In this week show we discuss how do you identify your idea clients. This is an important question to be able to answer, see I get a lot of people saying to me it anybody who is looking for a WordPress powered website and I can understand why they say this because it what I used to say. But as your experience builds you should be able to identify what are the type of clients and industries you that you can best service. In this episode both me and Adrian give some direct advice on who to identify this possible groups and then how to market to them.
Jonathon: Welcome back folks to the WP-Tonic Show. This is episode 462, it’s just going to be a discussion between me and my great, intelligent and knowledgeable co-host Adrian. We are going to be discussing how do you think to buy your ideal customers for the beginning of 2020. How do you identify who your market really is? Its more difficult than you think, and I’ve been struggling a bit and I’m sure Adrian is going to have some words of wisdom. So Adrian, can you quickly introduce yourself to the listeners and viewers?
Adrian: Hi everyone, welcome to 2020. My name is Adrian. I’m the CEO and founder of Groundhogg. Happy to be doing another year of the WP-Tonic show because, I came in what, halfway through last year.
Jonathon: Yeah, about that. It’s been great having you on the show actually. Thanks for being part of the WP-Tonic tribe. Before we go into the show folks, I’ve got a couple of our great sponsors to talk about. Our main sponsor has been a sponsor for over two years. They’ve decided to be our sponsor, our main sponsor for 2020, and that’s Kingsta Hosting. Now, if you’re looking for premier WordPress hosting, there is no better place than Kinsta. If for a client or for yourself, you’re a power user, you’ve got a membership site or wooCommerce site, you need something better than the average poor hosting that is available. Certain other providers, well you won’t get that from Kingsta. It’s top-notch, it’s Google Cloud base and you get a beautiful interface with all the bells and whistles, staging site, latest versions of PHB, you name it, they I offer it in the interface and it’s really easy to use.
Plus you get some of the best support on the market in 2020. These people really know what they’re talking about and you don’t have to move on to somebody that doesn’t know what they’re doing. The person that you communicate first off normally can solve your problem. So if that sounds interesting for yourself or for your clients, go over to Kingsta and tell him that you heard about them on the WP-Tonic show. Our second sponsor is another great product, a new product called Launch Flows. What is Launch Flows? Well, if you’ve got a wooCommerce site and you want a better checkout experience, basically Launch Flow will do that for you. It just puts the checkout experience on steroids. It also works with cart flows as well, but it just makes the experience amazing. So that’s interesting for your own wooCommerce site, or for your clients, go over to Launch Flows and see what they got to offer. So, let’s get into it, how do you identify who your ideal client or clients are going to be, you know, how do you do it, Adrian?
Adrian: There are a significant number of factors that go into discovering that ideal person. And it’s a journey that I’ve personally been on and my company has been on for about, well, really since day one. And as a business, you never really have like this perfect ideal customer, but everything that you do is always getting you closer to who that person is. You’re aligning your practices and your processes, your copywriting, your marketing along with that person. It’s just a continual process. Some of the factors that go into at least trying to come up with this person; for mine who I called digital marketer, Dave, is my ideal person. You have to align a few different things. Number one, you have to first know a few things about where you want your product to fit in a specific market.
Do you want to be down-market? So is your product going to be at the lower end of the price spectrum? The size of your company is going to be, what kind of culture you want your company to have? Or are you going to be upmarket? So we’re talking larger sales, you know, you’re going to have to have sales reps doing one-to-one calls. On things like that, your own internal company structure is going to have a big effect on who this type of person or who your ideal client is going to be. Especially if you want to say I want this many customers but this much revenue in any particular given time. Do the math on that and you’ll start to figure out where you are in terms of product-market fit in terms of cost and stuff.
Other things that you have to think about are in terms of, at least for a lot of people probably listening to this. If you’re a product maker or a course creator or a lot of you are probably agencies, people who do development work for other businesses, you also want to be thinking, how much support am I willing to do for any particular person and what’s the cost of that support is going to be? And that’s also going to help you develop a product-market fit. So I’ll give you digital marketer Dave as an example of who we’ve kind of overtime worked to align our business with.
Jonathon: You call that avatar.
Adrian: Customer avatar.
Jonathon: Avatar yes.
