What do you do when your most profitable customer starts to drain your employees’ energy and morale? And what if that client is worth over €750,000 a year (or 15% of your annual revenue)?
In today’s episode, André Morys, the founder and CEO of konversionsKRAFT shares how he made the tough call to fire his biggest client, and how putting his team first paid off in the end.
Today we’re talking with André Morys, the CEO and founder of konversionsKRAFT, one of Europe’s most successful (and award-winning) Conversion Rate Optimization (CRO) agencies.
André is a great embodiment of what a people-first leader looks like, not only when it comes to his clients but also his team.
As we’ll hear from André, putting his team first has led to increased productivity, better customer service, and more revenue in the long run.
And he walks the talk. In fact, in this conversation, André shares with us about the time he fired his single biggest client that was bringing in over €750,000 a year because they were becoming too much of a headache for his team.
And it paid off. Not only did they make that money back, André’s team ended up surpassing their revenue expectations for that year and continued to do so.
We also get practical and talk about how he merges big data with personal, qualitative insights to deliver results for his clients.
So get ready for a great episode on the importance of focusing on employee happiness and the impact it can have.
[00:00:04] David: Welcome to the Human Strike Back by Hotjar, the weekly podcast designed to help you succeed by putting people first. I’m David Peralta. Today, we’re talking with André Morris, the CEO and Founder of konversionsKRAFT, one of Europe’s most successful conversion rate optimization agencies. André is a great embodiment of what a people-first leader looks like—not only when it comes to his clients—but also to his team.
As we’ll hear from André, putting his team first has led to greater productivity, better customers service, and more revenue in the long run. He really walks the talk. In fact, in this conversation, André shares with us about the time he fired his single biggest client that was bringing in over €750,000 a year because they were becoming too much of a headache for his team and it paid off. Not only did they make that money back, André’s team ended up surpassing their revenue expectations for that year and continue to do so. We also get practical and talk about how he merges big data with personal qualitative insights to deliver results for his clients. Without further ado, here’s André.
How did you get into CRO, into conversion rate optimization, because up until maybe 10 years ago or even more than that, that didn't even exist?
[00:01:25] André: Yeah, and we started much earlier when the term 'conversion rate optimization' even did not exist, and it was not very famous. Everybody was scaling traffic with AdWords, so we were a little bit exotic approach, trying to find out how people react on websites. We were doing user research so we definitely come from the UX area, and we discovered that data helps us to prove if we are successful or not, and it made our clients very happy. Doing a user research was fine but changing the website based on the insights and measuring the success, it was great, and that was around 2003, 2004 or 2005. I think conversation rate optimization–the term came up in 2008 here in Germany.
[00:02:15] David: How long has konversionsKRAFT been around?
[00:02:18] André: I founded the company back in 1996. When I was trying to earn some money for my university. I wanted to study design and so I needed some money. Actually, it took off so heavily in 1996 that, I think, in 1998, we turned it into a stock-based company and I forgot that I wanted to study. Since then, I'm stuck with this company.
[00:02:44] David: Did you finish your studies or you left university to…
[00:02:47] André: No, never.
[00:02:48] David: Really?
[00:02:50] André: I just finished school and that's it. I have nothing. Actually, I am now teaching at the university as a lecturer, which is complicated because I don't have an academic degree. They always have to give me a special okay that I'm allowed to do that.
[00:03:07] David: That's really funny, but I see that your practical education in the real world on the streets.
[00:03:14] André: Yes, and my wife—she's a psychologist—I learned with her all the time when she was studying, and that really fascinated me about people and how do people react. It's a time when social psychologists started to do a lot of research and where behavioral economics were on the rise. I learned a lot about that and I thought, "If I will study anything, I would go for psychology, but right now, maybe it's too late."
[00:03:45] David: You've come to adopt a very strong people-first approach to your company, both in the way that you help your clients understand your users but also in the way that you have what you call a team-first philosophy. I was wondering if you could tell us a little bit about what that means for you, team-first.
[00:04:08] André: I remember one story when I was in holidays with my kids, and I went back with a plane. Actually, it was in Malta and it was 38 degrees and the air condition of the plane was out of order, and everybody hated it.
[00:04:25] David: By the way, that's 38 degrees Celsius? For our Fahrenheit listeners, that's like high 90s. It's unbelievably hot.
