Hey everyone, in today’s episode I share the mic with Peep Laja, founder of CXL, the knowledge leader in the optimization space.
Listen as Peep discusses how CXL began as a blog and turned into an agency, how they increased the readership of their blog to 300K per month, the secret to getting an 80% qualified leads rate, why building your email list should be top priority, and how switching from pre-recorded videos to live courses jacked up participation rates by 600%.
Download podcast transcript [PDF] here: Peep Laja On How CXL Captures 150-200 Emails/Day & Generates 100 Agency Leads/Month TRANSCRIPT
Time-Stamped Show Notes:
- 00:39 – Leave a review and rating and subscribe to the Growth Everywhere Podcast
- 01:07 – Eric welcomes Peep Laja
- 01:38 – CXL is an optimization company that started as a blog and grew to become an agency; it is not a training institution
- 02:07 – CXL has a total of 16 personnel divided into two teams – service and education
- 02:39 – Before starting his blog, Peep researched what made blogs successful and decided that he would create data-backed, long-form blog posts
- 03:21 – They now have 300,000 readers a month
- 03:36 – In the beginning, Peep wrote 1 to 2 blog posts a week but now they have 2 full-time writers and occasional guest writers
- 04:36 – Peep does not prefer guest posts because they usually do it for the back links—this can lower the quality of posts and their content editors spend more time editing theses posts rather than writing content
- 05:06 – When content is pitched, Peep does not pay the writer; if they approach an expert, they pay $350 per post
- 05:41 – They get 150 to 250 emails a day and generate over a hundred agency leads a month
- 06:13 – The email list is the main sales platform for CXL Institute
- 07:29 – Peep has added pricing on their website to eliminate low quality leads and they now get 80% quality leads
- 08:30 – The company that hires their agency and those who enroll in the Institute are the same
- 09:08 – In order to invest in employee training and growth, you have to be a big business
- 09:18 – Peep and his company had a big a-ha moment when they realized that their services could only be afforded by big companies that already had millions in revenue as opposed to their first target which was small companies
- 09:48 – CXL Institute does training in digital analytics and optimization through video programs and live online courses
- 10:20 – There is a problem with online courses as completion rates are low
- 10:53 – The live course is CXL Institute’s way to address the problem
- 11:04 – The dates are scheduled and it’s a live Q&A with an instructor who does live screen sharing
- 11:28 – The course participation and completion rate of CXL Institute is at 600%
- 11:50 – They have an all-access pass for companies
- 12:10 – Old sessions are recorded and can be accessed from within the site and new ones are done every two weeks
- 12:41 – The price for recorded and live are the same
- 13:03 – A typical course is priced at $499 and shorter courses are at $299
- 13:16 – All-access pass is $299 per month
- 13:48 – The course offers fundamentals as well as discussions on new products
- 14:05 – On average, they have 100 to 150 people signed up in a course
- 14:25 – The biggest thing in CRL right now are the better and smarter tools, AI and machine learning
- 15:03 – Segment is a SaaS tool that is combining all the cool stuff that is possible with personalization
- 16:10 – Segment is able to personalize their website based on your business
- 17:04 – Peep learns about new trends by going to conferences and hanging out with people
- 17:52 – To tailor your website, you can use Intellimize or Google Optimize
- 18:27 – Customer acquisition is done through driving traffic to the website, capturing emails and the email list
- 19:02 – Time-based autoresponders work less and less
- 19:25 – Trigger-based email is more effective
- 19:41 – Peep’s company also look at every single email for compatibility with their services and sends them a manual email to set a phone call for sales
- 20:39 – In statistics, the average means very little
- 21:36 – Peep’s company does all-inclusive CRL work for companies
- 22:05 – The price starts from $10,000 per month and goes up depending on how big the business is
- 23:32 – If you are an agency business working in CRL, it is better to work with big businesses
- 23:44 – CXL Live is a growth and optimization conference
- 24:24 – The event is done on a remote hotel
- 24:29 – The conference is an extension of the brand
- 25:09 – The goal is to foster real relationships by building the online community together in real life
- 26:04 – An ideal person to work with in organizing a conference is someone who can bring in a lot of good speakers
- 26:39 – What’s one book that you’d recommend to everyone? – Purple Cow by Seth Godin
- 27:00 – How does Peep learn? – Doing it and surrounding myself with people who have already done what I am trying to do
- 27:39 – Connect with Peep on his website
- 27:41 – End of today’s episode
3 Key Points:
- The quality of your content is of the utmost importance in building a blog.
- The effort is the same when doing business with small vs. big companies; the difference is the income.
