Do not index
Do not index
In a Sales-led context, overcoming a growth plateau is simply a question of optimizing your sales engine, and/or hiring more salespeople. In Self-Serve, it’s a little more complicated. How do you increase LTV and decrease CAC at the same time?
In this episode, Brian and Yohann talk about ZipMessage’s journey out of a growth plateau. The first step, Brian says, is to hone in on your revenue-producing customers. Where he went from there might surprise you.
Sections
(05:08) Identifying Which Customers Produce The Most Revenue
When your product supports a number of different use cases (and it always does), it’s usually the case that some customers are subsidizing others. A small number of customers are responsible for balancing out the cost of acquiring all your customers, in other words.
The minute Brian started noticing a plateau in growth, he decided to find out which customers actually produced the most revenue. His proxy for revenue was churn.
As he dug into the numbers, one segment was clearly outperforming the others:
What I learned through customer interviews and other analyses (surveys, usage data, and so on), was that coaches were the ones who did not churn, and they used it the most heavily, they saw it as the most essential.
So then I went even deeper with coaches. I probably did about 40 or 50 different interviews with coaches and really dug into how they use our tool and how they are duct-taping our tool alongside one, two, or three other tools that they pay for. A lot of really clear patterns emerged.
(08:54) Creating More Value For Your Best Customers
Turning the “coaches” segment into a persona would have been a mistake because it would have focused on who the coaches were instead of how they used ZipMessage.
Instead, Brian chose to analyze how ZipMessage fit into a coach’s workflow, and how he could own more of that workflow so they would consider it a no-brainer to pay more for the added value.
![We're following the aspirational pricing methodology of "Build more value to into the product so it’s a no-brainer to charge more.”
In my research interviews, I always ask about what other tools [coaches] are currently using or which other tools they’ve used in the past, and exactly how much they’ve paid or are currently paying for them. I see value as capturing the share of two or three $100-$200/month tools. One or two of those tools might be your $300 or $400/month tool. I want to try to move our product to a position where we're at least in the middle tier of that value chain.](https://cdn.feather.blog?src=https%3A%2F%2Fusenotioncms.com%2Fproxy%2Fblock%2F838ca0d8-5d96-4c37-8cfc-179516aaa008%252F5b7c6dbd-6c15-426a-89f8-b51880b319c3%252Fquote_icon.png&optimizer=image&quality=80&width=280){kind=icon}
We're following the aspirational pricing methodology of "Build more value to into the product so it’s a no-brainer to charge more.”
In my research interviews, I always ask about what other tools [coaches] are currently using or which other tools they’ve used in the past, and exactly how much they’ve paid or are currently paying for them. I see value as capturing the share of two or three $100-$200/month tools. One or two of those tools might be your $300 or $400/month tool. I want to try to move our product to a position where we're at least in the middle tier of that value chain.
(14:16) Tracking Outcome-based Customer Segments
Brian says tracking segments (especially outcome-based ones) in Self-Serve remains a challenge because most analytics tools are built for Sales and Marketing. To solve the problem, Brian implemented an onboarding survey which he integrated with his acquisition analytics and behavioral analytics tools. This gave him unprecedented visibility. If a user self-selected as a coach, he could view which marketing materials brought them into the ecosystem and how they used the product after converting.
We have an onboarding process that has a survey. And so what I'm tracking generally is two things that are important to me that I think I finally have a handle on in terms of tracking:
- One is breaking down our traffic and our trial users by what they’re here to do. What is their use case? Are they a coach? Are they a consultant? Are do they just work on a remote team, like in a SaaS company? Are they a salesperson?
- And then the other thing that I break down is the traffic source. So, how many are coming from Google? How many are coming through our viral loop? How many are from referrals or the affiliate program?
