Using Affiliate Marketing to Grow Your Business

As an entrepreneur or a marketer, the risk for you to use affiliate marketing is extremely low and the reward is high. You only need to pay affiliates when a customer converts, not when they drive people to your website.

In the webinar, KISSmetrics Founder Neil Patel and Dan McGaw discuss how to increase your revenue with affiliate marketing. Besides KISSmetrics, Neil also co-founded Crazy Egg and has spoken at over 100 marketing conferences. He has tons of experience with affiliate marketing, both from being an affiliate and driving the revenue of other companies, as well as through an affiliate program trying to recruit affiliates.

Among all of the companies Neil has created, he has had to deal with affiliates, whether that was running affiliate programs or driving affiliate traffic or potential revenue to other companies. For example, at KISSmetrics, Optimizely is often recommended.

Foundation of Affiliate Marketing
Affiliate marketing can be thought of as outsourced marketing, in which you’re hiring affiliates who are paid to bring you customers. If they drive visitors to your website, you don’t have to pay them. You only pay them if they convert visitors into customers. While you are trying to generate traffic as a marketer, the main goal is to increase the number of customers. If you generate a million visitors a month, but the visitors don’t equate to more leads or revenue, it’s almost useless. This is why the affiliate marketing space is so popular, especially in the web hosting industry, where most of their business is from affiliates.


How affiliate marketing works:

  1. Affiliate is assigned a tracking URL:
    This is to track which affiliates are driving your traffic.
  2. Affiliate markets your company:
    Affiliates can promote your company through several different ways: paid traffic (like AdWords), a YouTube video of the product and link to it with the affiliate ID, email blast, blog post, reviewing products, etc. The possibilities are endless. When you sign up affiliates, you should also limit how they can promote it.
  3. Customers or leads are acquired:
    This is when the visitor purchases the product or signs up.
  4. Affiliate receives a commission:
    When the affiliate drives you a customer or lead, you pay them out.

Something to know is that affiliate marketing and referral programs are different. Referral programs are great for people who are already customers. For example, if KISSmetrics had a referral program, and a current customer tells his or her friend about KISSmetrics, the customer can receive some sort of reward through the referral program. With affiliates, they don’t even need to be customers. Anyone can be an affiliate. You can recruit them in any fashion:, LinkShare, blog posts, etc.

Advantages of Affiliate Marketing
There are a number of advantages to use affiliate marketing, especially for startups:

  • Pay only for results.
  • Can be more cost effective:
    Neil says he hasn’t seen any other marketing form more effective than this.
  • Affiliates may be better at creating copy and reaching segments:
    Why would someone sign up to be an affiliate and spend time and money if they think they won’t be able to drive you customers?
  • You know your cost per acquisition:
    This will help you determine if you’re actually losing or making money.
  • You almost never lose money:
    Sometimes affiliates are a bit shady and unethical, and you’d want to drive them out as soon as possible.

Drawbacks of Affiliate Marketing
There are also drawbacks:

  • You don’t control the message:
    You want to be careful of this, because you don’t want them to lie or poorly represent your brand. They’re just looking to make money, so they aren’t seeing if they are driving good or bad leads.
  • Lead quality may not be as good:
    Chances are, the quality of the people are going to be as good as the ones going directly to your website.
  • If mismanaged your traffic may come from an unreputable source. This could make your brand look bad.

To learn tips on how to turn advocates into markets, affiliate marketing for SaaS companies and how to effectively measure your performance, watch the webinar:

Kalzumeus Podcast Episode 8: High Touch Software Sales with Steli Efti

I recently met Steli Efti, founder of, in Palo Alto, and did a podcast episode with him.  Transcript and links below as per the usual.

Sidenote: I listen to a lot of podcasts and have been using Marco Arment’s Overcast app recently to do so.  It was the best $5 I ever spent.  Give it a whirl.

[Patrick notes: The transcript below has my commentary inserted like this, as usual.]

What you’ll learn in this podcast:

  • Why engineers speak a different language than sales people.
  • How we can get over our reluctance to do sales to sell more software (without selling our souls).
  • Tactics for getting over the pain of rejection when doing sales calls (and sales generally).
  • How to qualify prospects so you don’t waste time pursuing deals which you’d never, ever close and can instead concentrate on the deals which your personal attention will cause to close quickly.
  • Why Steli shuttered a multi-million dollar consultancy to focus on’s SaaS product.

If You Want To Listen To It

MP3 Download (~80 minutes, ~54MB) : Right-click here and click Save As.

Podcast format: either subscribe to in your podcast reader of choice or you can search for Kalzumeus Podcast in the iTunes Store.

Transcript: High Touch Software Sales

Patrick McKenzie: Hi, everybody. I’m Patrick McKenzie and this is the — I don’t even know what this is – episode of the Kalzumeus podcast. Thanks for staying with us.

Keith, unfortunately, can’t make today. He and his wife and daughters are having fun back in Japan, but I am here in sunny Palo Alto, California with a buddy of mine who founded a company. We’ll talk you a little bit about the story later, but he founded a company, which these days, it’s, a YC funded company. Meet Steli.

Steli: Hey, guys. I’m super excited and honored to be on the podcast, a big fan of it.

Patrick: Steli, can you tell us a little bit about your background? I’m more from the engineering side of the house and you are… not.

Steli: I’m originally from Greece, born and raised in Germany. I’m basically a high school dropout that has no credentials whatsoever, completely unemployable, and never had a real job in my life. I’ve been an entrepreneur my whole life.

A lot of times I joke that the entrepreneurial super power that I use to move things forward is the hustle in sales. I love communicating. I love people. I love moving things forward, on the business end of things. I’ve been an entrepreneurial salesperson my whole life.

For the first few years, small businesses, boot-strap businesses back in Europe, and then seven and a half years ago sold everything I had, bought a one-way ticket to come to Silicon Valley, follow the legend of becoming a tech entrepreneur with the mission to be the stupidest person in the room. I’ve accomplished that every day since.  [Patrick notes: Silicon Valley sometimes seems to have almost Japanese norms with regards to modesty among founders, where the more self-evidently untrue statements like that are, the more you have to say them.]

I first built a business that spectacularly failed in a very painful way. This is the second venture, which took a few turns left and right, and we’ll talk about that, but that, thankfully, today is doing really, really well.

Patrick: One of the reasons I wanted to have Steli on the program is that Steli is one of the most successful sales guys that I know. I know it’s a personal weakness in myself that I’ve learned enough about sales and marketing to be dangerous, but I tend to always reach immediately for the low-touch sales, for things that can be automated, that play to my strengths.

Doing search-engine optimization, working on copywriting, working on scalable email strategies, lifecycle emails, that sort of thing, with the goal that I never get on the phone with anybody, and that I send as few emails as possible. That’s worked out pretty decently for my business.

But there are definitely times where I’ve thought, back when I was doing consulting, that, “Man, I just totally botched this opportunity for a $50,000 consulting gig because I was insufficiently aggressive following up with folks.”

Or, when I’m working on an Appointment Reminder, where the top-level accounts [Patrick notes: I'm speaking about the publicly available Office plan which costs $200 a month, not enterprise sales] have lifetime values in the $6,000 region that would totally justify me getting on a phone, and then yet I think like a lot of people listening to this, I have no idea of where that even starts. I think we want to talk a little bit about ales for software entrepreneurs and how you can use this to make your business better.

Maybe before we do that, talk a little bit about the elephant in the room which is that all engineers are socialized from a very young age to hate sales and everything it stands for. That Hacker News anecdote was priceless. These guys launched which is a CRM basically for sales guys for sales guys. It launched on Hacker News, what was it, two years ago?

Steli: January 2013.

Patrick: January 2013. The first comment on Hacker News was about your pricing strategy. Not about…not about the pricing strategy, it was about the pricing. It was like, “$125 a seat, that’s outrageous! I could build this in a weekend!”

One of your engineers actually wrote back and said, “Well, you shouldn’t see $125 in the context of that’s a lot of money to pay for software. You should see it in the context of if each of your sales reps was getting even one more lead closed a month into a deal, this would be worth much, much more than $125.”

I wrote back on that, “This is how a smart sales guy answers a pricing objection. Value-oriented pricing, it’s a wonderful thing.” Turns out that was a lot of the engineers, actually.

Steli: He was super proud that Patrick called him out as a sales guy, as a smart sales guy, he’s like, “I’m not even a sales guy!”

Patrick: Yeah, we’ve got this unfortunate and inaccurate socialization in the Dev community that all sales guys are like the characters on Glengarry Glen Ross, it’s the, “Always be closing! First prize is a corvette, and second prize is steak knives, and third prize is you’re fired!” Caricatures of sales guys. I’ve never seen the movie, my understanding is that intended as a caricature but some people idolize it.  [Patrick notes: You can see an analogous thing with Social Network, where Mark Zuckerberg is in the text of the piece designed to not always be a sympathetic character and yet some of the incidents which are supposed to make the audience wish for his comeuppance are things which developers really connected to.]

But be that as it may, that’s not actually what sales is about. You’ve talked a little, a while ago you guys basically did sales consulting for software companies. You would either tell them how to set up sales operations for software companies, or you would actually be the guys who would man the phones and sell the software to various prospects. Talk a little about software sales, how it fits into the picture of a software company, and the picture of the buyer’s company.

Steli: Maybe even before I comment on that, on the whole sales versus engineering culture clash between the two groups. I have just a few thoughts and observations that I’ve made over the years. I do think that engineers in general and sales people speak different languages.

Patrick: Definitely.

Steli: Therefore, there’s a lot that is lost in translation when they interact with each other. What I’ve seen is that building up empathy between the two groups can be incredibly valuable, educational to the individuals as well as to the company as a whole.

We would have retreats where we would have engineers do sales training, and they would have to pitch the product or do simulated cold call and a sales person would be a very difficult customer. Have them go through the pain of what makes sales difficult, so they can empathize more with it and then also train them on how to get better at it, and vice versa.

Have sales people be in small product brainstorming sessions and actually make them understand that you can’t just say, “Can we make this faster?” Or, “Could you just make, quickly just add this little feature that does this?” But actually have them think through all the implications of product development. How little is not really little, or this easy feature is not really that easy, and have them understand from an engineering point of view what it takes.

Once these two groups know a bit more about how each other’s work looks like and what is hard about it, and what it easy? Magical things happen.

Improving Software Sales: Low Touch vs. High Touch

Patrick: Definitely. I also think that there’s opportunities that are under-explored in a lot of software companies to make the sales team’s life easier with software. Most of the time when I’m talking about things that I build say in my consultancy or for my own products it’s using engineering to achieve marketing outcomes.

But you can also have engineering to achieve sales outcomes. Building, like you guys have built an internal CRM that you’ve spun out into a product.

But even those companies that already have CRMs or they already have an existing sales process, it’s amazing what you can do with a cronjob and 100 lines of logic in a Ruby application just to smooth that process along, or systematize it a little better.

Maybe we can talk about that in a minute. Let’s talk about for the folks here for don’t have a “sales function” at their software company yet, it’s just at solo-founder, they’ve got a website, people come to the website, they probably buy SaaS and in business we have a distinction between low touch sales and high touch sales.

Low touch is the 37signals model. You have a website that does most of the selling for you. Folks are brought to the website via some combination of search engine optimization, paid acquisition, etc. They get to the website, the website tries to get them into a free trial. The free trial is going to be the primary sales channel, and then maybe there’s some email that’s getting fired back and forth generally in an automated drip-email kind of fashion, or lifecycle emails.

Occasionally, the founder will write emails, but the understanding is that the founder isn’t really making the sale at that point, it’s convincing someone who has already convinced themselves on the software to get over the last hump.

High touch sales is the other end of things, where folks are broadly speaking, they’re getting on the phone, getting on emails, writing person to person communications with particular decision makers at the company. Man, there’s a lot of art and science in this guys. It runs billions upon billions of dollars in business in the economy. But in the SaaS industry specifically, there’s tiers of sophistication of software, where it makes sense to have high touch sales.

At the way high end we have large-scale enterprise sales where you’re selling to literally Boeing. That process takes between 6 and 18 months. It’s going to require typically that you send out the sales guy plus a support engineer who can answer all the technical questions.

You send them out to the office, they do a custom presentation that they’ve built specifically for Boeing’s use case. The presentation happens, and then go and take them out to a steak dinner where business is actually contemplated. Then this continues for several months and then maybe that deal happens, maybe that doesn’t.

The new innovation in the SaaS industry is that typically speaking the account manager, let’s make it the sales guy, the account manager/sales engineer team is only really viable for sales that are in the $75,000 plus, plus, plus region a year. You can read the classic essay by Joel Spolsky called Camels and Rubber Duckies. [Patrick notes: Still one of my favorite Joel on Software essays.  One of my bucket list goals is that someday folks cite individual essays of mine by name ten years after publication.  Maybe in a few more decades.] He says that basically there’s no software priced between $500 and $75,000.

Why is that at $500 you can convince a single person to put it on their credit card, $75,000 you can send out a sales rep and a support engineer to their organization and do the PowerPoint dance to get the 15 different decision makers on the same page. The interesting thing that’s happened in the 10 years since Joel wrote that essay, is that SaaS arrived, and the wonders of monthly billing in that you can actually get accounts with lifetime value between $500 and $75,000.

My understanding of it, is that after an account gets to maybe $80 a month in value to a $250 range, if you model it out as having a term-rate in the five percent or less region, then we’re talking about $1,500 to several thousand dollars of lifetime value. Then it suddenly starts to make a lot of sense to have somebody call them. Does that make sense to you?

Steli: Yeah. I do think that the volume frequency matters, so if you’re on the low end — let’s say the customer lifetime value that you have is, let’s say 2K, you can’t have a sales person call tens and tens of leads that don’t fall into that, to close one of them. You would have to have a high close rate and a high frequency rate of people that are in that bracket.

Everything that is above 5-10K is probably a more comfortable space in terms of customer lifetime value, so you want it to be in the few-hundred dollars a month range, ideally. But that dramatically varies on your market, your churn rate; like how long you actually are able to retain customers, how high is the volume of these leads that you’re getting.

All that needs a little bit of mathing and experimenting and exploring around, but typically I would say if you can estimate that a customer is worth a few thousand dollars, it’s definitely the right spot to try out inside sales and inbound sales, and see what magic you can work there.

Patrick: “Inside sales” is something that a lot of folks might not have heard before. Typically, there’s a distinction between inside sales and…I think it’s “outside” or “outbound” sales?

Steli: Outside/outbound. This is complicated, you’re right. There’s inbound and outbound sales. “Inbound” describes selling leads that are coming to you — signing up for webinars for your product trials, whatever it is. “Outbound” describing you cold calling, knocking on doors, going out to people proactively. That’s inbound and outbound.

Then there’s inside sales and field sales, “inside” being any sales person that doesn’t leave the building to do their job — so email, call, webinars or web conferencing. Then “field sales,” the people that actually have to get on a plane and fly to Boeing and spend a week there to make the deal happen, or the door-to-door sales guys, whatever that is.

Patrick: Inbound sales are probably where most of the SaaS companies, who might be listening to this, are getting it started with sales.

Steli: Yeah.

Patrick: Somebody’s come to the website. They’ve signed up for the free trial of the software, or they are on our email list. What is the next step for us, if we want to get started with inbound sales? I know that it’s easier than we think it is, but…

Steli: But it’s also harder.

Patrick: …to just hear somebody say it.

Steli: It is actually very easy. There’s two channels where you can communicate with somebody that comes to your website and signs up, either for your trial or your demo or your eBook, or whatever you do.

