Dress it up how you want – “unfinished success,” “pivoting,” “learning”- we all fail. There is nothing we can do to stop it – making mistakes is part of life. It’s nothing to be ashamed of, and in fact, it’s essential for growth – both personal and professional.
Unfortunately, fearing failure comes as naturally to us as failure itself.
When I Work gets about 500,000. Mailshake gets more than 300,000, Voila Norbert is at 100,000 and Right Inbox brings in over 150,000 per month.
So I’d say I have a lot of experience in building blogs. But that doesn’t mean I’ve gotten everything right along the way – in fact, I’ve made a lot of mistakes too.
In this article, I’m not going to talk about the practicalities of building a blog, because a lot of other content covers that.
Instead, I’m going to tell you about the good, the bad, and the ugly of building and running a high-traffic blog. It should help you understand your next steps once you’ve got your blog off the ground. What are you going to do with it? And how’s it going to help you?
Let me be clear about one thing: there’s definitely more indirect than direct benefit to building a blog that brings in tens of thousands of visitors a month.
Your sales team can utilize it. You can use it to help educate your customers, which ultimately will reduce churn and help expansion revenue. Some people have even given us low NPS scores on the product, but in their review they’ve still said, “I love the blog.”
Think about the value from a business perspective to have somebody say, “I love your content,” and be impressed with or get value from it. That’s an experience they have with your brand, whether they have to pay for it or not.
Over the years, we’ve built up this SEO powerhouse just by doing good content marketing.
Now, anything we publish on almost any topic just ranks well in three to six months, without us doing anything.
By putting in all this hard work over the course of three to five years – and we’ve spent more than $1 million on Mailshake alone in that time – we can now pretty much create content and reap the benefits.
So our job gets easier and easier. All we have to do is create the right content that maybe has decent search volumes and we’ll see results from it.
Now think about a bigger brand like HubSpot. They rank for almost every single term they target. They could write an article and it will rank because they’ve put in the effort upfront, and Google and customers reward people who have done something for a consistent amount of time.
Before I built any of my companies, I built my blog and I built an email list.
Regardless of whether or not it helps me directly sell, that email list has huge value, because it’s helped me move mountains since those early days.
Let me give you a concrete example of how that audience has benefited me.
SujanPatel.com generates 30,000 visitors a month. I’ve been publishing on it for years and I used my blog and the audience I’ve built to start Mailshake, to grow Right Inbox, and to promote When I Work. I also used my blog to sell over 50,000 copies of my ebook, 100 Days of Growth.
If it wasn’t for my blog, none of these blogs or companies would have had the kickstart that they had. So the value of a blog and an audience is huge. And it shouldn’t be measured by revenue.
Having put in a ton of work, my blogs are now generating hundreds of thousands of monthly visitors.
But the thing is, you don’t actually need to build up massive amounts of traffic to generate massive amounts of revenue.
I’ve already told you how SujanPatel.com brings in 30,000 visitors a month. It’s been doing that for the last five years, even though I’m pretty much half-assing the keyword research, and I mostly just write about stuff that I get asked a lot about or that I care about.
I don’t do as much of the keyword research as I should, partly because I’m doing this on the side of running a bazillion other companies and doing a bunch of other things.
But my website still generates over $1 million in revenue a year. That comes from the 20 to 30 leads I get per month for consulting engagements.
So on one hand, my blog kind of sucks. If I was just looking at traffic, I’d count it as a failure.
But over five years, I built $5 million in revenue from it, so actually I’d say it’s a huge success and that’s likely to be the outcome I was going for anyways.
Even though it only gets 30,000 visitors, it actually generates more revenue for me than all the other – much bigger – blogs combined.
Right Inbox is a Gmail extension.
If you check out the blog, you might notice that we write a lot of informational stuff around Gmail, like how to create labels, or how to archive an email. It’s very basic stuff – more like customer support articles than blog posts.
But those articles actually generate a ton of traffic, and we have hundreds of them.
Between them, they generate thousands of new installs a month/year.
Part of building a successful blog and validating the intent of your buyers is about testing different things to see if they work.
If I’d read something telling me that a bunch of informational articles would lead to installs and conversions, I probably wouldn’t have believed it. But even though the conversion rates are super low, the volume is very high, so it actually works really well for us.
Do it right and a blog can drive signups, sales, installs and free trials.
But if you get it wrong, it won’t do any of that. I know that for a fact, because I’ve done it wrong a lot.
The mistake I’ve made with every single one of my blogs is focusing on creating the brand and top-of-the-funnel education.