Adrian: Customer avatar. And I did this through working with a guy named Dan Martell who is a big SAS thought leader. And he was recommended to me by Chris Lifter LMS for anybody who knows that product, so some really powerful stuff coming out of this guy, kind of like branch of the universe. We came up with digital marketer Dave. Digital marketer Dave works in an agency. And the reason we chose, he works in an agency is because agencies often have the highest success rates in terms of implementation and the lowest amount of support tickets in terms of like post-purchase fulfillment. So whenever you’re coming up with an avatar, you want to know, okay, so who do I want in my tribe and how much am I going to have to invest in that person or in return for them investing in me? Because, what could happen is if we have, for example, incited to target, let’s say the DIY group of the do it yourselfers, of which we have many in our tribe. But if we apply particularly focused on attracting those people usually in that kind of relationship, the investment in the client can outweigh the actual investment in the product that they make.
So there is an imbalance there because you know, if it costs you however many hours to support a particular client, let’s say through either support tickets or you’re getting on webinars or calls and the level of support that they require is in the hours of time. If your hour is worth $250 an hour, but they only paid $400, for a product, if in my case as a maker, a product maker, and I charge a yearly license fee of between 400 and $500; that is not a profitable relationship. So that’s something that you have to think about. It’s all well and good to say, Hey listen, I want to empower people who are not starting out or who have never experienced digital marketing before and go in and say, Hey, listen, I’m going to uplift all of you, but your pricing has to be reflective of both ways investment, which is something that I learned the hard way.
And as I was coming up [inaudible 07:49] because we say, Hey, listen, you know, we want people who’ve never done digital marketing before who are totally inexperienced and we’re going to help you and provide all of the support that you’re ever going to need. And we used to have free support on top of that. Oh, we only have premium support now, yeah. Don’t offer free support. I mean, if you have the resources to do it, great. If you don’t, it’s not a selling tool, and it’s not a lead magnet, it’s a really big hindrance on the business as a whole is what I discovered. But we used to be going; our customer avatar used to be just the DIYs, not necessarily the agencies because they were using stuff like active campaign or convert kit or infusion soft or whatever.
Jonathon: So how do you deal with the free product, do you offer a kind of forum experience where people can post a question and if you get time, it will be answered some time?
Jonathon: And then with the paid version, you have a direct ticketing system, is that correct?
Adrian: Absolutely. So, something that you have to take in mind is when you go out and you choose your ideal customer avatar, again, going with digital marketer, Dave, who works in an agency, he’s pretty experienced, he’s been around the block a couple of times and he knows what he’s doing and he’s pretty much self-sufficient. That’s the ideal customer for us because they pay the money and they never submit a support ticket, which means that we have a very profitable relationship because there’s not a whole lot of fulfillment time on the back-end after that initial purchase. But, not every single customer that you ever get is going to be that ideal customer. Dan Martell calls it the halo effect. Other people will see those people succeeding; your ideally customers. So you’re thinking and say, Hey, listen, I want to be kind of like that person.
And they will actually just end up coming into the fold with them as a result of you helping this particular vertical of client success. And you still have to support and allow those people to succeed using your product. You can’t deny, I mean, you could, but it’s not probably a great idea to deny service to those people. So we have developed systems and processes to support those people as well through channels that do not cost us a significant amount of money and either or significant amount of resources in terms of either money or time in order to support them and allow them to see it as well. We have courses and office hours as well as a support group on Facebook, so that the people who are not our ideal customer who are still great people and great customers and an incredible asset to your business, but who do not fit that particular need or desire for that profitability ratio in terms of investments in your company and investment in the client.
People who do not fit that at least have somewhere, where they can still get the answers that they need in order to be successful with your product or service. That little bit of knowledge information took at least eight months of trial error and experience where I probably could have just gone to Chris and asked him or asked Dan and be like, Hey, listen, what should I do about this? And they probably would’ve told me and I probably would’ve been able to learn that lesson eight months sooner. But no, that lesson took a really, really long time. Especially for a startup, if you’re just like a course or you’re an agency and you’re getting your first set of clients, which is a grind like there’s no question that; it’s a total grind and you’re trying to figure out all right, where do I price it? What’s my service? You know, how much am I willing to invest in the success of my clients, finding that balance is incredibly difficult?
Jonathon: Well, it’s a bit like you know; let’s take constant contact and active campaign. They do similar things, but they are two very, I would say that they are attracted to two very different–
Adrian: There’s no question like.
Jonathon: –Kind of customer basis, aren’t they? Were the constant contact, they did a lot of building up in the nonprofit world, and they had consultants that went around physically, had webinars, physical meetings, and they seem to concentrate a lot on their small business, but also the nonprofit. Where, active campaign seems to be, and your market, the more professional digital marketer type.
