It’s the middle of the Pandemic, and Singapore is in lockdown. The vaccines aren’t available yet, and any idea of travelling to meet our clients meant 2 weeks in quarantine on either direction. We needed a way to make money online, and we needed it fast. The future of the business was at stake – we had to adapt, or risk losing everything we’d built.
We had plenty of content from training teams in Data Management, but most customers still wanted this in-person, not online, and we couldn’t get to them.
So we did what any small business would do. We fired up a Miro board and chucked ideas at the wall for how we could make money whilst these restrictions were in force. The Cognopia Academy was our best idea, so we threw our weight behind it and got on with product development.
This “strategic choice” led me on a crazy journey from building a product with the highest satisfaction ratings and no sales, to eventually blowing up our revenues by over 1,000%. Read on to discover how listening to other people’s customers transformed a stagnant product into a revenue driver, all while reducing our cost to serve.
What seemed so right did us wrong
To launch our product, we needed a Value Proposition. This is business 101, and we’d latched onto the Value Proposition Canvas approach from Strategyzer.
This simple canvas has two components:
- The customer and their pains and gains, and;
- Your product features (and how they create gains or kill pains)
We assembled the team back on Miro, threw up a blank template and started brainstorming ideas about who our customers were and what they needed. Having taken other online training, we knew what sucked and what worked, so it was pretty easy to come up with ideas. Satisfied that we’d done some good customer research and had a plan, it was time to execute.
Building takes time... lots of time
It took a long time to put the content together. I’m a bit of a perfectionist when it comes to presenting information, and that was one of our key value drivers. Make it easy, make it better. “Don’t make me think” is good design practice, and the less someone has to think about learning the easier they find it and the more trust they have in it. Still, I had zero experience creating video courses and it took far, far longer than I’d initially estimated.
A 5 minute lesson took at least a day to write, design, record, edit, refine, and release. We launched with 3 courses and around 6 hours of content – or about 72 man days of effort in total. I’m not the first founder to think “how hard can that be?” only for a lesson from reality to kick me in the teeth. When launching, treble your timelines and your costs, just in case.
I was proud of the achievement, and excited for the launch to get feedback from real, paying customers.
Build it and they will... stay home?
The biggest lie in product design is “Build it and They Will Come”. I’m not sure who first said this, but I am sure they were either lucky or stupid.
We got our first customers from LinkedIn. I’d been active on the platform for about 18 months, and had a warm audience to sell into. We also had existing customers that wanted training, so finding the first sales was relatively easy.
Feedback was great. Really, insanely great. We got comments like this:
Good course that teaches data governance. Easy to understand and therefore a must for everyone working in data management.
The Net Promoter Scores roll in … 10 out of 10, 8 out of 10, 9 out of 10, 10 out of 10… people love our course content! We’ve built a winner and the Value Proposition Canvas has helped us get there.
By this time, I was running out of contacts on LinkedIn to sell to, but with great testimonials and happy customers, I figured it was time to throw cash at paid marketing channels, starting with Google Ads due to its large audience and proven success for similar products. And that’s when I got my second kick in the teeth from reality.
Paying Google for garbage
After getting my first sale from Google Ads in minutes, I jacked the ad spend through the roof. Clearly I now owned a money-making-machine, and I wanted to get it running at full-speed.
Unfortunately, it was Google who had the money printer. The first sale was an unfortunate anomaly that led me down a blind alley. I spent more on ads. I spent money on Conversion Rate Optimisation. I spent cash on creating a slew of landing pages, and all that landed was a massive bill that our product sales couldn’t pay.
How could I have a product with customer satisfaction of 9.2 out of 10 that no-one wanted to pay for?
What was I doing wrong?
Finding demand from people who no longer need your product
At this point I realised the value proposition we offered was not what people wanted. Yes, we were getting high scores, but that was because we improved our product vs the competition (not challenging in a market where most training courses could talk a glass eye to sleep).
The people who had signed up largely knew me through Linkedin. They trusted that I’d put out a quality product, then they gave us good reviews when we delivered on that promise. But people landing on the page from Google didn’t know me from a bar of soap, and whatever we were offering wasn’t what they were shopping for.
How could I square this circle?
Fortunately I found “Jobs to be Done” – first through Alan Klement’s “When coffee and kale compete” and next through Bob Moesta’s videos on Switch Interviews. ‘Jobs to be Done’ is a framework that helps understand the real motivations behind why customers make purchasing decisions, focusing on the outcomes they want rather than just the product features.