As soon as we stopped thinking about bottom-of-the-funnel or middle-of-the-funnel or top-of-the-funnel content, and started thinking about buyer intent, we noticed free trials or installs or sign ups go through the roof.
It’s a silly mistake to have made, but because all of these companies are growing, it was easy for me to ignore that one key point: does this content, this keyword that I’m going after, have any buyer intent?
And if I’m being honest, I’d say 70-80% of our content has no buyer intent. It’s just general informational keywords that do a good job of tackling the persona, but have not historically delivered results.
I’m not here to tell you that influencers are bad.
Crazy Egg and a lot of other companies have leveraged influencers and subject matter experts to build up a large brand by getting these people to publish guest posts on their site.
So we tried to do the same. But a lot of the people we worked with ended up not doing anything for the actual growth of our blog.
The performance would be the same, if not worse than, the content we publish ourselves. And the audience reception was almost the same as well.
Of the content we publish ourselves, we can clearly see that the stuff we created where we got the intent right works ten times better than that influencer stuff. And when I say ten times better, I mean the content ended up generating way more traffic in the long term.
It wasn’t always like that. When we were just starting out, the value from influencers was high. But after you’ve got 100,000-200,000 visitors a month, the value diminishes a lot.
Part of this is that 5-10 years ago, when Kissmetrics and Crazy Egg built up their mega content sites, the industry was a lot less mature and a lot of people were actually using influencers to build their brands.
Now, a lot more folks use guest posts solely (or almost entirely) from a link-building perspective to improve their SaaS metrics.
Also, many content creation companies like Fresh Essays have the opinion there’s so much content out there that the consumer of that content cares less about who wrote it. They care a lot more about the value from it.
Unfortunately, there are no shortcuts.
Building a blog that attracts hundreds of thousands of visitors a month requires consistency. You gotta do it day in, day out.
The value of creating all that content and building all those funnels lies at the tail end, meaning if you do it for two years, you should expect to see pretty much no value.
But at the end of year three, you’ll get enormous value.
So you have to decide if you’ve got the patience and resource to stick with it.
As I said at the start of this article, even if you do build a massive blog, you may not get any direct value out of it.
So you have to think whether the indirect value is worth the investment in time.
For me, the indirect value has definitely been worth it. For instance, our content now generates more links – just by being out there – than our link-building team can generate themselves.
So if we measure our content on how much it helps us do SEO, it’s more work than two full-time people on our team can do.
I’ve covered a lot of points here, but there are four big takeaways that cut through all of them:
Looking to build or scale your own blog? Which of these points did you find most valuable? Or maybe you have a tip of your own? Let me know in the comments below:
You’re a good writer – should you start a freelancing service? But you’ve also had a great idea for an app – would it be better to invest your time and money there? Or maybe you’ve been frustrated with Dropbox and see the opportunity to disrupt the marketplace with a cloud storage competitor. Should you pursue this idea, even if it means leaving your job and exposing yourself to a tremendous amount of risk with no certain rewards?
Having too many business ideas might seem like a great problem to have, but in reality, it can be just as challenging as having no ideas to work on at all. When you have too many ideas, you run the very real risk of “analysis paralysis” preventing you from moving forward with any of them.
The key then becomes how you evaluate and validate each of your ideas. If you find yourself struggling with more good ideas than you know what to do with, the following framework will help you clarify your personal mission and find the business idea that best suits this purpose. Continue reading What To Do When You Have Too Many Ideas
We’re all looking for growth on some level. More customers, higher revenue, faster innovation, delivery, or service, bigger inventory, more locations, and on and on. The smart thinking says start small and grow.
Go big or go home.
Continue reading The 5 Reasons Companies Stop Growing (And What To Do About It)
You made it!
Whether you have thousands of subscribers paying a small monthly fee, or a handful of big-hitting, high-paying enterprise clients, you’re making more than $10 million in annual recurring revenue (ARR).
But if you’ve been driven enough to grow your business to this stage, you likely don’t want to stop now.
I know how you feel, because I’ve been there myself with brands like Intuit, When I Work, and a slew of others as a SaaS consultant.
So here’s where to go next…
By the time you’ve surpassed the $10 million mark, you’ve likely done a lot of marketing.
Finding new prospects is becoming harder because you’re close to exhausting your current total addressable market (TAM), which is hampering your growth efforts.
So it’s time to expand your product and chase a different, or broader, TAM.
That’s what we did at Mailshake. Our product can be used for a bunch of things – we started with marketing, targeting SEOs and link-builders, then moved on to sales and customer success.
So at $10 million, it’s really time to think about who else can use your product, or what else you can do to get more usage from it.
You should have a ton of user data by now.