(22:24) The Pros and Cons of Promotion-Driven Growth
Let’s not forget the reason ZipMessage faced a growth plateau, to begin with — early growth was fuelled by promotional buzz. Brian tells us how this can be a double-edged sword:
![A wide swath of my audience found [ZipMessage] interesting right out of the gate. And starting out of the gate with so many types of users is sort of like a blessing and a curse. It does help you grow relatively quickly in that first year, but it also led to a lack of focus on who the best customer is.](https://cdn.feather.blog?src=https%3A%2F%2Fusenotioncms.com%2Fproxy%2Fblock%2F6db00b8f-5779-4510-a168-060bc23d6cb3%252Fbf4c324d-ac2a-4ae1-bdf5-7197c0ce346e%252Fquote_icon.png&optimizer=image&quality=80&width=280){kind=icon}
A wide swath of my audience found [ZipMessage] interesting right out of the gate. And starting out of the gate with so many types of users is sort of like a blessing and a curse. It does help you grow relatively quickly in that first year, but it also led to a lack of focus on who the best customer is.
(28:34) Using User Research to Overcome PLG Hurdles
Brian found gaps in the Product-Led Growth playbook soon after he began testing it out. The PLG playbook works best for acquiring more users, but it is lacking when it comes to improving CAC: LTV post-acquisition.
![[My frustration with PLG] came down to an inability to see those patterns. Because when you're really embracing freemium and PLG, by design, you need to get a high volume of users into the top of the funnel. And that brings with it a high variability of users. Totally different use cases.](https://cdn.feather.blog?src=https%3A%2F%2Fusenotioncms.com%2Fproxy%2Fblock%2F8a6a7a0c-cc64-46c4-85d7-2d41369f9fa5%252Fbb4201f8-e5a8-4852-b224-1b3faa7d3544%252Fquote_icon.png&optimizer=image&quality=80&width=280){kind=icon}
[My frustration with PLG] came down to an inability to see those patterns. Because when you're really embracing freemium and PLG, by design, you need to get a high volume of users into the top of the funnel. And that brings with it a high variability of users. Totally different use cases.
User research is not every founder’s go-to tool for overcoming a growth plateau, but Brian makes a case for why it should be. You can’t build more value into your product if you don’t understand what value means to your best customers.
Any time I feel a little bit unfocused or have that fear of whether I’m doing the right thing or if this is going in the right direction, I talk to customers. Once you start to talk to customers, you start to gain some comfort. You start to gain some confidence. Like, “Oh, my gut was correct because this customer confirmed it, or this customer just said something and now five other customers just said something that sort of sparked a new idea” Just hearing customers verbalize their problems gives you confidence.
Transcript
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Yohann: Hi, I'm Yohann, and you are listening to the Self-Serve SaaS 'Cast. One of the consequences of having to figure out how to grow Self-Serve revenue without a tested playbook is experiencing a plateau in growth. In a sales context, you've got a sales engine to complement your acquisition engine. So the more users you acquire, the more revenue you make. It's just not as cut and dry in Self-Serve.
I had a recent conversation with Brian Casel, the CEO of ZipMessage, which is a tool for asynchronous communication, about how he overcame a plateau in growth like this one. And his perspective might surprise you. Well, if you're a regular listener it probably won't surprise you that much. The key is to amplify what's really driving revenue, and acquire better-performing customers over time. Easier said than done? Check out how Brian did it. Here we go. Brian, thanks so much for joining us. How are you doing?
Brian: Doing good, hey Yohann, thank you for having me on. This is fun.
Yohann: It is a pleasure. To set the stage, Brian, tell us how ZipMessage monetizes its users. Is it purely Self-Serve or Sales-driven? A little bit of both?
Brian: Yeah, today and since the beginning, it is fully Self-Serve. That might actually change in the upcoming months. We are making some changes in the product and the pricing, and so we might actually get into a little bit more of some personalized onboarding, but not yet.
I mean, currently it's still, customers come in... it's... I would say it's a fairly typical SaaS model. We do currently have a free plan. Part of the plan is to end that soon and go to a more traditional free trial. But but then beyond the free plan is just a couple of, SaaS pricing tiers and customers upgrade themselves when they're ready.
Yohann: Okay, awesome. So let's dive in. How much do you want to grow your revenue over the next year?
Brian: A lot? ZipMessage is still, I would say a pretty young product, we're almost at the two year mark. And I still consider us very much in startup mode, which means, I'm working on and I'm expecting to grow revenue quite a bit in the next year. I would like to see it at the very least, double, if not better than that over the next 12 months. And and yeah and I'm and we're working on specific things to, to accelerate growth in the next 12 months.
