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You may already be familiar with our case study of how we made $1 million for the SEO software company Moz.
The following interview reveals what happened next.
We recently spoke with Rand Fishkin (Moz’s founder). As you probably know, Rand is a leading visionary and perhaps the industry’s most famous marketer.
In the following interview, Rand describes the key decisions that grew Moz from $1.4m in 2008 to $42.6m in 2016.
He also explains why conversion rate optimization is “the most important marketing activity”—and how it has done much more than improve Moz’s sales…
Rand: Over the years, Moz has moved from consulting to subscription-based publishing to software as a service (SaaS).
Three catalysts led to those transitions:
1. We discovered what we were good at and passionate about—which was driving people interested in SEO to the site and providing them with valuable information for free.
Why free? My hatred for gated content is almost as deep as my love for the software business, and I stayed true to that part of myself. I firmly believe that having a deep knowledge of self is crucial for entrepreneurs and business leaders—it allows you to do what excites you both personally and professionally. Companies driven by engaged, passionate leaders dramatically outperform their less-excited peers.
2. We became drawn to the SaaS model for its scalability and high margins.
3. We sought to satisfy our venture capital investors. There is significant pressure to reach the exit point with as high a revenue multiplier as possible. If we were a consulting firm bringing in $42 million, we might reasonably expect to be bought for between one and two times our revenue. However, as a software business with that same revenue, we could reasonably expect a multiplier of three to eight. Every dollar you make in software is worth so much more when you exit or sell.
Rand: For a company seeking rapid growth—especially a venture-backed company like Moz—CRO is simply a must-have. CRO is the most important marketing activity because it makes every visitor exponentially more valuable.
Initially, we had high traffic, but few visitors took the next step. It didn’t matter to the business if 50,000 visitors read our blog—what mattered was that we only had a handful of conversions from those visitors.
The disconnect presented a massive opportunity to leverage CRO—and so we did.
Rand: Quite frankly, the first time I worked with your team, I didn’t even realize how valuable CRO was…but I do now. I understand that CRO, at its best and broadest, is useful from both a product and a user experience perspective. It helps you understand your audience’s intent, behavior, and preferences.
My favorite model—the model your team developed—involves asking different groups of customers and potential customers for feedback.
I can learn why they did (or didn’t) buy, what they hoped to gain from their time on my site, what they found most (and least) valuable about their experience, and so much more.
Many times, CEOs, founders, and executives don’t ask those questions soon enough (or at all). But when you get answers, you gain a new perspective—one that informs much more than your landing pages. It informs your company strategy, your product development, and your value proposition.
That’s the beauty of the research process behind CRO: it can accelerate your growth and how you appeal to your market in ways you wouldn’t have imagined.
Many people put CRO into far too small a bucket. They think of it only as a way to convert page visitors into buyers.
It is that, but it’s also so much more.
I’d encourage anyone still on the fence about CRO to ask themselves one question: Why have you yet to invest?
If you’re at too early a stage in your business and still need time to develop your product or boost traffic, that’s reasonable. Forgivable, almost.
But if you’ve simply yet to grasp the power of the practice? You need to examine the case studies of companies that have built in CRO as a core capability and skyrocketed as a result.
Google won the search engine wars of the late 1990s and early 2000s by concentrating on the user experience beyond the simple entering of a search term.
Twitter recently released quarterly earnings that, for the first time in several years, beat analysts’ expectations dramatically. CEO Jack Dorsey attributed the success to higher user engagement gleaned from an algorithmic timeline that better met the needs of site users—the exact principle behind CRO.
Bottom line: For Google, Facebook, and Twitter, it’s never been about only optimizing technology. It’s just as much—or more—about understanding user behavior.
Rand: Incremental changes—such as changing the headline of a landing page—are indeed a component of CRO. But they aren’t the main component—far from it.
I believe it’s more important to take the view from several thousand feet up, above those more in-the-weeds questions about button colors or image placement.
Ask why happy customers are happy, why unhappy customers are unhappy, and what problems you’re able to help them solve.
When Conversion Rate Experts worked with Moz, we took the long view. And what happened? We went from a $1.1 million run rate to a $2.8 million run rate almost overnight.
Those results were huge for Moz, and changed the trajectory of our business, touching everything from the direction of our product, how we invested, and how we approached changes to our business model. We’ve been improving ever since.
And we’re not done yet.
Here are some of our key insights from working with Moz.
Moz operates by what it calls the TAGFEE code; it focuses on being Transparent, Authentic, Generous, Fun, Empathetic, and Exceptional—values that are all conducive to successful CRO.
Transparency and authenticity lead to Moz talking publicly about its successes and failures. And when nobody fears failure, everybody feels safe to experiment. Like all our best clients, Moz understands that long-term success requires short-term failures. It’s hard to get one without the other.
Moz’s team goes to great lengths to practice empathy, the willingness to understand another person. Empathy is at the heart of great conversion.
Moz embraced CRO after facing pressure from an external source: VC investors. This is common. Many of our clients come to us because they face external pressures from
The scenarios that keep executives awake at night are often those that prompt an investment in CRO.
Of course, ideally, companies would embrace CRO from day one, as Rand wished he had.
When Rand hired us, he invited his entire executive team to join the project—the CFO, CTO, Chief Product Officer, Marketing Director, Creative Director, and Customer Service Manager. Why? Rand understood that CRO wasn’t just about marketing—it was about developing the business as a whole. It served as a compass to guide the company toward fast growth.
Moz is in tune with its visitors and customers because it is the hub of one of the world’s largest marketing communities. As such, it has become adept at seeing the business through its customers’ eyes. It can intuit which features they’ll love. Such connectedness is rare in web companies.
We’d like to thank Rand and the Moz team for their transparency and generosity in sharing their story.
1. We have already grown companies just like yours. (We have helped to grow clients in 37 countries in 11 languages.) So wherever you are in the world, if you’d like us to work on your website—to dramatically increase its profits—then claim your FREE website strategy session. On this free phone consultation, one of our experts will discuss your conversion goals and suggest strategies to double your sales.
2. If you’d like to learn conversion for free, go to our “Learning Zone” page, where you can download templates of million-dollar winning pages. Or, if you’d like us to build your company’s in-house capabilities (not for free), then contact us and we’ll discuss your requirements.
3. If you’d like to work for us—or see why our team members love working for us—then see our “Careers” pages.
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