Statements of Intent

~ This transcript is automatically generated so may contain some errors ~

so there's nothing wrong with growth. There's nothing wrong with getting a lot of people, but we have to define, we have to define our objective in the right way so that we're, we're truly getting the right people to the right experience where we, where we meet their needs.

Welcome to Statements of Intent. In this 20 minute episode, we're addressing how eCommerce has lost sight of the people at its very heart. You, the customer. It's a chat that's optimistic, it's casual, it's probably slightly ranty in places, but that's okay. But it's a place where I talk to senior eCommerce marketers.

And share their statement of how they're looking to change the status quo of eCommerce, adding more care, being more considerate to those very people that they're selling to - the customer. I'm your host, David Mannheim, the founder of Made With Intent. And we're going to jump right into it. Have fun

ladies and gentlemen, welcome to Statements in 10. I have. On my hands, a, a very tired, maybe, uh, Sean Ellis, who flew in from Sao Paolo, was it last night, or are you in Sao Paolo now?

I'm in Sao Paolo now, flew in from Rio de Janeiro last night, but somehow I, I squeezed, uh, eight hours of sleep, so I'm actually not tired, I'm just, uh, I'm just scrambling because I set my alarm to not give me a lot of time this morning, so. All good. All good. We're settled. We're ready to go. We're going to

wing this and I'm just going to pick your brain if that's okay.

I mean, as a way of a quick introduction, you are of course, author, uh, of Hacking Growth alongside of the great Morgan Brown. I say the great as if he's, if he's dead, he's, he's not, he's, he's over at Instagram doing his thing. And how are you going on the book, by the way, because you're on a worldwide book tour.

Correct. Or you were on a worldwide

tour to celebrate the book, right? Yeah. So it's really, um, you know, we, so many of our sales have been international, particularly in Asia, like well, well over half our sales have been in Asia. So, um, you know, part of it was just an excuse to, uh, to travel. Cause I do love to travel and so, and go, go meet with entrepreneurs all over the world.

And so, um, yeah, that's, that's been, that's been exciting. But the other piece is to hopefully. Hopefully add a little, uh, momentum to it and get us to a million. We're, we're getting close. So, um, yeah, that's, yeah, 1 million books. Not many, not many books, especially, uh, nonfiction books reach that number. So we, we will be really excited when we hit it.

We'll hit it eventually, but we, uh, we want to do it in the first 10 years of the book.

Well, my book, the person in personalization probably has still a, a little bit of a way to go off, sold 1, 219 copies. So, uh, I think you're a little bit

ahead of you gotta start somewhere. I do.

I mean, it hasn't been out five months now.

Um, of course you founded Qualory, which I think most, most people know. And I think, and of course Growth Hackers, I think that's rather pertinent to this conversation

because your statement of intent It's all about not being short term focused. And when we put that in respect of the customer, or indeed the voice of the customer, I think that, that means quite a lot.

That adds a lot of value. Could you talk to us? about what you mean when you say not being short term focused.

Yeah, it's kind of ironic because a lot of people, when they, when they think about growth hacking, which I'm, I'm credited with coining, uh, they, they think of growth hacks as being sort of the tricks that, uh, that you use for short term growth and, and that they tend not to be sustainable.

And that's one of the, The big, uh, you know, the big criticisms of it and, um, my, I am so long term focused that, um, you know, to me, anything that doesn't, anything that doesn't lead to customers being extremely happy and coming back is probably not worth doing. And so, um, yeah. And then the other piece being also kind of repeatable programs, uh, are, are also really important.

So it's, it's not just sort of like guerrilla techniques that gets someone to consider. A product, but you know, you want to have something that you deliver real value. People love it. They keep coming back to get more of it. You treat them well. And, and that's, uh, you know, that's, that's at the heart of really on this, on this world tour.

What I'm trying to get, uh, essentially trying to get everyone who attends my, my masterclasses and workshops to be focused on. And so, in fact, the very first thing that we do in, in both the masterclass and the workshop is. We focus on figuring out what is your core value of your product? What is the, what is the thing that makes people love your product?

How do you, how do you figure out a metric that reflects how much of that you're delivering and how do you optimize all of your efforts on growing that metric and not being, uh, Not being distracted by, by short term metrics, like maybe, uh, registrations that might, might look exciting on paper, but not really be delivering value or even revenue that, that obviously revenue is, is important.