Adrian: Yeah, so what’s kind of interesting in that space is and I’m more familiar with MailChimp versus constant contact in the same space, but they kind of operate into similar space. Part of MailChimp’s attraction factor is that if you’re a brand new startup, or you’re just getting started and you don’t have the money to invest in an active campaign, which can get pretty up there pretty quickly in terms of costs. Mailchimp starts out absolutely free and you can have up to like a thousand contacts or whatever it is for free and you can send your emails for free. And that is a huge attraction factor if you’re looking to start building a list, MailChimp has an extremely powerful list of affiliate marketers on their team who are constantly posting about how to get started with MailChimp, and MailChimp as integrations and pretty much every single tool.
So what I find interesting about, at least in the MailChip case, is that their ideal customer is really a low market person where they’re kind of just getting started. But, once they kind of start using MailChimp and their business grows, they become locked in with MailChimp and it’s very and difficult to switch from one CRM or marketing automation tool to another of which I’ve done for many people many, many different times. It is a very painful process and they basically bank on the fact that as your business grows, it becomes something because they’re high-tier pricing, they’re upmarket pricing and they have products to serve those upmarket people. As I said, you can target a specific vertical of customer but everybody else will be broadened because of the halo effect and it’s just unavoidable to have those products for those upmarket people, and they’re very pricey. And that’s where they make a lot of their money is on the back-end. As the business grows and becomes locked in and it’s too painful to move elsewhere.
Jonathon: Exactly. I think we’re going for our break and we’d be back and discussing how do you identify your ideal client or clients. It’s an important subject and if you don’t do this, you’re really flying blind, basically. We’ll be back in a few moments folks.
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Jonathon: Well Adrian, I thought we had a group discussion in the beginning. I just want to quickly; we veered off started talking about, which was totally my responsibility for some of the competitors in your sector. But I think it was linked because there are a few competitors there, but when you really look at them, they are very targeted. Certain groups like convert kit that they really built their brains on power bloggers, didn’t they, providing tools for the blogging, the top 20% of the blogging world.
Adrian: Well, my vertical is WordPress professionals. So everybody at Groundhog is a WordPress professional in some way or another. And they’re using WordPress and they’re dedicated to WordPress and they love the WordPress community and things like that. But in terms of like; I used to be a big partner in infusion soft, so I’ll talk about that a little bit.
Well they used to be also Power, but then with their new product Keep, they seem to be aiming at the small market now. Now, like Drip, Drip seems to be focusing and since it was–
Jonathon: E-commerce, doesn’t it? Their focus is–
Adrian: If you got an e-commerce business use drip. That’s basically their thing and that’s their ideal customer are people who are running e-commerce business because a lot of their features set and their content marketing is focused specifically on that nichefied e-commerce business.
Jonathon: Which it wasn’t when they initially did the purchase of [inaudible 16:53], co-founder. It was a more journalistic audience, but now they totally focus on that e-commerce sector, Don’t they, that their branding–?
Adrian: Well, I’m sure you’ve heard this before, and it’s probably not the last time we’ll mention it. But if you’re selling to, you know, a lot of– when new product makers or course makers, whatever; they get asked the question, well, who are you selling to? And it’s like, well, anybody that’ll buy it, right. That’s always the initial question, especially if you’ve never taken a marketing course or sales course or anything, and you’re pretty like novice in the whole industry.
Adrian: But the thing is, if you’re selling to everybody, you’re selling to nobody.
Jonathon: Were you at any stage, you know, and if you don’t want to discuss that, I totally understand. But at any stage were you interested or looked at just focusing we are the emails CRM provider for wooCommerce. If you’re in wooCommerce, we’re the tool for it.
Adrian: I thought about it and it’s an interesting proposition because that provides you like solidity, right? It allows you to cement yourself in a particular stance in position, which makes it really easy for people who are in that vertical to self-identify themselves to potential customers. And that’s the reason that nicheifing is so powerful because if you pick that particular vertical and you spell it out on black and white; people who read it will be able to easier self-identified themselves with the values of your company. Again, using drip as the example they identified themselves as the e-commerce CRM. And there are lots of CRMs and marketing automation tools that you can use for e-commerce, but them spelling it out, so if you’re looking between [inaudible 18:4] trip and it’s like, well, active campaigns seems like more generalist and but I’m an eCommerce company.