[00:04:38] André: It was unbelievably hot. I remember when I booked the tickets, of course, they have been cheap, for people in our family so not really, really cheap. But then I remembered, this is not the wealthiest airline, and the airplane was not working. The air condition was not working. It was late, it was hot, and then I remembered reading a news article about the airline and their shareholder, their pressured about delivering more profit to the shareholders. I thought, "Damn shareholder profitability."
That leads to nothing. Customers hate everybody. I realized that the flight attendants–they were also very mad about the whole situation–so I realized employers hate focus on shareholder value, clients hate shareholder value, everybody hates it. That was a big aha moment for me when I thought, "You should care about the people, your employees first and then your clients," and the result should be that everybody is happy and not that somebody is sitting somewhere, has a lot of money and on his bank account. That was an aha moment where I thought, "I'm the shareholder of my company, but when I have to choose, are my people happy or do I have a lot of money on my bank account?" I definitely realized it's more important to have happy employees.
[00:06:10] David: What was it that led you to prioritize the happiness of your employees even over your customers?
[00:06:16] André: Actually, I have so much positive feedback from my people, saying, "You know what? In the morning, I love to go to work. I love my work. I love my colleagues. I love everything around." We have a great culture at konversionsKRAFT and I think that's what makes us special. If we have applying for a job, we always say, "Come around for a day to know us," and everybody is kind of infected by our culture. I think it's kind of contagious so people realize, "Well, it could be fun working so maybe I should change my job." I realized, this is a high value for us. This is something that is important and that makes us special and that's also important for our recruiting and for our success so I realized it's much more important than virtual shareholder value.
[00:07:07] David: It's also case that the higher employee satisfaction and happiness you have, that's going to translate into customer satisfaction because your employees are going to be that much more willing to give the extra mile to your customers and to your clients.
[00:07:21] André: Exactly, and that's what happens. This is where I see my people really passionate about delivering great work. It's not just a Richard Branson quote. I don't know what the Richard Branson quote actually is but he said, kind of, "Focus on your employees happy and employees will make your clients happy." That is not just a quote; it really works like that.
[00:07:46] David: It doesn't really make sense to have a customer-first philosophy if your employees are unhappy because, ultimately, that's also going to translate. I have a question, though: in terms of concretely, once you realized that you wanted to have this team-first, employee-first approach, what do you start to do at your company in order to increase the happiness of your employees?
[00:08:07] André: First of all, I think it was an important process to be aware about that fact. It's nothing artificial where we said, "We want to have a team-first or employee-first approach." We realized that we already had it and that there were some clients that tried to put a lot of pressure on us, on our work, on our project managers, and bad project managers gave the pressure towards other colleagues. We realized that leads to nothing.
Actually, I think the people-first approach was already there. The first step was to be aware of this approach so this is why that aha moment of shareholder value against employer value–I don't know if the word exists–that was the first thing that came into my mind. Since then, of course, we have been trying to be very aware about our culture. We try to care a lot about our culture. We do workshops with the team to kind of realize what's important for us and what's not, especially while we are growing. It's hard to maintain your culture because if you get more and more people, of course, that can have a really bad influence on culture. First was learning that we had that approach and second was we needed to cultivate it; we needed to care a lot about the culture.
[00:09:47] David: You actually have a really great example of actually walking the walk where you fired one of your biggest client because they were actually sucking the energy out of your team. Can you tell me a little about that? Can you set the stage? How big was this client? What was going on at the time and what led you to take that decision?
[00:10:09] André: Yeah. This story is maybe something that is special to illustrate what's important for us but it happens all the time. I realized, a lot of clients are trying to make pressure or create pressure on our team just to try to leverage more power or quality out of the money that they spend for us as a consultancy. I think this is a really bad habit of some clients. This story actually is of one of our clients back then.
It was nearly like 15% of our overall revenue so a big team of around five people were working on that client, and it was kind of a good relationship but the more we delivered and the more expensive it was because it was actually more complex and more, the more pressure was put on our team. First, they didn't start caring about weekends or late hours and saying, "No, it has to be done," and, "I don't care about your quality insurance. Just publish the experiment now." We want to deliver quality so we always do QA, and, "Please sign with your blog that you don't care or your whole website will go down and we can publish it now." That's the kind of pressure they did and they put on us and the team.
[00:11:49] David: How long have they been a client at that point?