One is, if all you have is their email, you send them an email. The purpose of that email can be to learn more about them, qualify them further and sell them — although I would say that email is typically better for giving people information, maybe scheduling a call.

If you actually want to convince somebody to sell somebody on something, a phone call or in-person meeting are still a lot more richer environments, more successful environments, to make that happen. You could use an email to try to get on a call with somebody, or if you’re asking them for a phone number, you can pick up the phone and give them a damn call, which is something too many startups don’t do.

Patrick: Amen. Totally guilty of this myself, but it’s probably…in a good month I do maybe 10-15 calls regarding Appointment Reminder. If I was based out of the US and actually operating better — like if I was in sales and marketing mode for a week — I could very easily do 10-15 a day.

Steli: Most people that run a SaaS business and bootstrap or single-founder, their minds would be blown to even consider talking to 10 people. They’ve built the entire business in a way that prevents that interaction on that level to happen, because phone calls are seen as old-school, non-scalable.

Also, for people it’s a lot more comfortable to write their thoughts and have time to articulate that in writing. If rejection happens or something else happens, or they don’t hear back, it’s much more comfortable to have rejection happen in your Inbox than actually have it happen live, in real time, from another human being.

Patrick: Yeah. My first exposure to the distresses of being on the phone, I wasn’t in a sales job. I was a customer service representative at an office supply company, which you would use to buy things like paper or… staples.

Steli chuckles.

Patrick: Anyhow, I was the guy that you would call and say, “Hey, I want 400 pens,” and I would have to figure out what that actually was in the system, type up the order for you, and hit Go.

Occasionally, I would get phone calls about the fax orders. It’s not a sales job. It’s literally calling to follow up about an order someone has already placed. Maybe you said you wanted 400 pens, but what color do you want? What sort of a point? Or, “You said you wanted 400 black pens. Do you want 400 black pens like the BIC model, or do you want 400 pens of something that’s branded, or what?” I would give folks phone calls.

Often, if you call an office and say, “Hey, I’m Patrick McKenzie calling for — name of company here,” you immediately get, “We don’t want any,” and they slam the phone on you, and, man, I felt so bad when that happened.

Steli: Yeah.

Patrick: I actually got a bit of a thick skin about it for those two years, and then promptly lost that thick skin when I started a software business.

Steli: [laughs]

Patrick: Yeah, rejection is tough.

Constructively Dealing With Rejection

Steli: Yeah. Let’s talk about that a little bit, because I think that the whole point of rejection is probably one of the things that I see most common between sales and entrepreneurship in general, having to reprogram ourselves on how we respond to rejection. Because if you live your life in a way that tries to design for avoiding as much rejection as possible, there’s very little things you can do. Almost nothing in sales, and very little in entrepreneurship.

Here’s a couple of thoughts on the rejection piece, and then I want to give some, “How do you get started, and how should I call somebody who just signed up for a trial? What even do I tell them?” Let’s talk about those two things.

On the rejection piece, for whatever reason, we’ve all gotten here with whatever programming, social conditioning, our little bags of DNA, our character, whatever that is. Everybody dislikes rejection. There’s not a single person on earth, no matter how awesome they are, that likes to be rejected.

The question is, how can we figure out a way to deal with that rejection in a way that’s not too horrifying, too painful, too emotionally taxing? Early on, there are a couple of practical tips that I have, that are kind of super-hacks for our own brain, that are easy to do but can make a big difference.

One simple thing is to reprogram the scoreboard to, instead of focusing on the wins, understand that the losses are your stepping-stones towards your wins. We’re all SaaS people, conversion rates, metrics — so let’s say that you figure out that if you call 100 signups, that only 10 of them on average will actually want to speak to you, have a great conversation, and then end up buying the product.

That doesn’t seem that exciting. “I’ll have to call 100 people, and only 10 people will say yes.” Let’s say that the math works out, and that’s a good investment of your time, just as an exercise. Most people would focus on that. They would say, “Well, what I have to do is get 10 people to say yes every day.” They focus on the success.

You have a good day and bad days, and days don’t average out equally. Sometimes you have a good day and you get the first 10 calls, all of them say yes, they love it, and they buy from you, and you lean back and say, “All right, that’s it. I got my quota for today. I’ve got 10 wins. Let’s take the rest of the day off.”

Then you have another day where you have a bad day, and out of the 100 calls, nobody buys, and all of a sudden you’re off quota.

Instead of focusing on the 10 wins, what you can do is focus on the losses, and say, “I know that for every nine noes I get, I will get a yes.” I’m not trying to earn the success, I’m trying to work my way through the failure. Let’s say you put together a little scoreboard every day, and you make 90 little boxes. Every time somebody tells you no, you check off a box.

Patrick: I like this.

Steli: It gives you the satisfaction of progress, you check off boxes — that always feels good. Now all of a sudden, every time somebody says no to you, it’s not just a no, but it’s actually another check for your box, so you’re progressing your day.

If you focus on that, just going through that number of calls and that number of rejections, success just happens automagically, by itself. You don’t even have to keep track of it.

If you know your numbers better — if you actually knew how much revenue you would make per call — you could have a little box, and pennies, and every time somebody tells you no, you throw in two dollars into the box, and you know, “I earned another two bucks, because it brings me closer to a win that’s worth X thousands of dollars,” whatever it is.

If you use these little programs to focus on taking rejection for what it is, which is a stepping-stone towards your end goal. Then all of a sudden it’s important because you have to take all these steps to get to your end results, versus trying to avoid them and make big jumps to only have successes, only have people saying yes.

Patrick: Yeah. I think this morale management for the day-to-day grind of entrepreneurship is really important.

It comes up in a lot of circumstances too, not just sales — A/B testing, for example. A/B testing, if you’re doing it right, probably 75 percent of your tests close with a null result and you “learn nothing.” Neither a win nor a loss on the test. If the remaining quarter, half of them are a win, half of them are a loss, versus what you had before.

What I always tell people is, “You’re not learning nothing if you get a null result on the test. You learned on more thing that was not the best thing you could be focusing on right now.” If you’re getting no, it’s not just “no.” There’s a little bit of signal attached to the no, like “No, we’re not in the market for this,” or “No, I don’t have authority to buy this,” or “No, the price is too high.”

Then you can drill down into these later. If you’re always getting, “No, price.” “No, price.” “No, price,” then maybe you need to think on your pricing strategy, or the positioning of the software, to add more value.

Steli: Yeah.

Patrick: Although, people won’t be telling you, “No, price.” Charge more!

Steli: [laughs] Always double your prices.

Patrick: I got out my catch phrase for the day. We’re done. We can stop recording.

Steli: Yeah.

Patrick: We have a low-touch SaaS business. We have leads coming in.

Steli: Yeah. We ask for the phone number.

Patrick: We sent them an email. How do you ask for somebody’s phone number?

Steli: You can have it as part of the form — and we all know that means that conversions will go down — but in the early days I would recommend you to do it regardless of conversion going down or not, because those phone calls are going to be very educational. This is customer development.

You call people, and you actually learn from them. How did they find out about you? What do they like? What do they not like? What’s important to them? You get a real chance to interact with people and learn, beyond just the clicks on a website, beyond even when they send you an email.

In an email, I can just write words, but there’s a lot of context missing through tonality. I could write saying, “This is not for us right now.” Now, you don’t know anything about how exactly I mean that. Did I say [hostile tone] “This is not for us right now!” or did I say [casual tone] “Eh, this is not really for us right now.”

These two things point to different opportunities. One seems a lot more hostile, somebody that doesn’t want to be bothered. The other one seems a lot more friendly, maybe a little hesitant, even, about his own judgment. There’s different reactions which, in an email, you don’t know.

Patrick: Right, and since it’s a synchronous kind of contact, you can drill into that rejection right now.

Steli: Yeah.

Patrick: Is that, “This is not for us,” like “We will never be right for this,” or is that more of a timing thing? Did something happen at work? I can empathize with that — I run a small business, myself. Would it be better if I got in touch with you two weeks from now?

Steli: Exactly. Or even if you just say, “Oh, how come?” and the person says, “Well, your website promised X, but I found out your product does something totally different.” That’s valuable. Wow, if you hear that more than once, you know you’d better change the wording of the website.

Patrick: You’d better change the website!

Steli: Versus, if you only get two emails that say, “It’s not for us,” you have not really learned that much. There’s still a lot of assumption that needs to happen. You have to assume and interpret what that could mean.

Patrick: Particularly in less technical markets, I find that. I sell to office managers for a large portion of Appointment Reminder, and these are not naturally loquacious-on-the-Internet kind of people. They tend to write very short, clipped emails, and when I get cancellation reasons from them — which I ask for when folks cancel the trial — it’s often two to three words.

If they could write less than that, they would, but it bounces their castle if they don’t write at least 10 characters.

Steli: [laughs]

Patrick: Folks will write, “Didn’t work for us,” or “Too expensive,” or yadda-yadda. It’s like, “Wait. We’d love to have a deeper conversation about this.” Which, if I was on the phone with them we would, by the nature of that, be having a deeper conversation.

Steli: Yeah. In the early days, I would actually tell everybody to ask for a phone number, and don’t worry about the conversion rate so much. Then call these people, and have a conversation with them. Welcome them to the trial.

Patrick: OK, we’ve called folks. We’re welcoming them to the trial.

Steli: Yeah. Then you can do some very simple things. You can say, “I want to welcome you to the trail. I saw that you just signed up. I just wanted to hear, how did you hear about us? What do you want to get out of the trial? What’s your primary goal?

“I want to make sure that you get the most out of the trial. I want to make sure that this is going to be a success for you, that you’re going to get value out of the trial — out of the investment of time in our product.”

Then you have people tell you, “I heard about you from a friend,” or “I heard about you from this or that website.” That’s always good to know. Then they tell you, “Our situation is, we’re looking for a product and it needs to do this and this, so we wanted to check it out.”

Usually, the first bit of information you get is really valuable, but there’s so much more to dig into. We sell sales software, so they say, “We’re just ramping up our sales efforts, so we’re looking into systems.”

That’s obviously not enough information for me to really know who they are, understand if our product is a good fit, and see if I can point them in the right direction for them to get the value out of it and become a customer.

I would ask, “Tell me about it. What kind of sales do you guys do? How many sales people do you have? What are some of the challenges, some of the goals that you have? We’re going to dig into this to really understand your situation.”

This is not just about selling them. It might be that you find out, “Oh, wow” — within the first three minutes — “you should not be using my product. This will never work for you.”

This is a great opportunity to turn something negative around and do something positive, and tell somebody honestly, “Listen. After hearing what you’re telling me, you shouldn’t be using us. Our product is better for a different use case, but here. I’m going to point you in the right direction. I’m going to give you a recommendation for something else.”

Patrick: Yeah, I’ve had this. I’ve done this before, and it’s both the right thing to do — it buys goodwill with people — and you’ll be surprised how often folks will try to toss you a bone on that sort of thing. I had a customer, a prospect for Appointment Reminder. I was on a phone call with her. Let’s say that I largely sell to little fish and then trout, and she was like, “Yeah, I represent a whale. A big, big white whale.”

In the first three minutes it was like, “We don’t really whale-hunt here. But I happened to know there’s a well-regarded company that’s our main competitor. They go after whales, and that’s all they do. I know one guy at that company socially. Let me give you his direct number, and you can give him a call. I’m sure he can set you up with something.”

She was really happy about that. She’s in a medical profession, so she knows other people in the medical profession, and when her friends who are not whales say, “I called the big 800-pound gorilla and they didn’t even want to talk to me,” she’s like, “I know somebody who will take care of you,” and she sends them an email and copies me on it. It’s like, “Hey, meet Patrick. He’s the best guy in this. He will take care of you, blah, blah, blah.”

Telling her, “This is not going to work out. I’m not going to waste your time on this, I’m just going to get you a more successful resolution with my loyal competitor here…” Telling her no has raised my sales by like $300 a month, these days.

Steli: I’ve seen this work at so many different companies. People are just blown away when you tell them no. When you tell them, “You should not buy,” people are so positively surprised by that interaction that they’ll try to do something good for you. It’s crazy, sometimes people will not take that no for an answer.

They’ll say, “No, but I really think we qualify for this and I really want to buy this now from you.” You say, “Whoa, whoa, whoa. I’m trying to do what’s right for you,” and then they’ll try to convince you why they will qualify for the product in just a little bit of time.

Sometimes we tell people, “Hey, if you have less than X amount of leads a year, just use a whiteboard or a spreadsheet. You don’t need a CRM at that stage.”

Then they’ll challenge us on that and say, “Well, but we communicate a lot with our customers and we’re going to grow, and I want to use the right solution. You guys are awesome.” They’re going to fight you to buy your product. Sometimes we turn people down and then we see them just self-sign up, just put in the credit card and buy it regardless.

People are not used to that, and it will make a big mark. It will make a big difference — and it’s the right thing to do.

For a SaaS business anyway, you don’t want customer that are going to create a lot of support and then churn a few weeks after, because it’s not worth it.

Patrick: I think this is the fundamental thing that engineers do not get about sales. It’s not about just extracting moneys from people’s pockets unwillingly. That’s theft. That’s a great business model until you’re thrown in jail…

We’re doing value-creating businesses, and for a lot of markets, a lot of customers, they don’t naturally seek out stuff. The classical SaaS model, where it’s just low-touch and they have to generate all the forward motion in the relationship, doesn’t result in success for them, doesn’t result in success for their companies, doesn’t get them the best solution that’s out there on the market — so we need to nudge them in the direction of success a little bit.

That has, as a side effect, nudging a little bit more money towards your pocket, but it’s money that you’re getting for providing the value-creating service that, yeah, is the business we’re doing, and for creating the best outcome for them.

Oftentimes, the job of sales guy at a company isn’t so much…there’s the selling the person you’re talking to, but often you have to organize them a little bit about how to buy the product.

An example, something I did over email — and it’s something that I automated later — was somebody said, “I’m going to be the end user of Appointment Reminder.” They never used those words, but the “end user” is someone who’s actually pushing the keys and they input data.

“I’m going to use this. I’m the person who’s going to own the system, but my boss is the person who has the credit card, and my boss has said, ‘If you want to buy this software, I need to see the ROI for it.’” The office manager says, “I, not being a businessman myself, do not really understand this ROI thing, or how to calculate it. I Googled it. Wikipedia was kind of confusing. Can you calculate the ROI for me?”

I said, “Well, I am a businessman, and I love math. Sure, I would be happy to calculate the ROI for you.” That gets her over an internal objection. I’m not selling her. I’m basically selling her boss, by proxy, by giving her the ammunition she needs to make that sale to the boss. That’s kind of sales 201 — empowering people to be your champion internally.

How To Do Sales Without Feeling Like You’re “Doing Sales”

Steli: Yeah. Empowering champions internally to go through, to successfully navigate the internal sales process, to enable the organization to purchase your product.

I think, going back to that initial call, even if you’re like, “Well, I know nothing about sales…” You don’t need to. All you need to do is pick up the phone, call people, be nice to them. Say, “Hey, welcome.” “Welcome” is all it takes. “Welcome to our product. Welcome to the trial.” Then ask them what their goals, what their motivations, what their needs are, and try to really get to a level of understanding.

I think engineers are actually really good at that — better than the average person — of not just taking the first layer of information and being satisfied by the dramatic extrapolation of that that they make in their own mind, but actually asking, “What does that mean? What do you really mean by that? What do you guys really try to accomplish with this or that?” and get to a point where they didn’t just paint the outline, but they actually painted the entire picture for you.