Yohann: So, let's start with digging into this future state, the outcome that you're pursuing. How different is your company when it's making double the revenue? What does your company look like at this milestone?
Brian: Yeah, I would say that, again, we're in startup mode, and this is, for me personally, this is the first startup where I took a little bit of outside investment...
Yohann: Okay.
Brian: Everything up until now has been, a hundred percent bootstrapped. This one, I consider it more like half and half because I've self-funded a bit from exiting my previous business.
And, and then I took a little bit of outside investment from Calm Company Fund. And so as of today, we are not technically profitable. And so if we double revenue, and a bit more than that then, we're getting into break even profitability and, uh, that would be a good place to be.
Yohann: Okay. So, you mentioned that pricing is gonna change and you're going to experiment with different monetization models. Is this part of the strategy to make the revenue growth happen?
Brian: Yeah, that's part of it. The product itself is changing and expanding as well. The value that we are delivering to our customers... our best customers are professional coaches. And so, up until now we've had a great customer base just using us for the core of what we do, which is asynchronous messaging.
So being able to record and receive and send back and forth messages using video screen, audio only, or text. With ZipMessage it's this conversational layout, all on one page, all threaded. That's what we've been known for up until now, and that'll continue to be the core, but we're growing into other areas of running a coaching business, getting into hosting, like, interactive courses and interactive coaching, automating workflows where you can send messages to coaching groups and things like that.
It's just becoming a much more essential tool that a coach can really build their entire business on. So we're building those features and shipping those features right now, this month and next month. And as we do that, we're adding a lot more value and becoming more of an essential tool. So that will bring with it some changes in pricing.
Identifying Which Customers Produce The Most Revenue
Yohann: Okay. So, so walk me through the inflection point here. When did you realize that these changes needed to happen if revenue was to increase, did you hit a wall in growth, for example? Or did you, like, discover...
Brian: Yeah, so I think around early 2022, so around spring of 2022, we were about a year in, and, we had really solid growth up until that point. And then I definitely started to notice a plateau start to happen. I immediately went into customer interviews and I started interviewing a lot of our customers, like a wide swath of our customers. And I found that, and it I had known this, that we had a pretty wide range of the types of customers that were using us. So, we had a bunch of coaches. We had consultants, we had agencies, we had SaaS teams, we had Sales teams, podcasters all using ZipMessage in very different ways and different use cases which, seems sort of great at first, but then you start to see the plateau where it becomes less of an essential tool for some of those groups while it becomes more essential for others.
And what I learned through a lot of these customer interviews and other analysis and surveys and looking at usage data and things like that, was that coaches were the ones who did not churn, and they used it the most heavily, they saw it as the most essential. So then I went even deeper with coaches and I continued interviewing them throughout the summer. I probably did about 40 or 50 different interviews with coaches, and really dug into how they use our tool and how they are sort of duct taping our tool alongside one, two, or three other tools that they pay for. And it's and there was a lot of learnings there, a lot of really clear patterns happening. And so that's what led me to the direction of what we're building and shipping now and making it a more cohesive, singular tool experience that a coach can build around.
Yohann: That's fantastic. It's actually what we advocate ourselves. When we talk to companies about where to go next, we start with zeroing in on a specific outcome for a specific group of users and work backwards from there to build a pathway to the outcomes that they're most interested in. So you dug into coaches and discovered that they were essential to... that the product was essential to their workflows, more so than other user segments. But did you see correlations with revenue? And if so, what kind of correlations did you see and how did you calculate them?
Brian: Yeah, so, you're catching me right now... I would say we're right in the middle of this long process of like building and expanding the tool into this direction. So we haven't fully realized the product vision. Like, I've learned from coaches exactly what we need to build for them. We're about halfway through building it and shipping it.
But that being said, we've already shifted all of our marketing toward coaches, which means that... of the pie of users who come to us every month organically, more and more of that pie are coaches. Whereas before, it was pretty split between four or five different types of users. So, so now, as we see more of our traffic and users coming in, and they are coaches, we're clearly seeing a decrease in churn, which is a great sign that's starting to confirm what I saw in the research, which was coaches churned a lot less. So, so we're seeing that. And now we need to follow on with the other piece, which is, higher revenue of more of a product for coaches.
