Anatomy of a launch post-mortem: What went right, what went wrong

45 Comments- Get free updates of new posts here

1 2 0

A few months ago, when I asked if you’d be interested in learning more about the business side of “I Will Teach You To Be Rich,” over 400 people left a comment saying yes. So here’s a little inside scoop on what’s been going on behind the scenes on the business side.

iStock_000007166696XSmall

The Earn1k launch — for my new course on teaching people how to earn their first $1,000 on the side — was one of the largest I’ve ever done. Last week, after the launch dust settled, I did a post-mortem call with my team, and I thought I’d share some of the results with you.

Even though they sound dark and ominous, “post-mortems” are some of the most useful things you can do when launching a new project. A post-mortems is simply an analysis of what worked, what didn’t, and what you can learn to improve next time. Doing this helps keep you sharp and stay ahead of 99% of people who never do this (the Craigslist Penis Effect in action).

Here are some things we learned that might help as you try to earn more money or launch your own project.

* * *

Costs matter — but not as much as revenue does. This is especially true if the costs are non-scalable, like a one-time fee for a support system. In other words, you can scrimp and pinch about paying someone $2,000 or $3,000. Or you can just make 10x more with a better product/marketing and make the point irrelevant. This is the benefit of releasing amazing content, not run-of-the-mill BS that anyone can copy.

Measuring is important, but pick your battles. I like to measure myself in a lot of areas. But it came down to deciding to measure something — or just make it better based on our intuition. We chose to improve the launch rather than measure everything. The downside is I don’t know exactly what caused some of our results. I hope to figure it out in future launches.

Lots of communication problems. Once you get above 2 people, communication starts getting very complicated. We used PBworks, Google Docs, Etherpad, email, and phone, and we still weren’t all on the same page. This is why there are so many collaboration tools. This is also why it’s such a hard problem.

Have ridiculously detailed backups. After a technical snafu that cost me over $10,000 in 10 minutes, we created an insanely detailed checklist, including…

POTENTIAL PROBLEM — SOLUTION

…with every conceivable technical problem that we could encounter. This was detailed down to the level that, if my home internet failed, my shoes were already on so I could run to a friend’s house, who was standing by so I could jump back on a webcast.

Again, I never cared about this in my early days, and you shouldn’t if you’re launching something for the first time. But now, after growing for years, even a few minutes of launch downtime can cost me a lot. (And I’m just a teeny tiny player. Imagine the resources a company like Amazon dedicates to this.)

There are red flags for users who will never become customers. At my last company, our head sales guy told me an interesting thing: He said, “When prospects call up and ask for XXX [specific word], they will never buy.” In other words, non-buyers identify themselves with certain phrases, and you need to learn to identify them. For Earn1k, whenever someone’s FIRST question was, “How much does this cost?” I knew they would likely never buy. That’s because they focused on cost, not value. The people who asked, “How much can this help me make — and how do I know it’s worth it?” were much more likely to buy.

People will pay for content if you demonstrate enough value. We sold out of our $2,997 tier in 1 hour because we spent a month showing people to focus on value, not cost. I never expected to sell out. Yet I now know I under-priced that tier. So next time it will go up — dramatically.

Blogs have extreme variability in the quality of users. Most blogs have 90%+ freeloaders, aka people who never want to pay for anything and get mad when a blogger charges for anything. I love driving these people away from iwillteachyoutoberich as fast as possible. While the blog will remain free, I’ve consistently showed you guys why paying for value is important, and we now have an audience of people who are willing to invest in themselves — and don’t believe in fixed-pie syndrome.

People like when you turn away business for genuine reasons. I turned down over $100,000 of customers. I screamed at people who asked if they should join while they still had credit card debt, and told them to get their debt under control before going back. We refunded a $1,500 customer who treated iwillteach staff poorly and sent her packing. And we didn’t serve a $75,000+ segment on purpose (see below).