I devoured the content, watched as many of these “switch interviews” as possible, then started interviewing people who had already purchased data management training from others. I knew I was too biased about my own product, so this seemed like a great way to learn, and it wasn’t like I would be pitching these people (after all, they were already trained).
Seeing the world from the customer's eyes
You’d think someone that’s held a front-line sales and revenue generation position for over 20 years would already understand what customers want. But these interviews BLEW MY MIND.
Rather than asking about pain points (who wants to share that with some random interviewer, anyway?), just listen and learn from their buying journey. People love telling stories, and they seem to enjoy being interviewed in this manner. It’s like an opportunity to get everything about that purchase off their chest.
I'm an experienced professional in the data governance space and I am looking to get back into a mid to senior-level position within the space. That means the ROI is going to be much higher for me to get the certification because the salary expectations are on the higher side of the market
I reached out to Bob, and he helped me analyse my findings. Many people find the interviews hard, whereas I find them enjoyable. Analysing the insights feels like black magic – suddenly, clusters of demand jumped out of my research and screamed ideas for improving our products, positioning, placement and pricing.
I’d seen the world from my customer’s eyes for the first time, and there was no going back.
Explosive growth
The group with the biggest demand were in between jobs, had missed out on an opportunity to a better qualified (yet less experienced) counterpart, and needed certification to get a better job and make more money. I wasn’t selling training, I was selling a better career and a bigger pay check.
I lost out to another candidate who had much more data monetization experience. And that's actually what led me to sign up for the data monetization course.
More importantly, these were experienced professionals who had deep pockets. They didn’t want cheap, they wanted to pay for quality (no one buys a $50 Rolex watch thinking it’s the real deal, just like no-one buys a $10 Udemy course “on sale” thinking it’s going to change their career trajectory). They also needed less content, because they knew a lot and were in a hurry to get certified.
I mean, I feel like this is going to help me in my job search, right? So I guess I took that attitude and like I said, I'm not struggling financially. So it wasn't really as much of a concern for a couple thousand dollars.
As a result, we could:
- Know exactly what to ask to find the right customers, and know exactly where to find them
- Reduce the content duration (yay – no more late nights editing videos with my dog barking in the background), whilst increasing the prices
- Flip our business model from a firm selling training courses to one guaranteeing certification success so you can get the job you really need
Business blew up – over 1,000% revenue increase in our first year using the approach. We kept the happy customers (in fact, our customers are happier now – recording video testimonials), we got more money, we created less content, and we built a business where it was a joy to work in because customers really want what we’re providing.
Lessons for Founders - a Quick Start
I believe people need to learn in steps. We don’t learn English by writing novels, we learn the ABC’s. I needed to stumble through and make mistakes to find the right path, but you don’t have to.
Start by learning about the Value Proposition Canvas. DO NOT fall in love with this method, it’s just a nice framework to start with. When you fill it full of ideas, people start to believe in those ideas and test to confirm them – when the goal of testing is to learn what IS TRUE, not WHAT YOU BELIEVE IS TRUE.
Map out value propositions for products you use to get the idea. I would avoid building a product based purely on this level of analysis, because your assumptions are probably wrong and it’s a lot cheaper to find out BEFORE building than it is to do so after.
Once you’ve grasped that, get a copy of Bob’s book – “Demand Side Sales 101“. Even if you don’t use the methods he teaches, the lessons will help.
Finally, watch switch interviews and learn the technique. I did this from a few YouTube videos at first, but Chris Spiek, Bob and others now offer courses on this. A copy of “Never Split the Difference” will help you learn how to listen during the interview rather than simply waiting for your turn to speak. Get that, too.
What's next from us?
I’m keeping our Academy as it is the flagship offering we created. But I could not learn these skills and let them go to waste. I love running these interviews and learning from customers, especially when we find clusters of demand that no-one saw before.
I’ve used these skills to help identify the reasons why customers buy Data Catalogs. I’ve been invited on stage to share research about what causes an Executive to say “today’s the day we appoint an Advisory Board”. And now I’ve used them to pivot our business and focus on helping others apply these findings to launch their businesses.
As a result, we’re launching Growth Exposed – as a home to deliver this insight to other businesses that have a great product but are struggling to claim the market share they deserve.
I’ll be sharing more stories about how this works, including example interviews, how to run the analysis, and what to do to take the research and turn it into $$$. If you’re interested to learn more, register below and get updates whenever I publish anything new.