Demo Day is over, the lights have dimmed. What happens when your Accelerator Batchwraps?
Shippo provides businesses with an easy and affordable shipping at bulk discounts. Shippo secures access to better rates offered by smaller courier companies that are hard to find and compare, and the company has seen traction through Europe, Asia, South America and Africa.
Where were you when you joined Batch 8?
We were one of the earliest startups. We had exactly 3 paying customers, and that was the extent of our traction.
At the end of the Accelerator program, we reached 450 active paying customers, so we experienced a great deal of growth over the 10 weeks.
We also reached over 3,000 signups in that same period (we’re now at 5,300). Activation continues to be a key performance goal for us!
Who’s your favorite Distro Hacker?
We love the Distro team equally, but we did have regular 1-on-1s with Sean, who helped us focus on converting our substantial inbound traffic to active customers. There’s a higher barrier for people to activate after they’ve checked out the site since it requires them to integrate a new tool / process for their business.
As a tip for other Accelerator companies who might be reading this…
We met regularly with Sean — about 5 times total, and 1 – 2 hours each time, really learning from his experience with conversion and reactivation. A lot of Batch companies are heads-down not taking full advantage of the growth expertise at 500.
What were the biggest takeaways that helped you grow from 3 paying customers to 450 in 10 weeks?
Funnel design and drip emails
The most important thing was designing a really good funnel — you can’t rely on email campaigns if the funnel isn’t optimized.
We already had thousands of (unactivated) signups midway through the Accelerator program. We knew that these were all qualified customers, and that Shippo would take care of their biggest logistics problems, but they don’t know it yet. As a result, they would drop out of the funnel because they didn’t understand what we do or how we can help their business.
Before we joined Batch 8, we thought, Our product is so simple! It should be 100% self-serve, no explanation needed.
Clearly, this wasn’t the case as many people were coming to the site but relatively few were signing up, but still I think it’s natural for founders to believe their product should be as obvious to customers as it is to the team.
Working with Sean, we were able to identify a few key changes that had a positive impact on friction:
1. We used to ask for credit card information right away, thinking that this was important to collect up front. Now we only require credit card info when the customer actually purchases.
2. We also used to give the customer big range of choices — for example, between different shipping providers. Now we’ve activated 2 providers by default. If a customer wants to add more, they can, but if not they can just use the ones we’ve pre-chosen for them.
3. Finally, we broke the funnel into just 3 steps, instead of multiple.
This leads into the second big takeaway from the Accelerator. Sean encouraged us towards live chat and live support, not only for insights but also to increase conversions. We implemented Olark, which turned out to be very helpful for us.
It really brought things home that all of our customers rely on us to get stuff to theircustomers, which is a hugely important function for their business. They feel more comfortable after talking to us, and that’s something we definitely didn’t pick up on before. Fortunately, we’re a startup at a stage where we can offer that human touch and have it make a huge difference.
Everyone says “talk to you customers.” Can you elaborate on the Why / How for your team?
For our business, customer reviews are much more effective than non-organic channels for getting qualified leads and conversions. For example, a lot of people have left reviews on Shopify talking about our customer service, and this has been a big lead generator for us.
We’re a fast-growing startup, but we don’t see “talk to you customers” as a slowdown. We put everyone on Olark, including / especially our developers, so we all know what’s going. On that note, sometimes a dev may not understand why they have to build a specific feature, but after they talk to customers they understand and usually get motivated to do it even better.
No product is perfect in the beginning, but customers are surprisingly understanding if you’re transparent and show that you appreciate their feedback.
Finally, the third thing that changed for us was our approach to email. We worked a lot on the best language for drip emails and for other outbound sales email, and Sean was a huge help in this.
Sean got us on Intercom, which has been great.
We’re now sending email right away, and again at intervals of 1, 3, 5, and 14 days. Finally, we send one after 1 month.
We really didn’t want to ‘spam’ our customers so getting on board with funnel emails was difficult in the beginning. We discussed this a great deal with Sean, and concluded that if we email the customer and are able to reactivate, then we’ve solved a problem on both ends — which is awesome. If we don’t reactivate them, the fear of alienating them with “spam” is beside the point since then they’re not (/ never were) our customer anyway.
How well are your emails working?
Many customers actually think these are emails written manually, one at a time, by people on our team. They’re usually very happy that we’re emailing them!
Counter to our initial fear, we’ve received zero complaints about being spammy. Amazingly, sometimes we even get emails from customers apologizing that that they weren’t able to integrate sooner! So the email “reminders” we send are well received.
Shippo gets a decent amount of organic traffic. What strategies did you use to get traction as a boot-strapped early stage company?
Most of our traffic is organic. Our early growth strategy involved building applications on Shopify and Magento, which I’d strongly recommend for any API business.
Customers who are candidates for using an API first want to see other customers who are using it — this is because it always takes effort to integrate, which poses a risk for new customers. With the apps we built for other platforms, the setup time was about 30 seconds. We made sure the barrier was very low.
For our larger customers, we did outbound sales. Specifically, we went through LinkedIn looking for connections to a business’ CEO or business development person, and also used the amazing 500 network, which made it was easy. This is how we got our first 50 big customers.
Our smaller business customers help us to reach more people, build a brand, and demonstrate traction. At the same time, we’re very focused on the bigger customers that have high shipping volumes and in-house dev teams, but those require a long sales cycle.
You’re 2 months out of Batch 8… what are your biggest challenges now?
Our biggest challenge is still conversion! We’re doing decently well on our conversion rates, but there’s still more potential because we’re still making it too complicated for customers. One of my concerns is that we’ve been into shipping for so long now that we don’t always understand the perspective of new customers.
So we remind ourselves:
It’s about two things: simplicity and handholding. We’d like to offer more personal customer support more people on live chat, more of us calling customers. If we had the time, we would hop on a call with everyone and walk them through.
For us, it’s not about automating customer conversion. It’s all about doing things that don’t scale.
What are you most proud of in terms of change over the past 4 months?
We are really proud to have built something that makes sense for customers and seems to add value, based on what they’re telling us, and on growth!
I remember staring at Google Anlaytics in the beginning, looking at the Real Time section. I got really excited when i saw that one single customer was looking at our page “right now” and keep in mind at that time, most of our visitors were in Bangladesh or India where our service wasn’t even available!
We now have 5,300 users.
It’s challenging as an API-focused startup looking at long sales cycles because few investors or big customers want to talk to you in the beginning. So, we had to come up with unconventional ways of getting traffic and customers, for example without requiring full API integration.
We’re all first time founders, and it was invaluable to be part of the 500 family surrounded by other founders and mentors, saving us from many, many mistakes.
Distribution and Sean were awesome, but we got support in a lot of areas — hiring, investors, introductions, everything that noobs don’t know and might be afraid to ask.
There was Dave helping us out on Easter Sunday, Marvin staying with us till midnight perfecting our pitch prep, and knowing that no question was too small — or too big.
Hey! You’re in luck. There’s still 1 more day to apply to Batch 11 of the 500 Accelerator.Learn all about it and APPLY HERE.