[00:11:52] André: Like four years. Actually, it was a successful relationship because we built a big conversion optimization success story with them. I think we earned them hundreds of millions of euros, and they knew that, and they wanted more, and more, and more. On a certain point when some people in their team changed, we kind of lost the level of eye height.
[00:12:20] David: Yes, not on the same level, not on the same page?
[00:12:23] André: Exactly, not on the same level any more, and the pressure got more and more maybe because they got more management attention. From a couple of hundred thousands of euros, they wanted some couple of millions or I don't know what but, suddenly, the pressure was more, and more, and more, and I had to react heavily to stop it. When the annual renewal came, we are billing retainer plans so we have monthly recurring revenues.
Each year, we negotiate about the contract for the next year, and then I said, "You know what? I don't think it works anymore." They were like, "What? What do you mean it doesn't work anymore?" I said, "I think we are out. We don't want to do the next year with you anymore. It's too much pressure. The team is hurt a lot," and my voice was shivering. I was calling the client, telling them that because I knew that they will hate me now.
When I hung up the phone, I was so relaxed. I thought that was important. When I came back and told the team, I went into their office–they were all sitting in one office–and said, "I did it." They were like, "Woohoo!" cheering and saying, "Hey, that was a good thing." I asked them if we should do that and they said, "Yes. We have your full support." I said, "We will lose a couple of hundred thousand euros for the next year," and I said, "We don't care. It's more important to go each morning to our job and think about having fun and having a great job. It's more important than the hundred thousand euros."
[00:14:08] David: This is definitely an approach that I think a lot of companies would be too scared to even take because if you think about it in terms of revenue, a 15% drop in revenue, how are you going to make that up? How are you going to continue your operations and everything if, suddenly, you got that massive drop in revenue? What was it, specifically, that allowed you to confidently take that decision, knowing that you were going to be missing on that revenue?
[00:14:40] André: I don't know. We were not calculating how many new clients would we need or what would be the drop in growth rate for us. I wasn't approaching that question that strategically, to be honest. I just thought, "I have to protect my team. I want them to tell me again that they go to work happily each morning." That was more important for me. Actually, if you ask me now, I even did not look at the numbers after that to see how big the drop actually was. I remember, I think that was in 2016, maybe it slowed down our growth rate by a couple percent but I think the higher motivation and the happiness and all that positive feelings that we kind of rebuilt for the team with that move, I think it was worth every single euro that we maybe lost.
[00:15:46] David: Was this a decision that you made on your own or was it a decision that you made together with the team?
[00:15:50] André: I actually asked the team, "What do you think? Should we do that?" and when I realized I don't just have the full support of the team, the team would really love to do this step, that kind of encouraged me. I think just on my own, I wouldn't have done it if people told me later, "André, what have you done? That was our most important client." I thought it's a good idea. That was fully covered by the whole team. I think that was important for the whole success of that move.
[00:16:28] David: There are studies that have been done that tie employee satisfaction and employee engagement to employee performance. This is kind of backing up what you're saying because if you've got a client that may be bringing in a lot of money but it's actually draining on your employees, they actually have less of an output. They actually have less capacity. When you take that away from them and you're able to increase their engagement once again then, obviously, there's going to be a period where revenue might go down for a little bit but then you've got that engagement from your workers that is going to be able to eventually fill that hole with an increased performance that they're able to. Did that turn out to be the case?
[00:17:08] André: I think it must have been like this because I don't remember having any drop in growth rates. Now that I realize, there must be a hole of a couple of hundred thousand euros but, no, there wasn't a significant drop in growth. I think, as you say, the overall engagement, and happiness, and satisfaction of the employees compensated that a lot.
[00:17:34] David: From a personal example, I also went through something like that where I was working at a content marketing agency and the very first client that this agency had brought on was also the biggest client. As time went on and the agency evolved, there was less and less of a match, as you were saying, but it was a big chunk of the revenue. However, we all dreaded going on the calls with that client and we dreaded the work that we had to do for that client.
In fact, we spent quite a significant amount of time complaining about the work that we were doing. Once we've realized how all of that was impacting the other work that we did, we took the decision, just like you did, to let go of that client, not knowing what was going to happen. What happened was just the way that you said it. Once the call was made that we were going to end the relationship with that client, it was such a relief. We all felt so much lighter now that we weren't going to have to do that, that we had so much more to pour into bringing in new clients, doing better work for the other clients. The hole filled itself almost without notice.
