How to Unblock Your Growth [MY LIVE TALK] (#187)
And then here's the big one. Do you have a proven traffic lever that if pulled would double your business today?
Speaker 2:I'm Jim Huffman, and this is If I Was Starting Today, a collection of conversations about half baked startup ideas, growth tactics, and stories from founders, including my own journey as a business owner. All of the content is centered around one question. What would you do if you were starting today?
Speaker 1:Today on the podcast, I'm going to share a recent talk that I did as a LinkedIn live. It was in preparation for a talk. I had to do in front of 50 CEOs of 7 8 figure companies and the premise is how do you go from stock? To scaling. A lot of companies go into what I call the black hole of business, where you hit a certain milestone.
Speaker 1:Of revenue and you can't break out of it. I think there's a crazy stat where basically only 4 to 5% of companies breakthrough to over 7 figures. And then only 1% can get to 10,000,000 or above. So that inspired me to do this talk on how to go from stuck to scaling. So I hit on 3 key components of that on what's blocking your growth.
Speaker 1:Is it your position? Is it your conversion or is it your traffic and then how to unblock that with some frameworks that I've kind of been working on and developing. So if you're someone that's looking to grow, whether it's a company you're at or something you're starting and you've hit a wall, this talk could be for you. I'll also post the video where I showcase studies, which might be. Be helpful.
Speaker 1:Cause I'll hit on that during this call, but it's in preparation for what I'm launching around the growth marketing operating system. So hopefully this is helpful, but also put a link to that operating system. The E product that we're launching here in the next few weeks, much more to come on that, but hope you enjoy today's episode. All right. What I want to talk about today is something that I go through a lot as a business owner and with our clients, but it's when you feel stuck.
Speaker 1:Right? You're growing. And all of a sudden, the stuff you were doing that was working isn't working. And you're like, okay, what do we do now? Because this is something that is significantly more common than you realize.
Speaker 1:And I'm going to get into the stats for that. So excited to kind of get into this today. Before I get into the agenda, I'll do a quick background on myself. I'm Jim Huffman. I have a growth marketing agency called the Growth Heads.
Speaker 1:We acquired a company called Neat. We sell sweat proof t shirts wrote a book called the Growth Marketer's Playbook, The Claim TO Fame. It was ahead of Seth Godin for 72 glorious hours. And then, yeah, I mentor businesses and startups through the ANA Association, National Advertisers, Techstars have a podcast. And, yeah, if you wanna be friends, let's let's make it real on LinkedIn right now.
Speaker 1:With Growth Hit, we've been at this for 8 years, and we're your plug and play growth team. We do everything from top of the funnel ad work to bottom of the funnel, optimize your your website. We've run over 4,000 tests and we've really started to perfect a system through things that have worked and things that have not worked to run growth. What does that mean in simple terms? We design websites and funnels that convert from your shopping experience, your lead experience, your email flows, and we run ads.
Speaker 1:We run content programs that scale and and make money. We've sold a lot of different things. We've sold shirts, cowboy boots, HVAC systems, SaaS products, legal services, caffeinated chocolates, pitbull jammies. We've generated a quarter 1,000,000,000 in sales running a specific process. I don't want to sit here and be like, oh, wow.
Speaker 1:I am so smart. I knew everything. That is not the case at all. I have failed many times. A lot of those learnings that we're going to talk about today are from those failures that I hope you can build upon.
Speaker 1:Also, we bought a company called Neat. We make sweat proof shirts. What are we gonna talk about today? I wanna talk about why you're stuck and more importantly, what's blocking your growth? Is it your perceived value?
Speaker 1:Is it your funnel? Is it your traffic source? Are you running the right system for growth? Because I wanna share with you that operating system today so you can go to that next phase of scale. This is something we're working on that we're launching in a few weeks.
Speaker 1:Yes. There is a paid product on this, but just so you know, in the course or in this lunch and learn today, you're getting a lot of this for free. If you want to learn more and get the templates, a lot of other things we're doing around the growth marketing operating system, there's a link in the comments, or you could scan this QR code. I'm very much obsessed with the book traction and the entrepreneur operating system called EOS. Think of this as a system for marketing or growth.
Speaker 1:What we're gonna talk and about today that I think you'll like is I've got 20 plus case studies that we'll hit on. I've got 11 frameworks that you can leverage to go to that next level of growth and feel unstuck. My favorite one is how to 2 x your business in 10 minutes. And then I've got some exercises that you could take on and and do yourself. There'll be 0 selling of any services that I do.
Speaker 1:I'm also a big fan of case studies, and I think it's the stickiest way to learn. So I'm gonna show you examples that we've done with our own agency growth head or with our new brand, need sweatproof shirts. Feel free to sit back, eat lunch, drink coffee, and enjoy the show. But I think to get the most out of it, it's the exercises I throw at you to to take away as homework to do yourself. So in other words, this is not a spa.
Speaker 1:It's a gym. You get out what you put in. Alright. So let's go to phase 1 of feeling stuck. The real question there is, what is blocking your growth?
Speaker 1:You're like, wait a minute. Do I have a growth problem? Is that an issue? Yes. Unfortunately, you do.