Creating More Value For Your Best Customers
Yohann: So churn is the primary metric that's telling you coaches are the segment to focus on.
Brian: Yeah. And I would say that currently we're underpriced for coaches.
Yohann: Okay.
Brian: And that's why we're building more and kind of following the aspirational pricing methodology where, " build more value to make it sort of like a no-brainer to charge more."
Yohann: And how are you seeing the relationship between value and revenue? If that's too vague a question, I can rephrase.
Brian: Yeah, I mean, I just tend to think a bit like... like in my research interviews, I always ask about what other tools are you currently using or which other tools have you used in the past, and exactly how much have you paid for those tools? Or are you currently paying for those tools? I like to really get to understand that from customers. So I know pretty clearly, what they're using and what they're paying for those tools, which starts to tell me how every business owner has a stack of tools that, that make up their business, right? You've got like an email marketing tool. You've got a CRM tool, you've got your communications tools, you've got your project management tools. Everyone has their stack of different tools. They're paying for all those things and they all add up to a monthly bill of SaaS tools that they pay for.
Yohann: Right.
Brian: I see value as like occupying... not necessarily like checking off all the boxes in the list of tools that they need, but if you compare... so if you look at a small business or a coach or a consultant, they might be paying for 10 different tools, but they're different sizes, right? So, like, maybe two or three of those tools are in the $20 a month range. Two or three of those tools are in the a hundred to $200 a month range. Maybe one or two of those tools might be your three or $400 a month tool. So the, obviously, the more expensive tools are more important. They value them more. They ...I want to try to move our product to a position where we're at least in the middle tier of that value chain, if that makes sense.
Yohann: So you're seeing value in operational terms almost, where you're saying what does it cost you to operate your business, and how much of that puzzle can ZipMessage work into the product, so, so that operationally, the more you're covering, the more value goes up.
Brian: Yeah, and I like to think of about it like I'm not trying to get customers to start paying for our tool and our tool being the first time they ever pay for a tool like this. I find it more viable to try to replace other tools. They are already paying for other tools. We should make our tool better. And make it an easier choice to choose us instead of those, cuz they're gonna pay for that utility somewhere. It's an essential part of their business. They're gonna need some tooling to, to run that part of their business. I wanna make sure that the product that I'm building fills that utility for a certain type of customer.
Yohann: Gotcha. Has this been a core principle to how you've seen the product even before you focused on coaches? Like, before coaches were in the picture, were you seeing the product in these terms where...
Brian: I think, I think ZipMessage, compared to other products that I've worked on in the past, ZipMessage took a very unusual path in its early days. It's not like this is a strategy that I would necessarily recommend to anyone else. And looking back on it, I think it, it might have ended up being a little bit harder. It was, like, really exciting at the beginning, but looking back, I wish I had more clarity sooner, basically. But what happened in the case of ZipMessage, again, it's a little bit of a fluke in my experience, is that it started as just a super small idea. It really started as like a side project idea, I was working on a different SaaS at the time called Process Kit, and ZipMessage was just a personal need. Like, I wanted to be able to send a link to a customer and ask them to record their screen and send me back a message. Super easy, zero friction, because all the other tools... I would've to ask customers like, "Hey, can you go install this video software and then record a video for me and send it back?" So I thought that should be easier. So I built a simple tool. I built the, a simple version of ZipMessage, which was, just to be able to communicate, send a link and get into an async conversation. And yeah, it achieved that little need, but people quickly latched onto the idea of asynchronous conversational flow on one page, like, back and forth, seeing video after video or audio or text, all mixed and matched, all threaded on, on a single page. That's what like, to my surprise, that was the thing that people latched onto. When they see the tool, especially on the page, like that's the thing that really captures their interest. So I sort of just embraced that out of the gate.
I I thought I was going to niche down to coaches from the very beginning, cuz I saw that pattern early on. But I also saw interest from all these different use cases. So I started to embrace it and say maybe ZipMessage actually is just a horizontal product that has lots of different use cases.
But I learned about a year later that, not all use cases are equal.
Tracking Outcome-based Customer Segments
Yohann: I'm so excited by the evolution that your company is going through at the moment. So let's, dive into it in a little more detail, and let's talk about measurements specifically. How are you going to balance focusing on coaches and, what metrics are you going to look at there versus everybody else and what metrics you're going to look at there. Are the metrics even different?