Now, once you know who the customer is, what they need, what they want, what they’re trying to accomplish, what internal challenges they have, selling should be its easiest, enabling them to accomplish all these things with your product.

Telling them, “Well, you came to the right place. I’m happy to tell you, if you do X and Y, you’re going to get Y outcome, which is what you really want, what you really desire, and I can help you accomplish that. Here’s what we need to do to get that done.” That’s all it takes to be successful at sales. Or telling them, “Well, you came to the wrong place, but let me help you get there anyway.”

Patrick: In the happy case situation, where our product is a good fit for them, we’ve talked a little bit about, “OK, I understand” — by the way, echoing people’s words at them is a really effective communication technique in general, and works in sales as well.

Say, “Yeah, I understand that you’re really looking to decrease your no-share rate by adopting this software. I understand that you guys run a sales process which has 25 people in three time zones, and the management is getting crazy. I understand that…” whatever the pain point is.

“As it turns out, our software is actually a great fit for that. We have features X, Y, and Z, which will get you up and running pretty quickly, and I’m happy to assist you with doing that.”

Then the scary part is the engineer comes up to me, “Uh, there’s that closing thing?”

Cliff notes on every sales conversation ever — it’s like, “Conversation, conversation, conversation,” and then what we would call in marketing a call to action at the end. In sales, they have the thing but they call it the “call to close” instead. What is closing, and how do we do it?

Steli: It’s a great question. First of all, let me tell you if you ask for the close — which is basically asking the other party to become a customer, commit, give you the credit card number, whatever it is; the transactional point in which they become a customer.

If you ask them for that, if you proactively verbalize, “Do you want to become a customer? Do you want to purchase our product?” you’ve separated yourself already from the majority of the market, or even the majority of sales people that do “sales,” but are afraid of asking the question because they are afraid to hear the rejection.

There’s two simple ways to do it. One is just to ask for it. Let’s all do it together, “Do you want to become a customer of our product?”

Patrick: Do you want to become a customer of our product?

Steli: There you go.

Patrick: Wow. I think I must have said something like that for consulting engagements over the years. I think I’ve probably said it only twice for Appointment Reminder. It’s kind of crazy.

Steli: It’s crazy, right?

In certain cases where it’s clear that they’re not going to be ready to answer yet — it’s the first call, they tell you they have a 200-person team, and it’s a bigger customer, and you’ve just answered a couple of basic questions — they’re not yet there, to be able to say yes or no to that question.

What you ask instead, which is one of the most powerful questions you could ever ask, is, “What is it going to take for you to become a customer of ours?” It’s a very important question, especially for startups, especially when you’re early in the cycle.

Too many times I see founders talk to a bunch of “potential customers,” do their customer development — lean startup — and then they come back and they say, “Oh, I got all this great feedback, people loving this idea. They’re totally going to buy it.”

More often than not, just because I was nice to you doesn’t mean I have real buying intent. Just because I visited your site and liked an article doesn’t mean I’m going to purchase the software, so asking me, “Hey, what is it going to actually take for you to become a customer?” is going to do a couple of things.

Number one, if I have zero buying intent, I’m going to probably say it. Either I’m going to have a really weak answer to that like, “Eh, I don’t know” — that’s a red flag. How could you not know what it would take for you to buy? Or they say, “Well, I really like what you do, but we wouldn’t buy before 2018. Our budget is already allocated for the next few years.”

Again, you know, “Nice guy, but I shouldn’t probably waste my time on this.”

Patrick: Or one of the other classic things is, “Yeah, we don’t have budget. We’re a startup, too. We’re trying to get to a round of profitability. I just can’t justify $50 or $100 or whatever.”

You’re like, “Yeah, great. It was great talking to you.” I’m not going to work myself into a conniption if we don’t get the sale here.

Steli: Yeah. We’re not going to schedule three follow-up calls, each an hour, and send you 10 emails and case studies, to then realize what we could have learned in the first 20 minutes — that you are not in the market to purchase something.

Patrick: This process, by the way, is called “lead qualification.” You can do very automatic lead qualification, like lead scoring for example. SaaS companies typically will do two things. If, in the free trial, they’ve done X and Y and Z, then they have a higher score. If they’ve done nothing, then they have a lower score.

Or maybe demographic-based lead qualification, like if they work for Boeing a higher score for enterprise sales lead qualification. If they work for a flower shop, you’re probably not going to sell them a $100,000 software solution.

Anyhow, you can qualify stuff with a phone call, and then rather than feeding into some sort of magic state machine, just use your human intuition and your human brain, and take next steps appropriately.

Steli: Yeah. Important with that question you ask, “What would it take for you to become a customer?” is to actually follow up on that question until the virtual event happened, where they purchased.

Let’s say they say, “Well, I really like this. I will bring this back to my team and we’ll talk about it and see what they think.”

“Oh, interesting. What would happen if they actually like the initial outline of what you gave them? What would happen next?”

“Well, next we would probably schedule another call and have some more stakeholders participate and ask questions.”

“Cool. Let’s say I answer those questions to the satisfaction of all the stakeholders. What usually happens next?” You don’t just stop at some point. You actually continue asking, “What happens next?”

“Well, next you would have to talk to the legal department and go through a procurement process.”

Most people at some point instinctively want to just take that and run with it and go, “OK, cool. Thanks for all the information.” They hang up and they think they already know everything. Don’t. Fight that urge.

Ask, “Right, so we go through legal, we go through procurement. By the way, have you done this with any other provider that’s similar to us in the last one or two years, successfully?” That’s a good indicator that they actually…

Patrick: That is a great qualification question. You never want to be someone’s first SaaS provider. You also probably never want to be someone’s first consultant. Your life will be very difficult.

Steli: You don’t, so say, “Have you done this before, and what was the process like? Is there anything we can learn from that? OK, let’s say we do these things. What happens next?”

“Well, then you have to go and talk to my grandmother, then the palm reader…” until they say, “Yeah, then we’re in business.”

Cool. What you’ve accomplished now is a couple of things. Number one, you’ve seen if there’s any red flags in that process that you know will never work out. Number two, you mentally put them in the mind space you want them in — a future where they’re a customer. This is the kind of future you want them to be thinking about.

Patrick: They’re already visualizing that there exists a possible alternate universe in which they write you a check or give you a credit card.

Steli: Yeah. That’s a good thing.

Then, the third thing is, they’ve created together with you a roadmap of the buying process, so now you know everything it’s going to take to make that deal happen. Do you know how many times founders or sales people will come to me and they will say, “Next week we’re going to close this defining-moment deal. This is going to change our lives, and everything is ready, and I know it’s going to happen next week…”

Then the next week, it’s crickets. Silence, so I send them an email and say, “What happened with the deal? Did it close?”

They say, “Well, there was this thing that I didn’t anticipate. They actually also want me to go through the procurement department…” How could that be surprising? What that means is you didn’t do your job qualifying them, understanding the buying process — so every step of the way you’re surprised that there’s one more thing you have to do, and you get frustrated by these evil customers that want you to do these unreasonable things.

Patrick: If you could see me now, guys, I’m face-palming because I have been that guy.

Calibrating Your Expectations and Pipeline Management

Steli: Yeah, we all have. We all have been there. Nobody’s above that mistake. The question is, there’s a simple solution to that. You need to go through those steps. Ask somebody, “What will it take for you to become a customer?”

Have them tell you so you have a real understanding, “What will it take for me to close this customer? Am I willing to go through all these steps, invest all this time?” Have a realistic picture of what it’s going to take.

Or, if you think they’re already ready, and they love what you’re doing, just ask them a question. “Hey, it seems like it’s a great fit. You’re excited, I’m excited. I think this is really a good solution. Are you ready to become a customer today? Should I take your credit card? How are we going to do this?”

This is uncomfortable for folks, because it’s kind of confrontational. You might have to confront the other person, or be confronted by the person, saying “No,” or “I’m not ready,” or “I don’t think I’m going to buy.”

But the great thing about that is that it shouldn’t be about you winning everything and never being rejected. It should be about you learning as much as possible, and also about creating outcomes. Sales is a lot about just creating outcomes. Yes/no. Just build an outcome. “Maybe” is a deathtrap. “Maybe” doesn’t point in any direction or any timeframe. You know nothing, and it occupies mind space and mindshare.

Yes and no are equally good. They are a result. You can learn from it, you can check it off, you can put a number somewhere, and then you can move on in life. For entrepreneurs, it’s so important to be able to move forward and not have things that are in constant limbo, “We don’t know about this” space, which is a deathtrap.

Patrick: This is one of the fundamental things about pipeline management. Pipelines are to a sales process what a funnel is to a marketing process, where some amount of folks are in the tap.

With sales pipelines it’s like you have a certain number of stages that go through our customer’s typical buying process.

We have customers who are in any given stage in the buying process. We have 20 people who we have initial calls scheduled with. We have six people who we have follow-up calls scheduled with. We have three folks who we are under contract, two folks who we are providing services for, and then one person or firm service has been provided, we have cut them an invoice, we’re waiting on payment.

The job of the sales team — and the rest of the organization, really — is just pushing people from the left side of the pipeline to the right side of the pipeline. One of the reasons the pipeline thing is important is, if there’s a bubble at any stage in that process…

We’ve got folks who we’re having initial conversations with. We’ve got folks who we’re talking to the purchasing department. We’ve got folks who we’re providing the stuff for. We’ve got folks who our invoices are out.

We have no folks who we’re having follow-up conversations with right now. You can kind of figure that bubble is going to percolate towards the right side of the pipeline, and that sometime in the near future there’s going to be a month with no revenue in it, and that’s going to suck.

When you start to identify those bubbles early in the pipeline you’re like, “Oh, guys. Make an extra special effort to get those early conversations happening, to push people into…get a yes or get a no, but get stuff on the calendar for having the follow-up conversation so that we can push them through the rest of the pipeline.”

Steli: Yeah. If you manage your pipeline well, you kind of see the future, which is part of the beauty of SaaS anyway. With subscription revenue you can project what’s going to happen next month and the month after.

But the other thing is, one thing that I find beautiful about sales is that it really rewards people and processes that are results-driven, and it really punishes activity-driven people and processes. Too many times, I talk to people that will be like, “Well, we have all these great deals in the pipeline.”

I say, “Awesome. Tell me a little bit more about that.”

“Well, there’s this company, this company, this company.”

“Cool. How long have you been talking to them, and what are the next steps, and when do you foresee closing these customers — or not closing them?”

That’s when it breaks down and they’re like, “Well…” They’re so happy about creating conversations and having meetings and hearing from people that they like what they do, that they don’t want to move over to the uncomfortable part, which is actually creating the outcome, the yes or no.

They are very happy about the, “I have three logos I can put on a PowerPoint presentation and then say, ‘We’re in early conversations with these folks,’” rather than having just one — or no logo – and, “We’ve learned that this didn’t work, but we tried,” where we had a real result. They bought, they didn’t buy.

Sales really rewards outcome-driven activities, and managerial pipeline is all about, “Are things actually moving from left to right?” Because you can have thousands of things in every stage, but if nothing has moved, your business is dead. That’s it. You’re not getting any new customers.

Patrick: In addition to sale rewarding outcome-driven cultures, outcome-driven businesses, outcome-driven individuals, also traditionally sales guys stereotypically are smarter than the average bear with regards to numbers, but the numbers are typically tied up in, “What’s my commission going to be?”

But sales at companies which are very metrics-focused, where we know to a T that if we get 100 initial consultations, we’re going to get down to 20 meaningful conversations with decision-makers, which is going to result in five proposals that we sent out, and we’re going to close three of them…folks who have that level of understanding of how the math shakes out for the funnel, or for the sales pipeline, they do very well in life.

Since that’s copacetic with the engineering skillset that a lot of people have and the numerical inclinations of a lot of engineers…if you’re a product person, talking to people about their pain points and then saying, “The pain points which you have just articulated map up with some things we have made. These things we have made can make those pain points better…”

It’s not actually rocket science. This is something you can learn to do, and learn to be — knock on wood — a little less uncomfortable with, and you can often find out that you’re really darn good at it. I don’t do it enough for my software products, but in my consulting career pretty darn good at the sales…with the exception of the ones where it was just a total face-plant.

Like you said, that’s the cost of doing business. Face-planting is better than perpetually, “Will I, won’t I? Will I, won’t I win that engagement?” Get to no.

Steli: If you’re not face-planting once in a while, no matter how good or successful you are, you know that you’re not learning anything. You’re not pushing hard enough. You’re not trying things that are daring enough, because you’ve got comfortable, and you’re just operating within that comfort zone which is the borderline of your growth now. You can’t go beyond that.

No matter what you do, if you don’t get rejected once in a while, you know you’re in an unhealthy place. You’re in a place where not enough growth happens, because you’re confined within what you have accomplished in the past, and what you’re now good at.

Patrick: This reminds me of a conversation I had with one of my father’s buddies when I was six or seven. He was a lawyer. I had a vague idea that, “Lawyers take cases to trial.”

He said, “Yeah, I’m a very good lawyer.”

I said, “Oh, do you win all your cases?”

He said, “No, of course not. If I won all my cases, I’d be a very bad lawyer.”

This was very confusing to the seven-year-old me. I asked, “Why?”

He said, “Well, there’s this thing called making a deal before the case gets to trial, and if you’re winning all your cases, you’re making too many deals on cases that you would have won, so you should be a little more aggressive about taking stuff to trial.”

Similarly, if you’re winning all your sales conversations, something is going wrong either with the number of leads you’re pushing through the sales pipeline, or your lead qualification thing. It’s possible to win all of your sales conversations by only taking the folks who are deepest in your ecosystem. They’re your truest and best fans, totally the sweet spot for the app. It was an easy layup to get the sales, and you get all those easy layups.

But, you could maximize revenue for the business by going, “OK, what’s one ring out from that?” Maybe it isn’t someone who’s been reading my blog for five years. It’s someone who’s been reading my blog for five months.

You do sales, SaaS, so I assume you sell to a lot of other SaaS startups. You sell to startups selling to tech companies, or whatnot. Then at some point you realize, “We could also sell to startups selling to medical. That has new challenges. Let’s see if we win those deals, or let’s see why we lose those deals. We’ll feed that back into the marketing of the product, get into a place where we can win those, and take the lumps because we know we’re learning from them.”

Steli: Absolutely. First call, you pick up, you welcome people, you ask them a few questions to really understand them, and then you either ask them if they think they’re going to buy, if they’re ready to buy, or what it’s going to take to buy. If you do these things, it’s a perfect sales call. You’re 10 out of 10.

Patrick: …and you’re already better than 90 percent of the market. It’s insane.

Steli: Oh, yeah. You do that for a while, and maybe you want at some point to test what would happen if you don’t take their phone number in the form, but you actually email them and ask them for a call, and look at the numbers. But in the early days, I would always use that form.

Either way, if you have a SaaS business and you have a way to make more than just $10 a month on a user, using the phone as a way to onboard them, activate them, and close them, is going to be an amazing tool. If you don’t use that, you’re literally leaving thousands, millions…

Patrick: A lot of money on the table.

Steli: You’re losing a lot of money, leaving a lot of money on the table.

Patrick: Right. An additional thing there, by the way, relevant to your interests. If, like me, you’re pretty time constrained on the SaaS business, I specifically architected my business when I was early on, to never require sales calls. I was employed over in Japan, and didn’t want to do sales calls at 2:00 AM.