[00:18:48] André: Exactly. That's exactly the case and I think I would do it again anytime. Actually, I use that story, also, as a kind of a weapon. I don't know if that's the right word, but if I realize some clients start to stuck, I tell them the story. I see a lot of times when entrepreneurs meet and they are like, "How's your job?" and I say, "We grew 38% last year and our profitability is at 28%," and whatever, the next one says, "You know what? This and that number," I'm wondering why are entrepreneurs not going around saying, "You know, my employer satisfaction index has grown from 86% to 90%." That's important. It's only a number how they measure success, and that's wrong, I think.
[00:19:43] David: Exactly, because in some ways, it's actually the most important number because there really are more and more studies that are tying happiness to performance, and it's just something that unfortunately gets lost when we're so numbers-focused. I really appreciate you sharing this story because I'm sure there are listeners out there who might feel like they have a client they want to fire but are too scared because of the loss in revenue that might potentially happen.
[00:20:12] André: There's nothing to lose.
[00:20:13] David: Exactly. Exactly.
[00:20:16] André: There might be the case that it leads to a really good talk with your client, and you negotiate mutually and the client understands you, and they change their mind. Maybe you can refurbish the relationship and goes better then, but if you're really saying to yourself, "Yes, I'm okay for firing that client." You don't bluff. Do it. If you get the feeling you should do it, do it.
[00:20:50] David: How much revenue, exactly, was this client providing you a year?
[00:20:55] André: £700,000.
[00:20:57] David: Pretty significant.
[00:20:58] André: Yes, pretty significant but, again, it was worth it.
[00:21:04] David: I'd like to also get into how you apply the same people-first approach to actually working with your clients because I know CRO is very data-driven.
[00:21:15] André: No, I don't think so.
[00:21:17] David: Okay, I'd love to hear it.
[00:21:19] André: You're right. Sorry, I didn't want to interrupt you but, yes, for most people, they think CRO is a lot about data, and I think it's wrong. CRO means getting more people to buy, and if you don't know why people don't buy, or click, or give you the lead, or whatever, if you don't know why people don't do that, you can optimize. You can do trial and error, maybe. There's a big mistake of people using data to find out why things happen, and it's not possible.
Data is always qualitative. It tells you how much or where did something happen or when but it never tells you why. You always need to deeply understand people. You also need to understand that people don't tell you the truth if you ask them directly. I can't ask people that bought a new Porsche 911, "Why did you buy it?" Nobody would say, "To impress my neighbors." They won't tell me that. You'd have to know a lot about people if you want to increase conversion rates.
I think the whole focus on numbers, and number-crunching, and slicing, and dicing data, yes, it's important if you understood the principles. If you understood the principles of why do people buy, then you can use data and technology to leverage that or to scale that, but you always have to start with why. I know this is a famous book title of Simon Sinek but it's also a real philosophy. Start to understand why things happen. That's the principle, that you have to find out the real challenge. Then, you can start creating strategy, then you could build it and do an experiment to validate it and then use data to scale it, but always start with the question, "What do people hear and what do you think?"
[00:23:12] David: You actually have an example of a client who kind of fell into that trap, who fell into the data trap and were so heavily focused on the data that they forgot about the people behind the data. Can you tell us a little bit more about that?
[00:23:24] André: Yes, and it's the same pattern. It's management, people very focused on numbers, and data, and they see other companies invest heavily in big data infrastructure so they also invested in big data infrastructure and then they collect data for a couple of months. They hire expensive data scientists. In this case, this client did cluster analysis or CRM data, and all their product data tried to match that. They did so many things.
Afterwards, I asked them, "What did you learn?" They said, "It was heavy. It was really hard for us. We found some clusters but, actually, we don't know what to do with it." We built personas two years ago. Do you remember that? We have Carl, the heavy-IT hardware buyer who is aggressively comparing prices. Is there any cluster that matches to that persona? They said, "Yes, we have one cluster that's heavily focused on hardware stuff and things like that."
We started actually to match the qualitative insights from the persona with the quantitative knowledge of the data scientists, and magic happened. We did some personalization campaigns for them that we set up to target these customer types. I think, finally, they got 18% more revenue per visitor, which is a big number for them, a big success. It's, for me, personally, also a big success on putting people first, knowing who is this Carl and what does he want to do. This isn't actually for Carl-s out there. This is just the name of the person.