It's what keeps. The business functioning, but it's too easy to be so revenue focused that you do it kind of in spite of a lack of value. And sometimes, and sometimes you actually do it, uh, squeezing out the value that you could otherwise deliver. And so, um. When you ask the question, you actually, uh, even, even Riverside with all of its, uh, great, uh, recording capabilities, um, you, you fade it out for a second.

So hopefully I asked, or answered that question correctly. Answer the question you asked.

Yeah. I'll get close to the microphone this time, Sean. Um, no, I think

it was literally like a, like a. Freeze of a bandwidth thing. So, um, that's, that's the, the challenge of being in a hotel here. And

I was going to say, we'll blame the Brazil English, uh, channel.

Um, although you're not that far behind, are you? You're only three hours behind

now. Yeah. Crazy.

That's weird. I can't wrap my head around that one.

Um, you mentioned revenue and metrics, uh, perhaps being like acting as a proxy for what is essentially a North star metric or something more long term focus.

Tell me this, how do you feel about conversion rates within the e commerce environment? Most retailers look at conversion rate as being the gold standard, the metric to abide by. How do you feel about that?

So I think conversion rates are really important, but, uh, but, but again, people focus on the wrong thing when they're thinking about conversion rates.

And so I, I spend less time in e commerce. But, uh, I mean, conversion rates matter outside of e commerce as well. Um, I, I'll, I'll give you sort of the, the ultimate example when, you know, the number one thing that kills early stage startups that are trying to become long term successful companies is that they're not able to.

They're not able to get to product market fit. They're not able to create a product that meets the needs of the market in a good enough way that they can sustainably grow the business long term. And so what I see people do with conversion rate optimization a lot of times is that they will, they will essentially.

Kind of promise, whatever promise you can put out there that gets people excited and, and, uh, and drives that conversion, that kind of just one step in the funnel conversion. So maybe it's signup conversion, maybe it's download conversion, whatever it may be, but the, but the issue is that if you don't start by understanding what.

The product authentically is great at delivering, you're going to convert the wrong people to the wrong experience. And so you need to start with, okay, who are my must have users? And, uh, and why did they love the product? And if I can, if I can. Attract them to the product with a promise that actually reflects what the product's truly great as delivering.

It's going to, it's going to convert the right users to the right experience. And so, um, and then that's going to lead to long term retention of those users. And, and so, um, again, if you're, if you're just trying to maximize, if you say. Um, yeah, God, I would love to get a 60 percent sign up rate and, and you're, you're doing whatever you can to get that visit to sign up to 60%.

Um, you, you just may be converting the wrong people on what the product's not truly great at doing. And so a lot of times I'll take a lower conversion rate if it's off authentically converting them based on what the product is truly great at doing, then it's in a sense that it starts to act as kind of a filter.

You may end up losing a lot of people who just, Oh, well, I'm not interested in that. And so they, they don't end up converting, but now you're converting the right people. And, uh, and when you convert them to the right experience, you're much more likely to, uh, retain those customers long term and, and anyone who's, who's really studied growth retention is, is ultimately the gold standard for, for.

What you need to be able to drive, uh, long term growth in the business. If you can't retain, eventually you're just replacing and then you're going to be flat or even declining if you're, if you're losing users faster than you're gaining them. So, um, one of the keys to retention is an authentic promise that reflects what the product's truly great at doing in the first place.

That makes sense.

It feels like when you're talking about it, it's almost like a balance of quality and quantity. Like, is that an accurate statement, do you think? For sure. As though there's a, there's a focus on quantity, you know, shoving things at the top of the hopper. And I don't know whether Google's forced us into that mentality, or Facebook, or whomever, but I feel like there needs to be a balance between the two.

That's what I'm hearing from you.

Yeah, I mean quantity ultimately is, is going to be important for growth. It's going to be the thing that defines growth, but quantity of the right thing is what matters. And so, if you're saying, just give me every single user I can possibly get, You're, you're not necessarily getting the right quantity and that inauthentic promise about what the product does is going to ultimately is going to ultimately lead to a high churn rate.

And so once you define who the right users are, what the right promise is, you want to figure out what a metric you want to figure out a metric that reflects really how much value you're delivering, and then you want to turn the knob as, as. as wide as you can to get as many people who meet that criteria of people who are going to truly benefit from your solution, uh, in, in through your funnel to, to hopefully not just acquire them, but actually then retain them long term.

