accounting, pass-through vs. corporate taxation, guaranteed payments vs. distributions, finding a good accountant, etc. My accountant, Cameron Keng, is giving an attendee talk on this very topic at Microconf this year. I'm going to be taking notes. (The cheapest advice from him I'll get this year, for certain. ;) ) Remind me to post them if he doesn't. Noted on the other two suggestions.

tocomment 14y ago

Could you post your list of the 400 new things you could do with Twilio? It seems like there ought to be a lot but I can't think of any. (Or at least post your process for coming up with them.) I think bitcoin might be another technology that makes big "ripples", no?

patio11 14y ago
Or at least post your process for coming up with them. Think of a business. Think of any phone call, incoming or outgoing, which is sufficiently standardized that you could teach any college graduate to execute that. That person can be replaced with a Twilio script, at a fraction of the cost. My wife is sleeping in the room with my business notebooks so I'll hold off on finding and scanning it for the moment, but it was literally as simple as a) write down business, b) write down the calls they make, c) star the ones that sound like money. I think bitcoin might be another technology that makes big "ripples", no? We will have to agree to disagree on that one. Bitcoin's core innovation is the distributed self-organizing boiler room. As a transaction processing system it's technically innovative but wildly inferior to legacy payments for transactions which need to touch the real world. (It's interesting for transactions which don't, but could be replaced with a SQL update statement, which would improve upon it in virtually every way.) As a currency/commodity, the arguments in favor of it having a sustainable value north of zero are not credible to me. The main reason I have not nailed an 8,000 word stake in its rotten heart is that I think there's a non-zero risk that people will use every additional quantum of attention given to it as a reason to convince other people to "invest."
- euroclydon 14y ago
  Outgoing unsolicited calls, once removed, might lighten the load of what people are imagining here, unless I'm not up to date on Twilio's TOS.
hiddenfeatures 14y ago
My gut tells me, that this is not legal (it would not be in Germany), so I don't advise you doing this before consulting with a lawyer first. That being said, I just got a US phone number and I get at least 3-4 calls a week for the previous owner of my phone number. Those calls seem to be revolving around credit loans that she had. To me it seems as if they try to remind her that she should pay those loans back. One could pretty easily build a really annoying twilio-based version of those phone calls...

todd3834 14y ago

The video was great! It would be nice to hear about how you get people into the funnel so that we could do a lot of the things you recommend. You already covered SEO, do you have any other customer acquisition techniques?

patio11 14y ago
SEO and AdWords are my mainstays for my software businesses. This year I'm going to be dipping my toes into a bit of offline marketing, like e.g. going to the (without loss of generality) Omaha Conference For Orthodontics Practice Managers and just talking to people. Given what I currently surmise about the per-account LTVs for higher-end customers of Appointment Reminder, at many plausible guesses for how many conversations I can have per day and how many people I can convert, it might be worth my time to do that. (Step 1: Do it. Step 2: Do it systematically with predictable ROI. Step 3: Pay someone to execute on Step 2.)

ambiate 14y ago

I've followed/stalked you for years Patrick. Thank you so much for sharing your knowledge. You helped transition me from grey to white. On a side note, if your Vimeo account is Pro/Plus, please check the 'make accessible for mobile devices' option in account settings.