We were surprised: People LOVED this. It caused them to sign up more. Why? Because they knew the focal point wasn’t to gouge everyone and make as much money as possible. As I told them, “I don’t want everyone. I want the right people.” People respond when they know something is tailored for them, not everyone.

Measure your projections to see where you were wrong. At the beginning of each project, I create a simple table/spreadsheet of the results I project. The first 5 times you do this, you will be terrible. (Once, I did a projection and forgot to include one conversion #…which meant my results were 90% off…in the “bad” direction. Oops.) But each successive time, you’ll learn small ways to get better. In this case, we created 3 projections — Low, Middle, High — and then compared the projections to the “actual” results. We learned some fascinating things, including areas that we totally forgot to factor in. Next time, we’ll be better.

The $75,000 problem: As I said, we sold out of our top ($2,997) tier. Here’s an interesting thing: I could have sold at least double the number of seats over the remainder of the launch. But I intentionally turned down $75,000 in revenue. Can anybody guess why?

* * *

I know that’s different than most of the stuff I write on iwillteachyoutoberich, but I hope that was helpful. Let me know if you have questions and I’ll answer them in the comments.

1 2 0

Related Articles

How to save money

These are actual, real articles that someone wrote about saving money. I swear.   Not here. If that’s what you’...

Read More

I’m giving away a vacation cruise for 10 people

Things you can do on a cruise: Scuba dive, snorkel, and tour awesome places you’ve never been to Eat ...

Read More

45 Comments

1 2 0
 
  1. Every single person who spent $2997 to be in the top tier of your program not only paid you $2997 but also will be an advocate for future sells and probably the first ones knocking at your door, willing to pay the big bucks, when you launch another content-heavy course. If the content is as great as you say, which I have no reason to doubt it will be, then you have gained a literal army of affiliate marketers, and they are paying you!

    Beautiful.

  2. Am assuming the $75,000+ number is a lower price tier which you did not offer because you predicted that adding too many people would:

    1. Cause more administrative hassles than the money was worth
    2. The people likely to jump on the lowest price tier would be more likely to be
    i. the people least invested in the course BUT with the most problems with the course (can’t access webcasts, neglecting to do homework, etc.),
    ii. the people jumping ship mid-course because they hadn’t invested enough to actively seek the value
    iii. the people passively watching the course (but still needing the administrative back-end management), etc.

  3. You can also call a post-mortem a retrospective. Unless, of course, you just enjoy associating your launches with death. :)

  4. I really like your comment about people paying for content if you demonstrate value. Too often informational products are all hype. It is important to pre-sell by giving valuable free content away. This builds trust.

  5. My guess for turning down 75K worth of business is that the amount of time spent on these customers, would be better spent creating new products.

    Thanks for the tips on product launches. Very valuable information.

  6. Speaking from a programmer’s perspective, you have a scalability problem. You can’t clone yourself, so the number of customers you can host at a seminar is limited. There’s a limit to the degree with which you can delegate that work to others without diluting the ‘Ramit Sethi’ brand. And while the lead-up time of this project will probably pay dividends in the future, there’s a limit to how much you can gain by compressing that as well.

    While I’m sure this programme has been very successful for you, it’s not really going to bring you the ‘beyond avarice’-style riches usually associated with internet millionaires, is it?

  7. I think you intentionally made the decision to turn away $75,000 because this course has the potential to be huge, both for your clients and for you and your team.

    Since is the *first* launch of the program, it’s smarter to do a stellar job with a client base you can handle. You can use this launch to figure out how to improve your process and product even more, then consider scaling up, either just by price or by client load or both depending on what you’ve learned. The potential future returns on a first course done well will exceed $75,000.

  8. I’m guessing many of the people who would have paid 3k for the top tier but missed out will be willing to pay a higher amount if they get another chance in the future.

  9. Ramith,
    Great to sneak peak behind the scenes. It is also good to see the real problems: stuff that is usually hidden in the glossy mkt content usually made available.