When you sign up a new customer, you should have a pretty clear idea of how long they’re likely to stay with you and how much they’ll spend along the way.
In other words, your customer lifetime value (LTV) should be pretty predictable.
That means you can really afford to spend more aggressively on advertising, marketing, or branding to really scale up.
There’s so much stuff you can do, and you presumably know a thing or two about building a brand if you’ve reached this stage of growth, but in general it’s about being helpful. That could look like:
You and your team probably have a bunch of ideas about new stuff you could be doing to further grow the business.
Maybe you want to launch a whole new product, or target a new audience, or add a couple new features, or something else entirely.
Whatever your idea, always do the math before you do the work. Put in potential conversion rates – make them as realistic as possible, even if they’re completely hypothetical – and see how that looks.
So here’s an example. We were about to launch an outbound campaign. We were going to do cross-promotion with two of our companies, and one of those companies gets like 20,000 leads a month.
Sounds great, right? With 20,000 leads to work from, I’m going to go make a ton of money.
Well, maybe not. When we looked at how many of those 20,000 would actually use our other product, how many of them fit our buyer persona, that number dropped to about 4,000 right off the bat.
So how am I going to promote it? Easy: I’m going to put a link on the website; I’m going to do cold email; I’m going to call them. Whatever it takes to get the word out and drum up some interest. That left us with maybe 500 leads in the new company’s pipeline.
What’s my close rate and process on converting those 500 leads to a paid plan? For argument’s sake, let’s say it’s 10%. Now those 500 leads are down to 50 actual, paying customers.
And sure, maybe I can increase my conversion rate to 12%. Or maybe I’m feeling crazy and I think 30% is achievable because they know both brands, so they’re already kind of warm leads. Well, at the end of the day I’m still only talking about 60 or 70 new customers.
As you can see, I’ve gone from a super-exciting figure – 20,000 leads! – to 50 or 60 new customers. Unless your average revenue per user is like $1,000+, who cares about 50 or 60 new customers? It’s not moving the dial significantly for a business of your size.
Sure, you’ve got a company with an ARR of $10m+. But you probably haven’t gotten everything right along the way.
You’ve likely made too many mistakes to remember. I know I have!
Getting things wrong isn’t necessarily a problem – it’s how you get some of your best learnings.
What is a problem is failing to identify when something’s just not working and reacting.
Say I’m planning a marketing push and I want to run a big PPC campaign for the first time. Maybe I’ve got a $100,000 budget.
But we’ve spent $15,000 and it just is’t working. The conversation rates don’t match up, or my cost per click is way too high.
Well, then maybe that’s not a channel that’s going to work for me. And that’s the time to call it quits. I can hit the eject button, stop, and move on.
Having a strong leadership team will help you here. No good VP is going to look at bad numbers and say, “Yeah, keep doing that.” They’ll stop you early on.
Of course, it might be that this new tactic could be effective, and you’re just executing poorly.
That’s why I often ask a third party to take a look. It’s so useful to reach out to an agency or a consultant – someone who really knows the specialism, whether it’s PPC or something else – to help you understand your blind spots.
Is your business at this stage? What are you doing to maximize growth? Let me know in the comments below:
Reaching $1 million in annual recurring revenue (ARR) is a big target for a lot of small businesses.
I get that. It’s a big, impressive-sounding number.
But it’s important to remember that your job isn’t just to get to $1 million – it’s to build a marketing or growth engine that can get you to $1 million and beyond.
And that’s a very different mindset.
I buy companies at all stages of growth. What I usually see at this level is that people don’t build scalable marketing channels or growth engines that can actually get them past this point. They maybe have a tactic that got them to $100k or a strategy that got them to $1 million, but they have nothing else.
My experience with companies like Mailshake and When I Work means that I know what it takes to maximize growth at this stage of a company’s life. Here’s what you should be doing:
This is probably the first thing you’d want to do at $1 million to get to $10 million.
Figuring out your processes touches on every aspect of your business. There’s just so much stuff for you to consider:
And that’s only just scratching the surface. If it’s something that happens regularly in your business, you likely need to figure a process for it, because otherwise you’re going to get different outcomes every time you do it. That’s really inefficient, and it also makes it much harder to scale up.
The biggest failure here is people just don’t have channels. As people will learn from their first million dollars, it’s really hard to pull a channel out of thin air and get it to work. You have to test it. It takes a long time and you ultimately slow down growth.
You’ve likely got one or two key audiences who’ve helped you grow to this size.
Maybe you’ve been targeting early-stage startups and founders. You’ve created a fantastic blog aimed at founders and it’s brought you a ton of business.