I still don’t want to do sales calls at 2:00 AM, but let’s say I can push myself to make five a week — not as many as the leads I’m getting. You can just choose to only call X percent, and then do scalable approaches on the remainder and see, “For the folks I talked to, did I close more than we closed on the folks that we don’t talk to?” If not, red flag on the play.

Figure out the sales process. If you closed more, then that’s either an argument with yourself or with the rest of the business for, “We should be focusing a little more of our attention on active selling to the rest of the folks,” or it’s an opportunity.

Atlassian does this. They have a sales team. They say they don’t have a sales team, but they have a sales team; people who call and get closes.

But if a medium-touch approach for them in a given month converts a higher percentage of trials than the low-touch approach — the totally scalable automated thing — they file bugs against the low-touch approach.

They say, “something has happened, such that our standard medium approach is answering more customer questions, resolving more customer objections, getting more customers successfully onboarded than the low-touch approach, which means the low-touch approach is broken. Fix it.”

Then they fix it until the numbers go back to parity again. Then they focus on that, because that’s the part of the business that they really enjoy/institutionally like.

Then a couple of months later it’s like, “OK, we’re going to pull 10 percent of the trials off the rack and give them a call and see what the conversion rate is. If it’s at parity with the low-touch group, that’s great. That’s where we want it to be. If it isn’t — if the sales reps are effective at doing their jobs — that’s a bummer.”

Steli: I love that. That’s a great hack, organizationally. That’s cool.

Patrick: I think that’s why they say they don’t really have sales teams. They do have a sales team…I love you guys, but you have a sales team. But maybe they think it’s not a permanent sales team. They’re bug scouts in the organization, who happen to do sales for a bit of that bug discovery process.

Anyhow, I think that wraps up our conversation on getting started with sales for SaaS folks.

You guys had a very interesting trajectory, and it’s one that I think resonates with a lot of people here. You had a Y Combinator-funded startup that was in kind of an unrelated space, and then you pivoted over to being sales consulting as a service. Then from that consulting business, you pivoted into the current product business, which is with the CRM.

Why Steli Shuttered A Very Successful Consultancy

Patrick: Can you talk a little bit about your consulting business? That was a pretty good business, right?

Steli: Yeah.

Patrick: Just hum a few bars for me on that one. How many people did it get up to, or yadda yadda?

Steli: We had probably all in all, in-house plus the people that work from other locations, 60, we were on trajectory to cross the three-digit very, very soon. We’re a multi-million dollar business that was growing really fast. Basically, what we did is we built what we called a secret sales lab in the heart of Silicon Valley, who we would work with Venturebeat startups that at least had a series A, and we’re doing B2B.

The vast majority, 80 percent of all customers were SaaS product. Many of them, products that you guys know, have bought.

We would either do sales consulting, what we would call sales exploration, help you figure out how to go from a few customers and some revenue to a model that’s both predictable and scalable, where you can just plug in salespeople and you know exactly what should come out of that.

We had these customers, it was a lot of consulting, helping them, exploring, testing different sales strategies, generating numbers and then looking at that and figuring out what the right model is for them, and then we had a few customers that were already in scale companies that are now about IPO and on the IPO track that would say, “Hey, we have already 50, 60 salespeople. We’re hiring as quickly as we can. There’s these 10 verticals we’ll not going to get to in the next two years, but we know there’s money.”

Patrick: Can we just write you a check and…?

Steli: Can we just write you a check, and send you the leads and you just close these deals for us? We’re these two schemed outsource skilling part and then the more early staged consulting part, and became experts when it comes to selling for startups and the unique challenges and unique approach that you’re going to have when you do that.

Patrick: One of the nice things about the Valley, and I’m a bootstrap guy, I think that’s what makes me happy. Every time I come out to the Valley, and I work physically in Palo Alto right now, it’s sort of an air here.

One of the things that causes the air stat, there’s an ecosystem around startups where you guys have a very, very successful business step. Professionally, I already said the word “millions.” That’s a lot of millions, figure after 60. You’re making millions a year, basically getting the outsource sales product for a lot of these folks or telling them how to set up their first sales department.

Similarly, there’s a lot of business in the ecosystem out here. There are shops, like say Pivotal in San Francisco, which provide various services to the ecosystem.  Somebody raises money, they need to make an app or they have an existing website, they need to make an iPhone app and Pivotal is like, “We can take care of that and it’ll only cost you $200,000″ or that sort of thing.

There’s something that I get told every time I come out here is that given my skill set with the marketing automation, could just hang out my shingles and the Patio 11 Marketing Automation Agency and I would have billings of $5 million within a year. That’s true. Not really where I want to go with my life, but it’s a nice card in the back pocket if my family’s ever starving in the snow.

There are a lot of businesses like that. It’s not just the meme about selling shovels in the gold rush. It’s not. It’s B2B services that’s the nature of most of the business in the economy if you get right down to it. You’re selling tomatoes to pizzerias.  [Patrick notes: I think every time the words "selling shovels in a gold rush" are mentioned engineers suffer, because we're socialized to believe that it is somehow disreputable.  Software is a gigantic industry which itself consumes a lot of software, for the obvious reason.  It is as valid a market as any other industry for B2B products, and is flush with cash.  Many people who deploy the shovels meme think that cash comes from venture capitalists, but despite the impression you might get from reading TechCrunch, most software is not bought by three guys in a dorm room with a $1.5 million check coming in but rather "boring" profitable companies who pay $1.5 million in payroll every two weeks.]

Software as a service companies have a very predictable…The reason this works is software as a service companies have a super predictable path from really intelligent sales guy to money. Just like their customers have a really predictable path from installing software as a service product, increase revenues by 20 percent, similarly for the other stuff.

Anyhow, it had a really successful consulting business, why don’t we still have a really successful consulting business? Can you talk about the journey that got you to

Steli: That’s a great question. When we started, right from the get-go, there were two factors that played into our decision to actually build an internal product. Number one, we knew that in order to support all these different sales complaints for different customers to different verticals, there’s a lot of complexity involved. We knew that we would have to use software to manage all that.

Just selfishly, we hated all CRM systems and all “sales software” that was out there and thought, “No way are we going spend eight, nine hours a day using that kind of software. This is just going to make our lives suck.

We didn’t want to use anything that was out there and then two of my cofounders…We have three cofounders. I’m more the sales/business guy and the other two guys are product and engineering people.

Out of that lens and bias, we’re like, “Well, let’s just build our own thing and we’re going to make it exactly do what we want it to do.”

That was it, there was no real vision. We didn’t even know what that meant. We didn’t even know exactly what the product will look like. We just said, “Let’s just build something that does what we want.” Then, all right, what do we want?

We now have two customers after two weeks and we need to do this and this. Maybe it would be cool if you could just click a number and it calls it, so I don’t have to use a phone or something else. It does it in the software.

That’s how we got started. Then, as we started hiring and recruiting more and more people, we would use the software as a recruiting tool.

We would tell people, “Hey, we have this secret sauce, that if you do sales for another business you won’t have, and I’ll show it to you. You can clearly tell that we really care building products for sales people to be more successful.”

Patrick: You, the sales guy, should work with us. You’ll have access to the secret sauce, your job will suck less because there’s none of that using crappy software all day to do the job of a sales guy. It’s basically wall to wall calls and then recording the calls in the software.

The part of your job that is not the call sucks less. If this makes you more successful your sales guy there’s typically some sort of incentive structure there, this will directly impact the bottom line for you. It’s basically B2B sales to a single person.

Steli: Exactly. It helped us hire a lot of people, helped us make our sales people more successful, and then happier. Retain them all at a much higher rate than a typical sales organization will retain people.

Then what happened is that slowly but surely we had more and more campaigns with more and more sales people, and I know we’re the only CRM system or sales software company that literally had engineers sitting in a room next to sales people that were doing different kinds of sales.

Looking over their shoulders and going, “Why are you doing this? This makes no sense. Why do you have to click three? Why do you use this piece of paper all day long to make notes? Why can’t our software be better at that?” Fixing the problems, as well as have sales people turn around and be like, “That part of your software sucks, dude. I hate that this does this.” Iterate on it from a completely different perspective.

Patrick: This doesn’t happen nearly enough at companies, by the way, guys. Engineers embedded in a sales organization or embedded in a marketing organization. Believe me, if you can code your way out of a paper bag, for those of you who don’t run your own businesses yet, and just want to get the taste of coding to improve outcomes, walk into any other team in the company and say, “Can I watch what you do for a day?”

At the end of the day you’re going to have a notebook full of, “WTF! They do what with spreadsheets? That’s insane!” Man, was it back in the day, I was working with an SEO who was attempting to figure for some SEO-related reason, “I have a list of keywords in column A, I have list of keywords in Column B, and I’m going to figure out all the keywords that are in A and not in B.”

Every engineer in the room is like, “OK, that will take me two minutes.” This guy, college graduate, would literally spend several hours every day doing this manual keyword comparison. You can literally do this script.

We’re going to save you two hours every day forever in like five minutes. It’s going to be great. If wanted to it can also alphabetize them for you, it’s not that hard. But yeah. More product Devs, more product companies should go with the embed the product team in the entire organization and see what’s broken.

Steli: What’s broken?

Patrick: Yeah, build much better stuff. It’s also a great way to get at that.

Steli: We did that for a while, and then we actually started having a real product philosophy, and starting thinking this is how sales software should actually look like. Forget about everything else that’s out there, it’s really not helping anybody selling better.

This is what sales software looks like, and sales really is communications so it needs to be communications software. Let’s kill data entry because it sucks, and sales people are horrible at it, it produces a lot of bad data.

Let’s empower them, the people, to actually get all the answers they have through the software versus having to go to engineering and be like, “Well, I need this specialized list of all leads that have been called and emailed, but haven’t replied, but I don’t get all that data from my sales software so can you write a query in MySQL, and find all the data for me, and spend 30 minutes of your life doing that? Then I’ll come back tomorrow with another list?”

All the engineers went, “Well, why the hell is the software not answering the question? Why do I have to spend my time doing this manually?” Step by step we developed this philosophy and then the software got better, then it got a lot better.

Then all of a sudden our sales people would show their friends who in sales the software. Bragging about this is what we use for our job, and we would start getting emails or our sales people would come and say, “Hey, we could totally sell this software to this company. I showed it to them, they’re totally interested!”

I have to say that it would be cool to claim the credit and say, “Then I decided that as the CEO that this is the future of the business.” But it wasn’t. I actually resisted that a lot, because I was like we’re printing money over here, and this is actually a complex business to grow and I have a lot of things on my plate anyways. We’re going to get distracted by this, releasing the software as a product.

That external demand grew, and then the internal resistance started building. There was a small group of people internally that started lobbying like we should release the software. We should release the software. Let’s just launch the software! In every meeting, in every opportunity they were lobbying, hey the software, the software.

Those two voices from the outside and inside grew, and grew, and grew until I caved. Literally that’s what it was. It was no strategic decision making, literally I just went, “Well, fuck it. Let’s launch the software then, eventually.”

I thought that because the services business was big, and I thought that we knew that we had something special with the software. But I knew also, I’m a realist, so I knew this market is crowded as hell, it’s a very competitive market. We don’t have a ton of money to just spend on this experiment.

We have to have a small team work on it, so I thought it would take forever for the software to get anywhere near the services and consulting business. In January 2013 I said, “You know what? This is a small team of four people, you guys are the product team now. Go do whatever the hell you want. Launch it.” As an entrepreneur I like to say you’re almost always wrong with everything. I just get used to that. Once in a while, you’re actually happy you’re wrong, and this was one of those cases.

Where the software had a great first month, and then it had a great second month, then it had an even better third month, and it just grew, and grew, and grew at a really fast pace with very little resources. Then very quickly it outgrew the services business with a fraction of the cost.

At that point, or coming near to that point, it was long clear to us we have something that’s working way better than this other thing we had that was working, so we should start focusing more and more of our attention on the software versus the consulting business.

Patrick: Two things I want to drill into there. One was that, let me take the one that was more recent first, because I actually remember it. You mentioned that the software business was, the revenues were rapidly approaching the consulting business but at a lower cost.

That’s like the traditional margins in consulting are generally broadly speaking somewhere in the 20 to 40 percent range, give or take. The single biggest cost for the consulting company is the direct cost of the person who is doing the actual work that gets billed out to the client.

That cost is always going to be in there, always going to be the largest cost to the consulting company. It generally, there’s not much you can do to reduce it. You could hire less senior people, but then you get less senior results, and that’s not building a wonderful consulting company. On the flip-side, software service is huge upfront cost to develop it.

Then you push the go button and you start getting literally 90 plus percent margins on software, and a little less for the two of us because both of us have telephony embedded and there’s a hard cost associated with telephony, so we have non-zero cost of goods sold which means how much money you spend for a marginal customer to actually service them.

For many B2B SaaS businesses, it’s literally like our cost of goods sold is the strike account, so 2.9 percent plus 30 cents. Then the rest of the 500 bucks a month we just keep, then multiply that by 1,000 clients and life gets pretty good.

OK, you have the ridiculously successful business, you have the software business that you OK as an experiment, it wasn’t like, “Let’s dive two feet into that.” It’s just I’m going to break off a strike team to do the SaaS business, and oh, my God, it’s blowing up. We have one really successful business, we have a nascent business which looks like it has more legs than even the most successful business. How do you decide to make the transition? That’s not a no-risk transition.

The math of working a successful consultancy is that after you have a successful consultancy, you have a successful consultancy. FYI when I say that the margin for a consulting business is 20 to 40 percent, if you multiply 20 to 40 percent by the billings for a given year which you can extrapolate from them having 60 sales guys, that’s literally what they could pull out of the business every year with no work that they’re now additionally doing. But you decided to double down and go into a VC funded SaaS business trajectory which has substantially more execution risk.

Steli: Let me elaborate a little bit on this. I don’t want to come off too one dimensionally in that everything was just amazingly successful, and now how can use decide between amazing success and incredible success.

That was not our problem. It was not as simple as that. The consulting business was successful but it was also freaking hard. Painful. You had to manage, at some point we had to manage cash flow at a level that we had no clue what we were doing.

Patrick: It scares the heck out of you, yeah.

Steli: Also there’s these periods where you can’t keep up with the demand, then there’s periods in our business where there’s zero demand, like December for instance. The last two weeks of December, the first week of January, there’s no sales happening during that time.

All the customers you would close, we would close in the last quarter of the year. We would close at the start of the late of the second quarter of the year. You have certain bubbles where sales don’t happen as much, where selling isn’t as effective in B2B, you still have all the headcount. You still have all the employees who still get their salary.

Patrick: Their paychecks are due on the 15th and 25th of the month.

Steli: Every month, doesn’t matter what happens. Once you’re at the highest scale of revenue, you manage cash flows at a level where we were just not equipped to. We made some mistakes and that got us into really tough waters at times, and it just creates stress.

Patrick: Yes, cash flow stress is…I’m buddies with a lot of folks who run multimember consultancies and the single biggest stress factor probably, the real employees cost money. You’ve got to make their salaries every two weeks and the lifecycle of billings in consultancies typically does not line up with that.

It’s often for very successful companies like great team, 20 people working for it, best brand in the business, yadda, yadda, they don’t know whether they can make payroll four weeks from now. It’s kind of insane.

That happens in solo consultancies too. I had instances where it was like I had to get a particular engagement I had run up the cost of my wedding on prospecting trips to America, and then I was holding in the other hand an invoice for the same amount of money.

It was like, “OK, race. Does the credit card go over the limit first or does the invoice clear first?” Then that happened several times over a two year period. Much more stress than running SaaS businesses that were big for me.