Speaker 1:And if you indulge, you might be at a peak season where there's a trough coming. How do I know this? Fewer than 5% of all businesses in the US grow to over a million. If fewer than 1 percent grow to over 10,000,000 per year. There was a study that gazelles international did that analyzed 20,000,000 businesses to see how big they are, how they grow, but more importantly, where they get stuck.
Speaker 1:You might be living in one of those. It could be the valley of death between 1 and 10,000,000, 1050,000,000 or it could even be under 1,000,000. Either way, a lot of times businesses are stuck in these black holes of business. To expand on this concept more, there's an amazing book called Simple Number Straight Talk Big Profits for He's a Locking Your Business Potential that really calls out this black hole. It's the natural no man's land for private businesses between 1 to 5000000 in sales where most companies go to die.
Speaker 1:How do you know that you're in this black hole? How do you know that you're stuck? Maybe your company is everything to everyone and you're just competing on price or you're sending traffic to a site that isn't converting. You're like, you know what? Ads don't work for aim or you get small wins from one off tactics, but growth isn't repeatable.
Speaker 1:Right? You're like, hey. I I can't sustain this. Also, you could be living in a world where you have volatile and unpredictable growth. Right?
Speaker 1:It's it's very much seasonal. It's based on tactics and hacks. So the question is, if a lot of us are living in a stuck phase, what are we doing about it? You're probably like me wearing a bazillion hats at your company. It's hard to focus.
Speaker 1:You're like, our clients are churning. Let me just throw more money at ads. Right? Or we're not efficient with our spend or ad dollars. Let me try a new tactic and do cold email.
Speaker 1:Or maybe like, you know what? I know I need to talk to customers and uncover why they're churning or why they're not going with us, or let's go viral and throw money at a a big creative campaign. How do you go from survival mode where we're reactive to a world of predictable sales, predictable revenue, where we actually hit our goals? I think I do have an unlock for this on how to get unstuck, but I have some unexciting news. The answer is super boring, and it's something that a lot of people won't do because it's so boring.
Speaker 1:It's really around your system. It's not about spray and pray and one off tactics and trends that you read on Hacker News. It's about a system. I know this because we've worked with over 150 companies at different phases of growth. We've seen companies break through, and we've seen them get stuck.
Speaker 1:I find that it's more of lead bullets and that those are the system you run. So this is what we've perfected over the past 8 years, aligning on your north star. What are we trying to move? What's the goal here? Diagnosing what's working and what's not, and how we track it.
Speaker 1:Do you have the right strategy in place? Are you doing the right go to market strategy? Do you have the right activation offer? Do you have the process and team, and are you research driven to pull this off? Okay.
Speaker 1:So where do we start? This is the the way forward, which is a system. But how do you understand where to start? One of my favorite quotes, it's actually a phrase that my executive coach, Trig Maguire says, before we start coming to the table with solutions, we need to understand the problem and how it works. So with that in mind, let's understand how your growth problem works.
Speaker 1:Why are you stuck? I want to break it down into these 3 categories. The the first one is positioning, right? Maybe we're not growing because we aren't speaking to our customers the right way. The second category could be traffic.
Speaker 1:You don't know how to get traffic that converts or you don't know how to pull lever to get more traffic. Or it could be a third one. You have a conversion problem. You don't know how to activate customers on your website, offline, or wherever that would be. If you focus on growth before you have these 3 dialed in, then you will just accelerate your failure.
Speaker 1:I know from experience because we have been tasked with this too many times to grow when companies are ready, and we will now turn those clients down because it it does not end well. So some group work for you to do or an exercise for you to do on your own is ask these questions to really understand where is your problem. Where are you stuck? What's blocking growth? Is it positioning?
Speaker 1:Is it conversion, or is it traffic? Alright. So let's start with that 1st blocker, which is positioning. With positioning, there's 3 simple questions that I want to ask to uncover, Hey. Is this working or not?
Speaker 1:So first, do you get new customers or win competitive deals because of your point of differentiation? 2nd, can customers articulate your value profits? They're talking to a colleague or they're a reference. Will they say what you want them to say? 3rd, are you a must have or just a nice to have?
Speaker 1:By the way, you get bonus points if you have true urgency or scarcity. But if you are not answering this the way you would want, like, I'm the one on all of these, it actually means one simple thing. No one cares. We've built something that does not solve a problem. People are not looking for this solution.
Speaker 1:It isn't a hair on fire problem where they're like, take my money. But the good news, I have 2 frameworks in place on how to figure out, 1, why your customer should care, and 2, how we should speak to the customers to meet them where they're at. The first framework I wanna hit you with is what I call the pitch formula. You've probably seen this or a variation of this. This will be the most painful exercise you would do if we were to work together, or you can even do it on your own.
Speaker 1:And there's a few components here that I wanna call out. Whatever you're trying to figure out why your customer should care hone in on who your customer is. Where that goes wrong is you try and be everything to everyone. The more specific, the better. And do you truly know what they need and in their language?
Speaker 1:And then once you know your benefit, here's the other big part. Do you know what you're competing against? Is it a direct competitor? Is it an indirect competitor? Is it indifference or not doing anything?
