September Profit Report – What We’re Doing to Avoid Losing 4K Each Month
Episode 374: Show Notes
Today we’re sharing with you our profit report for September. This is such a great opportunity for us to reflect on our business while also giving you a sneak-peek into how this might be applicable to yours. And before you think this is going to be boring – it’s not a traditional income report and we’re not giving you every single figure because it leads to a lot of unnecessary comparisons, disrupting the possibility of learning something.
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In this episode, we’re going to go over what worked and what didn’t, where the money came from and how it left, and what profit was left right at the end. Comparing September’s report with the previous month’s will also be helpful in understanding the unpredictable nature of business and will be a good starting point for getting some new strategies in place.
The Revenue that Followed Our Reworked Strategy Academy Webinar
In September we did a lot of preparation for our upcoming summit (which, by the way, is happening from November 12th–15th, 2019!) and we were reworking a masterclass webinar training for our signature program, which included a mini live launch. We’ve been running this course for more than two years and it has necessitated a lot of testing and tweaking over time. What struck us was the same strategy that worked for a while, stopped working after six months because of changes in the market, competing courses popping up and just general stuff going on in the world. Being a thoroughly comprehensive program that covers many aspects of business, it was a bit challenging to market. We had to identify the main thing we wanted to accomplish and say about it because it was almost as if we were marketing to everyone – and therefore to no one! So, we decided to focus on the fact that the course could take students from having an idea to becoming a full-time creative entrepreneur. And when we focused on this one message, results started streaming in and people paid attention. We did two live public webinar launches before putting it back in our evergreen framework and it went well. Our conversions went up four or five times, showing us how effective our new webinar was! This really bumped up our numbers for September. We saw 40% of our income come from Strategy Academy, versus last month when it only brought in 16%.
Our Phenomenal “Gateway” Course, Trello for Business
Sometimes our Trello for Business course feels a bit like the middle child in that we assume it will be doing fine because it’s got two other siblings taking care of it. So, while we are guilty of ignoring it for periods, it pulls its weight consistently. In August, Trello brought in 24% of our profit and in September it went up to 25%, and the good results we’re getting with this program surprises us again and again. It’s a $29 program that teaches you how to use the Trello software to plan and organize your day, set goals, do an editorial calendar – just so many different things. In our August report, we showed you how this $29 product made up 20% of the revenue. But because it’s such a cheap course and has done well all by itself, it’s never had a live launch promotion. While we do advertise and talk about it, it’s not meant to be our cash cow – we’re using it to showcase our value and many people who have done the Trello course end up signing up for one of our other courses.
Why Low and Steady Does It
After we’ve played all the number games, we’re convinced that getting a steady income from a product is far better than having sporadic spikes and dips in revenue. Figuring out what to charge for your product or service or to work out whether a payment plan is an option is not an easy task. But after considering it all, consistent income beats the highs and lows every time. The highs are exhilarating, and they feel really good, but those dips can make you question everything. What’s important to say though is that it’s also a personality thing. There are no rights or wrongs when it comes to pricing – it’s all about what works for you and what you are willing to deal with. For us, though, the spikes that would come after a launch or promotion are great, but then the following months we would have nothing. So that big impressive figure quickly becomes less exciting when you divide it into however many months, and for us, this initial spike did not make up for the lack of revenue all the other months. The answer was low, steady income that grows over time. If you feel the same way, consider incorporating payment plans that steadily bring in a bit of money every month.
The Problem with Our Course Platform
The Teachable platform has served our students incredibly well: it’s intuitive, easy to navigate and works well with other products. Even for the checkout process, it has never prevented someone from checking out and it’s consistently working the way it should. But one of the things that have been frustrating from the perspective of a numbers-person and business owner is that there is no current backend that showcases forecasted revenue. What we would like this forecasted revenue to tell us is how much revenue we can expect to be coming in each month from the people who signed a digital contract for a payment plan. There is no report like that. And this is especially annoying because we know this data is available somewhere on a database. As we’ve said before, there are certain things we have done for the sake of our mental health – such as handed over our inbox to someone else and relinquished some other rights for sanity’s sake. We trust these people to handle these things on our behalf and they’re doing a great job. But now what happens is, every time there is a failed payment, there is an email sent to our inbox, which we don’t keep track of ourselves. The reasons for failed payments are mostly innocent and but they would get two or three chances to make the payment. If the payment fails a third time, however, Teachable automatically removes the person from the course and there is no way to reverse that or to even track those cases.
