How we repositioned our product
Practical wisdom from building a real company
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Every Sunday, I share something I’m learning while building a B2B SaaS company.
10/18/2020
A quote from me for the week ahead:
“Building a company is the best way to learn about business. It’s also the most painful.”
—
This week’s newsletter is about how we repositioned our product.
Enjoy, and let me know where I’m wrong.
1
Warning signs
Two actual quotes:
“If you’re as successful as you say, after a month we won’t need you!” - a prospect
“What will you do for us after month three?” - a customer, in month 1
Huge warning sign. I started imagining all our hard work acquiring and onboarding customers, just to see them churn in a few months.
Clearly something needed to change. But what?
Was it a problem with our product? Or how we described it to customers?
2
Background
You should understand our product:
Right now, anyone who employs hourly workers is having a difficult time hiring. Applicant flow has dropped 75%+ since the pandemic, and it wasn’t easy to hire pre-COVID.
We realized that companies rarely recruit their former employees. Or past applicants that they ultimately didn’t hire. These pools add up to thousands of potential employees companies just don’t contact.
So we’re building a SaaS product that enables them to keep in touch with - and hire from - these talent pools. It works.
When a customer signs with us, we run through their entire list of former employees and past applicants in a few months, then keep in touch with them in the months and years to come.
When employees leave or applicants drop from their hiring process, we “onboard” them to our product and recruit them back.
We soft-launched this product in June/July, so it’s new to us and the industry. Customers are referring other customers, and our sales cycles have dropped to days. (More on how we got here in future newsletters.)
Make sense?
3
Listen up
We needed to understand why some customers and prospects felt we were a short-term fix…
So, we did two things:
Looked at our (limited) customer dataset: Do we have a long-term value problem?
Asked current customers and prospects: Do they perceive a long-term value problem? Why?
We learned…
Our product’s value (measure: # of hires delivered) does decrease after our first run-through of our customers’ contact databases.
And this is what our customers and prospects believed: “Once you’re done contacting our database, what happens next?”
That is partly why prospects pushed for pilots and shorter-term contracts. (The other reason was “wanting proof”.)
Real problem? Check.
Solvable? Definitely.
4
Do
We decided to:
Reposition our product so our potential customers never have reason to question our product’s long-term value
Adjust our product roadmap to prioritize features that (1) increase long-term value and (2) make it harder for customers to churn
Change how we delivered our service in short-term contracts and pilots to avoid customers using us as a quick fix, then ditching.
I’ll just share what we’ve done with our positioning:
We changed from pitching a recruiting solution to pitching a retargeting solution. “We retarget people you lose in the hiring process, and great employees who leave.”
Instead of, “We get you a ton of candidates by reaching out to your entire database of former employees and past applicants.”
Seems to be working.
5
Etc.
If you want to learn more about positioning, check out April Dunford, author of the book Obviously Awesome. Her book is great. You can also find podcasts interviewing her. Hers is a sequential approach to positioning that frees the exercise from abstract marketing BS.
Within a few days of chewing on her material + thinking about our problem, we generally knew what we needed to do.
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