Brian: This really should be easier than it is, but it's actually really hard to get good tracking. I know this is all about Self-Serve SaaS, it's actually a lot easier to track if you're talking to every single new customer through a sales process, cuz you could just get the information you need about who each person is by just by talking to them.
But in Self-Serve SaaS you have to actually code and rig up pretty complex tracking mechanisms. And I mean, I'm currently using Mixpanel, plus, several other... ChartMogul Plausible Analytics, Google Analytics, like all these different tools and then, a lot of custom code built into our application. We have an onboarding process that has sort of a survey. And so what I'm tracking generally is two things that are important to me that I think I finally have a handle on in terms of tracking. One is breaking down our traffic and our trial users by who they are. So like what is their use case? Are they a coach? Are they a consultant? Are do they just work on a remote team, like in a SaaS company? Are they a salesperson? And then the other thing that I break down is traffic source. So, like, how many are coming from Google? How many are coming from we do have a viral component, so like how many are coming through our viral loop? How many are, coming from referrals and where are those referrals coming from? How many from the affiliate program, things like that.
Yohann: So this takes the form of something like a question in onboarding.
Brian: Yeah, it's a few things. We do have a question in onboarding. It's just, I forgot exactly how I phrased it, but it's you know what what do you primarily intend to use ZipMessage for? So that all gets stored on the customer's profile and our systems. We also track their initial landing page on our website. So if they, like, googled and landed on a page that's like specifically about coaching we can also sort of start to attribute that this person is probably a coach.
Yohann: Okay, so walk me through how this measurement system evolves post-acquisition. So what happens during the trial and after?
Brian: Yeah and this is gonna change in the next few months as we shift away from freemium to a more traditional trial, but currently, every user starts, like they, they sign up on a free plan, free forever plan. And what typically happens is they run into the limits of our free plan pretty quickly, and then they and then they decide to upgrade to lift those limits.
And a lot of times that upgrade path happens same day, like first day, or with during the first week. Other times maybe they kick it around for a few days and then they come back a few months later and then they upgrade. So, yeah, we have like several limits where they'll bump into a wall and see the upgrade screen, and then they'll upgrade from there.
Yohann: Okay. And you noticed that coaches specifically were bumping into limits more, or they were the ones who were doing it on the first day.
Brian: Yeah, I think they do convert more, but it's more about they... they're more active users, for a longer period of time than other users.
Yohann: So not just that they bump into the limits, everybody does. But then once they upgrade, they stick around for longer.
Brian: Yeah. And I can see in the usage patterns that they... they use it on a daily basis, whereas others might use it once a week or two or three times a month, and then, if you're using it that sporadically, then it's then you're more likely to churn at some point.
Yohann: So, were you seeing some kind of failure with the freemium plan that you wanted to fix with the free trial?
Brian: It's been over a year on the freemium plan, and I think that's, that worked fine for a while. And, but the strategy, the thought was when I started it was, use the free, use it as like Product-Led Growth, right?
So, have a free plan where we have lots of free users who would use it heavily on the free plan. And then, every time you share a ZipMessage link with a client or with a customer or with a freelancer you're working with or someone, you're exposing ZipMessage to that person. And then when that person responds to your ZipMessages, they have an opportunity to register themselves, first as a respondent user, and then if they want their own ZipMessage account, it's like a one-click process and they can get into their own free account from there. And we see that play out still all the time, but I thought that it would happen a lot more from the free users. But in reality, what happens is, the viral users actually come from paid users because it's the paying users who are sharing it a lot more.
And the free users really just use our free plan like a trial. They're not using it as like a free tool. And so, I think the strategy to really embrace freemium would be to make the free plan even more generous and lift the limits even more and make it a more useful tool for free. Which, theoretically, should should increase the top of funnel. But, given everything that I've learned about who our best customers are it just doesn't make sense to continue to pursue that path. So, so I decided that since they're already using our free plan as a free trial anyway, we're gonna move to a more traditional, probably a two-week free trial period which would expire. I mean, most customers currently convert to paid well before the 14-day mark anyway, so, we're gonna introduce new plans in early 2023 that are built off of that. And frankly, I don't think that it's gonna be that drastic of a change. Again, because like we don't see a huge active user base on the free plan. All of our active users are on paid plans. So, it's really just like more of a technical change in terms of billing.