- Live courses are better than modular online courses.
Resources From This Interview:
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Full Transcript of The Episode
We used to get a lot of low quality leads. By low quality, I mean people who couldn't afford us. We used to waste a lot of time on the phone with people who say, "What do we get for $400 a month?" It was like, "Man, my time spent on this phone call is worth more."
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All right, everybody, today we have a good friend that I've been following for a very long time. I've actually had him help with some other stuff in the past. Peep Laja, really well known in the online marketing space, especially around conversion rate optimization. He's the founder of CXL, formerly known as Conversion XL, which is where people go to learn about conversion optimization. More than that, which I'll let Peep talk about in a little bit.
Peep, how's it going?
It's good, man. Thanks for having me.
Yeah. Thanks for being here. Why don't you just tell everybody a little bit about what CXL is, first and foremost, and a little bit about your story, too?
We are an optimization company. We've been around for six years now. We first started as a blog that grew into an agency, and now into a training institution. Also, we throw two conferences a year, in the US and in Europe. We are really the knowledge leader in the optimization space.
Got it. Awesome. Just to clarify, are you guys still services right now, or is it strictly focused more around the educational piece?
We have both. We have two teams and each team has their own product.
Great. Awesome. How big's the team, overall, today?
We're at 16. We're very lean and efficient.
The whole impetus around Conversion XL, back in the day, what you used to call it ... I remember when you first launched that blog. This was back in the day, when long form content was ... Not many people talked about it. You started out with long form content. I think right out the gate you hit about 100,000 readers a month. Can you talk about that a little bit?
Yeah. When I started to blog, I did my research into what kind of blog posts get the most back links, most social media shares, and also was doing competitive research, seeing other blogs out there, what type of blog posts are they publishing, and how could they be better?
The answer was I should write data backed long form blog posts and that's what I did. I started with blog posts that were at least two, three thousand, sometimes five thousand words long. In 2011, hardly anyone was doing it, so the strategy worked and there was rapid growth.
How many visitors are you getting per month right now?
We are around 300,000 a month.
What does that ... Just so ... People are probably wondering in the audience, "How do I get there? How much content should I be publishing?" What exactly are you doing there? What does the cadence look like?
For the first three years, it was just me, writing one to two blog posts a week, so not that many. Writing good blog posts takes a long time, eight to 16 hours per post. Now, we have two full time writers, occasional guest posters as well, although not so much anymore, because they're mostly crap.
We're doing, on average, two posts a week, still long form copy format.
Yeah, I remember back then, I think you had a guest posting program. We can talk about the crap in a little bit, but I think you're very specific about what you're looking for, right? Every claim needs to have a link or a case study to it so there's no theory.
I actually do experience this problem quite a bit, too, where a lot of the guest writers applying are generally ... They're not that good. What have you seen around that? Why do think there's a lot of crap that's been piling up?
A lot of blog posts accept low quality posts. Most people who are guest posting, they do it for the sake of back links. They don't want to put in the effort to write a really good post. It takes my content editors more time to edit their blog posts, and give feedback, than it takes for them to write a brand new blog post. It's just not worth the effort. It ends up costing more than a post written by our team.
And how much are you paying, roughly, per post right now?
Well, if they are pitching us, we're paying nothing. You get the privilege of posting here. If we approach people, which we sometimes do, like if there's a great subject matter expert who knows about a topic that isn't often talked about, then we pay $350 per post.
You guys are at 300,000 visits a month. You have 16 people on the team. What are some other metrics you can share around the business? It can be around revenues, growth rates, whatever.
Revenues I don't really want to go into detail with. We're capturing 150 to 200 emails a day through our lead catcher mechanisms. We're generating about, I should say, over a hundred agency leads a month. Our agency is high tech. Its minimum is like 10k a month retainers, doing done for you, zero programs.
Our email list, of course, is the main way we sell our newest product, CXL Institute. Most of its sales come directly from our email list. So blog generates traffic, they subscribe to our list, then the list is how we make the bulk of our money.
You know we actually have ... There's a fair amount of service based businesses that listen to this podcast. I think it's interesting, because, for us, I think we're collecting about, I want to say, 2,000 or 2,500 emails a month, which is not as much as you. For our leads that we're getting, there are people reaching out directly, that's probably around 150 or 200.
When you say a lead that's reaching out to you, are these people that are saying, "Hey, I want your services," directly, on the site?
Correct, correct. Exactly. Our agency has a landing page. We're up front about what the costs are. We used to get a lot of low quality leads. By low quality, I mean people who couldn't afford us. We used to waste a lot of time on the phone with people who say, "What do we get for $400 a month?" It was like, "Man, my time spent on this phone call is worth more."