Speaker 1:And with who you're competing against, do you know your point of differentiation? Why in a competitive deal or competitive shopping experience, you are better and ideally significantly better where they care? So this is an exercise you could do on your own, but I went ahead and did this for our brand neat. A couple of things I wanna call out here is we got pretty specific on going after guys, big guys that run hot, maybe have hyperhidrosis and have visible sweat stains in the clothes that they wear. Who are we competing against?
Speaker 1:It's not about competing against other competitors that try and hide sweat. We actually wanna go bigger because people aren't as informed on our category. So we're going after your favorite regular cotton t shirt. Unlike those, neat proof apparel uses our advanced neat technology developed for the military to hide sweat and keep you looking confident and sharp. So we understand our persona.
Speaker 1:We understand our benefit and most importantly, our point of differentiation in a way that they would care. The second thing, now that we know why they should care, how do we say this to our persona in a way where they will hear it, where we lose their language? So I'm gonna give you the cheat code on how to do this. Let's just say you have 3 personas. This is pulled from Derek Halpern who who broke this down.
Speaker 1:Your early adopters, they are an informed persona. And the way we speak to them because they're informed, they wanna nerd out. We can speak in technical talk. We can speak in features. The afflicted persona, these are the fast followers.
Speaker 1:They aren't informed, but they have a problem and they need to solve it. So you speak to them in that problem solution format. Right? Pour salt in the wound and then heighten why you are the answer. And then finally, as you go to the masses and scale, this is where a lot of companies fail.
Speaker 1:The oblivious person, they're not informed. They have a problem, but they don't know it. How do we go to that next level with them? It's very simple. You have to get their attention.
Speaker 1:So I wanna show you in action how to market one product in 3 different ways to these 3 personas, and I'm gonna do it for our services at Growth Hit, which is conversion rate optimization to helping you optimize a website to get more leads or more sales. For the informed buyer, we work with lots of different companies, but say it's an ecommerce company. They are shopping for a CRO agency. So when we speak to them, we wanna be like, hey. We are a CRO agency that specializes in Shopify Plus stores.
Speaker 1:Like, oh my gosh. That's amazing. I sell these other players. I don't know if they're right for me. You're right for me.
Speaker 1:You understand my niche. Great. Let's go to the afflicted person. They have a problem, but they aren't informed. So I wanna do a headline that gets their attention.
Speaker 1:Hey. Is your bad conversion rate killing your profitability? Talk to Growth at our own how we could help. It's like, yes. That's my problem.
Speaker 1:Let let's get into the weeds on it. And the 3rd and final one, this is the hardest one, but if you crack the code on this, it can be the biggest unlock. And with this one, it's all about getting attention. Think of it as what's your BuzzFeed, Upworthy style of headline? Look what we put here.
Speaker 1:You wanna double sales without spending $1 on ads? You're like, absolutely, you have my attention. Think about investing in CRO. Notice how I'm marketing the same product, but I am saying completely different things based on who I'm speaking to, the informed person, the afflicted person, and the oblivious person. So there's some other ways to think about messaging customers.
Speaker 1:We call it the 5 levels of positioning, features, benefits, problem solution, use case, or aspiration. And what you have to understand is with your customers, if you're a b two b product, if it's a sales team, what language are they using? If it's a d two c product, what language works for them? So what I wanna do is show you some examples of companies that really nailed their language when going to market to think of a reason why people shouldn't care, but speak to customers with words that would resonate. So let's talk about solving a problem.
Speaker 1:Rocket money, it's very simple. Get control over your subscriptions. We're all subscribed to too many streaming services. They help solve that problem. They got acquired on the back of this one problem in one use case.
Speaker 1:Let's go to another problem. And again, these problems could be very real or they could even be kind of silly or or nuanced. This is Adam Shoes. They are in a red ocean competitive space, but they chose a segment of the shoe category for people where they don't come in half sizes, but come in quarter sizes. And you can get a different size shoe for your left foot versus your right foot.
Speaker 1:I love this example because it's a very specific problem, but it gives them that point of differentiation, which I love. Let's go to benefit focus. Wealthfront was launching a new product, the high yield cash savings account, where if I explained it to you, you would fall asleep. But what they do is they wanna show you the benefit. Hey, you've got this money in your checking account right now, your savings, you get $50 per year for having 50 k there.
Speaker 1:If you use us, we get you 2 to 3%. Right now, it's 5%. So by showing that benefit, that helps get traction. Another one, Spanx, this is my favorite example. They spoke to people with the use case because people had no idea what shape where it was.
Speaker 1:If they spoke in features and benefits, it would not resonate. So for them, it was all around, hey. You will wear pants without showing a panty line or wear a dress without showing any roles, use Spanx. These two use cases got them to 8 figures all because they knew how to speak to their customer. And then final examples, Warby Parker with their use case of the home trim program and then Figma, the product actually was not better than Photoshop.
Speaker 1:But because they knew the use case of collaborative design, that was huge to minimize the back and forth and the various variations you would save. So how are we doing this with our own brands and our own companies? With Growth Hit, you can see when we did the redesign of our website, the headline we had here, and was it converting? Why? Because growth isn't a guessing game.
Speaker 1:What does that even mean? As we talk to customers, talk to our sales team, what we really saw that people cared about is, is this going to be an ROI positive investment with CRO? Can we convert more visitors into buyers with a CRO team that pays for itself? This one experiment alone allowed us to take our cost per lead down from over 500 to a $150 by really understanding what customers care about. With Neat, very similar.