Yeah, that makes a lot of sense. So when you talk about being short term focused or don't be short term focused, I keep coming up to this thing in my mind of. Is this a philosophical, uh, pre requirement or is it a measurement requirement, i. e. what comes first, chicken or the egg, uh, the philosophical need to, we won't be short term focused as a business or the measurement need of, this is how we're going to measure the fact that we're not short term focused.

Uh, does that make sense? Have I made sense of that? It does. I mean, I,

yeah, I'm not, I'm not sure that I'm going to distinguish between the two of those, but I think it all comes down to setting the right objectives. And, um, yeah, and, and that's where, and that's where ultimately what we're in the business of doing is, is trying to drive impact.

So either, either our product matters or it doesn't matter. And, uh, let me make sure I've got my, uh, my do not disturb on here. Yeah, I have it on mine. I'm not sure. But, um, so either our product matters or it doesn't matter. And if our product matters to people, then, then we want to drive as much impact as we can.

If it doesn't matter, it's impossible to drive impact. So we, we need to start with what is that impact and then, and then, yeah, we have to do everything that we can to. Reach the people who, who truly need the solution that we've created. And, uh, and so there's nothing wrong with growth. There's nothing wrong with getting a lot of people, but we have to define, we have to define our objective in the right way so that we're, we're truly getting the right people to the right experience where we, where we meet their needs.

How do you, I'm curious as to how you define that because there's always this balance between you're clearly a customer centric person, right? I mean, you know, Qualaroo was, uh, was evidence of that. That's what the whole business was built on. Um, how, how do you balance that need to always focus on customer with things like shareholder return, with the need for constant growth, with the need for an evolving market, how do you always bring it back to the customer?

I mean, fortunately, like I think when you, when, when you really look at it, you're, everyone's aiming for the same thing. So whether it's shareholder value, whether it's please my board of directors or please my, my, my CEO, um, yes, maybe they'll get excited if, if there's a short term blip and, and, uh, You kinda, you, you grow beyond your, uh, realistic ability to, to satisfy that, that new, uh, demand that you've, that you've acquired.

Um, but then, but then, so if, if you grow in the short term beyond that, you are, you're gonna crash. You're, you're going to, you're gonna have unhappy customers that don't come back that are gonna spread negative word about you. And so in the end, your shareholder value is gonna go down. And so I think what's.

What's really important. And that's, that's the education piece is, is to make sure that you, your ability to generate revenue doesn't exceed your ability to acquire and, and satisfy or not just satisfy, but, but make really happy, uh, customers that, um, that have a need for your solution. And so as long as those are moving together, you're going to have sustainable revenue growth, but it doesn't need to be a trade off between revenue.

And, and, and growth of value. Uh, in fact, the, the opposite is also true. I see a lot of companies who say, um, we don't care about revenue right now. We care about growth. And, um, to me, that's the scariest thing in the world is trying to grow really fast without, without having kind of sustainable economics around it, where you're.

We, you know, the way I look at it a lot of times is, um, people say, Oh, if I can, if I can acquire, you know, a thousand users a day at half my allowable acquisition costs, I'm, I'm all for that, but I'm not going to monetize now. I'm going to monetize later and then, and then suddenly that same opportunity, someone comes back and says, um, Oh, we actually can give you a million a day.

If you know that those million cost you half of, you know, you know, you can recover the money you spent acquiring those million within three months because of your ability to monetize them, you're going to go full force into, you know, spending that money to acquire the million. But if it, if it's on some, you know, spreadsheet model of theoretically monetize someday in the future.

It's easy to make the little bets, but then when you start to make the big bet, that gets really scary because you know if you're wrong and so you end up being more conservative than you need to be. So if you're, if you're focused on sustainable economics, you're much more likely to, to grow effectively.

So it, it works both ways on that. So you're, you. You don't want to optimize just on the revenue side. You want to make sure that revenue and value are growing at the same trajectory or values may be even growing faster than revenue is, uh, because the other way around, it's going to be unsustainable eventually the value growth will crash and the revenue growth will crash and then.

But again, the other extreme is when, when they say, I don't even care about the revenue. All I care about is the growth. And when you don't have that, that sustainability feedback loop, eventually that can cause you to actually grow slower. And so, um, the, the goal should be. We have created something that the world really needs.

We want to get the right people experiencing it the right way in the biggest numbers possible so that we make really good impact on the people who have that need. And, and then the one other thing that happens is if you, if you don't do that, you, you leave slack in the market so that, so that a competitive.