Then we added pricing on our website. It was like a drop down. That basically eliminated low quality leads overnight, so now, I would say, 80% of the leads that come in are qualified leads.
Wow. That's awesome. Here's the difference. For us, even though we can, at times, get up to 200 leads a month, I just mentioned 150 a little earlier, the problem with the leads that we have coming in right now is the majority aren't qualified. We're looking at about 10 to 15% that are actually qualified. We refer a good amount of leads out to other agencies where we can't fulfill the work.
I think that's really interesting. It's good context. It shows that, clearly, what Peep's doing in the conversion world is working, because 80% of his leads that are coming in are actually qualified.
Going back to your email list for a second. People that opt in to your email list, are you strictly focused on segmenting them into your course? If they choose their own adventure, do they go into a services funnel? How does that look for you?
What we learned was that the companies that hire our agency and that subscribe to our CXL Institute, the training programs, they're actually the same profile. They're the same companies, with the exception that other agencies join CXL Institute, whereas agencies don't hire our agency.
In terms of the company size, if it's in house stuff, it's exactly the same, because in order to buy, or even need, CRO services, you need to be rather big. A minimum millions of dollars a month in revenue. In order to invest in employee training and growth, same stuff.
Small businesses, they want quick hacks, tactics. They don't think long term. That was one of our big aha moments. When we launched CXL Institute, we thought it's going to be for the small businesses that can't afford our agency, but after many months, we realized that wow, we were so wrong. We should actually be after mid to enterprise sized companies, because they think long term. They want to invest in employee growth and training, and they have the budget for it.
Can you talk about what CXL Institute actually is? What do you get in that program?
We are training people in digital analytics and optimization. That includes design, copywriting, testing, all those things. We have pre recorded video training programs, which is a small part, but the biggest part of it is, we do live online courses.
Here's the thing about online trainings. If you look at all the big players in the market, Coursera, Udacity, Udemy, you name it, they all have the same problem. The big problem is that course completion rates are horrible. People buy the course and they maybe log in once and then never again.
Only 2% get through, right?
Yeah. It's because learning is never a priority. You have always more important stuff in your to do lists. Who prioritizes learning over getting stuff done? What we changed, with these live courses that we're doing, is that these ... One live course consists of four to eight live classes that they place at a fixed date and time, like Tuesday, 9 a.m. or whatever. You actually schedule it in your calendar, so Tuesday, 9 a.m., I have a class. They last for 60 minutes. You can do 60 minutes a week for learning. It's live Q&A with the instructor, included, and it's live screen share.
It's a way better learning experience. Once we switched from pre recorded videos to live courses, our course participation and completion rates went up by like 600%. It's ridiculous. Most everybody is finishing the course.
Self paced learning is still a fit for some, so we have that, too, but the biggest portion, by far, is these live courses. We're releasing two per month. Our main model is we have this all access pass, meaning that your company, you have a bunch of people that need training, so you pay a monthly fee and you get access to every single course that we produce.
That's smart. Okay, does it work ... You have your live sessions and, I'm guessing, the old sessions that you've done in the past are recorded and they can access it in a library. Is that how it works?
That's exactly right. You can go back and watch recordings of past sessions. We have the new ones starting also every two weeks.
That's so smart, because there's people in here, I'm sure they're thinking about, "Oh, how do we get in on the course game," because there's a lot of people ... I almost feel like we're at peak course right now. A lot of people are doing it. The fact that you're building out time to actually commit to doing it live ... I think Seth Godin's course does this too. I'm not sure, 100%.
How does pricing work? How much does the live one cost and how much does the prerecorded old stuff cost?
We actually priced them the same, prerecorded and live, because a, people get more value out of live, so we want to incentivize, or rather, we don't want to incentivize people getting the recordings for a lesser price, because they think, "Oh, it's going to be cheaper." We know they are much less likely to consume the product. We're pricing them the same.
For a typical course, it's $499, like 500 bucks, or less if it's a shorter course. Some of our courses have also been $299. That's per course. If you subscribe to the all access pass, we charge $299 per month. There's an annual option as well. For the price of five courses, you get 24 if you go on the subscription plan.
Yeah. It sounds like a lot of the courses that you're creating right now, these could be new topics that pop up in CRO. Next week, you might say, "There's this game changing new product that came out," and you show people how to use it. So, these courses are new things as they pop up?
It's that, and also fundamentals. People need to learn Google Analytics all the time. It's a mix of fundamentals and new stuff.