Speaker 1:When we acquired the company, they had nothing but neat. What does that really mean? We knew that we are in a red ocean space. We had to tell people why they would switch. So we put, unlike your regular t shirts, ours hide sweat, make the switch.
Speaker 1:No pit stains, no back sweat. This combined with some other things allowed us to get that conversion rate from 0.6 to 4%. Something for you to think about if you wanna take some homework home with your own company or your own projects. Do this exercise. How would you speak to an informed buyer, an afflicted buyer, and an oblivious buyer?
Speaker 1:How do you speak and compete on features? How do you talk about a problem? How do you get their attention? Let's go to the next blocker, which is a a fun one, conversion. We we know our positioning.
Speaker 1:We know how to talk to people, but people are converting. Like, how do we action this? Right? How do we what's the application of our positioning for a website, for a go to market strategy? So first, I really understand if you have a conversion problem, I want you to ask these three questions.
Speaker 1:Do you have a consistently strong conversion rate and by traffic source, not just by email, but by paid organic or referrals? Do you have an activation offer that converts people quickly? Time and time again, I see too many people have a cool website, cool brand, cool slogan, but they forgot that final piece of give a pea give people a reason to convert now. And then are you converting customers in an ROI positive way? The first thing I wanna start with is your irresistible offer formula.
Speaker 1:This is from the book, $100,000,000 offer by Alex Hermozzi, where he talks about the 4 components of a great offer. You've got dream outcome, likelihood of achievement, time delay, and effort of sacrifice. What's the aspiration they wanna achieve? How likely is it they're gonna hit that? And then how fast until I get results or I see the benefit of it?
Speaker 1:There's a reason and then, effort or sacrifice. Hey. How much do I have to invest in this? Is this 7 minute abs? How long is this gonna take?
Speaker 1:So I wanna show some quick examples of some of my favorite offers to inspire what you could do. So here's Main Street, and here's our offer. Get $50,000 back from the IRS in 20 minutes. We do all the paperwork. You get the cash.
Speaker 1:If we can't help you claim credits, you pay $0. This is an amazing offer. If you're a startup founder, there's no reason not to do this. It's free. You only pay if they get results.
Speaker 1:This allowed them to get a massive round of funding all on the back of this offer. Okay. Let's go to the next one. This is Curology. We're going to d two c now.
Speaker 1:They have a personalized skin care product for you, and they give you the first product for free. Shipping is all on you, but you get to text and connect with the dermatologist rather than go in person and make an appointment. This is how they raised $40,000,000 was on the back of this irresistible offer. There's another one I'm obsessed with right now, our b two b, which is a tool that likes lets you see person level website visitor data. They give you the product for free for 30 days.
Speaker 1:It's a free, Slack integration. Then after that, you can decide if you want it or you can keep it for free, or you can just pay for the CRM integration and the CSV. This one is another no brainer offer. Why would you not do this one? The last one, actually, tomorrow show, this is, one of our clients, Pre Med Experts.
Speaker 1:They do MCAT tutoring, and one thing that we saw is the results here are phenomenal. They can actually guarantee they will lift your score by 17 points, and their persona is someone who's taking the MCAT for a second time. So they were bold enough to put that guarantee and there's time delay because it's just a 120 day program. So this is one if you can lead with the guarantee that's a huge unlock. One of the most iconic ones is from ConvertKit.
Speaker 1:They are an email tool, competes with Mailchimp. They kept hitting the wall because they couldn't get people to switch. Switching cost was very high with their CRM and email tool. So look what they offered. They offered a free migration service for your email service provider.
Speaker 1:So they made your effort or sacrifice basically nothing to make the switch. And now they're at over 50,000,000. I think it's 40,000,000 in ARR. This was a huge unlock for them. Okay.
Speaker 1:So you've got your offer. You've got the formula of it. But now the question is, how do you package up your value proposition and your offer? And so I call this the activation offer because you need to activate your value prop and that irresistible offer formula. So what I wanna show here is a spectrum.
Speaker 1:So if a client comes to me, can you guarantee we get new customers? I can say yes, but then the next question is, how aggressive do you wanna be and how willing are you to spend or potentially lose money on that, acquisition? So from least aggressive to most aggressive, here's what you could do. So least aggressive, you can activate people with content, courses, ebooks, or even cheaper. You can also access people with early access to a product if you play up urgency and scarcity.
Speaker 1:We can discount and bundle whether you're a SaaS product or an ecommerce product. Giveaways can be strong as long as that giveaway is aligned with your value prop. This one, when done well, is is my favorite, but it's getting a giving away a free product for referring, turning your customers into marketers. There's been some iconic examples of Dropbox and Harry's that have done this. And then the most aggressive is we can pay people to become our customers, whether it's PayPal crediting your account $20 or guilt group giving you $25 anytime you refer a friend.
Speaker 1:But something to think through with your value prop, with your customer, with the offer you wanna put out there, so you need to package it in one of these ways to really resonate and get traction. This is one one of the clients we worked with where we actually helped build a free tool that allowed you to see what your insurance rate would be to get an instant quote. In the spirit of giving away free content, we gave away a free product, which was great for lead generation. Another iconic one is 3rdLove. They are competing in a very competitive space against Victoria's Secret.