But there’s only so many founders in the world that would buy your product, so that total addressable market is fairly small.
So you need to think about what else you can do. Start targeting a new persona, or using other types of marketing, before you hit the ceiling on your current activity.
Sure, you deserve credit for building a business with an ARR of $1 million. But your job is far from over!
There’s always so much more for you to learn – and the same goes for your team.
Let’s say you’re planning to test PPC for the first time. Wouldn’t it be valuable to speak to people who’ve been there, done it, and bought the T-shirt? To hear what they’re doing, what’s worked for them, and where they’ve gone wrong?
You’re going to want to get out into the world and talk to other marketers and founders. Get yourself in some Slack groups, or use a platform like Clarity.
This is also a really good time for you to get some mentors and coaches onboard, both for your team and yourself.
Now, I know that coaches and mentors sound expensive. Maybe they charge $200, $400, $600 an hour. That’s a lot of money.
But this isn’t someone you need for 10 hours a week, every week, for the next year. It’s about giving your team access to an expert resource for an hour or two a month – someone they can go to who really knows their stuff.
We find coaches and mentors on sites like JBarrows and My Sales Coach. In fact, I just got off a call with one of our sales coaches, and he reviewed this outbound campaign we’ve been planning. He pointed out three or four slight adjustments and one major pitch change that we’re going to action. That hour-long session cost me $500, but the changes he recommended are going to dramatically improve the outcome of our campaign.
You could just go hire a very specific sales coach and solve the very specific problem you’re facing for 50, 100, 200 bucks per hour or per session. And you end up generating 10X the return on your investment.
Going from $1 million to $10 million ARR is kind of like going from a teenager to an adult. Now you really need to figure out how the world works and how to control your finances.
Building your management team will help you thrive in the big, bad world.
Let’s say you’re a sales-led organization, so your biggest challenge for growth is bringing in business. At this stage, your one or two-person sales team will definitely break, so you need to hire a sales manager – maybe a VP who can take you from one salesperson to 20. Or if you’re going to manage them yourself, you need coaches to help you learn how to manage better.
Usually you want to get a marketing manager or director too, or maybe this is where you go for a top-down approach, where you bring in a VP and they figure out the next steps for you.
Depending on your channels of growth, you’re going to want to double down in those areas, but you’re going to want a management team and a system to align all the moving parts of your business. We use EOS Traction for this, or another option that a lot of startups use is Scaling Up.
What outcome do you want from this company?
Hopefully as a founder or marketer or growth person, you’ve figured this out early on. If not, you need to ask yourself what your goal is and what that means for you personally.
It’s critical to say, “Okay, now I have this aspirational goal of where I want to get, I put pencil to paper for X amount of time. Now, based on where I’m at, where do I think this company can go?”
What’s realistic for you to achieve? If your ultimate objective is to devote 5-10 years to your business then get bought by a bigger rival, you’ve got to understand that’s unlikely to happen.
At Mailshake, we said, “When we’re at $1 million, we want to get to $10 million – and here’s what we think we can do to get there. And then from $10 million, we want to get to $50 million.”
When we get to $7 or $8 million, we’re going to check in and ask ourselves, “Is $10 million still possible? How about $50 million?”
Obviously, I would love to go a lot higher than $50 million, but that’s just too far out to be thinking about right now. So I put two rocks in place and say, “When I get close to that, I’m going to go think about those other things.”
This is where pricing levers and product become more critical.
In my experience, companies are usually led by one of three things:
You’re going to want to figure out which camp you fall into. Maybe you have a little bit of everything – a lot of companies do – but ultimately you’re still going to be dominant in one area or another, and that’s where you should be building your team to be as strong as possible.
To get to $1 million, you need to be generating about $83,000 in monthly recurring revenue. So how many customers does it take to get you there?
Well, let’s say you’re charging $50 a month for your product. That means you need approximately 1,600 customers to hit an ARR of $1 million. But if you’re charging $100 a month, you only need half that number of customers. Or if it’s $1,000, you only need 83 customers. If it’s $10,000, you only need eight customers to reach that magic $1 million mark.
This is important to know, because you can see how pricing has a very clear and substantial impact on hitting your revenue goals.
Can you increase your pricing? At Mailshake, on our road from zero to $100,000 ARR, we signed up 15,000 users. We wouldn’t even make it to $100k with that customer base, because we did a lifetime deal and used it to build our word-of-mouth engine, which got us entry into a market that we were pretty late to. So effectively, our fees were dirt cheap or nothing.
Now, to get from $100,000 to over $1 million, it was clear we needed to change our pricing. We were charging $9 a month, so we would need thousands and thousands of customers (9,259, to be precise) to make it work – it just wasn’t going to happen.