Steli: That was a big part of it. There was a lot of stress involved in that business. There’s also as we were growing that stress became more painful. You had to deal with a lot more management issues, cultural issues, human resources, just keeping the entire thing afloat and running was just a very, very hard business.

That played a really big part. At the end of the day as an entrepreneur you only have so much time, you only have so many hours in the day, so many opportunities that you’re going to follow, you can’t do everything.

You have to make decisions on like, “Do I want to spend all my life chasing this opportunity or that?” When one business is literally pushing a little stone up a mountain and it gets bigger and bigger, but it gets harder and harder and more painful — and the other business is tipping the little stone down the mountain, and it just naturally gains more and more momentum — it’s clear where the opportunity…momentum is the signal that you should follow, as an entrepreneur.

For us, it was just clear. We loved our product. We loved the services business, but we also kind of were burned out, after a few of those crazy highs and lows. I think when we saw that software business take off at that pace, multiple things happened.

Number one, we were thinking, “OK, this is clearly something that could be a massive success, and has this natural momentum in the market, so we’d better focus on helping that become all it can be. We can’t just split our attention.”

There was also a certain level of relief, of saying, “Wow. What would a world look like, where all we do is software, and we don’t have to manage this crazy amount of overhead and crazy amount of cash flow, and get subscription revenue?” As you said, you add more customers. You don’t necessarily have to add more cost immediately.

Patrick: Often, more customers don’t translate into more work or more stress, either. It’s just, as long as the server is up, it’s equally up no matter whether there’s 100 people paying you a month, or 1,000 people paying you.

Steli: Yeah, exactly.

Not to say that any of these decisions were easy or super-clear to us, for a while there was this back-and-forth of thinking, “Well, should we hold onto both things?” I wanted to. Just emotionally, I would have liked holding onto both businesses.

But then as time goes by, it’s clearer and clearer that it’s irresponsible to try to do that, and all of a sudden you start wondering, “What could we actually do on the software side, if I didn’t spend 80 percent of my time managing the other business?”

You start feeling like you have two relationships where you’re equally irresponsible to both parties and don’t make the necessary investment in them to help them become really all they could be, so you have to make a choice and say, “I’m going to commit fully to one or the other. It’s unfair to both to try to hold onto both things.”

Once you have to make that decision, now you have to decide what do you do with all these employees? Which ones can actually transition over to people that are going to work on the software business, and what do you do with the amazing people that can’t?

That’s really why it’s so hard to let go, because you’re like, “Wow, we’ve built this amazing group of people and talent. We would never want to let them go, but we can’t also hold onto everybody. It makes no sense.”

Patrick: That’s also one of the not-so-hidden advantages of Silicon Valley which is, in a lot of other locales the surrounding ecosystem couldn’t exactly conveniently absorb 60 very well-trained SaaS sales guys. Where, in the Valley…I don’t know how you actually managed it, but I’m presuming 60 very trained, very effective sales guys could all get jobs within, what, a week?

Steli: Not all 60 were in-house. The team that was in-house was much smaller. We’re talking 25-30, so half of that. But all of these people got jobs in the Valley. A majority of them are directors of sales, VPs of sales of high-growth, amazing companies. A lot of them became managers or executives at companies that were our customers, naturally.

We made sure that everybody got an amazing opportunity, and used what they learned with our business to take the next step in their career, in many cases with companies they were doing sales for anyway.

Patrick: This is a fairly common trajectory in consulting, by the way. I know some folks in the audience might not know this, but employers often say, “We’ve gotten used to working with Bob over the last two years. He’s been instrumental in our blah, blah, blah efforts.”

For an ongoing consultancy, there’s often a discussion between the consultancy and the client like, “Can we” — I hate this word — “‘buy’ Bob from you? Or work out an arrangement where we can recruit him without violating your various covenants that are in place?”

Steli: Yeah, it happens a lot.

Patrick: Yeah, it’s great. If you can get your existing clients a satisfactory resolution, it’s like nothing changes about your business aside from, “Rather than cutting us a check and paying us half the money, you just hire on the guys who you had working on sales, directly. Now you’re their employer of record. Congrats.”

Steli: Yeah. I’m really proud of that transition, and the relationship with all of the people. Not only that all of them remained friends — all of them became customers. Even the ones that went to companies that weren’t using our software turned around the company to purchasing the software product from our side, so all of them are customers, all of them are friends, and we have really great relationships.

But again, the actual day I had to announce this and have one-on-one conversations, let people know that, “This is the direction of the business moving forward, and some of you will move with us and some won’t” — single hardest day of my life.

It sucked, and in that moment you don’t have the advantage of hindsight to know everything will work out well — and people don’t, so it’s a terrifying event for people. But I’m glad how everything turned out. It was still very difficult to do that.

Patrick: Yeah. I can barely imagine.

I think this is something entrepreneurs might not…I guess many of us have a pre-entrepreneurial career where we had the employee mindset — I certainly did — but I think entrepreneurs, we have our own little culture about stuff. We’re like, “Yeah, you get a company shot out from under you, that’s no problem.”

“Real people,” who have jobs and expect a paycheck every two weeks, getting separated from a company when they didn’t see that coming is a really big problem!

Steli: Yes.

Patrick: I think we’re like, “Oh yeah, fail quickly. We’re going to dissolve the company and start a new one, yadda, yadda.” We owe it to employees to find them…a “soft landing” is a term of art, but it’s a useful term of art.

Find them a transition plan that minimizes the stress for them because employment isn’t just a business relationship. It’s the one business relationship that’s sort of a sacred trust, too. You’ve got to take care of those folks. I’m really glad that you managed to do that in that forthright and mutually — tri-party mutually — successful manner.

I think this is probably running to the hour and a half that these podcasts usually run, so where can folks find out more about if they want to — aside from

Steli: is a good way to get started. If you go to, when you go to our blog there’s a lot of sales content that people can read, and a lot of people seem to like it. People can just get in touch with me personally if they want to, if they want to chat sales, entrepreneurship, or anything else. Just We do have an email course to no small part…

Patrick: Yup, Steli took my course on doing lifecycle emails.

Steli: Yeah.

Patrick: It worked out for you, right?

Steli: It worked out. I don’t know how many thousands we’re making more every month because of it, but it’s a lot, so we owe a lot to you.

Patrick: I’m going to write that down for a testimonial for the page. “I don’t know how many thousands we’re making from it, but it’s a lot.”  [Patrick notes: I should really do this.]

Steli: It’s a lot.

We have a startup sales email course for people that thought some other things were interesting and they want to learn more. Actually, you can learn both more about startup sales, and learn what I learned from Patrick, in terms of putting email courses together.

Patrick: Awesome. Thanks very much, and I’ll sign off for myself. I’m Patrick. I always love getting emails from people, so please drop me an email. It’s Presumably that’s spelled, wherever you’re listening to this.

If for some reason you aren’t on my email list yet, you really should be on my email list. It’s at Just give me your email address and we’ll send you stuff that you enjoy.

One announcement that is upcoming from me, I’ve been working on a conversion optimization course for the last several months, all about B2B SaaS businesses, getting them more trials, more sales, yadda, yadda. It will hopefully be functioning later in July.

If you look on the bottom of this podcast, there will be…I guess I’ll just give a Bitly link. Bitly/kalzumeuspodcastsconversion.  [Patrick notes: Unshortened link is here.]  Just click that, and you can get an announcement when that course launches. I’m hoping to get it done in July.  [Patrick notes: I've been working on it most days for the last several weeks, but unfortunately, launching in July is not realistic.  We're moving to Tokyo next week.  Sign up and you'll hear when it is ready.]

Thanks very much. It was an awesome conversation. I particularly like how we got into actual nuts and bolts of it for SaaS businesses but for the LTV in the 5K-10K range, because I’ve worked with companies that have started fits and spurts in sales. It’s really made a difference for the business.

Thanks so much for showing up, and for all you guys in the audience, hopefully we’ll have another one in another month or two, and we’ll see you next time.

Steli: Thank you so much. Bye, guys.

Patrick: All right. Bye, guys.

39 Resources for Understanding the Science & Psychology Behind Great Marketing

We all know that a deep understanding of psychology will make us better marketers, but determining exactly where to start if we want to learn more about the psychology of marketing can feel daunting. After all, psychology is an enormous field, with many sub areas to drill down into and countless case studies, books, online articles and magazines to wrap your head around.

I’ve been grappling with this since I decided to focus on improving my own understand of the psychology of marketing. In an effort to make all of our lives easier, I’ve scoured the web for the best articles, infographics and books about the subject and organized everything into the following categories so that you can skip directly to the topic you want to learn about:

  • The Psychology of Marketing: An Overview
  • The Psychology of Pricing & Purchasing
  • The Psychology of Conversion
  • The Psychology of Good Websites
  • The Psychology of Color & Marketing
  • Books on Psychology, Persuasion, Influence & Marketing

So start reading, and let me know if I’ve missed any of your favorite resources in the comments section.

The Psychology of Marketing: An Overview

1. Psychology for Marketers: 9 Revealing Principles of Human Behavior – Don’t know much about the relationship between psychology and marketing? This article is a great place to start. It provides an introduction to psychological principles that are highly relevant to marketing and explains how to apply them to your marketing campaigns.

2. The 20 Best Lessons from Social Psychology – Did you know that tips for waiters go up 3.3% when an after-dinner mint is provided with the receipt, and they increase a full 20% with a look in the eye and a second mint from the server? That’s known as reciprocity, and, if you’re like me, it probably got you thinking about how to apply this to, say, email marketing or growth strategies.

3. The Complete Guide to Understanding Consumer Psychology – This guide covers everything you need to know about consumer psychology, from the power of emotions to the psychology of color and pricing. As the introduction states, “Understanding the psychology of your visitors will help you maximize your revenue because you can show them more of what they want and less of what they don’t.”

4. How to use behavioural psychology to improve your content marketing – Have you ever thought about how you can tailor your blog content to influence behavioral change that will benefit your business? Aaron Beashel looks at why some of the most popular marketing blogs are successful at generating conversions (and why others aren’t).

5. The Psychology of Social Proof & How to Build Trust in Your Business – Unless you’ve been living under a rock, you’ve probably been told countless times that social proof is a key ingredient to successful online marketing. This Unbounce article outlines seven types of social proof you can implement on your website today.

6. The Psychology of Social Commerce [Infographic] – This beautiful infographic uses statistics to illustrate how important psychological principles are reflected in purchasing behavior.

7. Persuasion case study: 2 ads using psychological “mind reading” techniques – Entrepreneur and expert marketer Ramit Sethi analyzes the psychology behind why two different ads are/are not effective.

8. 3 Neuroscience Secrets For Persuasive Marketing – Web psychologist Nathalie Nahai describes how the psychology of empathy can be used to boost the effectiveness of your marketing.

9. Unconscious Branding – Douglas Van Praet explains how interrupting patterns by going against the grain of what people believe or are accustomed to can spark viral marketing campaigns that are a huge success.

10. Trust Me For 5 Minutes: How To Get People’s Jaws to Drop (And Open Your Emails) – No marketer should ever forget that the thing people care about the most is themselves. They want to know how you/your product are going to make them happy, healthy, more successful, well-liked, hotter or loved. Learn how to tap in to this in order to create more effective email subject lines.

11. How to Win Friends and Influence Your Audience: 10 Theories to Know for Greater Persuasion – This ultra-comprehensive overview of how persuasion works in marketing is packed with real-life examples of emails, social media posts and websites that demonstrate how a mastery of psychology and influence can help you build long-lasting relationships with your subscribers and customers.

The Psychology of Pricing & Purchasing

12. 5 Psychological Studies on Pricing That You Absolutely MUST Read – The results of these five studies can help marketers make smarter decisions when it comes to framing the pricing of their products.

13. 4 Ways To Influence People’s Actions – The Behavioral Psychology Of Impulse Buying – This is a fascinating overview of how understanding four key concepts of retail marketing––merchandising, the shopper mindset, messaging and promotions––can improve your sales.

14. 9 Laws of Price Strategy Based on Customer Psychology – Have you ever heard of the reference price effect? It refers to the notion that when a customer can directly compare the price of a product with a competitor, price sensitivity increases. Learn how customer psychology informs eight additional key laws of price strategy.

15. Pricing and the Psychology of Consumption – People are more likely to consume a product when they are aware of its cost (via monthly charges, for example). Yet common pricing practices such as advance sales, season tickets, and price bundling mask how much a buyer has spent on a given product, decreasing the likelihood that the buyer will actually use it.

The Psychology of Conversion

16. Persuasive Writing: 4 Copywriting Techniques Swiped from Psychology – Joanna Wiebe of Copy Hackers gives you four techniques based on psychological principles and studies that will improve your conversion rates.

17. The Psychology of Anticipation and What it Means for Your Conversion Rates – Neil Patel shows how psychology is the driving force behind conversion rate optimization, focusing on three tips about the feeling of anticipation that can improve your conversion testing.

18. The Psychology of Landing Page Videos (+5 Video Optimization Tips) – Explainer videos are found on nearly every startup and SaaS company’s website. So what makes a video an effective catalyst for conversion? This article outlines psychological principles that can optimize the performance of your video.

19. 10 Ways to Use Psychology to Convert More Customers [Infographic] – I love this infographic (and the author’s commentary in the post) because it goes beyond the typical psychological principles––reciprocity, social proof, etc.––and explores how understanding lesser-known psychology theorems can improve your online marketing.

20. 15 Psychological Triggers to Convert Leads into Customers – A Marine Corp vet and entrepreneur explains 15 important psychological triggers that, if implemented correctly, can generate massive sales for your business.

21. Is Too Much Choice Killing Your Conversion Rates? [Case Studies] – Unbounce’s Events Strategist Stefanie Grieser looks at what several case studies about the psychology of choice in marketing tell us about conversion optimization (hint: in most cases, less is more!).

The Psychology of Good Websites

22. The Quick and Dirty Guide to Turning Your Website into a Persuasion Powerhouse – As the author says, “When it comes to persuading people online, the most effective tool is an understanding of human psychology.” In this article you’ll learn about eight psychological hooks you can use to invoke positive emotions in people visiting your website.

23. The Psychology of Why Sexy Websites Suck at Sales – Learn how attractiveness and familiarity influence the overall effectiveness of a website. You might be surprised: effective websites don’t always coincide with how we normally think about good looks!

24. How to Use the Psychology of Color to Increase Website Conversions – This comprehensive guide will teach you how to utilize the psychology of color to increase website conversions. It’s a must-read for anyone who’s about to build a new website or do a site redesign.

25. 5 Psychological Principles of High Converting Websites (+ 20 Case Studies) – Discover five psychological principles, including the “Law of Pithiness” and the “Principle of Cost/Benefit Analysis”, that are backed by the results of website a/b conversion tests.

The Psychology of Color & Marketing

26. How do colors affect purchases? – Fun fact: 85% of shoppers state color as a primary reason for why they buy a product. This infographic by KISSmetrics presents visualizes how color affects purchasing behavior.

27. Why Facebook Is Blue: The Science of Colors in Marketing – Here’s a fun look at how color influences our emotions as well as how color preferences vary based on gender. Plus, you’ll find out why hyperlinks are that bright, deep blue color.

28. The Psychology of Color in Marketing and Branding – This article from Entrepreneur debunks many of the common myths about color in marketing and branding and suggests alternative ways of looking at how color affects conversions.

29. The Meaning of Colour in Marketing –’s infographic look at the meaning and emotion behind colors and how this can affect your marketing.