Yohann: Okay. This is kind of a theme to what I've been hearing from you so far as a whole. You see what's working it, you double down on it. And this technical change won't affect people who aren't benefiting from it, but people who are, it'll work even better for them.
Brian: Yeah. Yep.
Yohann: Nice. Speaking a little bit more about metrics, once people convert what do you track there? Do you still continue to track behavior or, like, how would you go about improving churn?
Brian: Yeah, I mean, we do have our tracking in place to see how active, like overall, like statistically, how many active users and how often do they use the product and things like that. So, I mean, if I'm honest, I don't look at the tracking data on a everyday basis.
I don't look at it probably as much as I should. I look at it when I'm trying to make strategic decisions. But my day-to-day focus is basically on, on the product. I work directly in the product, in the code, and I'm like the product designer. And then I work directly with my developers every day, and I'm talking to customers every day. So, that's mostly where my focus is, yeah.
Yohann: Okay. Are there metrics that you look at on a day-to-day basis?
Brian: I mean, the ones that are, like, obvious right in front of me are a number of customers, and like, how many new customers did we get today? How many new free signups did we get today? And I tend to I, I do keep a log, like on a weekly basis, like how we're doing week to week and then I'll look at month to month.
But again, like that's more of just like a quick glance. I try not to, try being the key word here, I try not to let the numbers and the metrics really impact my focus or my mood too much. Like, just because maybe today we had no customers, or yesterday we had three, I don't want that to like, change any big strategies that we're gonna execute. Like I, we're still working on the same strategies over, over a number of months. So that's where my focus is
The Pros and Cons of Promotion-Driven Growth
Yohann: Let's talk about the journey up to this point, Brian. So just to summarize, you went really broad with ZipMessage at the beginning and now, two years in, you're seeing that there's one segment of users that's more profitable than the rest. But going broad in the beginning, how did you get that off the ground? Walk me through what the company was doing in the early days, like the acquisition focus, the product focus. What was it like to go broad and see growth from it?
Brian: I think it started really quickly. I started coding the product in January of 2021 and we had first users in March and first paying customers in April of 2021. And it was pretty quick. And I don't have a large audience, but I have some of a network and an audience and a podcast and Twitter.
And so that was, that's usually where the very first place that I go to announce something new that I'm working on, is I'll talk about it on my podcast, Bootstrap Web. I'll send it out to my email newsletter. And so, that's where the very first awareness and exposure for the product came from. And I would say, compared to all the... I've done lots of products before ZipMessage, and this one clearly had just more widespread excitement and interest than everything else that I've done before, because everything else that I've done before really only struck like a small sliver of my audience as being interesting and worth paying for. And this one... that's what led to it starting out of the gate with such a wide, like, types of users, is that a wide swath of my audience found it interesting outta the gate. It's sort of like a blessing and a curse because it does help it grow relatively quickly in that first year. But it also led to a lack of focus on who the best customer is. And I was a little bit torn cuz I knew I should niche it down, but I was seeing positive patterns on, on a bunch of different use cases. So, it started pretty organically in the early days. And then, I've been investing in content and SEO and that started to help a little bit. And then, it went up on Product Hunt. And that brought a pretty big spike of users. I mean I also have gone on lots of other podcasts and have had some exposure and some well-known influential people have found it interesting and shared it or they actively use it. And some are very active coaches, so they help spread it to other coaches, so...
Yohann: Got it. So there was like this promotional loop that kickstarted the growth and kept it going for a while.
Brian: Yeah, and we've seen the viral loop start to kick in as well.
Yohann: Tell me a little bit about the viral loop. What do you mean when you say that?
Brian: Yeah, so, every time you use ZipMessage, not every time, but if you're using it with customers or with clients or with freelancers, so people who are like outside of your organization, you're literally sending a ZipMessage link to a customer. And when they receive that link, it usually has, like, your first message to that customer and you're asking that customer to respond, and then that customer clicks your link, they land on your conversation page. From there, they can click a little button that says reply, and then they can start recording from their camera or from their microphone, or they can write in text. And then when they try to post the message, it prompts them to say, "do you wanna get notified of when future replies come in?" Then they can put in their name and email.