Speaker 1:They activate you with a quiz to figure out the right product for you to personalize a recommendation, because 80% of women are wearing the wrong bra. This was what really put them on the map, was their fitting room quiz. Buffer, they were famous for their 25 day email course to master social media marketing. So putting a free course out there, and it was genius to do it through email because, 1, get the email, but, 2, you're training them to look for your content in the inbox and open it. So that way, when you're eventually running social media, you'll think of them.
Speaker 1:Girlfriend Collective, they went aggressive and did free leggings. They give you leggings in exchange for sharing this on email. These are 90, now a $120 leggings they would give away for a share, but they were able to acquire 6 figures in new customers on the back of this strategy. And then obviously giveaways, can work. We did this with 1 client and got 30,000 email sign ups in in a month on the back of a aggressive giveaway to go to their winery, which is actually a castle.
Speaker 1:So So what are we doing with our brands and with our companies and our products? What are our aggressive offers, to increase conversion? So in Growth Aid, we're doing a couple different things. With our website, we are doing content and courses for free in exchange for the email address to get them into our CRM. How to grow a brand in 23 steps from 0 to 7 figures.
Speaker 1:We're also doing free CRO audits. These are normally, like, $1500, that, we will do for free if you'll jump on a call with us. With Meet, we're testing a lot of things. We've tested the 100% sweat proof guarantee. If you show that you sweat through our shirt, we'll give it to you for free.
Speaker 1:We're aggressive with bundles, so that means discounting, and we're doing incentives at checkout from free shipping to a free t shirt. But one big one is our free t campaign that that we're testing, right now. It's working a little too well, so we we had a positive. So something to think about. As you craft your irresistible offer, how would you also need to activate it?
Speaker 1:And another fun way to think about it is if you had to guarantee conversions, anytime someone came to your website or you got them on a sales call, what is the most aggressive thing you would do? And does it make sense with your business model? Okay. Let's go to the 3rd blocker of growth, which is traffic. You're like, alright.
Speaker 1:I've got my positioning dialed in. I know how to activate people, but it is crickets. I don't know how to get traffic or I'm getting the wrong traffic. So I want you to ask these three questions to really understand if you have a traffic problem. Do you have enough traffic to hit your goals?
Speaker 1:A lot of times, people will come to us wanting to to to fix their conversion rate, which we need to do, but we're also like, you don't have enough traffic for us to even evaluate if if it makes sense. 2nd, you have a diversified, traffic, so you're not dependent on any one channel. We see a lot of companies can be a one trick pony, which is fine until a certain point. A lot of people get stuck when they're too dependent on Facebook ads, too dependent on referrals. And then here's the big one.
Speaker 1:Do you have a proven traffic lever that if pulled would double your business today? Do you have a paid channel? Do you have a partner channel? Do you have a go to market campaign strategy that that you can really mobilize? So to uncover this, I wanna talk about a few different things.
Speaker 1:1st, uncovering your unit economics to figure out what are the right options for you for growth. And then I wanna break down your growth options, which will be very dependent on your business model. And then finally, my favorite thing, your growth calendar. It's not about coming up with a list of ideas to do. It's actually calendaring out what you do.
Speaker 1:Okay. So unit economics. What does this even mean? What are we talking about? So do you know your numbers?
Speaker 1:Do you know what game you're playing in business? Do you know your customer acquisition costs? Do you know what your lifetime value is within 90 days or 1 year? Do you know what your churn rate is or what your repeat purchase rate? Why do I care about this one?
Speaker 1:I wanna know, are you in the acquisition game or someone biased for you one's time and you never see them again? So you always have to fill the funnel. So you're selling Christmas trees, you're selling diamond rings, or you're in the retention game where you close them once and you have them for life. Right? You're a recurring service, you're a subscription product, you're a SaaS product.
Speaker 1:Okay. So I'm not gonna go super deep on, you know, how you should think by calculating cost per acquisition and ROAS. Actually, I do have that here, but I wanna show you once you start to understand your your CAC, why certain things will be important. So look at cost per acquisition, from the perspective of an ecommerce company and why your AOV, your average order value matters. So let's say you're selling like a t shirt for $40 and it costs you $10 and you make $30 on it and say you need to keep $5 to buy more inventory or to pay people whatever that is per shirt.
Speaker 1:So you your CAC ceiling could be $25. That's really hard on paid ads to do that. But if instead of selling a single product, hey, I'm gonna boost my average order value to be a 115 because I'm gonna bundle. You're actually gonna have a smaller gross margin because you're discounting, but your CAC ceiling on a new customer acquisition goes from $25 to $70. Now you can run paid ads.
Speaker 1:Now you can test other things. So as you're an ecommerce company thinking through what are your unit economics, what's the most you can spend to acquire somebody, think of the different levers you can pull to increase AOV, to increase margin. One factor that isn't in this, if you have a great recurring product, you could potentially break even on the first purchase. You could lose money on the first purchase if you're gonna get paid back in 60 or 90 days. But these are things when figure out your CAC ceiling, factor in your price and your payback time.
Speaker 1:And I wanna go specifically into payback time with the b to b company. Let's say you have a service and your average retainer is $7 per month. So let's say you make basically a $3 off of that as your your your gross margin. And you need to take $1,000 because that needs to go to pay you, that needs to, like, pay ads, what whatever that is. So you're willing to spend $2,000 to acquire that new, client.