30. True Colors: What Your Brand Colors Say About Your Business [Infographic] – This monster infographic examines which colors are most-commonly used by companies in various industries, which colors should be avoided by major industries and what emotions and values are evoked by common colors.

Books on Psychology, Persuasion, Influence & Marketing

31. Influence: The Psychology of Persuasion – If you’re in business, sales or marketing you’ve probably had someone tell you that you should read this book. Influence explains the psychology of persuasion, why people say “yes” and how to apply key principles of persuasion to business.

32. How to Win Friends & Influence People – Sure, this is more of a self-improvement book than a marketing and sales book, but this guide to mastering people skills is a must-read for any marketer who wants to deepen their understanding of the psychology of building good relationships with––and influencing––people.

33. Permission Marketing: Turning Strangers Into Friends And Friends Into Customers – Another one of those books that’s on every marketer’s reading list, Permission Marketing argues that by focusing on individuals who have signaled an interest in learning more about a product, companies can develop long-term relationships with customers, create trust, build brand awareness and greatly improve the chances of making a sale.

34. Neuromarketing: Understanding the Buy Buttons in Your Customer’s Brain – Unveiling the latest brain research and revolutionary marketing practices, this book teaches techniques for making your marketing more powerful, unique, and memorable.

35. Triggers – This book looks at 30 psychological triggers that you can master to influence potential customers and increase sales.

36. Priceless: The Myth of Fair Value (and How to Take Advantage of It) – Psychological experiments have shown that people are unable to estimate “fair” prices accurately and are strongly influenced by the unconscious, the irrational and context. Many of the most successful companies in the world exploit a deep understanding of pricing psychology to get people to pay and buy more. This book will teach you exactly how they do it!

37. Brainfluence: 100 Ways to Persuade and Convince Consumers with Neuromarketing – Brainfluence explains how to use neuromarketing, which covers the intersection of behavior science and marketing, to more effectively market to potential consumers.

38. The Branded Mind: What Neuroscience Really Tells Us about the Puzzle of the Brain and the Brand – This book looks to lessons from neuroscience to understand how consumers respond to brands and make purchasing decisions.

39. The Buying Brain: Secrets for Selling to the Subconscious Mind – The Buying Brain explores brain-friendly product concepts, design and prototypes; how to create effective packaging, pricing, advertising and in-store marketing; and how to build stronger brands that attract consumer loyalty.

For a master list of the best books on social psychology, check out this roundup on the Sparring Mind blog.

That should be enough to get you started. Now I’d like to hear from you: what is the most useful resource you’ve found––whether it be an article, book, ebook or video––for understanding how to apply principles of psychology to enhance your marketing?

About the Author: Chloe Mason Gray specializes in digital marketing and growth strategy for startups and intrepid entrepreneurs. Be sure to say hi to her on Twitter. You can also follow her on Google+.

EP61: Nate Kontny says “Solve your own problems!”

Today’s interview is with one of my favourite people on the internet: Nate Kontny. He’s the solo-founder of Draft, a web application that helps you improve your writing through collaboration. He also blogs at Ninjas and Robots.

Notable quotes

“Solve your own problems!” – Nate Kontny

“Take two or things in your life that your passionate about, and merge them together. Then you’ll start creating cool things.” – Nate Kontny

Show notes

Note from Justin

I’m releasing a new course (based on my sold-out workshops) called Build Your Own Audience. It will be available on July 29th at You can sign up to my mailing list and get early access on July 25th.

I need your help. People don’t know the show is back, releasing new episodes every Thursday. I took a break back in October, and people think the show is still offline. If you could go to iTunes leave a nice review that would be superb.

Also: if you’re listening on Stitcher, please leave a review on there!

Justin Jackson

PS: By the way, I’m working on something new called Product People Club. Go to, and sign up for the waiting list. I’ll have something to announce shortly!

Music: Land of the Lost and Can’t Stop the Rush by Striker, visit them at

My experience reviewing 8 webinar software options

There are a lot of webinar software options available these days, so I was pretty excited to see what I would find.

Unfortunately my results were less than inspiring. Here are the findings.

Note these details were current when I looked, but I’ve provided links to their sites so you can check for the updated details. 


Here are the features we were looking for in webinar software.

Must have

  • Can support 50 people and can scale into the hundreds
  • Works when we test it!
  • Reasonably priced

Nice to have

  • Nice UI
  • Easy setup / installation process
  • Runs on mobile
  • Can stream webinars live for people who don’t register

1. Webinars on Air


Yes there’s hangouts, and youtube live, and hangouts on air, and webinars on air, and scheduled hangouts. Confused yet?

Webinars On Air is a wrapper that adds webinar functionality to Google Hangouts. So the software driving the webinar is Hangouts, but people access it via Webinars on Air which gives the presenter a few more features.


Since hangouts is free, all they are charging for is the wrapper and it’s well priced.

25 attendees – $20 / month
50 attendees – $60 / month
Unlimited attendees – $99 / month


This is the software we have used for a few smaller webinars and it’s generally worked well. Here are my main observations.

  • Cheap!
  • A little bit confusing the way it works.
  • No free trial.
  • Can stream live direct to YouTube and your site which is nice.
  • Automatically publishes calls live so it’s not great for private calls (although you can manually remove them).
  • Is slower in responsive time than GotoWebinar.
  • Automatically publishes recordings to Youtube (huge timesaver).
  • You can integrate payments and email options.
  • No plugins and it’s pretty straight forward for users to access the call.
  • We’ve had a few issues where presenters couldn’t get on and hangouts can be a little bit clunky.
  • You need to be organized to use it since you have to ‘Schedule’ webinars. I’d like an option to just click a link and open the call.

Overall it’s a great option, particularly for smaller webinars and lower budgets.

2. GotoWebinar


Same picture since 1973. Same software too (and it still works just as well).

GotoWebinar has been around forever in more or less the same format. The best way to describe GotoWebinar is “If it aint broke don’t fix it”.


50 attendees - $99
100 attendees – $99
500 attendees – $399


GotoWebinar has one and only one very nice feature – it works. Pretty damn well. It’s not pretty. It’s not feature packed. It’s certainly not modern or sexy. But it works.

  • Expensive, old, clunky, pretty pricey.
  • It works very well, it was the only one that worked seamlessly when I tested it by myself.
  • Handles recordings however we’d often lose them and they don’t record the talking heads so it’s really just recording audio if you aren’t sharing a screen (which we often aren’t). Then pushing that recording to Youtube is a huge pain.
  • Easy setup a lot of people probably already have the software. Although the need for dedicated apps on mobile and plugins on the computer is somewhat of a barrier.
  • Worked pretty much flawlessly – recording worked well
  • The video quality and response time is excellent, much better than anything else we used.

We may use GotoWebinar when we do larger webinars.

3. Fuze (formerly FuzeBox)


This one had a lot of potential but wasn’t quite there when we tested it.

Fuze was reviewed a few months ago when it was called FuzeBox. We actually originally chose it as the winner, purchased it and used it for a few webinars. However we had trouble with most of the ones we ran so we ended up cancelling.

It’s nice, modern looking software and it’s ludicrously cheap. If only it just damn well worked!


125 attendees – $8 / month
“High capacity” – $20 (not really sure what high capacity means)


Everything looked good on paper with FuzeBox and in our small tests with just me and Alex. But it fell down on live calls more than once. Here are my main notes.

  • I was impressed that it says it’s used by big names like Amazon and Evernote. Although I kind of wonder how they would go if their webinars kept crashing like ours did.
  • Music is a bit annoying.
  • Uploading keynote didn’t seem to work too well. We would have to swap to PDF to upload the content and it worked better.
  • Interface looks good.
  • Tried on mobile had to install app, then it asked me for meeting number, gave up.
  • It ‘s a little bit clunky, logging in to one site and being taken to another, the process felt a bit messy.
  • The interface for running the webinars isn’t great, a bit confusing.
  • Our recordings kept dissapearing.
  • Webinars froze up on 2 or 3 different calls and crashed. We told support but we didn’t really get anywhere.

This looked like the winner on paper but it’s not a good look having a webinar freeze up and crash. When that happens you’d pay hundreds just to have an option that worked.



The guy on the right sums up how I felt after testing 8 webinar software options. is a lightweight screen sharing tool. I wanted to look at it to see if we could use it more as a webinar tool.


$38 / month for 2 presenters
$12 / month per presenter on the pro plan.


I liked the idea of having a more simpler webinar tool in theory. In practice though it didn’t work when I tested it and the features were too limited to use as a proper webinar tool. Here are my notes.

  • Supposed to be good, pro plan up to 250 attendees. The plans are a bit confusing. I had to email them to clarify their pricing and learn that they charged $12 / month per presenter.
  • When I originally tested it out, it seemed pretty good as a simple screensharing tool. I assume sharing your screen is worse on bandwidth than presenting slides though so it might not be the best way to run a webinar.
  • I couldn’t get audio working
  • Pretty simple mainly for screensharing

I was amazed at how many of these options just did not work for me on first try. I’m not really sure why. Whether it was my audio setup, or bad luck, or these apps are just inconsistent. For ones that didn’t work though and I couldn’t fix quickly, it was a major turn off. I’ll pay anything to avoid that happening on a live call.

5. Meeting Burner


Looked the goods. A nice design gets me every time!

Meeting Burner looked too good to be true. And was.


50 attendees – $40
1,000 attendees – $99


I played with it a few times and didn’t have much joy.

  • I couldn’t hear audio.
  • I found the interface confusing. I couldn’t work out how to share my screen or upload a presentation.
  • I couldn’t see video. In fact not much seemed to work.

Again it could have been bad luck, but this one just didn’t work for me.

6. Click Webinar


All these years I thought this lady was providing me customer support. The whole time she’s been running an effective webinar with ClickWebinar.

I was excited about Click Webinar but again it failed me.


50 attendees – $40
100 attendees – $89
500 attendees – $160


  • Up to 4 presenters
  • Auto recording which is nice.
  • Nice looking interface.
  • Crashed when I tested it.

7. Google Hangouts

Hangouts only works for 10 people so it’s more of a meeting tool than a webinar tool.


Still confused. Isn’t this a text messaging app?




  • The interface is ok but there’s a bit too much going on. For example screen sharing needs more space to be really effective.
  • I always get confused about how to launch a hangout and get confused between hangouts and Youtube live events, and between the hangouts app which does text and the video calls. I get calls some through and they will come through on my phone but I want to take them on the computer. Overall I find the experience confusing.
  • For a small meeting with talking heads it seems like a great option. But to present content or run a larger webinar or even a 1 on 1 call I find other options better.
  • The price is right.
  • The video quality is ok but not as good as GotoWebinar.
  • I’ve tested hangouts with guys with bad connections and it crashes more than something like GTW.

8. AnyMeeting


Couldn’t get this one to work for us unfortunately.

AnyMeeting looked good on paper but didn’t work for me.


200 attendees – FREE (Ad supported)
200 attendees- $78


  • I don’t think it scales past 200 which isn’t ideal.While we probably aren’t going to have a webinar with more than 200 people on it, I don’t like choosing software that has a ceiling on it like that.
  • Seems to run in the browser which is good.
  • Clicked the link on mobile and got some white screen of death action.
  • It couldn’t figure out how to use my microphone.
  • Couldn’t get it going on iPad.


Obviously creating great webinar software is a huge challenge, because I was very disappointed in most of the services I tried. GotoWebinar is not the prettiest, not the cheapest and doesn’t have the most features. But it works and in this group, that is a defining quality.

What do you think?

I’d love to know what you think of my findings, and if you’ve had any luck yourself with other webinar software options.

The post My experience reviewing 8 webinar software options appeared first on WP Curve.

The Future of Conversion Optimization – What’s New and What’s Next

Trend forecasting posts are usually reserved for the New Year, but so many changes have happened already through 2014, that we’d be remiss if we didn’t tackle a few of them now. With conversion optimization, the user still remains the key pivotal player, but the way they interact with the web and how they buy is changing. Let’s take a closer look at the ever-shifting landscape to see what’s coming up on the horizon in terms of both technology and design.

Mobile is No Longer a Minority

It used to be that sites were designed with “mobile friendly” options, much in the same way that browser redirects were used to accommodate users in the early 2000’s. Then came responsive design and “mobile first” champions, which provided a truly optimized experience for users – until they reached the checkout. Then, thanks in part to clunky, “bolt-on” e-commerce systems, they were generally funneled to their respective desktop-only versions, only to abandon their cart out of sheer frustration.

And that’s exactly what happened for the University of Oregon Duck Store. Through a partnership with Volusion, it added mobile optimized commerce, which immediately saw orders rise for the subsequent six weeks. The Duck Store had already optimized its product and category pages for smaller screens, but not its checkout process.


By renovating its ecommerce strategy to focus on the growing mobile market (which is getting close to 50% of traffic saturation), the Duck Store was able to increase its conversions and mobile sales by a whopping 184%.

As more mobile retailers begin to optimize their mobile commerce offerings for the full suite of pages, and not just products or categories, mobile commerce will continue to grow by leaps and bounds, likely taking over conventional desktop e-commerce shopping in the coming years.

The Pros and Pitfalls of One-Touch Access

Amazon revolutionized e-commerce with its patented “1 Click Checkout”. Now the process has become even more streamlined thanks to mobile devices. The Amazon Mobile Payments Service takes “1 click shopping” to the next level by letting users swipe to complete a purchase. Not to be outdone, Apple has also invited third party developers to take advantage of its TouchID service, a similar mobile checkout option.


What’s more, PayPal has also leapt into the fray, touting that mobile payments alone grew over 92% from 2012 to 2014. PayPal also partnered with Samsung to introduce biometric payments on their highly popular Galaxy S5 phone. But before you rush out and start swiping, you should know that it wasn’t long before the biometric scanner was successfully hacked.

Of course, needing to obtain one’s fingerprint (as well as know which finger they predominantly use to swipe) is still an issue, but expect to see more joint partnerships crop up between payment processors, app developers and mobile hardware manufacturers as ease-of-use shopping becomes more mainstream.

Even Responsive Design Can’t Save You, Says Study

Mobile responsive design has been heralded as the ultimate solution to end all your mobile conversion woes. Even we here at KISSmetrics embrace and encourage the use of mobile responsive design. But a new joint study from Internet Retailer and Keynote shows that mobile responsive design alone isn’t everything it claims to be.

For example, according to the Aberdeen Group, Inc., a one-second delay translates to a 7% loss in conversions. Following Internet Retailer’s example, if a mobile commerce merchant makes $100,000 a day from their site, that ends up being $2.5 million dollars lost. Not surprisingly, online retailers are clamoring for mobile optimization, and in their rush to deliver, developers are taking shortcuts.

The fact is, consumers expect to see and use a site that is a seamless transition from desktop to mobile, when, despite advances in mobile design, the foundation just isn’t there. In the study, responsive sites loaded quickly on desktops – an average of 3.15 seconds, and 2.80 seconds on tablets. But when it came to smartphones, the wait was an average of 18.24 seconds (using 3G and 4G connections).

In trying to deliver quickly, the article reveals that developers will often cut off parts of a site that they believe are contributing to heavy load times. But looking back at the consumers’ expectation of a seamless experience transitioning from desktop to smartphone serves only to end in frustration. That’s not to mention the introduction of key pieces of technology, such as CSS3, that are relatively new, so finding knowledgeable developers who can leverage this component to its fullest is still a challenge.

And although there’s no concrete formula for always delivering a prime, optimized experience that loads equally fast for everyone, you can’t fault developers for trying. Case in point – Yottaa, whose mobile engagement tweaks considerably cut down load time for their customers.