[00:25:15] David: What was the qualitative work that you had done with them prior to this massive data project that they did?
[00:25:20] André: We did a lot of interviews with customer service people, asking, "What are these people that actually call you? What do they want? What are their questions? What are their objections?"
[00:25:33] David: With the customer service team from your clients.
[00:25:35] André: Yes, exactly. They have a phone service center. These people, we ask, and the result was that we were able, also, to kind of cluster or aggregate all the types they have and took five personas. They were based on real experiences. Everybody agreed on them and we knew what we call emotional drivers or emotional motivators. We knew what motivates a certain type of customer, and we knew that this Carl, for example, he loves the feeling of having a good price, of doing a great deal. If he has that idea, then he wants the product now. This is what we actually changed on the website so, really, what to do.
[00:26:31] David: Taking a couple of steps back, how many customer service reps did your team speak with from your client to get the results that you needed?
[00:26:41] André: I think it was four to five people we had on a two-day workshop, and there's something special that we use. I think maybe in other countries, similar things exist. We use a study that is done here in Germany every year and it's called Limbic Types. This is about a psychological classifications of people. You put them in certain clusters, and you build types. This is kind of the scientific background of that. It's comparable to MBTI or other type models.
[00:27:21] David: It's like a personality type?
[00:27:23] André: Exactly, personality type. Once we did all these interviews with the customer service team, we matched these observations with the existing types of that model because this is already empirically-validated so we can match that. We know that the result of our interviews is not just our fantasy or our desire; it actually matches with the real observation of real people here on the market.
[00:27:58] David: What else happens in these two-day workshops that you spend with the customer service team? Was the outcome of that workshop to come up with these different personality types that are their ideal customers?
[00:28:11] André: Yes, that's the final result of the workshop. We try to teach our clients that conversion is something that happens in the mind of the customers. It's not in your analytics tool or your AB-testing tool; it's something that happens in their mind. When we do these stories, we try to dig deeper, and deeper, and deeper. When we do the interviews, we hear about the customer stories. We ask, "Why does Carl need to know when the product will be deliverable?"
We get a feeling of their emotional drivers–that's how we call it–and that actually helps us later to change the website because we know what we have to tell this Carl so he actually buys. I think this is the real gold. We're digging for gold. When we are doing these interviews, we want to get these kinds of information about very emotional objections or their motivations, and this is what we can use later on in the website.
[00:29:21] David: These emotional drivers, this is what you're looking for because you know that this kind of messaging is going to be what resonates with a potential buyer or visitor at your website. How do you know that you've hit an emotional driver? How can you recognize an emotional driver?
[00:29:36] André: Actually, while we are developing personas, we don't know that. Developing a persona is still a qualitative process. I know there are also quantitative ways of building personas, but I think you can't know what you don't measure. If you have no data about emotional drivers in your existing data, you can't build another persona out of data. Because we do this the other way around, starting qualitatively, we know our personas. Actually, they're just a hypothesis so this is why we use A/B testing or personalization to have done a data-driven validation of our hypothesis.
[00:30:18] David: Okay, you talk to the customer service people and you ask them all about what kind of questions are they getting from people, what are the different kinds of people that are asking them the questions and then, once you have an understanding of what the questions are but also why behind the questions–not just what are the questions but what's the motivation for asking the question or what's the need on their side to get that question answered–once you do that, then you have the information that you need. Is there anything else that you need before you can build a persona out?
[00:30:50] André: That's enough to build a persona. What's special about it is we really try to focus on one central emotional driver. We don't say, "This persona is a little bit traditionalist but also likes performance and luxury, and if there is something fun, they'll also do it." This is like a big mashup of different types. We try to see, "This is a traditionalist. He loves things that are the same way as they were 20 years ago and he wants them the same way for the next 20 years. He wants reliable stuff and he wants everything to be in order and harmony."
This is why we focus on certain personas. You said how do we know that it resonates? If you use the word 'resonance', that's one of these principles. Actually, when we know about these emotional drivers, that's what we want to create. We want to create emotional resonance. We want people coming on our website, saying, "Wow, this was what I was looking for. How did they know?"