Speaker 1:But let's talk about the payback time. You're like, actually, you know, we're doing well. We wanna be more aggressive. We're willing to, you know, not get paid back until it's another 6 months or 12 months. And look how your tax ceiling expands from 2,000 to 12,000 to 24,000.
Speaker 1:So this is something based on your p and l, profit loss, or your balance sheet. How much are you willing to spend to acquire a customer? What's that payback time need to be? Because if it's 2,000 or 24,000, you're doing completely different things. So that's why your churn rate matters.
Speaker 1:Do you land and expand so you have a negative churn rate? If if so, you could be super aggressive with acquiring customers. So some things to consider with your unit economics. It's not as simple as, like, hey. Do I know what my CAC is?
Speaker 1:It's what is your CAC ceiling, and what are you comfortable with? What are the levers you can cool pull, whether it's pricing or with payback time and how you wanna run your business? So once you understand that simple question, the next thing is what are your options based on your business model? How much are you willing to spend to acquire a customer? So let's say, hey.
Speaker 1:I don't have much budget. Here are some options to play with. Whereas if you do have a budget, here's what you can play with. So to give some examples, so if you have no budget, it's like, I'll be scrappy, do content marketing, I'm a new referral program, I'm gonna work on strategic partnerships or build a community, more scrappy bottoms up stuff. But if you have the luxury of great margins or maybe you're you're you're backed by some some real funding, then we can start to play with some of these paid activation strategies from, obviously, online ads, partnership campaigns, influencer campaigns.
Speaker 1:You can do events, marketing stunts, lots of options. But here's the big thing. It's not just about, like, what we're gonna do. The next phase is you need to calendar out your growth. Too many times I see people have amazing ideas that they wanna run.
Speaker 1:They throw it into a spreadsheet. They throw it into a list, and none of it gets done because they do not calendar it. So if I wanna choose any hill to die on, it's not to have a to do list, but to have a calendar. So I'm gonna show you what is a very ugly slide and hard to read, but I think it's it's maybe the best one here. So when thinking about calendaring out your growth, here's, a couple categories.
Speaker 1:So first, what is your, so this is a growth calendar, month 1 to month 12. And think of your calendar in 2 simple categories. 1st, what are your always on growth tactics that you're doing? Right? So we're always earning Facebook ads or search ads.
Speaker 1:We're always doing partnerships. We're always doing SEO. So these are things you're always doing you're always investing into. The second category, is growth events. These are the ones that are ongoing, but you calendar them because they're not as repeatable, but they're things that you can do in in limited basis.
Speaker 1:So, for example, hey. We're we're launching new product features for a SaaS 4 times a year, or we're launching new products for ecommerce company every quarter. We're gonna do influencer campaigns. We're gonna do giveaways. We're gonna do PR stunts.
Speaker 1:We're gonna do offline events 2 times a year. We're gonna do build a tool and do engineering as marketing once a year. So the companies that really go to that next level, the ones that balance their always on tactics versus their growth events. So what I have here is a list of your options for your always on growth channels. And what I would say is don't try and do all of these, but pick 1 to 3 where you can be best in class.
Speaker 1:And then as we look at our growth events, I'll list all the options here. You wanna think through what are the ones that I can do on a monthly, quarterly, or, like, biweekly cadence, to really figure out what's right for you. But if you wanna go to that next level, to be like a black belt with your your growth calendar, I'm gonna give you 2 tips. So the first tip when you're calendaring out growth is, do you know your seasonality? Factor in your peaks and your troughs.
Speaker 1:So ask yourself what quarter is bringing the most sales. Right, and what quarter is slow? And based on that, when it's a peak season, it's to be in capture time. When it's a trough season, it is demand creation time. So to give an example, when it's, demand capture season, let's say you're a ecommerce company where q 4 is gonna be huge for you and maybe you're also big leading up to to this is when you're like, okay.
Speaker 1:We need to be dialed in with our ads, with our email, with on-site optimization because this is when it's time to make money. But when it's a trough season, this is when you're like, hey, we can be creative. Maybe we should do launches. Maybe we should do a stunt. Maybe we should do a collab.
Speaker 1:Or it's like, hey, let's build a list to prepare for when it's a peak season. The companies that can minimize the troughs and maximize the peaks, those are the ones that can do really exciting things with our growth calendar. The second thing to factor in is as you calendar out your ideas and tactics, you need to meet your customers where they are in their buying journey. So factor in your cat customer's buying process. And so ask yourself, what do they know?
Speaker 1:What don't they know? How can you shape their approach to this buying decision if it's your service or if it's your product? Meaning, like, what questions are they gonna have or what objections will they have? So with your calendar and your growth opportunity, you need to ask yourself, is all of our initiatives focused on these people that are already engaged and bottom of the funnel and, like, hot and ready to buy? Or are we focusing too much on people that are top of funnel, oblivious and cold?