k3n 14y ago

I'm not trying to take anything away from you at all, because what you've provided is very good. However, I'd like to say something about marketing vs sales, in that it seems like your material is more geared towards sales than marketing. I'm going to go off on a tangent here somewhat, bear with me... To explain in my eyes, I see marketing as everything you do to promote your project (i.e. brand/product/etc.), which may not always have a direct financial payout tied to it. For instance, FOSS projects have their own motivations for gaining usage and popularity, and revenue may be tied to that, but they're not explicitly selling anything. But, they do wish to get noticed, to have people try them out, etc. and so they are selling the idea of their project even though they're not actually ringing anything up at the register. On the other hand, "sales" is much more closely coupled with driving a user to purchase (or maybe even just 'sign-up' for) your service or product. This is what I'm mostly seeing in the slides: pricing, email campaigns, conversion rates, etc. These are all pretty exclusive to making a sale, and while they do embody marketing concepts, there's a lot more to marketing than simply corralling the customer to the register. Why am I droning on about this? I'll admit that it's for selfish reasons; I was hoping to see some marketing guidance for the page itself. I review lots of projects, and a majority of them that are created by engineers fall into one of the following buckets: * zero marketing whatsoever, possibly only a github page with a couple sentences in a readme * poorly-constructed marketing, such as using lots of buzzwords and generic phrases without actually telling me anything at all about what the project actually is or does; for instance, many times the only blurb given is akin to "cures what ails you" Now there are some that get it right, though I suspect that many of these either have someone with marketing skills on the team, or they've had an actual marketing guru help them out. That, or they're generally really observant and pick-up on it without having to study. Either way, when I review a project, it's a shame that the basics are so often neglected: * problem definition: in explicit terms, what problem(s) does your project solve? * product differentiation: if yours is "the best", "an alternative", "the new way", etc., then why do you think that? Why should I choose yours over X? If you can provide some concrete examples here, all the better. * product demo: if it can be demo'd, then please at least create a simple working demo. Note: I don't consider projects that include demos as a part of the source code, which must be downloaded, built, and configured as a proper demo. I also don't consider any that require you to register or provide an email address as a proper demo, either. Unless it's a very pressing need that I have, I'm not going to spend 5-15m fiddling with your source or giving away my info. Just host it somewhere so that I -- and possibly my CTO/CEO/purchasing agent -- can see it in action. * licensing, terms and conditions, etc.: make them prominent enough that I don't need to browse your source files or open a support request to find out if I can even use it. Sorry, this got longer than I anticipated...

mdlthree 14y ago

I am having trouble processing some cognitive dissonance when comparing your parable of the "Crazy Egg Enterprise Edition" but then using pricing strategies to take advantage of the sane kind of managers. While, I understand the concept of feature segmentation, I supposed should not be concerned with how other people run their business. I only need to focus on my profitability and not being a sucker.

coopdog 14y ago
I suppose it's all in the wording. Have the cheaper options but don't call them enterprise, and then have the really expensive enterprise option for managers for who the pain of being called anything but is more than a slight blip in the budget. Giving them ways to pad their budget was also an eye opener for me. The idea that they might not even be conforming to our rational actor model of balancing cost and value opens up new pricing considerations. I wonder if a monthly 'flex' option where they can temporarily boost their budget to some ridiculous figure would work. The engineer in me does cringe at the thought of it though

ComputerGuru 14y ago

I'm super sorry to have just learned about microconf only to find that it is completely, totally sold out for this year (plus being only a few days away). Any other good conferences like this one? From what I can see, this is all content and zero fluff, not cheap but not outrageously expensive either. I'm more than ready and willing to book even if it's a few hours from now for something like this. Share your thoughts, guys!

patio11 14y ago
BaconBizConf and Business of Software are the other two software business conferences that I'd fly to America to attend even when not speaking.
- deleted 14y ago
  [deleted]
krallja 14y ago
I can recommend Business of Software. patio11 has spoken there, as have many other HNers, Seth Godin, Richard Stallman, etc.

biot 14y ago

My $0.02 worth: For many of you, assistance directly from the CEO in integration is a really compelling offer, because wow, you can’t get that anywhere else. [...] We’ll do the copy‑pasting for you ... and it will actually be done by a freelancer that we’ve hired and told them how to FTP stuff. If one claims "assistance directly from the CEO", I would be disappointed to learn that access credentials to my website were handed out to some third-party freelancer who performs the integration rather than being handled directly by the engineer-owner. If you mean something different such as "our CEO ensures the job gets done to exacting standards" then that's freelancer-compatible as the statement makes no claims about who provides the assistance.