Cool. And just a rough range right now. How many customers do you have for these courses at the moment?
It varies. On average, I would say 100, 150 people per course sign up. Some more, some less.
I want to switch gears to talk about CRO, because that's what you're known for. What's new in CRO? What are some trends that you're seeing?
I think the biggest thing that we're seeing right now is that tools are getting better and smarter, machine learning is all the rage, and AI. Of course, there is still no substitution for human brain and knowing what you do, and so on, but when it comes to quantitative data analysis, gathering, and testing, stuff is getting more interesting. Stuff is getting easier to use. We have better capabilities, also, when it comes to personalization.
A good example would be a company that the listeners might know, Segment. It's a SaaS tool. Segment is combining all the cool stuff that is now possible with personalization. If you go to their website, segment.com, and if you work at a big company, they then detect, based on your IP address, what company you're from and their live chat auto populates with, "We had advice for your company." Let's say, "We have advice for Conversion XL."
They'll say, "Our scoring model on the ... " This personalization, they have ... Where you're from, and detecting who you are, is done with Clearbit. Clearbit sends data to Drift, their chat tool. They use [inaudible 00:15:44] as their lead scoring school. They tell me that their lead scoring model shows that I would be a good fit to talk to their sales team. Such a personal sales message has a really ridiculously high response rate.
Also, they do data enrichment with Clearbit so they know what kind of company. Are you eCommerce or whatever you are. They personalize the website to you. If you are eCommerce, their website will show eCommerce case studies, eCommerce testimonials. If you're a really big business, they'll remove pricing, because you know ... Get in touch, pass it on to the sales team. They'll be even able to figure out what your email address is while you are browsing anonymously. They'll do outbound sales outreach to you, just because you visit the website.
All of these things are already possible. Not many are still using it. Just one example of what's coming.
I remember reading a blog post about the segment thing that you just talked about, but where can people learn about this new stuff that you're talking about? I'm assuming a large part is coming from your blog, but where else do you go to learn about this stuff?
I think conferences and hanging out with people. There are various Facebook groups, of course, where people share this stuff. CXL Facebook group being one of them. I learned this, about Guillaume, who runs Growth for Segment, I learned about him from a guy I know. It's just the old grapevine, still doing the work.
I remember reading that post and I talked with my developer about it, one of the people from the team, and then ... Do we have to have Segment to be able to make that work? Because we do have the other ones. We have Clearbit. We have Intercom, things like that, but is Segment the secret weapon?
No, no, no. You can use ... There are various tools. You can use Intellimize to tailor your website based on the data that comes from Clearbit. You can use Google Optimize to personalize your website based on what you know about the user. There are various ways to cook it up. You just have to be creative.
I just think there's something missing on our side, because we do have those two tools, but maybe it's adding Intellimize, which will plug it all together. Anyway, that's a more tactical question.
What's working well for you, for both of your businesses, I guess the services side and the course side, what's working in terms of customer acquisition.
The fundamentals still work the best, which is driving traffic to the website and capturing emails and then emailing. So, email list is still by far number one. I think building your list should still be top priority for most everybody.
What does your nurture sequence look like, since we're talking about email right here? How in depth do you go? Some people keep it really basic. It might be a six email sequence. How complicated is yours?
You know, it varies. More and more, what we're seeing is time based autoresponders, they work less and less. That especially is true for onboarding emails, like, "Hey, welcome to our tool. Did you know it can do this?" People don't care about those emails. They say, "Yeah, yeah, I can figure it out." Your tool should be easy to use enough so that people don't need those onboarding emails.
It's much more effective to do trigger based emails, meaning that behavior based. They do something and because they did something will trigger an email, or an in app message, or something like this. We also, we look at every single email that is joining our list, and through a lead scoring exercise, we identify customers who are most, let's say, best fit for our product. Then we actually send them an email manually, saying, "Hey, could we get on a five minute phone call," then we try to ... You're much more effective trying to sell somebody over the phone rather than just a mass email.
If it's a high fit lead, then we try to get on the phone, close them like that. Of course, keeping in mind lifetime value.
Great. Because you work in this space so much, you know so much around it, what are some crazy stats you can share around CRO? Maybe like two or three that you can rattle off. Do you have anything in mind?
It's the standard thing about statistics that the averages mean very little. Any fancy stats you hear, the chances that any of that stuff will apply to you is minuscule. I don't have any fancy numbers to impress you, I'm afraid.
That point's really important, because most people are probably thinking, "Well, what are some numbers? What's a good conversion rate?" But that answer is it varies. Something like that, from a guy like you, I think that means a lot.