So we increased pricing – in fact, we doubled or even tripled it. And then at $1 million we’re asking ourselves, “Okay, how many more customers can we get? How many more customers are out there?”
This stage of growth is also when you should hire somebody to look at churn – maybe a customer success person, maybe a consultant, maybe someone in product metrics.
Whoever they are, you need them to find your bad customers. Where are your high-churn customers coming from? Then you can do less of that specific activity, or you can fix what’s going wrong early on in the funnel.
Typically, I’ve found activation is the biggest problem, by which I mean customers fail to activate, or maybe they’re aggressively sold to, or you’ve got a product issue at the activation stage that’s causing people to churn.
If you have high churn further down the line, it’s typically because your product isn’t being used enough. So you need to be asking:
You don’t want your product to be seen as a “nice little tool” that saves users a bit of time; you want them to see it as a whole platform.
To get there, you need to figure out how you can expand your product to be used more, so that it’s valuable for a longer period of time.
In other words, you’re effectively using your product as a marketing channel that compels customers to use it more. Maybe you can continue to grow by creating more micro-tools and features, or launching new updates all the time.
So how do you figure out what your dev and product teams should be focusing on?
Speak to your sales reps! Ask them about the most common reason that they don’t close a deal.
Let’s say it’s because you don’t integrate with X, Y and Z. So if you built those three integrations, guess what? You can go back to the prospects and sell them.
Or maybe you’ve missed the boat on those specific prospects, but that will reduce friction with other potential customers, so you increase conversion by expanding your product.
That’s why I see product as a very big function of marketing.
So far, it’s mostly been about the decisions you need to take within specific areas of your business – which processes do you need to build? Are your prices right? Are you chasing the right customers?
But as a founder, you also have to make some personal decisions at this stage.
Full disclosure: I hate the term “lifestyle business.” It’s really, really hard to build any business of any size, and I would never discount any business in the world that’s making $5 million or $8 million or $10 million. Those smaller businesses make up more of the US economy than the larger companies do.
You need to ask yourself some honest questions here. If you have a $5 million business, what do you want to do with that money?
Do you want to just increase your own salary?
Or do you want to invest in growth to help it become a $50 million business?
This is a super valuable piece of advice: whether or not you actually want to sell your business: act like you do.
You want to operate your business as if it’ll be sold in six months or a year from now, because it forces you to focus on all the right areas. Operating a company that’s built to be sold ensures that you have a good management team, you’re profitable, and you have healthy growth.
If you get a lot of churn, you have a sputtering growth engine that needs work every couple of months.
So if you build your company to be sold, it will be more efficient. You’ll be happier as a founder. And you’ll be focusing on those hard things. Like, what can I build in my product that can give me strategic value?
And frankly, this is an exercise I don’t think people do enough of, or early enough.
Now, let’s say your goal is 100% to sell the business. That means you also need to figure out who you’d be a strategic acquisition to, and what they would want from you.
If this is the route you’re going down, I’d urge you to actually reach out and introduce yourself to those people, whether they’re your competitors or are in adjacent fields.
Go to the events they go to, and make sure you find an excuse to bump into them or get an intro. You want them to know your name. Maybe you share a little bit about your company before you’re ready to sell because in a perfect world, you would keep them up to date.
So here’s an example: at Mailshake, one of our potential acquirers would be Salesforce.
Now at the moment we’re too small for Salesforce, and we likely will be for a long time. But we know a lot of people at Salesforce. We’ve gotten feedback from them. We know some of the Salesforce ventures folks, we just say “Hi” to them. We keep them up to date.
They laugh at our numbers – and when we first built the relationship, they were definitely laughable! But now they’re like, “Oh, okay, that’s a little better, but still laughable.”
It gets better every time! And this is definitely the stage to start cementing those relationships.
Is your business at this stage? What are you doing to maximize growth? Let me know in the comments below:
There’s no silver bullet to growing a business.
The actions you need to take are massively dependent on the size of your company.
Stuff that works for a six-month-old startup just isn’t applicable to a vast enterprise, and vice versa.
In my last article, I spoke about maximizing growth for businesses at that early startup stage, with annual recurring revenues (ARRs) of up to $100,000.
Now, I’ll be talking about the next stage – companies with an ARR of $100k to $1 million. I’ve got hands-on experience driving growth for a few businesses that fit this mold, like Mailshake and Right Inbox.
At this stage, your hustling days are behind you.
You’ve already hit on a couple of channels that work for you. Now it’s about making them scalable, building some processes, and hiring a team, because if you’re going to grow your business further, you can’t do it all yourself. That’s the opposite of scalable.