Or they have the option to post their message anonymously and they don't have to register for anything. They could just, record and send it back. So most people do put in their name and email. And so, so now they are a respondent user. So now they're gonna get notified from ZipMessage every time the next reply comes into their conversation.
And when they're in there they see a little call to action that says, " hey, do you want your own ZipMessage account where you can send messages like this to your people, your clients? And they can click that one button and then, and now they've started their own free trial. And then they go through our free signup, onboarding process from there. So, that's essentially how the loop works. The other thing that we have is a thing called intake pages. This also makes us different from other video messaging tools. So you can have your own intake page, ZipMessage.com/yohann and you can customize your URL like that, like mine is literally ZipMessage.com/brian.
And that's a page that I can share with anyone, I can talk about it here on the podcast. You go to that page, and that's a page where anyone can record and send me a message so I can take intakes from like an audience, from a small group. And and you know that too exposes ZipMessage. There's like a powered by ZipMessage thing at the bottom, things like that.
Yohann: Awesome. So I understand the viral loop, but just putting two and two together, people who came in via the viral loop, they weren't upgrading, they were just trying out ZipMessage, but not hitting the limits.
Brian: Some of them do. We do see people convert from the viral loop, yeah.
Yohann: Okay. Okay. So when you measure traffic source... Tell me a little bit about traffic source and coaches and if you're seeing any correlations there, just like you're seeing correlations with revenue.
Brian: Yeah, I mean I think it's still pretty early to tell, but I look at traffic sources as where should we be investing our money and time in terms of top-of-funnel marketing. Whether it's continuing to push on Google or, I think we're always gonna have this viral component, that's not going away. There's a little bit more maybe that we can try to push on within the product itself to, to try to promote, ZipMessage accounts. We have like respondent users who've just responded to a zip message, but they don't yet own their own ZipMessage account. So we can maybe do a bit more to nudge them toward getting their own.
But traffic sources is just about looking at who's sending us users and uh, where should we be investing to get more of them.
Using User Research to Overcome PLG Hurdles
Yohann: You mentioned before a little bit of frustration with trying to go Product-Led Growth. Tell me a little bit more about that. What? What were the frustrations specifically?
Brian: I think it, it came down to inability to see those patterns, right? Because when you're really embracing freemium and PLG, like, by design you need to get a high volume of users into the top of the funnel. And that, that brings with it a high variability of users. Totally different use cases.
Yohann: Right.
Brian: Of course, there are ways to slice and dice all that traffic data and see which ones are, higher users and things like that but the reality is... what I saw is that several use cases were very active in their very first days on the free plan. So it's not until they are actually paying customers for multiple months that you start to see which ones stick around and which ones drop off.
So it just made it even harder to dial in marketing, to dial in product, to literally figure out which features we should be building or should not be building because we don't, we didn't know who we were building for, like literally for the first year and a half, I think we built a really great product, especially on the core of being an async messaging tool.
We just kept on hammering on that, like making that a really great experience to go back and forth with messaging. But all these other features that we're building for coaches now, like automation workflows and being able to run a coaching program, interactive courses and things, like that stuff wouldn't have made sense to build earlier, because we didn't know which of our wide swath of users would find those features interesting.
Whereas now we, we know our best customers find those features very interesting. So we're gonna give them that.
Yohann: And it's risky because you, first of all, you don't see the pattern until six months later and you see that growth plateau and second, you might think to solve that growth plateau in a number of ways that are not research and research turned out to be the ideal way to, to figure out what was going on there. But I don't think that's a go-to method to solve a growth plateau for a number of founders.
Brian: Yeah, I mean, talking to customers is not easy. I've come to actually really enjoy it. I really do. Like it so you gotta get comfortable with that. I mean, I've had multiple previous businesses where I, and some of them were much more sales focused, so I've built up that muscle of just being able to get onto a call with a customer and actually enjoy it. But at the same time I am all about async as you might imagine. I don't like having a packed calendar of calls, like live calls. So I do a ton of communicating with customers using ZipMessage, so, which is all asynchronous and my team were completely asynchronous. But all those research or a lot of those research calls I did get onto live Zoom calls just to pack in like a good 45-minute research call without having to go back and forth async.
