Design the Ultimate Customer Experience
Doing things that don't scale. Again, I'm sure there are people thinking wow, that was not enough time on pricing. It really, really was because your job on pricing now is to do the math and run the experiments. I can't give you the price here and now today. I might be able to give you some advice. Feel free to ask. But I can't give you the price here and now today. It's always a process of experimentation even when I'm working with clients one-on-one or in a small group. I can give you advice on pricing, absolutely. I can ask you if you accounted for all these different things, but until you run the experiments, until you actually try and sell it at that price, until you see if you got all of the expenses that you need to cover, if they're all accounted for, until you figure that out, you don't know what the final price is. I can't tell you that thing. You need proof, okay? So those are the things you need to think about to make your pricing strategic, to think about how you're gonna ...
grow your business from it. Now we need to move on to doing things that don't scale. I didn't come up with this. This wonderful man named Paul Graham who's the cofounder of Y Combinator has a epic blog post called Do Things That Don't Scale. It's many years old at this point, and it is more relevant than ever before. He says in this article startups take off because the founders make them take off. Startups take off because founders make them take off. They do things that cause their business to takeoff, and that's what we're gonna talk about in this lesson because it's not necessarily posting to Facebook a certain number of times a day or sending the right number of emails or building your list in a certain way or selling the right kind of product. It's putting in the work little bit by little bit by little bit and actually making your business takeoff through that process of experimentation and iteration and strategic design. We're gonna start with designing the ultimate customer experience and when I say ultimate, I mean ultimate. We're gonna look at this from a lot of different angles, so we're gonna be here for a little bit. Do things that don't scale, what exactly does that mean? In Paul Graham's article he talks about a number of different things. These are the ones I think that translate most easily to the kinds of businesses that you're running. The first one is allowing things to be fragile, allowing things to be fragile. What that means is that at the beginning, sometimes in the middle, sometimes at the beginning of a pivot that might feel like the end of your business (chuckles), things are going to feel like they could collapse at any given time. Like the whole thing could just break down because you're working really hard. Maybe you're working at hours you don't wanna be working. Maybe you're putting in time on the weekends. Maybe you are answering all of the emails and doing all of the things and still not bringing home the amount of money that you wanna bring in. I am not suggesting that running your business has to be hard at any given time, but at the same time I think we have a big fear of allowing things to feel fragile. We feel like we have to have it figured out before we can move forward, before we can try to make it work, but businesses aren't, they don't come kind of fully formed out of the brains of their founders. If that was the case, here in San Francisco it would be full of billion-dollar companies, but it's not. It's full of scrappy little startups that are trying to figure stuff out. Those scrappy little startups are allowing things to be fragile. They're hiring people before they necessarily need them because they know six months from now, three months from now, a month from now they're going to need that person. They're investing in things like advertising because they're testing things out. It's always a fragile balance, and in self-funded startups, bootstrapped startups like ours, it's an even more fragile process. It's hard to balance but it's really important. You are not going to have everything figured out at all times, and if you wait to take the first step until you think you know exactly what it's gonna look like or exactly how to get to your endpoint, you're never gonna take that first step. It's not gonna happen. Something I am absolutely experiencing now in my own business as we sort of shut down a training company. It didn't look like this on the outside, but internally what it felt like was shutting down a training company or slowly shutting down a training company at the end of last year and birthing a brand new membership-driven company, and right now things are fragile. Things are fragile. It's a constant figuring out month over month what's the right next step? Am I going to have the money I need to pay the team that I have hired, and guess what? It's fun. Because if you just allow it to be fragile, if you don't give yourself the expectation that well, I'm Tara Gentile. I have to have this stuff all figured out before I get started. It's fun to experiment. It's fun to play around. And you know that just because you make one wrong move everything isn't going to come crashing down around you. It's not actually as fragile as it feels because the beautiful thing about the process of experimentation is that there's always a next experiment to run, and so if you're being smart and you're being a certain level of cautious about it, that we as self-funded and bootstrapped startups need to do, we can know. We know how many experiments or what kind of experiments we need to run to keep things churning along, to keep paying the bills, but also to play around with accelerating, putting our foot on the gas when it comes to our core offer or a follow-up offer especially as you streamline your business. So as you're thinking about well, how am I gonna go from this whole junk drawer of things that I've been offering to this point to a streamlined, focused, on purpose, intentional, highest contribution kind of business, I'm telling you there's going to be a time where you are doing things that make your business feel fragile. Where you take an offer off the market that you were originally thinking was gonna pay your Christmas shopping bills, right, but instead