Look at your company or your product as a funnel.
You need visitors to your website. You need to get those visitors to submit their details via a contact form, or to sign up for a product demo or free trial. Once they’re in the signup flow, you need to get them to convert.
Having a sales function will help move your prospects through that funnel. They have the bandwidth to nurture leads who aren’t yet ready to buy, which is something you likely don’t have because you’re too busy running the business.
Hiring your first salesperson is a big step in the journey of any business. And it’s a very different task to (eventually) hiring your 10th salesperson.
Finding someone with the right persona is super important. You don’t need a sales manager at this stage – you need a doer. Someone who’s going to be hands-on and able to take action, even if that means building a whole new process or creating new sales slicks from scratch.
They need to take responsibility for everything sales-related so that you can focus on other areas of the business.
You don’t have time to spend all day cold-calling potential prospects. And you don’t have time to handle all the marketing yourself, either.
You need to find a marketing person who can do that for you.
Their core strength or skill set should align with the core channel of your business. With Mailshake, our core channel is SEO and content creation, so that’s the sort of marketer we went out and hired. Someone with the experience to scale our content and SEO operation, so I as a founder could go and figure out some other channels.
On a related note, you want to be figuring out customer support at this stage.
There’s marketing value to customer support, because when you’re speaking to your customers, you’ve got the opportunity to generate growth from their accounts.
Maybe you launch a referral program. Or maybe you start driving them to engage more with your content by sharing helpful articles from your blog. That way, you’re not just some product they’re paying for – you’re a genuine expert that’s offering real value to their business.
One of the things that worked for us early on was linking to our latest article or webinar from our email signatures. It’s super scalable and low impact, and it got a bunch of new eyes on our content.
Is your business at this stage? What are you doing to maximize growth? Let me know in the comments below:
It’s no secret that increasing numbers of internet searches are being performed on mobile, not desktop. In fact, last year mobile internet consumption overtook desktop as consumers’ device of choice for accessing the world wide web – a trend that shows no signs of letting up anytime soon.
Continue reading How to Turn Web Traffic Into Mobile App Users
Historically, we’ve been conditioned to think of our competitors as enemies; that they exist purely to try and steal our share of the market, and that the only way to respond is to try to steal theirs.
“I went to so many meetings where we had to define other companies as the enemy. ‘We’re doing 92 percent of the market in terms of PR impressions!’ ‘They don’t even have a social plan!’ ‘We’re gonna crush them!’” Ted Bauer, writing about his experience working for a travel consortium company
Many big corporations are testament to this attitude.
Walmart and Target frequently step on each other’s toes trying to corner the same niche markets.
Domino’s, Pizza Hut, and Papa John’s have attacked each other’s brands numerous times. In fact, in 1997 Pizza Hut and Papa John’s took so many shots at each other that the feud eventually had to be settled by the U.S. Supreme Court.
Continue reading Why You Should Be Friends with Your Competition
“Sentiment analysis is a really handy tool which sweeps through the internet looking for mentions of your brand or product and, then, categorises the overall ‘feeling’ of what people are saying about you. The categories are ‘Positive’, ‘Neutral’ and ‘Negative’ and, with some tools, you can dig deeper to get more insight into how people feel about your business in terms of satisfaction. With some tools, you can also read actual comments for a more ‘human-centric’ take on the results of your sentiment analysis.
Sentiment analysis is important for us at Number For Live Person as it helps us to see how accurate our results are and to make improvements based on customer satisfaction.” Dima Suponau, Former Microsoft, CEO & Founder Number For Live Person
Applying sentiment analysis across different departments will have a positive impact on your business bottom line. Sentiment analysis, also called data mining, can help you measure your PR and marketing campaigns, improve customer service, conduct market research, and develop a better product.
There are challenges when it comes to sentiment analysis, but it is worth the effort.
How can you effectively apply a sentiment analysis system? How does sentiment analysis algorithms work? Here’s everything you need to know about sentiment analysis!
Before we delve into the nitty-gritty of data science, machine learning techniques, and text analytics, let’s answer a simple question — what is sentiment analysis?
Sentiment analysis, also called opinion mining, is the process of text analytics that helps you understand the author’s emotions. Sentiment analysis tools classify online mentions as positive, negative, or neutral.
Sentiment analysis provides you with qualitative data and helps better understand the true meaning behind the numbers.
Your target audience expresses its thoughts and opinions online. Listening to what they have to say and analyzing survey responses or social media conversations will help you prepare products or services tailored to their needs.