    My take for the $ 75,000 is also scalability and natural restraint to attend, interact and fullfil the expectations of your audience. However, I assume this number does not grow from a bottom line potentical subscribers (it would be in the hundreds of thousands considering your number of blog readers) but in the top subscribers, who were SOLD out and NOT able to subscribe.

    You’d better turn down $$ from these leads – but keep them on your radar (emails, phone numbers, level of interest, etc), for future versions of your course.

    I could not subscribe to your course, but look forward to joining in a future version.

    Fábio

  10. I could have sold at least double the number of seats over the remainder of the launch. But I intentionally turned down $75,000 in revenue. Can anybody guess why?

    Scarcity.

  11. You turned down the $75k because of the 80/20 rule and you thought (probably correctly) that those people would cause way too much hassle.

    • Just a clarification, everyone: The $75k would be the Tier 1 (Personal Coaching) people, so they probably would not cause too much trouble. They are the highest-quality customers of all.

  12. Great post, I like the post mortem approach :) I am guessing you turned down the other $75k to keep the tier 1 membership’s perceived value? If not you should tell us why because I am dying to know!

  13. Isn’t it actually $37.5K? Those 25 customers (double tier 1) were likely $1500 (tier 2) customers…so they still handed over half the $…

    Time is your MVR (most-valuable resource). To provide suffice coaching w/o having ‘clients’ wait 30-60-90 days for feedback, you would have to scale back the #.

    Otherwise the domino-effect of negativity would take over – longer wait for clients = more time for excuses = less positive experience = less likely client has success = less, less, less…

    I think it was a wise decision to scale-back the high-end package to keep the integrity w/ your best clients. I’m guessing there’ll be another chance!!

  14. and btw, ‘post-mortem’…horrible;) Why not just ‘Stop, Start, Continue’?

  15. @impertinente:
    Unless you limit your clientele to millionaires, you’re never going to become a millionaire offering personalized advice. The math just doesn’t work.

    What you can do, and probably some of the options Ramit is considering: 1) Just make a respectable living and call it a day. 2) Focus on a small group of customers to generate case studies, which you use to teach teachers 3) Systematically build cache and launch yourself as a media personality.

    If you’re trying to actually help people (do well by doing good), options 1 and 2 are your speed. If you’re just ‘trying to become a millionaire’, then option 2 or 3 are probably your best bets, option 3 being a faster ride up (and a shorter trip back down again).

  16. I guess you thought 25 ($3,000 x 25 = $75k) more people would be too much for your coaching team to handle. Similar to what a good school or university does when they claim a XX to 1 student/teacher ratio. I’m looking forward to digging in to week 2 later tonight.

  17. You turned it down to provide a higher quality experience to those who signed up. Otherwise you and your resources would’ve (probably) been stretched too thin for your clients to feel like they got the value they paid for – and deserved.

    I’m just glad I got in (not at tier 1 though) before you did this analysis and figured out how much more you could charge for this course if you run it again :-)

  18. I’d like to see even more detailed posts about your product launches for future posts. It’s really helpful for someone who is interested in creating products and I feel like a lot of people are afraid to talk about their methods.

    Thanks for the honesty.

    Austin @ Foreigner’s Finances

  19. Thank you for this. I find this analysis quite insightful and sometimes knowing the process is more useful than broad general ‘directions’ (and proves that you are human – I had my doubts!).

    I think one of the reasons the course has been so useful is largely around its structure and process. the live casts have been fantastic and the forum is a wealth of information. Thanks again!

    p.s. re: the 75k, I’m guessing it has to do with sticking to what you said initially (10 spots – first in) and therefore increasing the value to your customers

  20. Thanks for sharing these post mortem tips. PM’s are a vital part of any production I think, otherwise you never learn from them.

    I think it’s great you are able to turn away customers who aren’t worth the hassle…afterall, none of us got into this to deal with rude people!

