The Importance Of Staying Close To Your Customers
We recently hosted a webcast conversation between Jason and Hisham focused on the importance of leaning into your customers and learning from them in order to grow your business.
Don’t have time for the full webcast now? Catch the webcast highlights and tips from their conversation in our companion blog below.
Letting People Guide the Product
When Jason VandeBoom launched ActiveCampaign in 2003, he wasn’t trying to start a business or grow a company. He was just trying to make some money to pay for college. All of his customers were small businesses and they all started wanting the same thing: to communicate with their customers. At the time, the options for small businesses to implement something like this was somewhat limited.
Instead of building one-off tools and products for each company, Jason decided to create a contact management package and sell that instead. “[I had] no idea of what that could be,” Jason says, “and then as someone bought it, I just glued onto them to learn as much as I could.”
In fact, for a while, Jason says he didn’t even care about the revenue he was generating. Rather, “all I cared about was the interesting work and ensuring I was providing a ton of value.” His focus on listening to the customers helped him learn a lot about what customers needed and how to add to ActiveCampaign’s product catalogue.
So much so that by the end of the first decade his company was up to eight products, all of which impacted a piece of the customer experience. “We learned a lot about each piece,” Jason says, “but the tool didn’t actually matter as much as moving data throughout their entire experience and making that feel like a unified experience.”“As someone bought it, I just glued onto them to learn as much as I could.” - @jvandeboom Click To Tweet
Obsession with the Customer
But, after more than a decade, the company still only had about eight employees. And, even though it was 2013, they were still mostly doing on-premise solutions. A lot of what they were doing wasn’t scalable. They learned a lot, including the immense value of listening to their customer base, but they knew they needed to make a change in how they did things.
“It took years to make the change from on-premise to SaaS,” Jason says. As a company that focused entirely on improving customer experiences for their clients, they didn’t want to create bad experiences for themselves.
Jason was adamant that they not abandon their early customers, but they needed to make money to grow. So they slowly helped their customers transition and sold them on the value with the new offerings. “[The value of the customer is a] key fundamental piece,” Jason points out, “[It’s] not thinking about time with the customer as a cost. [But] thinking about that as an opportunity for how you find out some opportunities with your product.”
By working closely with his customers and listening to them, Jason and his team could figure out what problems they’re actually trying to solve. This allowed ActiveCampaign to offer better solutions or provide more value over time.
One of the changes ActiveCampaign made was switching customers to monthly checks. “There’s a certain pressure that comes with a monthly payment that’s really nice,” Jason says, “you have to prove value all the time…and create an experience that matters.”
Even today, ActiveCampaign stays very focused on the customer. Their obsession with staying true to the customers and their problems has been a beacon that’s helped guide them to success. Everything else — revenue, customer growth, etc. — has fallen into place because of their strict customer focus.
Jason’s belief in working closely with the customer is something that he hopes is scalable. And it’s something that they continue working on as the company grows. “I’m a big believer in trying to create productized teams,” Jason says, meaning that they try to create teams who are self-sufficient and not dependent on other teams in the organization.
This, he believes, does a couple of things. First, it helps bring customers closer to everyone. They look at things differently than, say, an engineer does, so they can bring amazing insights into how the problem is solved. It also helps the teams have a general understanding of the market. This way they can learn what matters to the customer and what ultimately makes their business successful.
Ultimately, “it all goes back to customer value,” Jason reiterates, “without that, we’re just either forcing someone to buy something that’s a poor product, or…taking advantage of the fact there’s nothing better yet.”
Part of that means that, as ActiveCampaign grows larger, they don’t plan on moving upmarket and changing their customer base. Instead, they plan on becoming even more personalized with their product and their platform to create highly unique suggestions, products and experiences for their customers.
But on the flip side, as they grow, there is one thing he does that he admits is not infinitely scalable: reading the raw data from their Net Promoter Scores (NPS).
Right now, their company has over 70,000 customers and every quarter, the raw NPS data ends up in his inbox. It’s not broken down into categories, so he’s able to consume the raw feedback. “You get a sense of the tell and the emotion from your customer base, and that’s far more powerful than a number or something like that.”“It all goes back to customer value. Without that, we’re just either forcing someone to buy something that’s a poor product or taking advantage of the fact there’s nothing better yet.” @ActiveCampaign Click To Tweet
Knowing what he knows now, Jason says he wishes he’d made fewer assumptions. He assumed that there were people and companies out there who knew the problem, knew the space, and knew the answers. In reality, competitors were going through the same experiments and trial and error as he was.
Jason says they weren’t taking enough bets on themselves. “You’re watching everyone else and what they’re doing and feeling like you’re behind,” he says.
Ultimately, though, the one thing he says he wishes they did differently was to move faster on making decisions. They talked about some things for years before pulling the trigger. Ironically, it was the fear of success that held them back. The fear of all of the steps that would need to follow a change kept them overthinking things for way too long. It’s something that they still haven’t been able to free themselves of completely, but is certainly something they’re aware of moving forward.
Thanks to Shannon Lorenzen for contributing this piece. If you seek to bring the entrepreneurial spirit to your organization, Lean Startup Co. can help.