[00:32:01] David: This is something that I think a lot of companies stumble on where they take the effort to create a persona but they don't base the persona on qualitative data. They base it on assumptions or they base it on quantitative data like the size of the company, the amount of people that they have in their team and then how many kids they have and what kind of car they drive and this kind of thing, but this qualitative aspect of what were they asking, what are their needs, what is the main challenge that they're facing and how do they want that solved, I think that's a step that a lot of people kind of skip because of the effort that it takes. You have to make the effort to discover this qualitative data.
[00:32:50] André: Exactly. It's more effort, it's complicated and I think, for a lot of people that want control, it's easier to use the existing data they have. It makes much more sense for them to use data to make things out of that data and they don't ask themselves, "What's the thing that I don't know, that I don't have in the data?" Maybe it needs to be a little more grit or courage to do this qualitative approach and think about things that you actually don't know and then validate them. Yes, it's more effort and maybe what you create is pure nonsense, but you will find out. You will find out when you validate it.
[00:33:37] David: The potential for return is so much higher because when you do hit that emotional resonance, that's when the results come in.
[00:33:44] André: Exactly. I don't know if we should come back on the employers, but I think it's the same mistake for management people. Focus on the things that they have, and that they know, and that they can measure like revenue, and income, and team sizes, and so on, and it's so much harder to try to control things that you can't measure if you don't have it inside your data.
[00:34:12] David: Exactly, like how are your employees feeling, what's going on in their lives, what's motivating them and what's driving them. Going back to this specific example, was there anything else besides talking to the customer success team to discover or validate these personas? Did you talk to anybody else?
[00:34:28] André: No, as I said, we matched this with the limbic type system in that case. We have other times where we do, later on, more interview with customers directly, but we are very aware. As I said, customers don't always tell you the truth so you have to be very aware about the track if you do real customer interviews to get sharper personas. Sometimes, if you're not really a professional in that area and you do more and more interviews, actually, it can lead to weaker personas because they result in an average, maybe done superficially because you're not able to go that deep into the personality and into the motivation.
[00:35:22] David: Now, how did you go from discovering this persona to creating messaging that was going to resonate with that persona?
[00:35:29] André: Actually, a lot of hypothesis about things that we can change on the website already started to develop during the persona workshop. When we were already sitting together with our client and their team, I think we took tons of notes about things that we could actually change on the website. We did a walkthrough through the website. While we are doing the personas, this is something we also do every time because that intensity of being customer-oriented or having the perspective over the customer, you will never have doubt again, only when you're really that deep into the customer's mind and emotional drivers.
It's a perfect way for actually looking at the website and thinking, "Damn, would he or she like it or not and open some websites of competitors and asking themselves what do they think about this?" I had a lot of moments where our clients, "Their website sucks," when they're looking at the competitor website. After developing our persona and what's important to them, they looked again at the competitor's website and say, "It's not too bad. Damn it."
[00:36:50] David: What I'm really interested in finding out, though, is because coming from having a persona to having messaging that you can confidently say or you can confidently hypothesize is going to resonate that persona, this is where to start move away from it being a science to it being more of an arty. If you have to empathize with that persona, put yourself in their shoes and imagine if this is driving them, what is the message that's going to resonate with them. This is what I'm wondering: can you speak a little bit about that art? How do you go from having a persona to concrete messaging that you're putting on the website that you think–because, at this moment, you're only hypothesizing–is going to resonate. What was the actual process that you did in that case? How did you get that final message that you put on there.
[00:37:43] André: As I said, during the workshop, we already create a lot of these ideas or hypotheses. Because they are already matched to a persona and that persona is described, has a face, and a name, and a picture, and we also try to–like in the real store, what would I say in front of a salesperson? Why won't I buy the product? This is very clear. When our concept people started to work on that hypothesis and all the variations for actually doing an A/B test, I think they can base their work on a much better foundation of understanding clients' needs.
[00:38:27] David: If you don't mind, can we get specific? You mentioned that there was a specific persona, Carl. What were his emotional drivers?
[00:38:35] André: Carl's emotional drivers are that if he decides to have something, he wants it immediately. He's the guy that wants to control things. He wants to do a good deal and he wants things immediately. What we actually did on the website is, in one variation, we showed a little notification. Maybe some people know that from companies like booking.com. It's like a little messaging window, appearing a couple of seconds after the page has loaded, and it says, "This is the best deal that you can do here and if you order it right now, it will be delivered tomorrow." This is all we did. We had several ways of showing that little messaging window at different places, but it was easy to deduce that message from the persona, Carl, because we knew so good what he wants, actually.