  21. Hi Ramit,

    there’s one thing that’s been bugging me – you said in your launch that people who try to go for passive income (I guess this includes selling products) before freelancing, are deluding themselves.

    What’s your reasoning behind this? Is it to do with not building expert status? Lack of market insight?

    I’m really curious….

  22. My only question is..
    Who taught YOU all this stuff? Experience or mentorship?

  23. Am I the only one picking up on the expected future launch at a higher price? seems turning away $75k now could yield $150k later (or more?) especially provided the original group will now be advocates for the program.

    Ramit thinks people will be willing to spend “dramatically more” as he sold out and didn’t expect to. Seems pretty self-explanatory to me.

  24. In response to Naomi’s questions, I have also wondered why you suggest freelance before passive income. My conclusion was that freelance actively causes you to learn to get in your customers heads with immediate feedback; either you get hired or you don’t. With passive income, you could always fool yourself in to misinterpreting results or ignoring results altogether.

    I also think that people looking for passive income first might be demonstrating a laziness to actually putting forth effort in earning additional income.

    Just my thoughts.

    • Yes to all of the above, David. Most people who claim they want to make passive income use it as an excuse to do nothing, instead of freelancing and getting immediate feedback. The difference is, one requires getting off your ass and doing something, and the other requires dreaming about a great idea one day raining down from the sky and showering you with money.

  25. You turned down $75,000 in tier-1s because you don’t want to be that douchbag who says “Act now! There are only 25 slots available! You’ll never have another chance like this again!” and then later says “Because the demand was so overwhelming, I’m opening up an additional 40,000 slots!” It’s a bullshit marketing technique I see all the time, and it always comes off kind of sleazy.

  26. I would guess another reason to do freelancing before/over passive income is that freelancing can build you some semblance of credibility and a client/customer base that sets you apart from the other products out there. I could write a kickass ebook or make some awesome product but if nobody knows about it, or nobody trusts me enough to pay money for it, it’s not going to do me a lot of good.

  27. All good points above.

    I think you said the idea of passive income is often delusional because building significant passive income typically takes years of hard work.

    There’s a potent myth online about making passive income, which generally translates as ‘people who work 16 hours a day to make money while they sleep.’

    Freelancing also gives you a chance to meet your clients face to face and find out first hand what makes them tick.

    That said, I’m not convinced that an info product based business is more likely to fail than a service based business.

    Your thoughts?

  28. Thanks for the behind the scenes peek Ramit.

    It’s cool and pretty useful to learn about these kind of things, and I can see applying a post-mortem to more than just business oriented areas in my life (“Now why did I burn my fingers with my soldering iron?”)

  29. We imagine that you also chose to keep the program small to retain intimacy with the group. In Malcolm Gladwell’s “The Tipping Point”, he notes that a community can only be had with an amount of 150 people or less. Small communities also tend to be more productive as well. We’d bet that your small group accomplished more than the total combined results of your blog readers. Great lessons to learn, and thanks for sharing them!

  30. It certainly is important to perform an evaluation after any form of presentation as there is always room for improvement and it’s nice to know what worked well so that you can use those techniques again. I also can understand your frustration with people who are too cheap to pay to get good advice. Sure, it’s nice when things are free, however, some things are definitely worth paying for. Robert Kiyosaki in his Rich Dad series often wrote about the people who were too cheap to pay for parking and as a result missed out on a seminar that would have helped them to learn how to become financially free. Well, to each his own. All the best with your future endeavors.

  31. When I purchase something, I’m not just putting money into it, I’m assigning a priority to it.

    For example, when I purchased Wired Magazine for $5 a pop, I used to read it cover to cover. As soon as I signed up for a yearly subscription (passive monthly payment of $0.89 per issue), I ended up never even opening it out of the plastic wrapping.

    When I cancelled that subscription, the intent was not to save $10.68 per year, it was to release the mental dissonance (created by not having read something I paid for) in my mind. Now that I don’t pay for it, I don’t have to think about it anymore.

