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How honoring your ICP pays off + Semrush pricing strategy

Muck Rack, Vintti, LeadDelta, Muck Rack, & Jason Lemkin

Author

Okerosi Davis
May 04, 2024

Hello and welcome to Product Weekly - 2 cents on proven product marketing among SaaS companies. It’s read by startup founders, creators, and product marketers looking to constantly learn. Support on Patreon and get weekly resources directly in your inbox.

To new subscribers, welcome onboard, and thank you.

Update: Am renaming it Product Weekly. In the coming weeks, I will be sharing two more issues ( Product In Reverse on Tuesday and Built By Creators on Thursday)

Stay tuned for the deep dives;

1/

Semrush’s strategic moves to $334m ARR

Am listening to Eugene Levin (President of Semrush) being interviewed on SaaSOpen on the growth moves they made to scale the software company to over $330m ARR.

Nathan was focused more on the financial numbers, but in between the conversation Eugene shared two key growth tactics worth sharing with you.

Tapping into Affiliate Marketing early on

Around 2012/13, a third of Semrush's revenue came from affiliate marketing. And back then, they paid 40% recurring revenue to their affiliates. Eugene admits that the percentage was back then probably because they were desperate.

We did it because maybe early on we're a little bit desperate um. It was a phenomenal deal for Affiliates.It attracted a lot of really great people but Perpetual fees they sort of incentivize people to kind of grab something and do nothing with it because they just uh get paid forever.

However, they have changed the reward system since then, from a perpetual fee to rewarding affiliates for bringing in new customers.

Their current affiliate program currently offers a cut from every stage of the acquisition process ( new sign-up, free trial, paying customer).

Note: Eugene advises founders and marketers to not structure an affiliate program perpetually but to max it out to 2-3 years of recurring revenue.

The pricing strategy that paid off

The initial lowest pricing tier was just $49/mo back in 2010 but now stands at $129/mo. From checking their pricing page using the Wayback machine, in 2022, it was $119/mo - a gradual price increase thus far.

However, before Semrush drastically increased its pricing, the team conducted a thorough research worth noting; - the first was through experimentation and its impact on the conversion rate.

The second time board challenged us a little bit more to to do it in a more scientific way. So we worked with guys at a company called Profitwell,we did a lot of customer surveys and not just surveying semrush customers existing customers but people who are you know in the market for products like this and and got a lot of price sensitivity and packaging studies and then we made a decision.

Note: The Semrush pricing page has been evolving for the last two years, but Eugene emphasizes the tiers offering should focus on functionality/capabilities rather than value metrics like most pricing pages out here.

2/

When honoring you ICP constantly pays off

Gregory Galant Founder and CEO of Muck Rack took to the SaaSOpen stage to share the growth of their PR software company to $64m ARR.

Aside from the early stage of getting to product-market fit with a PR community, a couple of SAAS growth insights remain tried and true.

Here are the takes I shared on LinkedIn.

2/ Be immersed in customer conversations

This my sound like a broken record, but talkng to customers remain pivotal in the growth of any business.
Also, you get to focus on there needs and not be wasteful on resources.

3/ Honor your ICP - constantly

For Muck Rack, it's the PR people and Journalists.Keep a pulse on the market and their needs to help them succeed often.

4/ As you go up market, Sales is a given


At the start Gregory thought their saas will be self-serve but as they went into enterprise clients, Sales Reps became essential.
The reason for this is simple - the decision makers are more than one.The PR person needs to convince the CMO why Muck Rack is essential for them.

Team-led Growth Playbook for RB2B

If you missed the Tuesday issue; Product In Reverse, I wrote a deep dive on how Retention .com scaled to $22m arr in 4 years.

Underlying the content engine that they scaled the saas beyond $10m arr, is a playbook they are executing on their new spinoff RB2B.

Adam and the team ( Pete, Daina, Taylor, Santosh) have gone all-in to create great content around RB2B.

The team at RB2B is now taking the content engine to the next level, partnering with LinkedIn creators to 20x product-led growth.

Below is an example post I came across on the platform;

Note: The moves being made by Adam and the team have been dictated by a recent statement he made from being the customer acquisition trenches building Retention .com.

In today’s world, there is a pipeline crisis, SDRs and BDRs are not the ones creating demand. What is creating demand is thinking like what we are doing right now [ producing a podcast episode with Peep Laja ] and you cannot measure it.

3/

LeadDelta - CRM for professional relationships

Verdan Rosic’s interview on Indie Hackers reveals some SaaS growth insights worth sharing. Some key insight that sticks out for me on scaling LeadDelta to $25k/mo is the way to think about SEO and Chrome Web Store:

SEO starts with positioning! First, you must understand where your product fits on a “Supermarket” shelf………Then, your best friend becomes keyword research and making strategic moves on the terms you can actually win.

To win on the Chrome extension webstore, you have to treat it like any other channel;

  1. Understanding incentives. Yours, the channel’s, and users.

  2. Building trust with stories, reviews, and people.

  3. Finding the right fit between price and product

Vintti - Offshore staffing agency for accounting & finance

The founder Santiago took to Reddit r/enterpreneur to share how they scaled from $0 to $1m/yr in 16 months. One key nugget that stood out for me is the way they approached LinkedIn and SEO execution from day one.

LinkedIn became a great channel for outreach (it took 3 weeks of work per lead, but it worked - this will be explained in another post, but we basically did a very detailed step-by-step plan), and also we started SEO on day 1. Today, we get over 2,000 clicks a day on our website – all organic traffic! More importantly, happy clients became our biggest advocates, constantly referring new businesses.

Jason Lemkin - Founder & CEO of SaaStr

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Thank you for reading.

God’s speed.

 Okerosi