Hit $5,000/month revenue (but some bad news too)
by Oliver MeakingsSo, after leaving my job to run roastmylandingpage.com full time about 9 days ago I've already crossed monthly revenue of $5,000 which is a great milestone.
I have been running test ad campaigns on all major platforms: Twitter, Facebook, Quora, Reddit and Paved.
The issue is that the CPA is super high. In fact each new customer is costing me about £110 - leaving just £40 profit per roast. Here you can see my exact progress: https://twitter.com/helloitsolly/status/1382272106306633736
Lots of people share revenue milestones as part of the #openstartups movement, but I wanted to share both revenue and expenses to show how challenging new customer acquisition is.
My goal is to get CPA down to around £50 per roast, leaving £100 profit but I also have some other ideas.
- Upsell existing customers into other services
- Build out my email list to nurture potential customers into buying
In fact I have already launched a few new products into my client area for my existing customers, including copy rewrites and page builds. If I can sell these to existing customers the CPA will be nominal.
I'll keep sharing what I am learning along my journey. I'm only in my second marketing sprint but I am shipping lots, learning lots and loving the support from other makers.
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Congrats on the great progress!
I'm with @mbuckbee—I think £150 sounds low, considering the value you're delivering. I'd raise your prices (significantly). £150 may be a lot of cash for a bootstrapped solo founder, but for established companies £150 is just a rounding error on lunch. In fact, I bet a junior marketing employee who manages the company website would get thrown out of their boss's office if they filed an expense report for £150 to hire some guy to roast the website, but for a £1,500 website conversion analysis it would seem like an excellent investment. :)
Another thought: can you change the pricing structure to turn this into recurring revenue? Booking one-off sales requires constantly feeding the funnel. Is there a way to do a follow-up mini-roast (quick bake!) every month to review progress?
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How did you come to decide upon a price of £150? That seems very low.
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@olly I would stop pitching it in a way that makes it sound like it should be cheap. How about "how much would you pay for a concise but actionable audit by an expert that has reviewed websites for hundreds of corporations?"
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@JeremyDuff I was playing devil's advocate :) I wondered the answer without any value-based selling. I like your copy a lot though - can I use some of the phrase on the page?
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I don't see too much of a difference between 150 and 250.
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Increasing the price (as you would expect) decreases the conversion and profitability. I have tested multiple price points and the decision was based on that.
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How do you manage to sell your product to different customers? I am techie with zero knowledge about sales and marketing. I want to sell SAAS product but getting rejections may be I am not that good in sales. Any suggestions on how can I improve selling any product or SAAS product. Thanks
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Start by creating buyer personas. EVERYTHING works from that:
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Thanks a lot. This is very helpful. If you don't mind can I send DM? I have few questions to ask.
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If you post them here I can answer and everyone can benefit @aditodkar
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I want to know if my product is at initial stage then should I email or approach first 10-20 customers? Any suggestions/pointers for getting first 10-20 customers? Any good email template or any other techniques you would like to suggest for approaching customers? I have never done sales & marketing. So wanted to understand how to approach people and how to convince people?
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@aditodkar try my site www.first100users.com.
You have to test, learn what works, and do more of it.
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Not gonna get into the debate over the pricing but want to point out a major error in the thinking/wording above, for the benefit of people inexperienced in business:
That is not "£100 profit" it is just net revenue after the CPA.
You still have to take out the payment for the person doing the review (even if it is yourself) and gross this up if it's an employee, to cover their associated costs.
There's also amortising other expenses of running the site, although once at this kind of scale it's relatively minor.
Depending where you are and how you pay yourself, if this is a pty ltd company aka C corporation it will be independently taxed so you need to set aside 18% (UK) to 25% (Aussie) to cover taxes. In the USA it will vary by state (0..12%) on top of the 21% Federal tax. These taxes generally apply after all the other expenses mentioned above have been deducted. As an additional slug, in the USA, 8 states have a Gross Receipts Tax which kicks in before deductions (and they have the cheek to call the rest of us highly-taxed hah!).
If you have a sudden surge of income from a service like this and are close to end of a tax year, you may want to be strategic about when you take on any major new clients, if there's a chance to avoid revenue from them kicking in too early. In Australia, for example, the tax office will calculate an estimated tax liability in the next year and you can find yourself with an unforeseen bill that will take a year or so to reduce.
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This would be a great business to optimize for organic search because it is so niche. I checkout out a couple of your articles and they are missing a meta description, the heading tags are not optimized, word count is low, etc. There are some quick wins there that can help improve traffic.
Organic traffic takes time, but you could really establish yourself as an expert with comprehensive and well-optimized content.
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Upselling existing customers into other services seems like a great way to go. One upsell I'd suggest is a landing page builders, like dorik.io (the founder is an Indie-Hacker too). You can collaborate and get an affiliate commission from him. Someone who's built a landing page for a SaaS will likely build another, be in the community of other like-minded SaaS founders who'd like a recommendation for landing page builders or may just want to rebuild his.
Another idea - let's say you see that a lot of your customers build on their landing pages on WordPress. You see that a lot of them miss a key component like a good-looking review section. You can build yourself a WordPress plugin to solve that problem and then offer that to that SaaS owner whose page you're roasting...
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What is CPA?
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Cost per acquisition, which is the cost of acquiring a customer.
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congrats!!
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Hey @olly, congrats on leaving the full time gig, have been enjoying following your progress.
Would love to hear more about acquisition channels (we work in a similar-ish but non-competing space) - how has Paved worked for you? Twitter, Facebook?
Happy to connect and share some learnings about optimising ads (I have a long background in Google Ads).
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Thanks for this. I share some more stuff about CPA on my Twitter, like this: https://twitter.com/helloitsolly/status/1382272106306633736
Broadly all paid channels are too high right now but performance is as follows from best to worst
Twitter
Facebook
Google Ads
Paved
Reddit
QuoraI am running lots and lots of experiments with small budgets and reviewing indicators and conversions.
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