But you know, like I, when I was really in the mode over the summer, like of sprinting on these research calls I packed them in and I enjoyed it. And I think anytime, like for me, going back years across multiple businesses, anytime I feel unsure, or a little bit unfocused or having that fear of am I doing the right thing? Is this going in the right direction? The answer has always led back to once you start to talk to customers, you start to gain some comfort. You start to gain some confidence like, oh, my, my gut was correct because this customer confirmed it, or this customer just said something and now five other customers just said something that sort of sparked a new idea in terms of " oh, there's something here that I didn't know existed before." Just hearing customers verbalize it, like it just gives you confidence. And so, that's the best thing that you can do for sure.
Yohann: Another really smart thing you did was you zeroed in on your most profitable customers and researched their workflows.
Brian: Yeah,
Yohann: that come about organically? Did you talk to a bunch of people to begin with?
Brian: Yes, that was a very intentional progression. When I started seeing the plateau happen, what I first looked at was like, let me talk to the people who have used it actively in the last two or three months. And that was like a wide swath of users.
I probably did 20 interviews or so that were like, maybe six of them were coaches, maybe six of them were something else, six of them were something else. And I coupled that with survey data, I coupled that with usage data, and I triangulated and I figured out, okay, coaches are definitely the path, it's totally clear. And then I focused the next like 30 interviews on coaches. And so like then the actual interview changed. Like at first it was more about a little bit more general about how you're using it and what other tools you're using it for and what are the use cases that you're using it for.
And then once I started to zero in on coaches, the questions were much more about tell me about your coaching practice, how is it structured? What tools do you use to run it? What are your goals? What, how are you trying to change it? So then I started to really see patterns in terms of " Oh, all coaches have this sort of structure. Or they're all trying to do this or that and that relates directly to how the product should be structured for them."
Yohann: Fantastic, Brian, thank you so much for walking me through all of that. I think it would be really helpful to anyone who's trying to figure out Self-Serve on their own. Speaking of, I'd like to end with two questions. One, are there any big resources that come to mind that helped you figure out this Self-Serve engine?
Brian: Honestly, in my case, it's been a combination of being networked with other SaaS founders and really closely observing what has worked for other people. Not, like, necessarily following every single tactic that somebody else does but just being, having close conversations with friends and advisors has been a big one.
And then the other thing is just building a lot. Like over, over the course of my career, I've built lots of different products and designed products and I've researched and talked to so many customers in different ways, and that's just a muscle that you start to build up. And looking back on previous products, I could see where I, wasn't focusing on the right things and, and you just start to zero in on " Okay, this is what matters."
I'm very much of a designer, like I, I spend most of my time designing interfaces and how the product should function and things like that. So I feel like I've improved a lot on being able to deliver an experience that customers find very productive. And really you only gain that through just building a lot of stuff and shipping a lot of stuff and and moving quickly through that.
Yohann: Right. And second, do you have any advice for people who are on similar journeys with Self-Serve?
Brian: I think that we talked a lot about the customer interview process, which is incredibly important, but I also think that in startup circles there's been an overemphasis on customer research before you have a product in hand. There's a lot of like theoretical... it's fine to interview customers for if you're researching a market and trying to decide whether or not you're gonna build something in that market. You want to, yeah, talk to customers to see if there's something there. But I've come to the conclusion where it's I, I'm not gonna know for sure just by talking to a customer, like theoretically, if I were to build this product and you tell me you're gonna pay 50 bucks a month for it, will you actually? That's not validation to me.
I'm much more interested in talking to customers in deep research interviews after they've experienced my product, or they're in the process of looking at my product and they can actually start using it today. And I can get their feedback on whether it's useful or whether we're hitting the mark or not. There's different types of talking to customers. Early on, it's more like exploratory is there a market here? And then later on, it's more about it does this tool meet your needs? What needs to be changed?
Yohann: That was awesome, Brian. So many nuggets of insight there. Thanks so much for sharing your story with us. It's really interesting to see a product in evolution and thanks for walking us through what's going on at ZipMessage at the moment.
Brian: Yeah. Thanks for having me on, Yohann. This was fun.
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