Automated sentiment analysis can identify problems you are not aware of. For example, are your customers happy with your packaging? Or the shipment company?
They might leave some valuable feedback on social media channels you are not part of. Finding and analyzing these comments will help you stay one step ahead of your competitors and become an industry leader.
Sentiment analysis applies various natural language processing techniques to analyze and classify online mentions. Moreover, the analysis uses machine learning to provide more accurate results over time. The text analytics get better with every analyzed result.
There are three types of sentiment analysis algorithms:
– rule-based
– automatic
– hybrid
A rule-based sentiment analysis applies predefined rules to online mentions.
First, you create a list of expressions and words. If one of them was used in a sentence, the algorithm classifies the statement as positive, negative, or neutral.
This approach to sentiment analysis gives you full power over the process. Based on the sentiment lexicons you have created, the tool will categorize the mentions exactly how you need it.
There are several disadvantages to rule-based sentiment analysis.
Since the analysis is based on positive and negative words, the system will have trouble with the analysis of different combinations of words. For example, the expression “pretty bad” or “not bad at all” (in british it means it’s actually really good) can be confusing, as it contains two words with opposite sentiment.
Data scientists do their best to improve the process of sentiment analysis. That is why they came up with automatic methods of sentiment analysis.
Automated algorithms tag the mentions as positive, negative, or neutral. Deep learning ensures that the more data the system can crunch and categorize correctly, the more accurate the results will be in the future.
In other words, thanks to data mining, sentiment analysis tools will be able to provide better results every day.
Machine learning algorithms also ensure that a tool can correctly identify sarcasm or irony. Of course, the system is not perfect yet, but it is getting closer.
Automated sentiment algorithms will also save you a lot of time. Instead of manually searching for mentions and setting up rules, a media monitoring tool will perform the process for you. You will get actionable insights at your fingers.
Last but not least — there are hybrid approaches to sentiment analysis. In that case, you can manually assign the sentiment to the mention and help a machine algorithm get even more accurate results.
“Sentiment analysis is an online tool which helps businesses to snoop on customers and potential customers to see what people are saying about their brand. Using keywords, sentiment analysis quickly collects comments made online and sorts them into positive, neutral and negative to give you an overall view of how people feel about your product or business.
At UpperKey, we’ve been using sentiment analysis for some time now. As a property management business, our reputation is everything and we work really hard to protect it. Sentiment analysis helps us to do this by identifying negative comments and complaints and dealing with them quickly.” Johan Hajji, CEO & Founder at UpperKey
There are two ways you can implement sentiment analysis into your company — a sentiment analysis tool or an API.
Before you decide on any of them, you should examine your needs and your available resources.
Sentiment analysis is one of the features of many media monitoring tools.
The premise behind the tool is simple — the tool collects all publicly available mentions containing your predefined keyword and thoroughly analyses the results.
Media monitoring tools automatically assign positive, negative, or neutral sentiment to the collected mentions.
This type of solution has many clear benefits. You can log into the dashboard and filter the mentions to examine only positive or negative statements.
Moreover, you can correlate sentiment with other metrics, for example, the volume of mentions or influencer scores. That way, you can analyze the results in-depth and make more informed business decisions.
Most media monitoring tools operate in SaaS models, so you can use them only when you need to for instance Brand24 would be a good example.
On the other side of the spectrum, you have sentiment analysis APIs.
There are many open-source libraries available, mainly in Python and JavaScript, as those languages are best for deep learning and advanced data analytics.
If you have experienced engineers with data science and programming background, take a closer look at some of these Python libraries:
– NLTK
– TensorFlow
– Scikit-learn
– PyTorch
If you are more interested in Javascript, take a look at these NLP libraries:
– OpenNLP
– Stanford CoreNLP
– Lingpipe
The obvious advantage of a customized sentiment solution is the ability to tailor it exactly to your needs.
Of course, you need manpower to implement this solution. It will be expensive to build your sentiment analysis algorithm as you need your resources to do that.
Sentiment analysis is the cherry on the top of your overall brand analytics. You can implement the insights you get from sentiment analysis across your organization, starting with the customer experience team and ending with the IT team responsible for product development.
What exactly are the benefits of sentiment analysis?
Brand monitoring helps you manage and protect your brand image and reputation online.
Brand reputation is one of the most important assets your company has. People buy from brands they trust.
Analyzing the sentiment of online mentions about your brand will help you spot any surge in the number of negative mentions. You can prevent escalation of most crises only by reacting swiftly to unhappy consumers.
But sentiment analysis in brand monitoring is much more than that.