With nearly a dozen case studies, and clients like Bayer and H&R Block, Yottaa is defining the building blocks that make mobile responsive sites load fast – even on smartphones. For example, they suggest:

  • Prioritizing elements on a page so that important pieces load first. This also involves breaking up an HTML file into smaller chunks, and sequencing what shows, when.
  • Loading images based on the profile of the device requesting them – higher resolution images for desktops and tablets, smaller resolutions for faster loading on smartphones.
  • Splitting a site off as a “smartphone only” version, rather than lumping it together with desktop and tablet responsive sites.

The Future is Now

Now that you know what’s ahead for mobile, payment processing and security, you can work toward building a more unified user experience for mobile, without slowing down the smartphone segment of the population. Just remember that for every shiny new gadget and feature out there, there’s the looming specter of privacy and security concerns. Although mobile is reaching greater and greater saturation in the market, it’s still very much like a toddler finding its legs – unsteady, uneasy and awkward at first.

By keeping these points in mind, you’ll be better prepared for when technology inevitably catches up with user and retailer demands, so that your site can convert like a pro – right from the start.

What are your thoughts on the new improvements, technology and findings from these studies? How do you think they’ll affect your conversion rates? Share your thoughts with us in the comments!

About the Author: Sherice Jacob helps businesses improve website design and increase conversions with user-focused design, compelling copywriting and smart analytics. Learn more at iElectrify and get your free conversion checklist and web copy tune-up. Follow @sherice on Twitter, LinkedIn or Google+ for more articles like this!

Our exact hands off process for hiring developers offshore

When I started WP Curve, it was just me and my lead developer Andrew. As we signed up more clients, we had to hire more people – fast. Fast forward 12 months and we employ 16 people in total across 10 different cities.

We need one more developer for every ~30 customers we sign up. When we started growing at ~60 customers per month, we realised we needed to put a robust process together for managing it. It’s funny because I started out in HR, but left because I didn’t like it. Now I find myself writing HR policies!

In this post, I will run through our exact process. This is an almost direct copy of our internal process. I’ve kept out a few sensitive details and also added in explanatory notes for things that people outside the company may not follow.

The process is managed by Ness, our Virtual Assistant based in the Philippines who works part time (3 hours per day).

If you want to implement this process in your own company, I’ve provided a Recruitment Process bundle which contains this main process as well as 3 additional files (mentioned below) as Google Docs. You can copy them and customize them for your own business. This is 100% free and I’ll send them to you if you add your email address below. This will also add you to my weekly emails, where 10,000+ people enjoy a weekly update of our best content.

Grab the free recruitment bundle

Enter your email below and we will email you the full recruitment process bundle (3 Google Docs). You will also join 10,000 people and get my weekly emails with business and online marketing advice. 

Entire recruitment, select, onboarding and exiting process

Here is the entire process from start to finish. This flowchart was put together using Lucid Chart which is a web-based charting application I’ve used for years. You can click on a section to go to that section or use the menu on the right. Or you can just read through the whole post below. I’ve also included a high level description here so you can see where everything fits.

Step 1 – Trigger

This is where we decide whether or not to hire and we kick off the process.


Step 2 – Recruitment

This is where we find potential applicants, trial them and make a hiring decision. This is where I’ll spend most of our time on for this post.


Step 3 – Onboarding

This is what happens after we have decided to make a hire. The first part, the pre-start tasks is about setting up the team member in our systems.

The second part is what happens on day 1 and beyond.

I don’t cover these steps in this blog post.


Step 4 – Exit procedure

In the rare case where a team member leaves, we have a process for that to. We don’t cover this in the post but it’s more or less an exact duplication of the pre-start tasks but in reverse. i.e. it’s about removing access from our systems.


In this post we will focus on the first 2 parts of the overall process.

1. Trigger hiring process

In step 1, we decide if we should hire and kick off the process if we are ready to hire.

We hire based on the need we have in the business. We aim to have all tickets responded to within 6 hours. If our average first response time goes outside 6 hours, then we start the hiring process again.

I’ve documented the process below. If you don’t use the same tools as us, you can just modify the process to suit the systems you are using.

Every Monday a task is added to Ness’ Trello queue to review the response times in Help Scout. Trello is our task management tool and HelpScout is our support desk tool that we use to manage all of our client jobs.

The task is automated using Schedule Once / Trello Zap in Zapier.


Here are the procedures for checking Help Scout and reporting back to the founders.

  • Log into Help Scout and visit Reports / Productivity.
  • Click the dates up the top right and change the ‘Date Range’ drop down to ‘Custom dates’.
  • In the first box pick the date for the previous Monday.
  • In the second box put the date for the previous Friday (i.e. 3 days ago) - this will give us a report for last week.
  • Under ‘Compare to’ choose ‘Do not compare’ then click ‘Update’.
  • We need to look for 3 metrics. The first is the average First response time which is shown under ‘First response time’. The second is the highest day’s response time. You can get that by mousing over the highest point on the chart on the right. The third is the lowest day’s response time. You can get that by mousing over the lowest point in the chart.
  • Notify the founders via Slack with this canned reply below and show an image of the report.

Hi guys

I have checked the response times for last week’s tasks.

The average first response time was [Put first response time here]
The busiest day was Monday with a first response time of [Put Monday first response time here]
The quietest day was Friday with a first response time of [Put Friday first response time here]



Recommendation: [Insert recommendation from the options below]



If the average response time is over 6 hours then make a recommendation that we kick off the hiring process.
If the average response time is under 6 hours then make a recommendation that we wait a week before looking at it again.

If the founders agree that we should hire again, we need to follow the process below.

Kicking off the hiring process

If the hiring process is triggered automatically, double check in Slack with the founders to confirm that we are hiring again.

  • Create a task in Trello called ‘Team member hiring process #x’ (replace X with the team member number we are hiring for.)
  • To find X, open this folder and add 1 to the highest number of the recruitment efforts documents there. Note this folder just contains all of the historical hiring documents.
  • Open this folder and create a new document.
  • Open the recruitment efforts template (see below).
  • Copy the contents of the recruitment efforts template
  • Change the title of the document ‘Recruitment effort team member #x’ to the number of the team member we are hiring for.
  • Fill in as many details as you can.

Advise the founders that you have completed this step before you move to the next step.

The recruitment effort template is the file we use each time we recruit someone.

I have included the information from this document below. You can also download the actual file by opting in below. I’ve added in dummy text so you can see an example of what would go in each field.

Here are a few notes about what I’ve put in the doc:

  • I’ve excluded the pay rates. I’ll respond to pay rate questions in the comments if people have them.
  • This process is for a web developer. We would do a similar process for a different position by changing the trial task and some of the details.
  • Depending on where we are hiring in the world and what type of gig, we will source applicants from different places. We have hired on Odesk, Elance, (Philippino job board) in the past, as well as using word of mouth through existing team members and from other entrepreneurs who have let their team members go. Our team have connections to local universities and are regularly referring people to us. Half of our team have come through word of mouth either via existing team members or from other entrepreneurial friends. This is one of the many benefits of building up a community around your business.

Here is the recruitment effort template. I’ve embedded it here. To get the actual Google doc, opt in to the emails right at the end of this post.

2. Recruitment process


Contact 10 potential applicants (employee search)

The first part of the recruitment process is finding 10 potential applicants. If we are using a job site, we will search through the resumes on the site and pro-actively email ones that look suitable.

This usually involves looking at 30 or 40 applicants and looking out for people who mention the right words.

I have these tables set up for Ness to get an idea of which people to invite and which ones not to invite.

The exact process is going to differ depending on what sites you are using and what type of role you are recruiting for. The process is skipped if we get a direct referral, in which case we would give them a trial straight away.

Also with the process below, we don’t wait till all people have responded and pick a ‘closing’ date. We trial anyone who looks suitable and we hire anyone who passes the trial (more or less), as soon as we do the trial. If we get more than 1 who are suitable, we may hire more than 1 at once.

HTML / CSSProgrammer
CoderFront end
Back endCustomization

The email in the recruitment effort document above is sent as an individual email from Ness to each person who we have shortlisted.

Pre-screening process

As replies to the emails come in, we have to go through a process of pre-screening the applicants to determine if they are a good fit. Usually I will try to arrange a time to text chat with them on Skype to go through this process.

When they reply, ask if they can make a time on skype to chat about the role. We have to find out a few things about the potential recruit before we go ahead with the trial.

If they can’t make a time when you are online, then you can do this via email.

What to look for
Things to consider
What hourly rate are you prepared to work for given you will get guaranteed hours each week?Our standard rates are $x / hour on weekdays and $x / hour on weekends. We can go as high as $x / hour during the week for a senior dev, however if the dev won’t work for $x then they need to be rejected. If they try to bargain with you or ask for more than what we are offering, reject them. Please note, we pay staff in USD.Often when we ask developers this question they will think about their contract hourly rate for small jobs. But since most of our jobs are full time hours, and we are guaranteeing work each week, they should accept a lower rate. Sometimes I have to go back and forth with them to make sure they are ok with the rate.
Part of the job involves writing development notes for clients. Are you comfortable with written communication?Do they seem friendly, responsive and have good english communication skills via email. Don’t worry too much about their answer to this question but just pay attention to their language skills in the communication.
The job often involves fixing WordPress plugin clashes, changing CSS and HTML and sometimes PHP. Are you comfortable with that type of work?They need to show some knowledge of HTML / CSS and WordPress. If it becomes clear that they are more of a designer or a virtual assistant then reject them. If they say they can do HTML / CSS stuff but not PHP that should be ok. But if they seem more like a designer or an assistant then they won’t be suitable for a development role. If they say I haven’t used WordPress before, then reject them.

Reject anyone who doesn’t look right. For the rest we can invite them to a trial.

Here is a transcript of a typical Skype chat I will have with a developer to ascertain the details above:

“****** started a chat
Jun 4, 3:08 am
hello there..

hi there

I am invited about a developer job.


this is ***

where are you based?


so tz is not a problem for us if you are from aus

oh right

where in the Philippines are you?

Olongapo, Zambales sir :)

do you hired someone already?

oh yeah

we are always hiring :)

what sort of work are you looking for?

part time / full time?

part time.. so I can be flexible

yeah I can see that you outsource.. that’s the service of your site..

ah ok so you have a full time job?

we do small development jobs for clients

most of our team are full time

but we are flexible

oh great.. by full many hrs per week

9-5 monday to friday

but some devs work other times

it just depends on what they want

what would be your ideal situation?

maybe a 2-4 hrs per day will do.. do I need to keep a daily contact with a manager of the project I will be in?


we have a tool that we use to communicate

it’s sort of live chat / email


We can have team members that only work part time but they have to work the same hours each day

so we have some that do 7pm till 10pm at night for example monday to friday

what if I start 10pm to 1am..that would be consistent hours for me

ok and can you briefly explain your skills?

My skills are: html, css, jquery, php.. wordpress is a cms platform made via php so I know of it also.. but I also use laravel(a php framework) for development.. I know a little of system administration because it is a great plus for dev guy like me.

please tell me your current time..thanks sir.


it’s 12:20pm here

2 hours ahead of you

And what kind of wage would you be looking for?

so I can work 12-3am your time.. or I can work 6am – 9am your time sir..

about wage.. can we meet halfway..

what is your hourly rate?

assuming you have 15 hours a week guaranteed each week

$** per hour sir

we generally pay $** / hour assuming that it’s guaranteed each week

an we pay a bit more on weekends


weekends for me will be good for whole day since I am not busy. 6 will be good sir

so you would prefer to just work weekends or during the week as well?

still work at weekdays as well sir. but just saying I can dedicate 6-8hrs for weekend..

6 to be sure..

ok and are you happy with $** on week days and $** on weekend?

Monday to Friday 10pm till 1am and Saturday 9-3pm?

m to f – 12am to 3am and sat 9-3pm your time sir will be good. the 10pm to 1am I based it on my time sir.sorry.

yeah that’s your time

Monday to Friday 10pm till 1am and Saturday 7-1pm? your time?


Ness usually organises 2 hours for you to go through some set tasks and then makes sure we are online to be on call to help

ok sir..

so how we do the hiring process for me..
we pay through paypal

it will be fine with me..

ok cool

so how me stay in touch sir?

how can I contact you.

yep email

my email is **@**.com 

but if you can provide yours, I will get her to email you and arrange a trial for tomorrow or the next day. Is that ok?

will you need my email.

ok sir.

would you mind pasting your email here in case I don’t get it?


great thank you

talk to you later sir.

thanks mate yep

looking forward to the trial

ok sir..”

Arrange a trial

To test applicants, we complete a paid 2 hour trial. Here is the copy you can use to arrange the trial:

“Our process is to arrange a paid 2 hour trial so we can give you some sample jobs. Are you happy to do a 2 hour trial? If so can you please let me know your PayPal email to send payment and also let me know a time that suits you to do the trial.”

When they reply with a yes, here are the steps you need to follow to sort out the trial. Note this process won’t make sense for you to use for your own business. However I’ve left it here as is so you can get a feel for how we do things.

The first step is to check whether our test site ***** is restored to original form. The easiest way to check is to look at the bottom right hand corner of the homepage. If there is a category widget there then it’s the correct version. If there’s a contact form then we need to restore to the original version.



If you go have to restore the site, here is the process:

  • Visit **** and login with LastPass
  • Click on File Manager
  • Click on public_html on the left.
  • Click on the ‘teamtrial’ folder (not the zip file) and hit the ‘X – Delete’ button up the top and confirm.
  • Click on the and click ‘Extract’ up the top and confirm. This will replace the ‘teamtrial’ folder with the template files.
  • Close the tab and return to cPanel and click on ‘phpMyAdmin’
  • In phpMyAdmin on the left click the + button next to ‘dbprefix’ and then click ‘dbprefix_dbname’. This is the team trial site database.
  • On the right hand side it will list all of the tables, click ‘Check All’ down the bottom and from the ‘With selected’ drop down click ‘Drop’. Then click ‘Yes’ to confirm. This clears the database.
  • Click ‘Import’ up the top to import a new database.
  • Click ‘Choose file’, and navigate to the test install directory here in Google Drive. The path is “****”. Choose the file called “****.sql”. This is the template database file. Click ‘Open’ then click ‘Go’ down the bottom. This will restore the template database.
  • Once all of that is done, hit Control Shift N to open an incognito tab and visit the trial site ****. Make sure it displays the template site (see screenshots above to confirm). If it does then the site has been re-set and it’s ready for a team member to complete a trial

Note I also provide a screencast of me completing all of the steps but I’ve left that out for security reasons. The test install site is just a basic WordPress install with a few typical problems. Those are the problems that the developers work through on the trial.

Once the site is ready, it’s time to arrange the trial with the potential developer. Here are the steps for doing that.

1. Explain to the developer what is happening. Here is the copy you can use in the email.

“Thanks for agreeing to do a trial. Our process is to share the instructions via a Google doc which I will do shortly. It contains everything you need to know in order to complete the 2 hour trial.

We will pay $** USD for the 2 hour trial. Please confirm that this email address is the correct email address to use for PayPal.

Choose a 2 hour time period to complete the trial and then work through the steps in the document. Please do not work on the site for more than 2 hours. Part of the trial is testing how you go at following instructions so it’s very important that you only spend 2 hours on the trial.

When your 2 hours is up, please email back and let us know you have completed the trial.

There are more details inside the Google doc which I will share with you shortly.”

2. Share the WP Curve Trial Instructions document with the developer.

I’ve embedded a copy of the trial instructions document below. You can also get the full Google doc to use in your own business by opting in at the end of this post.