And drip is saying worthy e-commerce one, who are you going to pick? You’re going to go the one that spelled it out in black and white. Now, of course, there are exceptions to this rule, but I’m sure if you looked at like the overarching millions of customers that they have signed up combined, then you’d probably see the distribution lean towards at least in e-commerce people towards; that’s one of them. The reason that we haven’t particularly done that is, “A”, there is someone in that space already. So they’re called Jilt and they offer e-commerce specific marketing automation.
Jonathon: Never heard of it, which is never heard of it, to be honest.
Adrian: So there is software as a service product, but they cater to Shopify, Easy Digital Downloads, wooCommerce and big commerce and a couple of others. So we didn’t want to go into that space because they’re doing actually really, really well in that space. And we decided to shift our focus instead of just doing like e-commerce; we were just going to do WordPress. And we are going to try and do our best to control the WordPress niche because a lot of software as a service product, you know is our platform-agnostic, right? So they can work on–
Jonathon: Well, you know, you look on the hosting side with liquid web since Chris Lima joined them; their focus now is wooCommerce, isn’t it? WooCommerce if you’re looking, it big enough for a substantial hosting company. So, I was wondering why you– and you might be still thinking about it. I was just interested because I think it really links into our conversation, doesn’t it?
Adrian: I think if anybody– so we’ve been in it for about a year now and I think if anybody was starting out and maybe in another lifetime, if I was in like month one, I would say like, all right, well who are we going to really identify? I might’ve chosen to go down those paths and be like and chosen wooCommerce or whatnot. I think part of the reason that I’m probably not going to go to that road is because, WordPress powers something like 75 million businesses, I think the status; wooCommerce powers about four.
Adrian: Right, so you’re thinking about total market potential capitalization. If you built a brand on top of just being like the wooCommerce people, you have that very specific cap on your total possible market capitalization. Now having a really big capitalization on 4 million people, is certainly nothing to cry about. So there is that to be said, having even maybe 1% of that would be incredible. Having 1% of an entire WordPress market though would be better than that, and we also have a lot of other tools. Our original MVP wasn’t at all designed for eCommerce at all. It was really designed for the consultant, the service business and people who kind of like get on the phone and talk to their people. We then introduced a lot of helpful e-commerce features like our WooCommerce integration is very robust and would rival that of some of the leading marketing automation people who do operate.
Jonathon: Well, so that sure, isn’t it? If you’re in wooCommerce, it would be a natural thing to use WordPress by email CRM system?
Adrian: One would think, wouldn’t they?
Jonathon: You would have thought, would you?
Adrian: So, I honestly like the appeal for me is absolutely there. One of the things that you mentioned earlier Convert Kit, right, so, Convert Kit really went in their initial stages after the content creators, the bloggers, the vloggers, people who wanted to build their lists, they were busy writing content. They didn’t have time to do or learn anything about marketing or–
Jonathon: Well it still is the situation. Who was the founder of convert kit?
Adrian: The name escapes me.
Jonathon: It escapes me, but I was reading one of these blogs and he said to me, it was a [inaudible 22:44], his own niche. Because he said that, you know, like MailChimp and some of the other established players, they provided terrible way of getting people to sign up. They provided some HT mail code that was a bit wonky and there were a number of third party plugins that you could purchase that.
Adrian: Back in the day.
Jonathon: Back in the day about three years ago folks thought old.
Adrian: Back at three years ago in technology time is like decades.
Jonathon: Oh, give me a break. So basically, they’re really clunky and some of these third party systems, so I said you wanted to provide an experience where people couldn’t get a way of getting people to sign up for the newsletter easily that would work with the back-end system easily and that’s how convert kit was born basically. And in fact like I say the laser focus, but if you read some of his materials and some of it is quite insightful. It took almost three years because he said for the first two years he didn’t quite understand who is target audience was. And then he realized it really was this top echelon. His initial target audience was this top echelon blogging community. And he had laser focus about getting in with them, providing value, meeting them personally, and building the business up.
Adrian: One of the reasons that– I got another reason we didn’t go down the like super niche route is because our niche doesn’t necessarily belong to what kind of businesses, but the people who are serving those businesses. Again, our avatar is digital marketer Dave, who is not necessarily running his own business but is doing the marketing for other people’s businesses. Again, because I used to be an agency or working in an agency rather, and Groundhogg was scratching our own itch. We’re like, all right, we need a software that we can use that we know will always be there for us. So we built Groundhogg instead of using what we were using, which was infusion soft at the time and started–
Jonathon: Goodness gracious.