“Brand monitoring is a goldmine of information when it comes to information about your brand. The information from news sites, blogs, podcasts, forums, and various social media channels will help you craft the right message for the right audience” says Lukasz Zelezny, Search & Social UK Based Consultant.
Understanding customer feelings is the context of your numerical data. Real-time sentiment analysis will help you understand how your brand position itself and how your image evolves.
Unfortunately, you can try to prevent a crisis, but you will never be 100% immune to one. Sooner or later, a crisis will hit you, and you will have to switch into crisis management mode.
Sentiment analysis will help you identify the root of the problem. Pinpoint the main problem, and you will be able to prevent the crisis from spreading.
Besides, you will be able to monitor the response and lead through the crisis. Are you hitting the right tone? Is the response helping your brand? Monitor sentiment during the whole duration of the event and use the knowledge to prepare even better for the future.
Your existing and potential customers are a goldmine of insights and feedback that can help you develop a product tailored to their needs.
Adding sentiment analysis to the customer experience evaluation will help you pinpoint your strengths and weaknesses. You can show off your best qualities and increase the gap between you and your competitors.
The same rule applies to your weaknesses. Your customers may complain about the issues you are not aware of. Identifying the problem at an early stage will help you provide a solution quickly. Listening to your customers will help you position your brand as a customer-centric company.
“Hugely important is what it is. Sentiment analysis tools use machine learning to chase up mentions of your brand, product or service online and to then present the overall results in terms of positive, negative or neutral. As well as being able to drill further to get more insightful results and read actual comments, these tools are now being trained to recognise emojis for even more accuracy.
I regularly use sentiment analysis at Chilifruit as a lot of my new business is gained by word of mouth and by online reviews. As such, it’s absolutely vital that I know what is being said about my brand at any given time. In the rare case of negative comments, I’m able to respond directly and nip the issue in the bud before it becomes a reputational problem.” Milosz Krasinski, Managing Director at web consulting company Chillifruit
Your customers will not only complain online. They will also leave valuable feedback that helps you improve your product, service, and messaging. Researching consumer attitudes is a must-have these days.
No matter in what industry you are operating, your ultimate goal is to present your product or service to the right audience. People who are actively looking for the solution you have to offer will also tell you what they like and dislike about your offering.
You can also apply sentiment analysis to customer experience. It is much cheaper to sell to your existing client base than to acquire new customers. Your customers expect a hassle-free, smooth experience. If you are not able to provide one, they will look for an alternative.
Automated sentiment analysis and text classification will help you swiftly assign any incoming queries. Reducing the time your customers have to wait for a response will result in reduced churn levels.
Sentiment analysis will not only help you better understand your customers; it will also improve your understanding of your business niche.
You can compare your products to your competitors and identify any niches your product will fit.
If you apply the sentiment to social media accounts, you can see what type of content resonates best with your audience and on which platforms you are most likely to succeed.
Sentiment analysis should also be an indispensable part of your PR and marketing campaign assessment.
Most PR professionals and marketers focus on the number of mentions, the importance of the source of the mentions, or social media reach.
Sentiment analysis is the cherry on the top of all these data.
After all, a high volume of mentions is not an indicator of a successful campaign. But a high volume of mentions and prevailing positive sentiment most certainly is!
Since we already know a lot about the benefits of sentiment analysis and data mining, let’s examine the challenges you will face.
Although sentiment analysis is getting better with every analyzed mention, the process still has to be aware of its shortcomings.
The biggest challenge is, of course, detecting irony and sarcasm. That shouldn’t surprise you, given that many people have a problem with recognizing sarcastic statements.
Consider this statement:
This is better than nothing.
Would you assign it a positive, negative, or neutral sentiment? As with sarcasm and irony, it is hard to decide without the context. Your sentiment analysis tool of choice will face the same problem.
At this point, you might think that sentiment analysis is not worth the effort.
But it is!
First of all, sentiment analysis will assess the vast majority of online mentions correctly. From the start, you will be able to benefit from sentiment analysis and implement the results across your company.
Secondly, the automatic and hybrid approaches to sentiment analysis will improve the results over time. Of course, the algorithms have to be based on large data sets. But you will see improvements over time.
And thirdly, the main problem of sentiment analysis — sarcasm and irony — is not that common. People usually say what bothers them right away.
The answer is simple — yes, you should.
Sentiment analysis will give the necessary context to other data available at your company. You can apply the data to many different aspects of your business, from brand monitoring and product development to customer experience and market research. Incorporating sentiment analysis into your overall brand analytics you can work faster, deliver more accurate results, and exceed your KPIs.
Sentiment analysis is no longer a technological curiosity. The process has practical applications that will help you bring your business to the next level.