Speaker 1:Balance out your campaigns and where they're focusing and where the growth opportunity is because, our agency we've been very guilty of focusing too much on bottom of the funnel and not enough at top of the funnel. So as you're balancing out your opportunities or your your growth calendar, really, factor in, your peaks and valleys and your customer intent, which customers you're you're going after. So I'll show some quick examples of companies that have done a really good job managing their growth calendar and different channels they do. So this is HubSpot. They they do an amazing job on the paid ad side, giving away their free tools.
Speaker 1:They've acquired podcast company or podcasts to have a huge podcast network. They do events. They do all annoying content, and they do engineering as marketing. They launch the site grader that puts their website on the map. This is kind of a best in class b to b company with all they're doing with with traffic sources.
Speaker 1:I'll add on a few specific ones. This is Car Edge. They help you find the right way to to buy a car. Think of it as this car buying and selling marketplace. And what was interesting is, they really made content marketing specifically on YouTube work.
Speaker 1:They have over half a 1000000 followers. It's a father and son duo that makes really funny videos, which was a fun way to unlock a new channel that wasn't as traditional with this category. Another one with our b to b, they've done an amazing job with an academy in content, to put out their podcast content, but also have a b to b academy for anyone in this category who then eventually want to use their product. Honest company, they did a phenomenal job by unlocking SEO with, technical SEO, really understanding, keyword volume, keyword intent, having a strong site map to find people looking for their stuff. Another one is, Turtle Travel Pillows.
Speaker 1:They were able to unlock traffic by going global by doing language translations. So not just to have a website in English, but in French, in German, in Dutch as is a new traffic source. So what are we doing with Growth Hit? Trying to, like, unlock our growth and our growth calendar. You know, we have things that are tried and true on the ad side, but really going big on our newsletter, which is now over 15,000 standing at the podcast, doing partnerships with, like, Hotjar and Convert to drive traffic and then investing in a partner channel, which is Clutch with getting strong reviews there.
Speaker 1:And then on the neat side, we're really focusing on being best in class with ads, email, and SEO is kind of the the three catalysts for for driving traffic. So one thing to think about based on your cost per acquisition comfort level of your pricing, your payback time, your business model, what are your options for what you should focus on, for getting traffic? Ideally, having not just 1, but 3 so you can be somewhat diversified. Alright. Well, we did it.
Speaker 1:We've unblocked growth. Right? It it's happened. Traffic, conversion, positioning, we have it all figured out. That is not true.
Speaker 1:I have completely lied. There is there is one more bonus blocker, and you all might be able to guess what it is. It is fulfillment. This is something where you get everything going. You get traffic.
Speaker 1:You're converting them. Your activation offers, how many, like, crap. I can't fulfill in the business. So So to know if you have a fulfillment issue, one, you probably will feel it, but also ask these questions. Can you fulfill enough work to hit your goals?
Speaker 1:Do you have the inventory or bandwidth to fulfill the necessary demands to hit your goals? Do you have a positive return rate or churn rate to justify growth? You might be fulfilling on it, but they're return or they're churning or you're sending out products, but they're crappy. So how do we solve this problem? Well, sadly, I do not have a framework for that.
Speaker 1:However, I'm gonna inspire you hopefully with what we're trying to do at Growth Hit, and at NEAT. So with Growth Hit, we, it worked. We were able to drive traffic and sell out of our products, but we had to stop ads. But I didn't wanna do that. So we got creative and we went into preorder mode with our products, and it's still working.
Speaker 1:The ROAS and it has come down. The cost per acquisition has gone up a little a little bit, but it's still within our guardrails of our cost per acquisition ceiling. And we'll be back with more inventory in mid September, which is exciting. What about with growth head? As we will with certain services, we hit a wall.
Speaker 1:So we're testing 2 different things. We're selling just the strategy rather than the execution to give the play by play road map of what to do, and then we're also giving out the operating system as an e product. Essentially what you're seeing today, we're packaging this up to basically hand over everything we would do to run growth so people could kind of do it themselves. So hopefully this is helpful. Whenever you're thinking about feeling stuck or what's blocking growth, let's understand the problem.
Speaker 1:Is it positioning? Is it traffic? Is it conversion? And then there's some frameworks at your disposal to figure this out. Right?
Speaker 1:If it's positioning, you've got the pitch formula and you've got these positioning tools to figure out why customers should care and how to speak to them. If you have a conversion issue, you need to figure out why customers should buy now and how you should aggressively act or create an activation offer that will get them to buy. And then if you have a traffic problem, first, understand your unit economics, figure out your growth options, and then start to calendar out your growth. And do it based on your peaks and troughs in the, the intent meter of who you're actually going after. So I hope that's helpful as anyone out there is stuck and figuring out what to focus on.
Speaker 1:I'm gonna do another workshop on the phase 2 of this is after you get unstuck, it's really figuring out what is your go to market plan. Right? Because as you're unstuck and you're looking forward on what to do next, I'm kind of fascinated when people will be like, hey. You know, should we focus on ads or content or sales? And the first question is, what's that one growth lever you're gonna pull to get to the next level of growth?
Speaker 1:What is your go to market strategy? Are you product led growth like Slack? Are you founder led growth like Basecamp or Sphinx? Are you sales led growth like Salesforce? Or you could be doing account based marketing like Varonis, Or maybe you're gonna grow, from paid, like true classic, being black belted ads.