Around your ... Going back to your services, because I'm sure some people in here would be interested, how do you charge for CRO, in general, if people would like to start working with Peep?
Most top players in the industry charge a flat retainer. Of course, what you get for the retainer varies from agency to agency. For us, we take into consideration how many tests we would run per month. For us, it's all inclusive. Not only do we do conversion research up front, that we charge separately for, to identify what should we test and so on. We give you an X amount of A/B tests per month. We also design and code up inside the testing tool.
As I said, we start from $10,000 a month and that goes up, depending on how big the business is. The question we're asking is, if we improve your sales by a modest 1%, how much is that worth to you? If your annual revenue is one million dollars, 1% is what, 10,000? It's not very much. It's like barely a break even.
Of course, they should estimate ROI over 12 months. If they make a million a year, then 1% addition is 10,000 per year. So the ROI is not going to be there. If you are like Marriott Hotels, where your online annual revenue is eight billion dollars, that's going to be a lot of Lamborghinis, 1%.
Based on the value the customer would get, that's where we come up with a flat fee that we charge.
You ask that question first, before you even determine what your pricing structure might look like. If it's a Marriott, it's going to be much bigger.
Exactly. Solely because they get more value out of it. Frankly, working with small business, or large business, the effort is pretty much the same. It's not that small businesses are easier to work with, but the 1% is just worth so much more. Hence, if you're in the agency business in CRO, it does not make sense to work with small businesses.
I want to talk about your conference for a little bit. Tell us a little bit about what it is and we'll go from there.
CXL Live is a growth and optimization conference. We just had one last week, early April, April 5 to 7. This was our third one. We had 400 plus people there from 22 countries. We'll have the next one again in Spring, next Spring 2018. Three days of a lot of fun.
I hand pick practitioners to come talk. My example of Segment is something I heard at my own conference, when Guillaume from Segment was detailing what they do and how they do it. That's the kind of content we have, and massive parties. We threw the event in a remote hotel. All the attendees stayed at the hotel. We basically booked a full resort for the event. Everybody stays in the one place. It's loads of fun.
Awesome. Why even do a conference?
It's an extension of our brand. Conferences are very expensive to put on. It's not a money maker.
How much does it cost, typically?
To throw a conference?
It's tied to the number of attendees. For us, it's like half a million for 400 attendees. Food is killer expensive. Hotel rooms, because we bundle them with the ticket. It's not a money maker. We do it as an extension of our brand. We have a strong online presence, but now we want to bring the actual community together and foster real relationships.
A lot of people say these conferences, you're lucky if you break even, but I'm sure these relationships that you're talking about right now, they pay off in spades, long term, right? That's what you're seeing?
Exactly. Of course, attribution is shoddy, at best. That's the idea. That's the idea. A lot of it is about the brand and attributing the brand to dollars is a whole separate topic.
I've had conference people on the show before. I always like to ask them, if you were to hire one person to help you run the conference, what kind of person would it be? What's the title? What are your thoughts around that?
Somebody to help me put the conference together. I think the most valuable thing that somebody could bring in is knowing a lot of good speakers who are practitioners. You have your names that everybody knows, but if you want to have a new lineup every year, to keep things interesting, you're going to run out of the most popular names rather quickly. You've got to be always fishing for who's somebody who's amazing but people just don't know about him or her?
Having somebody on the team who would say, "I know a hundred guys who are amazing." That would be an asset.
Great. We're going to work on wrapping up here. I've just got a couple more questions for you. What's one must read book you'd recommend to everyone here?
Since it's a broad question, a broad audience, I would have to go to the classic "Purple Cow", Seth Godin.
There you go. That's a great book. I think that's maybe the second or third recommendation. That's awesome.
How do you get better at CRO? How do you get better at marketing? How does Peep learn?
There are two mains ways. The number one thing is doing it. There's no substitute to actually getting hands dirty, and trying stuff, and seeing what works and what doesn't, and adjusting course as needed. That's by far the most important thing.
Number two is surrounding yourself with people who are doing similar things, who have been there, done that. Mentorship has been huge for me. Trying to find people who have maybe done what you're trying to do and see if you can learn from them.
Awesome. So, Peep, this has been awesome. What's the best way for our people to find you online?
All right, Peep. Thanks so much for doing this.
Thanks for listening to this episode of Growth Everywhere. If you loved what you heard, be sure to head back to growtheverywhere.com for today's show notes and a ton of additional resources. But before you go, hit the subscribe button to avoid missing out on next week's value packed interview. Enjoy the rest of your week and remember to take action and continue growing.
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