[00:39:42] David: In other words, you gave kind of an instant gratification notification, letting him know what would happen if you placed the order right away. Because that resonated with that particular emotional driver for the ideal customer of your clients, that led to an increase in conversions from that particular persona.
[00:40:05] André: Exactly. What's important to understand is if you don't do that experiment where you try to validate your insights that you have from the persona, actually, there is no value in using personas. I think a lot of companies have their persona somewhere deep in their file system or somewhere hidden. They sometimes completely forget that they have them. Why? They never validated the insights that they get out of them.
I compare it to a tool. If you have a plumber at home because your kitchen sink is out of order, you don't care about the tools that he's using; you just care that this thing just works again. That's the result. It's the same with the persona. The persona is a tool and the management only cares about the numbers. If we are talking about the revenue-per-visitor outlet, that's where you get the management get listening. Personas and emotional drivers in the business world? Well, they don't care. That's the important learning for us when it's about personas. We tell people it's a UX tool. It's nothing that management likes.
[00:41:17] David: Discovering these emotional drivers, this is tied to this personality type that you discovered through this limbic system that you, in particular, are using. Would you recommend that anybody who's doing some personas find some kind? Should they use this type or are there other types that they can find? Because that also sounds like a critical step that a lot of people maybe miss out in order to discover these emotional aspects.
[00:41:43] André: It helps us to get these personas more focused. You could use MBTI, Big Five or any other personality type tool that's out there. Byer modalities, DISC, whatever–there are so many. What's important is if you have all your personas and you try to match them through that type, you realize much better on what things should you focus and what things should you forget because if you're trying to say everything about a certain type, it gets mixed up, and averages, and you don't learn that much. You don't get that many insights. I would say build more radical and focused personas. 'Radical' is maybe the wrong word.
[00:42:29] David: That have a strong stance?
[00:42:31] André: Yes, like over-emphasize their core motivation.
[00:42:36] David: For example, in my case, I've taken different kinds of personality tests and it turns out that one thing that really appeals to my personality type is visionary language, big thinking, looking into the future about what you could create, not necessarily immediate, not short-term but more of what it can lead to as opposed to Carl who is immediate gratification, wants things now, wants to keep things the same. If it turns out that a personality type like mine turns out to be the ideal customer, then you want language that addresses that, that's a little bit more future-thinking, forward-thinking, not what's going to happen next but what this is going to lead you to maybe 5, 10 steps down the road.
[00:43:22] André: Exactly. In this case, actually, because this was the data-driven part, we knew that we had some data that makes it feasible to have kind of a prediction about the personality type. If a customer comes on the website from a price comparison page and he's sorting the last page for price or he's clicking on sale or whatever, we have tons of data that contain indicators that a visitor might be a certain type. This is where this cluster analysis that our client did was very helpful because we had correlations between their assortment or categories, like what categories of product are people are looking at and what type they might be. This is one of a lot of factors that we put together to predict the personality type, and then we start the personalization based on that type.
[00:44:23] David: But then it's also really important, of course, to understand who your ideal customer is, right? Because you could have a wide range of customers or clients but then each company will have its own specific criteria for what their ideal customer will look like, what the lifetime value of that customer is, what size of company, all these kinds of things. This is where you match the quantitative data with the qualitative data so that you focus on Carl, for example, and maybe not somebody else who you could speak their language but that's not the kind of customer that you want bringing in.
[00:44:58] André: Exactly. This is another reason why I'm not a big fan of the quantitative approach for building personas because if you look at your existing CRM data, you don't have the client you want to have; you will find the client that you actually do have, and maybe this is not the client where you earn the most money with. This is why I think it's good to do it the qualitative way and doing experiments.
[00:45:24] David: How do you discover which type of customer would potentially make the most money for your clients?
[00:45:32] André: It's funny. When I'm doing these workshops without sitting in front of a computer, most of the time, there are people from our clients that can immediately tell us which of these clients has a bigger CLV, customer lifetime value, and which has a smaller. This is Carl, and Frank, and Heidi, and whatever–just some typical German names–so can you please get them in an order of customer lifetime value? It's easy to do for them without any database. It's always funny, but, actually, people in workshops jump off their seats, saying, "I know that guy. This is my neighbor," or, "This is the cousin of," whatever. Sometimes, it's a little bit spooky, but while we do these workshops, of course, customer lifetime value is a big thing and the question is always, "How can you approach better these clients that are more valuable for you?"
