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35 - Software As A Service 1 - Smackdown

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SAAS Smackdown P1

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Episode Recap:

What I learned when launching our first real SAAS program.

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Best Quote:

I remember the very first software as a service we ever had was called Digital Repo Man. It was this really cool product where basically if you had an ebook or some product that you were selling, you would use Digital Repo Man to lock it down. Then you could give it to your customers and when your customers wanted a refund you could turn their license key off so they couldn’t give it to other people.

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Transcripts:

This is Russell Brunson and this is the Marketing in your car Podcast.

I hope you guys are having an awesome day today. I’m actually not driving to the office today. I’m driving to a hotel to pick up our programmer. He is a stud. Some of you guys may know him.

He is in town for the next couple of weeks working on some cool projects, so I am going to grab him from the hotel. I have kind of a little longer drive today, so I thought I would do a podcast and talk to you about what we are doing right now, because it’s exciting.

Just to get the wheels in your head turning if you are doing any software as a service products, SAAS (software as a service). This is kind of an interesting time in the internet world.

When I first got online, the thing to create were these little .exe files, desktop-based. I remember Armen Morne things like E-cover Generator, Header Generator, Sales Letter Generator, all these different products. When I first got online, I saw all the things that Armen was doing, and I was like, “I want to do software too.” I did Zip Brander and Form Fortunes and all these other little software programs.

Back then, the cool thing to do was create these little downloadable software programs to download and run on a computer. That’s what we did. People would pay for it one time and we would end at that point.

I remember the very first software as a service we ever had was called Digital Repo Man. It was this really cool product where basically if you had an ebook or some product that you were selling, you would use Digital Repo Man to lock it down. Then you could give it to your customers and when your customers wanted a refund you could turn their license key off so they couldn’t give it to other people.

It was a cool thing. For whatever reason, it didn’t sell that well. I think it’s one of those things where it’s a prevention versus a cure. People don’t really want to buy a prevention. They want to buy a cure.

They wanted to buy something for after someone steals their book so they can go out there and beat up the customer that did it, but they’re not willing to pay money to lock it down ahead of time.

Anyway, it didn’t do that well, but it was the first time I had sold software as a service, where people log into a members area, they pay you monthly. It was kind of cool.

My favorite thing was that if I made an update to the software, it automatically made the update for everyone. Whereas with Zip Brander when I made an update I had to contact all my customers, give them something to download a new version.

90 percent of our support questions were because people hadn’t downloaded the newest version. It was kind of a nightmare. Software as a service became really big for a while, and we started doing some things in it, but I never really paid a lot of attention to it.

Then a little while later WordPress came out and we started building three or four different WordPress plugins and themes and stuff like that, because the WordPress is so big. I’ve got a friend who is probably listening to this podcast, Stu McClaren and he runs a site called WishlistMember where they sell membership plugins for WordPress.

They’re doing awesome. They’re making an insane amount of money with it. I was talking to him back when we were in Kenya and he told me one of the biggest issues with it is that their support is kind of a nightmare. Everyone has different servers and different hosting and different version of WordPress, all these different things that can happen with WordPress. Then if you make an update, everyone with your software has to go download the update.

In January this year, we kind of mapped out this idea for a really cool plugin, and that’s what we were going to do. Then we found someone who had something kind of similar and they went and looked at it. The service we had created is a really cool thing that will go and backup your entire website.

It’s this really cool thing, but it’s kind of hard to explain. It’s awesome. The company saw they had something similar and they built a WordPress plugin. They had it for about six months and then they took it down.

We contacted them and said, “Why did you guys take down the WordPress plugin?”

They were like, “Our software doesn’t need the WordPress plugin. We just used it to get into the WordPress community. But it’s a nightmare. We have to support a billion different website. It got so support-intensive that we just couldn’t do it anymore. Now we’re back to our normal software as a service thing.”

I was like, “Isn’t that interesting?” A company like that had huge VC money and they couldn’t even support a WordPress plugin. Again, this year we were planning on building this WordPress thing out and we finally decided not to go that direction.

We’ve been focusing on three software project simultaneously, which probably isn’t the right way to do it, but they all go hand-in-hand so we did it that way.

One is a shopping cart that we are calling Backpack. One is an analytics and follow-up tool called Actionytics. Then one is this really cool front-end website creator, and we don’t have a name for it yet. Hopefully we’ll think of a name soon.

After these programs are finished, we’ll be excited to start rolling them out. My focus for next year is 100 percent this new software company and these three products we have. I think the potential is really big with it.

That’s kind of the direction that we’re focusing on. As we’re developing software programs, for any of you guys who are thinking about developing software, I wanted to give you some tips and tricks and ideas to think about that we have found helpful and might be useful for you guys if that’s the way you’re going.

By the way, if it’s not the way you’re going, you should look at it. If you get one really good software program, it will feed you for the rest of your life.

One of the big things is the first version of our landing page creator was actually an automated webinar site. It was called ClickFusion.com. I loved that domain name, I love the logo, I love everything. We built this automated webinar software which I think is the best out there by far.

I think the problem is we have way too many features. We can do anything for everyone. Because of that, no one ever adopted it. It was too much stuff.

A little while ago I read a book called Rework by 37 Signals. Of all my marketing books, it’s probably the one I’ve read the most times. Stu, who I was talking about earlier, actually recommended it at Pirate’s Cove. Rework is a book written by the owner of 37 Signals, and they have Base Camp and a lot of other products like that. They’re all software as a service kind of things, and they were talking about their methodologies to create software.

One of the big takeaways I had is that they draw out their feature list, and they cut it in half. Then they cut it in half again and again, and they try to make the most bare-bones, simple thing as possible.

When customers come and ask for features, they say no. If people are looking for this or that, they tell them to go try their competitor. They basically say they try to keep things so simple and easy that you really can’t mess it up.

It’s a different mindset. Most software people I know look at software like Bill Gates and they want every feature in the world like Microsoft Word with a billion features that no one knows how to use except the bold, italics and underline.

I just kind of thought about that from our side. Let’s make things that are simple, easy, that everyone can use. As we’ve rebuilt this new automated webinar/landing page/funnel generator, this time around we’ve built it way differently, where it’s stripped-down, bare bones.

It does one or two core things really well, and that’s it. It’s turning out amazing. I’m excited to start marketing, because I think people are going to really jump on it, because of how easy it is to use.

That’s kind of what I’m doing right now. I’m at the hotel, going to grab Todd right now. I may do part two of this tomorrow or even tonight. I want you guys thinking about first off, creating some software, but second, creating it very simply, very easy.

If you’re thinking about that at all, I would go read Rework by Jason Fred. You should read that no matter what. Every mistake I’ve made in business, when I read that book I was like, “Crap, I made that mistake and that mistake.” I found tons of them.

That’s about it for today. I hope you enjoyed this podcast and I will talk to you all either later today on part two of this one, or tomorrow. Thanks everyone.

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