Navigating Automatic Monthly or Annual Payments
We have some products that are charged over a long period of time, and with our Goal Crusher Club, it’s an annual membership. There are some ways you can get into the monthly membership but for the most part, it renews annually. That’s a long time between when you decide to buy the program and when you need to pay for it again. So, we want to be sure to remind you of your payment and not come off as malicious about it, because it will automatically renew. We wanted to learn the best practices for taking care of our customers in this regard. There is a big lack of reporting, so we don’t even know who is going to be renewing or not. We have to manually export a ton of spreadsheets and interpret it. This is frustrating for us and for you guys because this process takes time and the last thing we want is for someone to be surprised when they’re charged. We came across a company called Gravy Solutions who is already working with very well-known people in our industry. And what we discovered through them was an absolute revelation, especially around the number of failed payments there were! We were told that we were losing about $4000 a month just on failed payments – and we didn’t even know. It has had a huge impact on our monthly revenue.
Backend Systems Correcting and Making Payment Plans Work
Losing all that money each month has made us realize we needed to go over our backend processes, and this is part of our planning for next year too. But all this correcting and checking involves a lot of time and a lot of tech, and we didn’t get into business to figure out all of that. We’re doing a lot of things, also for the summit, that we didn’t go to school for, but that is just part of this line of business. We also don’t have a dedicated tech employee and have always done this ourselves – we are very much in the weeds of our business. We have a desire to increase Strategy Academy by gaining increased consistency in revenue. When money is walking out the door, such as with the failed payments issue, we want to fix that because we’ve already technically earned it and now we’re losing it in unnecessary ways. We’ve been promoting SA on a 12-month payment plan, but if we don’t get this problem sorted out, we’ll continue to lose money through failed payments. Our income could have been higher had we not encouraged payment plans, but we truly believe this allows more people access to our programs. Paying a huge one-time amount is not attainable to everyone and we’re convinced many people would not have signed up for our program had there not been a payment plan option.
Goal Crusher Cub and the Expenses We Had
The third product in the lineup for the highest income percentage is Goal Crusher Club. This course has also just been skating along by itself and we haven’t been promoting it at all, and yet it brought in 17% of our income for September – which we’re very happy with. During the previous profit report, we mentioned that we wanted to spend on average about 30% of our revenue on advertising. Last month we were over by a lot, but for September we got really close to our target. We did more outward promotion, such as showing up in our DMs, instead of relying only on advertising, and this made the expense come down significantly. We hit 31% for September! Contractors, on the other hand, went up a bit. Twenty percent is our goal but we came out on 37% this month. The reason for that is a one-time expense that greatly bumped up the number. Payroll came in at 16%, and our profit number turned out to be fairly consistent – a good 10%!
Quote This
As much fun as those spikes are, consistency feels way better for us.
Highlights
The Revenue that Followed Our Reworked Strategy Academy Webinar. [0:03:10.1]
Our Phenomenal “Gateway” Course, Trello for Business. [0:09:37.1]
Why Low and Steady Does It. [0:12:53.1]
The Problem with Our Course Platform. [0:17:16.1]
Navigating Automatic Monthly or Annual Payments. [0:24:37.1]
Backend Systems Correcting and Making Payment Plans Work. [0:30:30.1]
Goal Crusher Cub and the Expenses We Had. [0:36:06.1]
ON TODAY’S SHOW
Abagail & Emylee
The Strategy Hour Podcast
We help overwhelmed and creative entrepreneurs break down their Oprah-sized dreams to create a functioning command center to tame the chaos of their business. Basically, we think you’re totally bomb diggity, we’re about to uplevel the shiz out of your business.
KEY TOPICS
Revenue, Consistency, Failed payments, Payment plans, Backend systems, Strategy Academy, Trello for Business, Goal Crusher Club