Uh, solution can come in there and, and, and satisfy that demand if you're not able to. So, um, that's the other reason why you want to be aggressive in making sure that you don't leave a lot of slack in the market. Uh, so yeah, yeah. Fast, fast, uh, growth is super important.

That's the sentiment I definitely got.

So that, uh, I'm going to push you a little bit if that's okay, Sean. Sure. No, no problem. I mean, what we're talking about is a balance, right?

But that sentiment that you just said. About getting the right customer, uh, to ensure that we have correct product market fit, um, et cetera, et cetera. That sentiment that you just said there, what are the things that prevent people from thinking like that?

Because it feels so obvious and it obviously feels somewhat, somewhat ethereal. It feels like something to attain to. What are the things that stop people thinking like that?

Yeah, and it's not so much the thinking, it's the doing that becomes the hard part here is that once someone's convinced of that, then suddenly you realize that a marketing team who might be the one who's, who's responsible for kind of growth of the numbers in the business, you know, maybe it's a sales team if it's a B2B product, but whatever it is, it's, um, there's usually one team that's kind of that, that growth curve is responsible for it.

Um, yeah. It turns out that the marketing team has, has very little power into being able to affect long term growth. So what the marketing team can do is bring them to the front door. And so you can do what I had said, where if you take the time to truly understand why people love the product, who love it, and you set the right expectations, you're at least acquiring people with the.

With the right expectations about the product. And so you're more likely to drive sustainable growth. But if you want to truly be able to capture market share, you need to be able to focus on those conversions that you talked about. And, and to really think about, okay, now that they're in the product, how do I get them to that valuable experience as quickly as possible?

And so we call that in growth, we call that the aha moment. So speed to value. How do I get that? And that generally sits within the product organization. And then, um, you know, and maybe again, in B2B, maybe customer success plays a role. Sales might play a role, even the same way that I was saying, you get a sales person who's promising a bunch of things that the product doesn't do.

Their numbers can look good in the short term, but you're not going to retain those customers and you're going to ultimately not have growth on a strong foundation. So it turns out that in order to do this, you need Everyone on the same page in the company, you need cross functional alignment and not just alignment in in thought, but alignment in action so that they're actually executing toward the toward the same goals in the business.

And that's where it falls apart, because. Product teams are generally thinking more in terms of, you know, we're one feature away from not even needing a marketing department anymore. And, uh, and so they're, they're thinking in terms of the product roadmap, where the truth is that the, the product team plays a huge role.

In, in helping people get to a valuable experience with what they have already built, and they just don't prioritize those efforts a lot of times. And so, um, that's, that's actually one of the major things that I'm focused on, on this international, uh, Tour right now is I, I full cross-functional teams together for the full day in these big group workshops where they're ultimately getting on the same page around what is the value, how is it created, how do we work together to amplify it and get a lot more people to experience it more quickly.

And, and that's the, the impact side of things. And, um, and so. It's the habits of being able to do it that are hard. The theory, it's pretty easy to get the theory where people say, Oh yeah, that makes sense. We need to aim for that. But, but theory without habits, that doesn't get you

anywhere. Yeah, it resonates, but it's difficult to.

difficult to achieve. I totally get that.

Well, look, this, this is usually like some kind of cute 20 minute podcast to eke out the thoughts of great people like yourself. So thanks for coming on. The things that I learned about your statement of intent, not being short term focused is about being objective led about alignment, both in terms of mentality and organizational and balance as well.

I think there's a balance between the short termism and the long termism or indeed. You know, what is your objective in order to lead towards that balance? Absolutely. Where can people find you? Um, specifically where could people find you on perhaps June the 19th, 2024?

I am going to be at the growth marketing summit in Germany with yourself.

So, uh, yeah, that's, uh, that's a dangerous question to ask me because, um, between that time and now I will be in. So many different cities, so many different, uh, workshops and presentations that, uh, where the hell will I be on June, June the 19th. But, um, yeah, I have the context of you and I meeting through that conference.

So, yeah. I'm

glad that's memorable. Right. Uh, thank you very much, Sean. I appreciate your time and have a great day in Brazil.

Thanks, David. Appreciate it too.

There we have it. Thank you so much for listening. Please do like, subscribe and share on whatever platform it is that you're listening to on today. This show comes from the team behind Made With Intent, the customer intent platform for retailers. If you are of course, interested in being more profitable, whilst being more personal.

And please feel free to check us out at madewithintent. ai. Thanks again for listening and joining us on our mission to change how eCommerce sees, measures, and treats their customers. I've been your host, David Mannheim. Have a great day.