Designers, these are the kind of companies you don’t want to work in

Who am I writing for?

Product, UI/UX and web designers who work in software/technology companies

There are two kinds of buyers of software; individual buyers and business buyers

Individual Buyers

Individual buying decisions for low-ticket software are frequently driven by emotions more than logic. For example, everyone around me is saying that Slack is an amazing product? Ok sure, I’ll install Slack and try it out.

Then on Facebook, I see an ad for another competing chat product, but for some reason it just looks ‘old’. Like the design is from a few years ago. They promise better features, but no one in my social/work circle is talking about them. I’ll pass.

Individual buyers want to buy products where it feels like there’s been a lot of thought and effort that’s gone into the details. The website looks beautiful, the animations are crisp, the app feels easy and intuitive to use, it has some wow interactions in the interface. It feels as if they’ve understood the day-to-day problems of the user, and added small little things that just make it easier.

SMB tools, personal apps, tools that cost less than $99 to start using, these are all bought by individuals. Examples are Slack, Buffer, Zendesk, Mixpanel, and most “well-designed” mobile apps.

Business buyers

I’m defining a business buyer as someone who has P & L responsibility.

Having P & L responsibility involves monitoring the net income after expenses for a department or entire organization, with direct influence on how company resources are allocated. Those with P & L responsibility often give final approval for new projects and are required to find ways to cut budget expenditure and ensure every program is generating a positive ROI.

Business buyers don’t care about your product. They care about their problems, and whether you can provide a solution to their problems. And the level of problems they’re looking at, those are rarely solved by products alone. Instead, business buyers’ problems are solved through a combination of product, people and deep industry knowledge/expertise.

So, if a vendor can convince her that they’ll solve the business buyer’s problem, the buyer

  • doesn’t care about the website being beautiful (she’s only going to glance through it a few times anyway)
  • doesn’t care that the product has a steep learning curve (because obviously the vendor is going to train her team)
  • doesn’t care that onboarding is difficult (because obviously vendor will have solution specialists who’ll set up and integrate the product with her existing systems)

Examples: Veeva, Domo, Marketo.

So, if you’re a designer

Don’t work in a company that sells to business buyers in enterprise companies, because your skill set isn’t as valuable as in a company that builds software for individual buyers. If you can’t make out who a company sells to, ask them what their Average Contract Value (ACV) or Average Revenue Per Customer (ARPC) is. Anything above $60000 is a place where you don’t want to be.

Understanding the A/B Testing Market

Zarget got acquired by Freshworks back in August 2017, and I was meaning to write about the internals of how the A/B testing market functions. Here are my thoughts and learnings:

1 – A/B testing doesn’t work for those who have low traffic. When VWO/Optimizely started out in 2010, one could survive by serving the SMB market. In 2017, there are far too many competitors and this isn’t possible anymore. For a product to do well, it has to go after customers who have non-trivial traffic and budget to pay for an enterprise testing vendor.

2 – A/B testing products on their own will always have high churn. Testing requires time, technical help, marketing/psychology skills, design skills, meaningful traffic, and yet might not give you the wins that make it worthwhile. In such cases, it becomes difficult to prove the direct RoI of the tool investment. This situation becomes 10x worse for SMBs who don’t have the traffic or the tech/design resources, therefore the high churn in this segment.

3 – Adwords is an unprofitable channel for an SMB focused A/B testing tool. Enterprise competitors and agencies (who charge ~$10,000 per month) have driven up the CPC bids, and SMB customers anyway churn quickly. These two factors mean one cannot rely on Adwords to profitably acquire small, $49 – $99 per month customers.

4 – Another reason for high churn is that Javascript based tools are easy to remove or replace. They’re usually a script that sits just after the < head > tag. Don’t like it, just delete that line. Nothing breaks, and no process is disrupted.

5 – On the other hand, they’re also difficult to place on a website because you can’t use a tag manager to insert the testing tool’s JS. It has to be the first one to load, and therefore is placed before the tag manager’s JS. I’ve heard first hand accounts of marketers who’ve walked up to their IT teams asking to place a JS tag on the website, and been told to fill up a “Business Impact” form, so that this tag can be considered next quarter!

6 – The best market to go after are companies that have a conversion rate optimization (CRO) team in place. A CRO team or senior testing leader means the company is committed to conversion optimization and will run it as a process. Ideally, the testing tool wants to be the one that helps the company run and manage the process. Or, at least be an integral part of the process.

7 – The best customers for an A/B testing tool are those who think of A/B testing as a method of verifying their decisions, and not as a method of finding ‘testing wins’. These customers don’t just go after the ‘wins’, instead they are also happy when a losing test result helps them avoid a bad decision.

8 – Optimizely was probably the smartest A/B testing tool. Their good decisions include:

  • moving upmarket to serve enterprises, though this is a natural progression of most martech vendors
  • having a server side testing product that is difficult to install, but also very difficult to remove
  • giving out a basic free plan which made it the default choice for beginners and SMBs
  • asking agencies to connect them directly to the client (the end buyer of the product), and then owning that relationship, vs. depending on the agency to champion Optimizely to the client
  • adding personalization to their product suite (see next point)

9 – Personalization is a good space to be in, because of two reasons:

  • the average internet buyer today expects a more personal experience when compared to a few years ago. And it is claimed that personalization increases conversion rates. Therefore, most brands today implement some form of personalization on their ecommerce stores.
  • a personalization product takes time to implement, but once in place, it upholds the visitor’s website experience… unplanned removal of the product frequently breaks the website and the customer’s experience, due to which most orgs don’t remove it easily.

Give the “why” behind your feedback, else you’ll warp your team’s behavior

Early in my career, I was sometimes given feedback to the tune of “this isn’t good enough, change it to ….. (my manager’s opinion)”. I’ve worked in tech marketing, where this is extremely common.

I’d ask why, but the reason wasn’t well articulated, or it wasn’t articulated “customer-first”. This in turn led me to change my behavior. Instead of creating marketing that would resonate with our customers, my primary goal was to do work that would get my manager’s approval.

That was incredibly frustrating… the realization that you’re doing something so that the manager approves it, and lets go live. It was difficult to know if I was right or wrong, it would all depend on the manager’s opinion at the time of reckoning.

I suspect the larger problem occurs when this seeps into a company’s culture, and the north-star becomes “what will my manager think?”, versus “how will this make things better for our customers?”.

After I started managing people, I have made the same mistake. But I try to recognize and check myself when I can, and make an honest attempt to explain the “why” behind any feedback I’m giving.

If I can’t give a well-articulated “why” for a subjective opinion or feedback, then I think harder about it, and try to understand why I “feel” that ways. Overall, this has allowed me to explain things better, get buy-in from people around me, and provide some context + direction to those I manage. Most importantly, I’m more often able to steer a decision towards what we as a group think is best for our customers.

So yeah, if you’re managing people, please provide the “why” behind your feedback.