Speaker 1:You could grow through organic and SEO, like NerdWallet or Honest Company, or it could be influence influencer led growth. You're Kylie Cosmetics, and you have Kylie Jenner. And based on your GTM go to market plan, then you need to build your growth machine. Right? We've unlocked growth.
Speaker 1:We've got the foundation. But what is that machine that you're gonna build? And I'm showing the one that we've built right now for for need where it's very much offer and paid led. Right? And so once we dial in our offer, we're trying to figure out the key paid channels and organic that will get us to that next level.
Speaker 1:And then for the website, it's like having specific things dialed in, having our email and SMS strategy at a black belt level, and then having that growth calendar planned out. And then just as a reminder, as you're building up that growth calendar, really factor in the peaks and valleys and the customer intent. But I wanna leave you with one more exercise that you could think through. And it's around you're you're in this go to market, growth calendar planning mode. You're like, what should we focus on?
Speaker 1:And there's this idea of a smart cut where you can double your business in 10 minutes, and you do it by focusing on the high impact test ideas and and growth opportunities. Like, focus on those those leverage points. So there's a book 10 x is easier than 2 x that kind of inspired this a little bit where are you focusing on those high impact opportunities? So here's 10 ways to double your business in in 10 minutes. 1, focus on ad copy and creative.
Speaker 1:They'll have an outsized return. 2, this one's the easiest. Raise prices, double prices. 3rd, change your offer. Make it something that will double or triple your conversion rate.
Speaker 1:Partner channels. Can you unlock a partner channel? Your referral strategy. How do you turn customers into marketers? Outbound.
Speaker 1:Are you, just focusing on inbound? Can we turn on an outbound strategy? Automation, media buying, platform, and then retention. And to figure out what's right for you, I really think you need to start by identifying those bottlenecks. So I'm gonna go through the hall of fame of companies that were able to double their business in basically 10 minutes.
Speaker 1:So we've got Hotmail. Right? This was at a time when there were 70,000,000 people on the Internet. This is essentially what became, Gmail. And what they did is with this free email service, at the very end, they put end of the email, they put PS, I love you.
Speaker 1:Get your free email at Hotmail. This little mini billboard on every email allowed them to get to 1.5 million or I'm sorry, 12,000,000 users within 18 months. Another classic example is Dollar Shave Club. This one video put them on the map to to kind of be the d two c flagship brand that everybody strives to emulate. This is represent us.
Speaker 1:I love, this one. Just a simple tweak to their ad campaign that allowed them to go from hitting a 1000000 people to 25,000,000 people. As I look at neat and even at, like, true classic, doing these levers on ads can have an outsized return. Airbnb, they went from user generated content to professional images on their website. So this product update was a huge unlock to become now a publicly traded company.
Speaker 1:We have Wondertab. These guys created a Chrome extension as a new distribution channel for their their travel site. And then I mentioned, Turtle and what they've done with their, different geographic targeting. So So what are we doing with growth at Indeed? So with Indeed, it was pretty simple.
Speaker 1:We raised prices. We stopped selling individual shirts at $38, and we sell bundles at a 100. That literally allowed us to more than double sales in the business. Also focusing on content. By doing some creative, by recording our own videos, we're able to go from a campaign that wasn't ROI positive to one that's able to scale and we're able to to sell out.
Speaker 1:The next move is launching, various sites with different languages in all of the countries, states, places where it's super hot. So this is on the road map next. With growth, and this one's pretty funny. We're already making content. We're like, hey.
Speaker 1:What if we just repurpose it for other channels like YouTube and TikTok? We did that and we started seeing, clips get over a 1000000 views all because we just submitted to another platform. Has it resulted in any leads? Not exactly, but still fun nonetheless. Alright.
Speaker 1:So that that's a fun exercise that you could go down when thinking through your strategy. But, again, really appreciate you guys taking the time today on your potential lunch break, to go through this idea of, from being stuck to scaling. And, again, this is all kind of pulled from what we're working on, which is a gross marketing operating system. I'd love your feedback on either the frameworks or case studies I put out there, what you liked, what resonated, what didn't. So, yeah, you can check out the growth market operating system.
Speaker 1:I put a link to it in, in the comments right now, we're doing it a pretty steep discount. We'll probably be going full price next month, but would love your thoughts on it. But, again, thank you all for the time.
Speaker 2:I'll give a few plugs. 1st, I send a weekly newsletter each Thursday featuring 5 articles or tools that have helped me. You can sign up for these weekly updates at jimwhuffman.com. 2nd, for anyone running a start up, if you need help growing your business, check out Growth Hit. Growth Hit serves as your external growth team.
Speaker 2:After working with over a 100 start ups and generating a quarter billion in sales for clients, Growth Hit has perfected a growth process that's hell bent on driving ROI through rapid experiments. Plus, you'll get to work with yours truly. So if you wanna work with a team that's worked with startups that have been funded by Andreessen Horowitz or featured on Shark Tank, then check out growthhit.com. And finally, I wrote a book called The Growth Marketer's Playbook that takes everything I've learned as a growth mentor for venture backed startups, and I've distilled it down to a 140 pages. So instead of hiring a growth team, save yourself some money, get the book, and you can just do it yourself.
Speaker 2:I hope you enjoyed this episode, and I'd love to hear feedback. I'm on Twitter at jimwhuffman.
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