you're gonna take the time and energy you would have put toward that and you're gonna put it toward your core offer. And there's a really good chance that's gonna work out really well for you. Maybe not in December, but maybe in January or February or March, but in the meantime, things are going to feel fragile. One of the reasons they feel fragile is 'cause you're gonna be doing things that don't scale like taking the extra step to delight customers. As you're developing your core offer, as you're refining your core offer, one of the best things that you can do is actually ask yourself what else can I do to make this customer happy? Not in terms of high-ticket things or a huge amount of your time but instead a handwritten thank you note, a gift, a phone call, just a quickie, even just an email that says hey, thank you so much for signing up with us. I'm here if you need me. Ask yourself what it would take to, what extra little, tiny step it would take to delight your customers? One constraint I do like to put on this is how could that take as little time of yours as possible, because the first thing, especially again self-funded and bootstrap business owners, the first place they go is well, I can give them an hour of my time. No, please don't give them an hour of your time (laughs). I mean in some businesses that's gonna make sense, but mostly there's something very, very small, very cost-effective and very time-effective you can do to take that extra step to delight your customers. Starbucks does this when they ask their baristas to delight their customers at any given store. They're allowed to say hey, that one's on me. They're allowed to make sure that the drink is done properly. In fact they're asked to do that. If you don't like that, I'll remake you something else. Give it a try, if it's not for you, I'll remake it. That's an extra step that they take to make sure their customers are absolutely delighted. So think about that. What does that look like for your business? Similarly, create an amazingly great customer experience. This is all about thinking through what would make my product incredibly shareable? What about this experience would make every customer I have wanna tell their friends about it? What about this transformation, this experience of me, of my team, of my product, would make someone say you've gotta try this? Create an amazingly great experience. Fourthly focus, focus, focus. This is something we've talked about with a few of you here as well. It's very tempting when you're thinking about this core offer that is going to help you get to that big revenue goal that you have that you think big and wide. What Paul Graham says here is that instead you wanna focus on a very small segment of customers and make sure it works with them first. So like with Ayelet earlier we were talking about how maybe the best place to start is just selling to parents who have a kid between the ages of zero and three, and you just appeal to their needs, and then as you get that system down, you can add in additional customer segments. So think about who is that precise, exact, target customer that you can court through an amazingly great customer experience. Those extra steps that's going to allow you to get that system churning that then you can reproduce for bigger and bigger groups of people. Just because this core offer is eventually going to be 80 to 100% of the revenue your business brings in, doesn't mean it needs to start there. Finally, recruit customers individually. We're gonna talk more about this one. We're gonna talk in depth about that one, so I'm gonna leave that as a little teaser, and ask you to remember that developing an offer is a process of discovery. So each thing that you do that doesn't scale is an opportunity to discover whether a hypothesis is correct, whether an assumption was spot-on or a misconception. So every little thing that you do, each and every unusual thing that you are not going to be able to replicate a thousand times over, is an opportunity to discover something new. Eventually those things that don't scale are going to lead you down the path of something that can scale, that can grow with you. If you're intrigued by these concepts, I highly recommend listening to the very first episode of Masters of Scale with Reid Hoffman. He talks to Brian Chesky who's the CEO of Airbnb, and they talk about these exact things, doing things that don't scale, creating a handcrafted experience. Brian Chesky in this episode says it's really hard to get even 10 people to love anything, but it's not hard if you spend a ton of time with them. If I wanna make something amazing, I just spend time with you. And I'm like well, what if I did this, and what if I did this, and what if I did this? When it comes down to it, doing things that don't scale, creating an amazingly great product experience, focusing, all of those things, essentially come down to spending time with your customers and asking them all those what if questions. That's how you get not just 10 people to love your product but thousands because at the end of the day, your perfect customers are not that unique (laughs). It's really easy, we've been told, especially us millennials, how wonderfully special we all are our whole lives, right? That special snowflake problem that we're all suffering from now, us millennials. Anyhow, so we've been told that we're all special. We're all unique. Guess what, that's not true. My problems are not that different than your problems. Your problems are not that different than my problems. So if you can find 10 people who have a certain set of problems or a certain set of needs, a certain set of questions, a certain set of goals, you create a product that's an amazingly awesome customer experience, you take those extra steps, you spend tons of time with them to get to know them and exactly what they need from you, and you create the product of their dreams from that, there are thousands of other people out there that have that same set of goals, that same set of frustrations, that same set of problems. And so by doing those things that don't scale, you discover the path to scaling your product. Whether that means actually reaching thousands of people or whether that means reaching 100 people instead of 10.