Adrian: –And started implementing that for our customers instead. As the agency person, Groundhog is really designed in order to allow agencies to succeed in installing it on a customer’s WordPress website. Adding some funnels in there and the customer or the, whoever the agency is, or whoever the client is, can call their agency and be like, I need you to change this thing. And they can log into the WordPress website and do it in a couple of seconds. Or that clients can actually do it themselves because if they understand a basic understanding of WordPress, they can log in and change some email copy if they need to because it looks exactly the same as WordPress. So, really it was designed to make that interaction between client and agency significantly easier.
So we’re really almost going over the heads. Our targeting is over the heads of the typical DIY or small business and going straight for, all right, so you’re an implementer, you’re an agency, you have 50 or so people who are using this platform or who are using WordPress. You can use this to quickly and efficiently set up marketing funnels and campaigns and all of that stuff across all of your client’s sites as quickly as possible.
Jonathon: Well it’s totally logical because there’s a real cost. There’s a number; we’ve talked about active campaign, constant contact, MailChimp, you got mail lights and there’s about 20 of these different drip focused at e-commerce, convert kit, the blogging world, but they’ve expanded that. But you know, leaving it to the client; well, they expect you to be experts straight off, don’t they?
Jonathon: Well, how can you be an expert there? Yeah, they have similarities but they also have, the interfaces are different and these are complicated, powerful systems to some extent, aren’t they? You can’t, how could anybody but expert on a dozen to 20 different systems, they just couldn’t so–
Adrian: No, and especially for the small business who as a small business owner, I’m sure as everybody who is on this call right now understands. Business owners wear many hats. They’re the CEO, the CMO, the CFO, the CTO, they’re pretty much everybody in their business, and asking them to learn an additional language, if you will, is something that is neither, like, it’s not a sexy proposition, but the end result of learning that language is certainly sexy. But the getting there or the ramp-up to understanding it really well is not great. And what agencies promise is essentially the end result without the learning experience because they’ve already gone through that learning experience.
So we know that agencies are out there who are struggling with implementing a lot of these different systems for their clients because of lousy integrations or it’s complicated or the end-user or the client doesn’t know how to understand the system and they want to. We saw to relieve a lot of the tension in that relationship. And that’s really where our niche is. And that’s why we didn’t go down the road of either like choosing e-commerce or choosing content bloggers or choosing everyone. We’re going above that straight to the people who are the [inaudible 28:35].
Jonathon: I just think it’s been an interesting conversation. We’re going to kind of point it out, even in this area, the products have found niches in the main product and they focused on different sectors. The idea that there’s one all-embracing the only real general tool that does that to some extent is MailChimp. But they do that for the specific reason you pointed out earlier now in our conversation.
Adrian: They lock you in. I was reading Pippin from Easy Digital Downloads and Sandhills Development; his end of year blog post and they send all of their email marketing through MailChimp, okay. And he did something like, I want to say three and a half million in revenue or just under three and a half million in revenue last year, which is pretty freaking awesome. And 32,000 of that went to third party providers of which the biggest share went to MailChimp. That is a big email marketing bill. And that is where the money is made because they lock you in when you are a small company just to, you know, your aspirations are over the moon and everything and as your business grows, it is such a painful process to move away from that provider and go possibly to another one. So their target is the art market but the money is made at the top of the market where you’re kind of like locked in, which is a great business model really.
Jonathon: Yeah. So I’m going to go, we’re going to wrap up the podcast part of the show. We’re going to have some bonus content where I’m going to talk about how I feel that I’ve identified what I call buckets.
Adrian: Buckets, I’m interested.
Jonathon: I call them buckets of groups of individuals and people that I’m aiming to provide a service to. So I’m going to get a response from a way more intelligent, better looking, most successful co-host. And he’s probably going to give me a typical answer. We’re going to finish off the podcast part of the show. If you really generous listeners and viewers and you want to support the show, there are two things you can do. You can go to the WP-Tonic website and sign up for our newsletter of a load of lead magnets, but we’re going to be expanding the value of our monthly newsletter with special prizes aimed at you our listener. There will be more about that in the coming weeks. And the second thing you can do for us; if you’re really generous, is go to iTunes and give us a review. It really does help the show. We will be back next week with another great internal discussion or great guests and we’ll see you soon folks, bye.
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