[00:46:39] David: One thing that we always ask all of our guests is a lot of people are on the fence about embracing a people-first approach, this kind of qualitative approach or your team-first approach. What would you say to them to help them understand that people-first really is the most sustainable and successful way to go?
[00:47:01] André: It sounds harsh when I use it, but I would use the Dunning-Kruger Effect. If you're not aware about the Dunning-Kruger effect, it says if you're inexperienced, you are maybe a little bit over self-esteem about your knowledge and then, when you fail, you get more humble and learning, "Okay, there's a lot I don't know," and then you will start being curious and learning more, and that's why you get an expert.
I see a lot of people that are stuck in this stage where they are not humble, where they're very self-esteemed. Maybe it's a role they think they have to play because they're in a management or leadership position, but I think, actually, it's weak. Being humble and being curious gives you so much more value and you learn so much more. You will develop so much better, and this is where you create value. This is where innovation comes from. This is where you're not stopping to being better and better each day.
This is why I try to encourage people to get over that thing. In the Dunning-Kruger Effect, they call this peak, Mount Stupid. It's harsh to call it. You don't want to call people stupid. It's just normal. I tell the story, when I was five, my grandpa taught me to play Fur Elise from Beethoven. I was so proud of it. I thought, "Wow, I can impress everybody in the family. I'm a big piano guy." I just could do the first couple of tones, that's it.
This is where you are in Mount Stupid. You do your first company, maybe, or you do your first optimization project or whatever. Or it's not your first; maybe, you do that for two, three, four or five years and you think you're damn good in it. The problem is thinking you're damn good in it prevents you from learning more and being open towards other opinion. This is my personal story. This is my own interpretation. It almost helped me to succeed. I don't know if it fits to everybody, but this is my personal way.
[00:49:22] David: It makes perfect sense because overconfidence and believing a little too much in yourself will actually prevent you from growing and being open to new opportunities and new things.
[00:49:31] André: I see the online marketing world is full of overconfidence, unfortunately.
[00:49:38] David: I would agree with that. If you could recommend one resource to our listeners to help them succeed by putting people first, what would that be?
[00:49:48] André: I read a lot of books and there are great recommendations. If you've seen blog posts like The 10 Habits of Successful People, there is one thing you will see. Every time, you'll see one of these recommendations, and that's, "Read a lot of books." Why? It's a proof of concept that there are so much things to learn. I never read one book where I didn't learn anything. You will experience that you don't know everything so this is my personal recommendation.
[00:50:26] David: Is there any book in particular that you would recommend?
[00:50:29] André: It's hard because there are so many different perspectives. Right now, for example, I'm reading Ray Dalio's Principles. This guy, I would maybe never read his autobiography. He's a hedge fund manager and a financial guy so it's completely not my world. I learned so many things by reading that book. That's the latest I've read now but from the past, there are dozens that inspired me. Maybe I should do a blog post about that.
[00:51:05] David: Great. Finally, André, where can people go to learn more about you and the work that you're doing with konversionsKRAFT?
[00:51:13] André: To meet me personally, I'm a lot of conferences. This year, I will be in Vancouver's Call to Action Conference. I will be at Digital Elite Camp in Tallinn and many others because I love speaking and working with people. Otherwise, if you're not able to read German, my book, Conversion-Optimierung, then you might use Google Translate to read our blog, konversionsKRAFT.de. This is German. Most about me is in German.
[00:51:52] David: Alright, André, thank you so much for taking the time. This is a really insightful conversation. I really appreciate having you on.
[00:51:57] André: Thank you. Thanks for having me.
[00:52:06] Louis: Thanks for listening, my fellow human. We know how fast paced life is. If you're listening to this on your daily commute, while running, or even cooking, you can always go to Hotjar.com/humans and look for today's episode. That's where you'll find access to all the resources and humans we talked about, the full transcript of the conversation, and even links to really see the episodes.
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'The Humans Strike Back' is hosted by Louis Grenier (Content Lead) from Hotjar.
Hotjar is a powerful way to analyse people's behaviour on your website or app and understand how you can improve their experience. Based in Malta, Hotjar launched in 2015 and grew from €0 to €10M using a people-first approach and no outside funding.
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