This is Alex Turnbull’s account of how he and his team built Groove from zero to $100k/month in 2 years and lessons learned in the process. He originally shared these lessons on their Groove blog. The Groove blog is one of the best on starting and growing startups. Check out some of their best posts here.
He writes:
“Last Tuesday, November 25th was a huge day for our team. At 2:14PM EST, we recorded the trial-to-customer conversion that put us over $100,000 in monthly revenue.
I knew the day before that it would likely happen on Tuesday, but I still managed to forget to check our numbers until the end of the day, by which point we were a few customers past that mark.
Still, I was obviously elated. It was a day that we had been waiting a long time for. And because of this blog, it was a day a lot of people had been waiting a long time for.
And while my thoughts on the milestone and what it means have evolved over the last year, I’m excited to write this post.
I’m excited because in that first post, I said:
“This is the blog I wish I had read the first time I started a company. It’s going to cover the lessons we learn from our own experiences, including our tests, our wins and our fails, backed up with real numbers. Everything from design, development, strategy, marketing, sales, growth hacking, hiring, fundraising, culture, customer support and more.”
And I’m happy that, as I look back at the 50+ posts we’ve written, that’s still true. The amount I’ve learned over the last 14 months has been incredible, and it makes me happy that others have been able to learn from our experiences, wins and fails too.
Today, I’m going to share the biggest lessons we learned on our journey so far, as well as what comes next.
1) There’s Literally NOTHING More Important Than Deeply Understanding Your Customers
Chances are high that you don’t know your customers as well as you need to.
We certainly don’t; customer development is an intensive, ongoing process for us, and we’re learning new things every single day. Add to that pursuit the fact that our customers are constantly changing, and it’s easy to see why customer development is not a task or a project, but a way of running a business that never gets put on the back-burner.
Nearly every mistake we made early on can be attributed to not understanding our customers well enough.
Spent $50K building the wrong site and the wrong product?
As much as it hurts to write now, one day of asking questions and intently listening to our prospective customers would’ve avoided that.
Lost $12,000 by discounting — and as a result, reducing the perceived value of — our product?
A few dozen conversations would’ve made it clear that price wasn’t even in the top five things that customers were concerned about when it came to choosing Groove.
Again and again, we made screwups that would never have happened if we had known what we know now: in business, conversations with your customers and prospects are the most valuable assets you have.
We do customer development in a number of different ways:
“You’re In” Email
Probably the only “hack” that we’re still using $100,000 later, sending an email to every customer asking them why they signed up has been one of the most powerful data-collection tools we’ve ever tried (and we’ve tried some expensive tools).
This email has singlehandedly given us deep insights into the triggers that cause people to sign up for Groove, and we’ve been able to apply those to our marketing with tremendous results.
Customer Service
There’s a reason that I, as a CEO, spend more than half of my time doing customer support: it’s that valuable.
Getting to see exactly what our customers are thinking and feeling about our app is a huge advantage when it comes to thinking strategically about what to build, fix and upgrade next.
All businesses have to do customer service, but we’ve made it a crucial part of our customer development flow: recurring support requests get logged in our marketing spreadsheets just as often as they get logged in Pivotal Tracker.
2) Don’t Underestimate the Power of Messaging, Positioning and Copy
In our earliest days, Groove was a design-first company when it came to our marketing site.
We built what we thought would be beautiful (a mistake to begin with, as we now know that form follows function in effective design), and then figured out what copy would fit within those parameters.
Over the years, our approach has changed completely.
While we’ve redesigned our site a number of times, one thing that has remained constant in our growth has been the massive difference that testing messaging, positioning and copy makes.
But here’s the thing: you can’t have good copy without first doing the work to understand your customers. Much of the copy on our site now came directly from our customers’ mouths in our conversations with them, and that’s why it converts: because it speaks their language, not ours.
And don’t forget to test.
Better Homes & Gardens tests their magazine cover blurbs — not the main headlines, but the tiny blurbs along the sides of the cover — with tens of thousands of non-subscribers before they go to print, to see which blurbs make folks more likely to pick the magazine up off of the newsstand.
If one of the most successful and long-standing magazine publishers still doesn’t know enough to write persuasive, final copy without testing, what hope do we have?
That’s why we test everything with Optimizely.
3) Content Marketing Is Ridiculously Effective (If You Do It Right)
I’ve said this a number of times on this blog and elsewhere, but it bears repeating over and over again: content marketing has been the single biggest driver of growth for our company.
Not advertising (which we don’t do).
Not affiliate marketing (which we probably won’t do).
And not referrals (which we do but need to do better).
Content.
This blog.
Our new customer service blog.
Our content efforts have carried the growth of this company, and the ROI of blogging is not to be ignored.
Here’s what our growth chart has looked like:
Like many of these lessons, if I had known better, I would’ve done this from day one.
But it’s also important to understand that the results of your content marketing, like any strategy, depend completely on setting the right goals and executing the right way.
If your goal is have a blog and you execute by writing blog posts, then that’s all you’ve accomplished.
But if your goal is to build your business through content, there’s more to consider. It’s not difficult and literally anybody can do it. Here are the two things I wish I knew when I started:
Take the Time to Create Good Content
Anyone can write “B” content. Most people do.
That’s why “A” content gets shared and consumed so much. By taking a few extra hours on each post, you can exponentially increase the effect of your content.
Over time, you learn what your respond best to, from topics to format and structure, but the key is not to half-ass it. Invest in good, thoughtful content that solves real problems for people.
Promote the Absolute Hell Out of It
Within a few weeks of launching the blog, we had thousands of subscribers.
That wasn’t just because the content resonated with people.
It was because the hundreds of hours we spent behind the scenes building relationships with people, doing influencer engagement and promotion.
When we hit “publish,” the work was only half done.
Good content is useless to your business without relentless promotion.
And if, like many people, you feel “spammy” promoting your content, consider two things: first, if your content is truly valuable, then you owe it to people to get it in front of as many eyeballs as possible. And second, influencers are influencers because they add value to their audience. If your content adds value to their audience, they’re happy to share it.”
Read the complete post here.