    I paid a lot for the earn1k course, not because I expect actual learning material in return, but because I am mentally assigning a high priority to it.

  32. I can’t stand the term “passive income”. What you want to do is get paid based on the VALUE you provide as opposed to the hours you show up. If you want to make 1,000 a month extra, learn how to provide 1,000 worth of value. A business is a system, be it people or processes or both, that make money based on the value given. The goal should be to own that business system.

  33. Hi Ramit and fellow readers!
    Maybe this is not the best place to put it in, but I promised an update on my business and here it is.
    I cannot thank you enough for the Earn1K free course and the change it made to my thinking. I did not even think of having my own business 2 months ago and now, even though I am still not making any money, I have my Etsy shop, a blog that I was meaning to put on for friends and family anyway, and hoping to make some money soon :)
    I know it is a small step and it is not really a business yet, but I am doing something and I am very proud of myself!
    So thank you once again!
    Magda

  34. “…But I intentionally turned down $75,000 in revenue. Can anybody guess why?”

    I think PJ has it the closest. It is about integrity-doing what you say you are going to do. Having a lot of integrity when selling a product like this honors those who committed to the tier originally, and separates this course from too typical “get rich quick” schemes.

  35. I love what you said about focusing on revenue. I worked for a non-profit that focused 99% of their energies on costs. It really dragged us down. When the boss is haggling with paper guy over the cost of a ream of paper, I realized we were going down in flames. If we focused on healthy revenue- we might have saved ourselves from firing 1/4 of the staff and seeing another 1/4 (including me) leave for greener pastures. The stress of cost focusing is unnerving. A good balance is so needed.

  36. I love how you sent that one customer packing cause she was a pain to deal with. Nothing makes me madder than when someone complains aggressively. I don’t mind if someone complains about something with my websites, but when they are rude then I usually never give them any kind of response.

  37. This post mortem (or retrospective) is a great source of information and will try to apply a similar method for my future workshop.

    Regards Carl,
    from T.O.

  38. You turned down 75K now for 300K or more later. If you had them all in on this level, the next time they will be first in line and will pay a premium. They will not want to miss out of the valuable information you sold them on.

    I loved that line about the customers that asked the specific question. It is true across the board, I have been in inside sales, outside sales an online sales and it is the same.

    A prospect that inquires with a certain exactness or tone after you have given them a ton of information and if you presented yourself and product correctly is not going to buy! The aspect of value building never occurred. You are dead before you even start.

    The upside to this is when you figure out where you went wrong with this person, you can remove that from your sales presentation and make more sales.

  39. [...] what you wanted, instead of thinking about how much better so and so did just have an honest post-mortem and figure out what you can do better next time. launch, [...]

  40. [...] and sleep and bitch and moan when it’s over but unless you go all in and finish strong, any postmortem you do will be incomplete and you’ll be back where you started for the next [...]

  41. Hey Ramit,

    great post. I would have preferred to see more details on a couple of points, like the projections spreadsheet and the insights derived, but maybe it’s for a next post?

    Onto the 75k, assuming you did not reveal the number of people you wanted and therefore I exclude that you wanted to stay true to your word of only having x number of people in the tier (which I assume to be correct, as you could have easily gone around that with a statement like “due to popular demand, I am increasing the number bla bla bla”; I think you are keeping the people who wanted to join but could not in a warm state via follow-ups etc and then give them first right to join the next phase which you already said multiple times will be more expensive?

    You have already worked out you undersold yourself so this explanation is plausible.

  42. The “risk management” list is a great idea. I recently made a spreadsheet of potential risks, chances of them occurring, consequences, and finally mitigating actions, for my business. The risks included getting my hardware lost or stolen, or changes in the marketplace, and the exercise has already put my butt in gear to take action. This is only worth it, of course, when there’s real money attached to the consequences.