Note I keep some of the steps a little bit vague. This simulates what the job will be like and also forces the developer to use a bit of initiative which can reveal if they are suitable for the job. There are generally too many jobs here to get through in 2 hours. The very last one is an extremely difficult task that I wouldn’t expect any new hires to be able to complete. I used Skitch to pull these screenshots together.

3. Make a note to follow up with the developer in a few days or diarize the day when the trial is happening.

4. When the developer is finished, log into and do a send money to their email address for $** USD.

5. In the recruitment effort document, copy and paste the ‘Trial Results’ section and update the name and email with the details of the developer. Check the developer’s notes and on any tasks that they didn’t complete, say ‘Not done’ in the comments field of the shortlisting table and mark it as read. Go through each section for tasks that were completed and make a comment and mark the section as green, orange, or red. Use my comments to make a decision on how the developer went. Remove my comments as you go and replace them with your own comment about how they did on that task.

6. Confirm your scores with the founders to finalize a score.

7. If the score is less than 70% reject the applicant with the email below. If the score is more than 70% make a hiring recommendation to the founders via Slack. If they agree to the hire, send the email below confirming and work out a start date.

Rejection email

“Hi [first name]

Thanks so much for doing our trial. At this stage we’ve decided to not go ahead with you in the role. Please stay in touch for the future as we are growing quickly and always looking to grow the team.

Thanks again.”

Hire email

“Hi [first name]

Thanks so much for doing our trial. You did a great job and we would love to have you on board as employee number #x. Here is what we would like to offer. Please confirm that you are still happy to proceed.

We can’t wait to work with you :)

Position: WordPress support developer
Pay rate: [Add agreed pay rate]
Work hours: [Add work hours]
Starting on [Work out a date, if in doubt pick the following Monday]“

8. Repeat the steps above to clear the trial site for the next trial.

9. Once the start date is agreed, send a calendar invite to the team member and to whoever is the team leader online at the time, saying that the team member is starting. In the calendar reminder list the ‘Day 1 tasks’ below so the team leader and team member know what to expect on the first day. Here is the copy to include in the request:

“Hey [first name], this is the appointment for your first shift at WP Curve. Before the shift please follow these instructions to set up our live chat tool Slack, so you can chat with our team leader [team leader name].

1. In your email you will have an invitation from Click on the invite and set up your account.

2. Download the Chrome shortcut so you can chat live with our team.

3. Just before your shift, log into Slack and look for the team member [Team leader name]. Click on his name and say hello at the start of your shift. You will get more instructions via there once you start.

Looking forward to working with you!”

The day 1 task document contains a standard list of tasks that we have people do on day 1. It’s mainly setting up the systems and reading through our processes.

Grab the recruitment process bundle

Everything in this document is included in Google Doc form for you to take and modify for your own business. This includes:

  • The recruitment process
  • The recruitment effort template
  • The trial instructions

If you enter your email below you’ll be added to my weekly email list and we’ll immediately send you the whole bundle for free.

Grab the free recruitment bundle

Enter your email below and we will email you the full recruitment process bundle (3 Google Docs). You will also join 10,000 people and get my weekly emails with business and online marketing advice. 

Has this post been useful?

We put a lot into this post and I hope it’s been useful. If you think it has, please email it to someone, or share it on Twitter or Facebook. If you have any questions or comments please add them below.

The post Our exact hands off process for hiring developers offshore appeared first on WP Curve.

5 Tips You Need to Know to Improve Your Twitter Strategy

If you haven’t already heard, Twitter is becoming the new 1-800 number. Across the world, customers are using Twitter to publicly voice their pleasure or frustrations with a brand. It provides a make or break opportunity for brands. Responding to tweets, whether good or bad, will almost never do any harm (assuming the company tweets responsibly) and ideally restore or build the customer relationship. Failing to respond is like not answering the phone. It only leaves the customer more frustrated and the customer relationship more tarnished.

Today’s infographic shows 5 things you may not know about consumers on Twitter. For one, they don’t care when your customer support team in manning the Twitter lines.


They’ll tweet you at 3AM, with many expecting a quick response. And in some cases, they won’t even tweet to your account. They’ll mention your name, but stop short of @ mentioning you.

Investing in a good social media monitoring tool is integral to your Twitter and social strategy. You’ll have all your mentions and activity in one place to keep you organized and on top of all your mentions.

Thanks to Mention for providing us with the infographic. You can also download the PDF and share it with your colleagues.

10 Ways to Convert More Customers Infographic

Four Data Driven Alarm Signals for SEO and How to Respond

There are some things about your website you simply can’t ignore — manual penalties, negative SEO, stuff like that. There are other problems that can come up, too. They aren’t quite as obvious, but they are just as damaging.

In this article, I share with you four of these data-driven alarm signals. I want to you to know exactly what metrics to watch, how to find out if you’re in danger, and what you should do about it.

1. Loss of Indexed Pages

What It Is

Google’s algorithm crawls your site and puts these pages into their vast index to be returned in search results for relevant queries. As a courtesy to you, they tell you in Google Webmaster Tools exactly how many pages of your site are in their index.

If you are consistently adding new content and maintaining a valid sitemap.xml, this number should rise. Of course, if you intentionally remove certain pages, then the number will go down. However, if the number of indexed pages drops suddenly or declines gradually over time, then you have a problem on your hands.

Why would this happen? Google removes pages from its index for a variety of reasons. Sometimes, pages just drop off the index because of age or lack of visitors. This is normal. Other times, however, Google penalizes pages, i.e., deindexes them because of spam or unnatural backlinks.

When a page is removed from Google’s index, it will no longer be returned in search results. The fewer pages you have indexed, the less likely it is that your site will rank for certain keywords.

Where to Get the Data

Go to GWT → Google Index → Index Status. This will show you a graph of the total indexed pages over the past twelve months. Make sure that you’ve left the “removed” box unchecked.

The image below shows a site that experienced a severe loss of indexed pages. In this case, the indexation loss coincided with a manual penalty.

index status

What to Do

If possible, find out what pages might be deindexed. If you have a site with just a few pages, indexation loss could be a major blow to traffic. If the deindexed pages are landing pages, this is even worse. You can find out if a page has been deindexed by searching Google for “site:[your page URL]”

google neil testimonial

In this case, I checked to see if my page was still indexed by Google. (Thankfully, it is.)

On large sites with tens of thousands of pages, it’s unrealistic to search every page for deindexing in this way. However, you can still fix the problem by conducting a backlink audit.

It’s a good time to audit your entire link profile for spammy links, and to remove them. I’ve often seen Google start to deindex pages, and a month or two later hit the site with a manual penalty. You can thwart such total deindexation by conducting a thorough audit, link removal, and disavowal.

2. Duplicate Content

What It Is

Duplicate content — when your content is displayed on multiple on- or off-site locations — can erode your rankings and put you at risk for algorithmic penalization. Often, the fault of duplicate content is oversight in the development stage of a website (i.e. misuse of session IDs or URL parameters). Other times, duplicate content is a result of scrapers or content syndication without a rel=canonical tag.

Where to Get the Data

There are plenty of tools that can help you target and fix duplicate content. Screaming Frog is one of my favorites. However, you can access duplicate content information easily and accurately within GWT.

Go to Google Webmaster Tools → Search Appearance → HTML Improvements

The site below has just a few duplicate content issues. These probably aren’t enough to warrant any serious traffic loss or penalization.


What to Do

The fix for duplicate content listed in GWT is very easy. Simply go to the pages that are listed as containing duplicate content, and change them.

3. Lost Links

What It Is

A great link profile is at the core of a great site. You simply can’t have a strong web presence unless you’ve got plenty of healthy links pointing back to your site.

But what if those links start disappearing? It can happen, and when it does, you will have a problem on your hands. Lost linkbacks mean lost ranking, lost traffic, and lost revenue.

Though spammy linkbuilding is a relic of a bygone SEO era, it is still important to work hard at creating high-quality backlinks. You do so through content marketing and careful guest blogging.

But links don’t last forever. Moz’s research shows that that 75% of the web disappears within less than a year. As Nick Garner pointed out, “Most of the web is short lived.” The reality of the disappearing web — also known as “churn rate” — means that you will experience lost links.

Where to Get the Data

There are plenty of tools for analyzing your link data. I’ve probably used every one on the market — Majestic, Moz, LinkResearchTools, SEMrush, etc. I’ve also developed tools — KISSmetrics and Crazy Egg — that help you understand your metrics and visitor behavior.

You can get backlink counts for free from the analysis tool, or by using Google Webmaster Tools.

I recommend that you keep a close eye on this number, and on this page in Google Webmaster Tools. Go to Search Traffic → Links to Your Site.

links to your site

  • Total links: If this number declines gradually or sharply, it indicates a loss of linkbacks and the potential for site decline. Remedial action: Content marketing improvements.
  • Who links the most: Most of your links should be coming from other niche sites, blogs, industry websites, etc. If you see an alarming amount of off-niche, porn, gambling, or spam sites, you have a problem. Remedial action: Conduct a link profile audit.
  • Your most linked content: Links should be pointing at your landing pages, content pages, or other significant pages. If you discover old, irrelevant, or undesirable pages being linked to, it’s a sign that you need to make some improvements in your content marketing. Remedial action: Content audit. Target the most linked to pages for improvement. Continue content marketing.
  • How your data is linked: This is the anchor text used to create the links. If the anchors contain irrelevant, spammy, or over-optimized anchors, you could have a problem. Remedial action: Link profile audit.

4. Organic Traffic Decline

What It Is

When your organic traffic goes down, you need to deal with the issue as soon as possible. Every site faces fluctuation, but if a fluctuation turns into a trend, it’s an alarm signal.

Where to Get the Data

In Google Analytics, go to Acquisition → Keywords → Organic. It doesn’t matter that the specific results are (not provided). What does matter is whether your organic keyword traffic is up or down. The graph below indicates a problem:

google warning and penalty

For this site, the “warning” point was the first symptom that the site was experiencing a problem. Their organic keyword traffic customarily experiences peaks and troughs, but there was a sudden dip that was lower than usual. This was a warning sign. The next peak did not rebound to previous traffic average levels. Then, one month later, they received a manual penalty.

Manual penalties do not always come with warning signs like this one. Regardless, the change in keyword traffic usually indicates some level of problem — be it a spammy link profile, deindexed pages, etc.

What to Do

Just as the causes for organic traffic loss are legion, the treatments are many. First, you need to find out exactly why traffic declined. Ask questions, and get data answers:

  • What changes happened in the backlink profile?
  • What other traffic sources changed?
  • Was there an algorithmic change?

Ask as many questions as you can until you’re able to form a hypothesis — a possible reason for the traffic decline.

Some of the best big-picture solutions are also some of the most basic — reevaluating keywords, improving content marketing, removing toxic backlinks, etc. There aren’t any stock answers to solve this problem. It must be solved on a case-by-case basis.


The SEO’s job is not merely to optimize title tags and create keyword-rich content. The SEO’s job is to study the numbers, to identify problems, and to develop strategic solutions. If you take a look at each of the data points I’ve described in this article, you may be able to prevent some major disasters or simply improve your SEO.

What other data-driven alarm signals should the SEO watch?

About the Author: is the Chief Evangelist of KISSmetrics and blogs at Quick Sprout.

Buy Yourself Time by Systematizing Your SaaS With Trello


This is a guest post by Kyle Brown, author of the upcoming book Systematize.

Are you spending a lot of time explaining how to perform tasks to your employee(s)?

Do you have documents scattered all over the cloud, various emails, and computers?

Do you struggle to find documentation when you need it?

If you answered yes to any or all of these questions, then hope is not lost and there is something that you can do.

You’re running a SaaS business and likely don’t have the resources or the desire to hire an individual or management company to run the operations of your business and you cannot be everywhere all of the time. Spending your time repeating endless cycles of q and a are not the answer to growing your business.

Image if you had more time to market your business or work on a new feature for your SaaS to increase the profits? What if you could consolidate all of your methods for performing tasks into a clean organized manner so that you could easily find and share information required to run your company?

In this post I outline how you can take your mind share and knowledge required to perform tasks in your business and document them so that your team can execute in your place. The method is also known as systematizing. Also referred to as standard operating procedures and business process management.

I have written other detailed posts on how you can systematize at my blog and on the BidSketch blog that you can read for more background. The purpose of this post is to give you an overview of how you can use a tool named Trello to document your processes after you have created them. It also includes some of what you’ll find in my upcoming book, Systematize.

Introducing Trello
Trello, a Fog Creek Software product, is an interesting tool that I’d heard about some time ago while listening to the Startups for the Rest of Us podcast. It has evolved since that time and so have the things that it can be used for. One of those things is documenting business processes.

System requirements
To document processes effectively your system of choice should have at a minimum the following three elements present.

  1. Decentralized hosting.
  2. The ability to control profile based permissions.
  3. The ability for you and your team to collaborate.

Trello meets all of these requirements and more.

To document a business process using Trello, follow these steps:

Create an Account
This is relatively straightforward. Free accounts are available and will serve your purposes. So visit to create your account. At the time of this article, you can use your Google account to sign up.

Setup your First Process
The first thing you need to do is identify a task that you want to document into a process. I recommend starting with something small. You can always add larger processes later once you get a feel for it.

Note: During your first sign in you may recognize that some content already exist. This content has been place there for you by Trello to help get you started. So to avoid disturbing that, you will create your own content from scratch.

Create an organization
In the upper right hand corner of the screen, you want to click the ‘+’ icon, then select “New Organization.” Complete the “Name” field (You can use your company name) and click the “Create” button. We will use a fictional company named “SaaSco”


Create a Process Category
Trello uses containers called boards to store information. We will use these boards to house individual process categories. So click the ‘+’ symbol again but this time you should select “New Board….” For this example, let’s name this one “Marketing.”

Create a sub category
By default Trello may provide you with three new boxes named “To Do”, “Doing”, “Done”. These boxes are called “Lists” and we will use these to store our process sub categories. For this example, we will name it “Blog Post Processes” in the next few steps.


We are only going to use the “To Do” list so we can remove the other two. Click in the upper right hand corner of the “Doing” list and select “Archive this list” and the list should disappear. Repeat this for the “Done” list.


The only list that you should have left is the “To Do” list which you should rename “Blog Post Processes” which is as simple as clicking on the words, typing and clicking the “Save” button.


Create your First Process
1. Now we want to create the individual process. Trello uses “Cards” to store detailed information. We will use these cards to store your individual process. In this example we will create a process for posting to your company blog named, “How to write a post for the blog” by clicking the “Add a card” link, then click the “Add” button.

2. Now it is finally time to add the actual process. Click on the card that you just created and you should be presented with a box in the center of the screen which allows for a variety of functions. I will outline four of them.


  1. Edit the description: In this section of the card, you should include information such as the process goal or objective, the effective date if different from the posting date, the specific team members, and any other special instructions.
  2. Members: Allows you to determine who can access this process.
  3. Activity: Logs all of the activity around this process and serves as a revision tracker so that you can determine which changes were made, when, and by whom. This is useful information when process are changed and you need to determine why.
  4. Checklist: These are specifically handy when you start documenting step-by-step instructions for your process.


And there you have it. You have successfully taken a time consuming task and systematized it using Trello. I really feel like this is the tip of the iceberg when using Trello for this purpose.

There are many features which add additional functionality that were not addressed. This post was meant to serve as one example of how Trello can be used to serve as the infrastructure to create, store, edit, share and collaborate your business processes to systematize your business and save time.