6 min read
We've all experienced sophisticated, modern marketing tactics- you express interest in a product or service by viewing it online, and then later the same product or service turns up in a digital advertisement on another website.
This savvy technique is known as digital remarketing, and our latest podcast guest, Moshe Vaknin is leading the industry.
In our recent Path to Profit episode, GrowthForce CEO, Stephen King connected with Vaknin who is YouAppi's Founder and CEO to discuss the company's success, the lessons that can be learned from their business model, and how any type of business can benefit from the principles of remarketing.
Moshe's company, YouAPPi has been repeatedly placed among the top companies on the Deloitte Technology Fast 500™ EMEA List where it's ranked among the fastest-growing technology, media, telecommunications, energy tech, and life sciences companies in Europe, the Middle East, and Africa.
Selling Specific Products and Services to Specific People
So, what exactly can be learned from the way Vaknin helped his company grow fast enough to impress Deloitte? Vaknin breaks it a 3 fold approach:
- How does your business differentiate from your competitors?
- What are your profit drivers (your most profitable clients, services, or other revenue channels?)
- Are you generating the biggest ROI on the dollars you do spend?
To start, the lesson of selling unique products to the right customers. Vaknin emphasizes the importance of differentiating your company, services, and products from the competition and identifying the clients that will be most profitable to your business. Specifically, he suggests offering them a high-value product that produces measurable improvements to their own profit margins.
Differentiating Your Offering
Socrates was on to something with his “knowing thyself” philosophy.
Regardless of what industry your business is in, you will always have someone selling a similar service to yours. In order to stand out from your competition, you need to pinpoint exactly what exclusive benefit you offer that will attract customers—and keep them coming back for more.
For example, in the last three years, Vaknin's company looked at all the services they offered and narrowed down their offerings to focus on their unique value and selling proposition – the service they do best that stands apart from any technology their competitors can offer.
Unlike most digital marketing products out there that show advertisements to fresh eyes to gain leads, get a brand in front of fresh eyes, and convert more people into customers, YouAppi uniquely focuses on retargeting, re-engaging, and reconnecting existing users with proprietary algorithms that track users their devices.
"Exactly, exactly," Moshi says, "We focus it on one thing we know we do very well, and this is retargeting."
Identifying the Most Profitable Customers
In any service business that requires a significant amount of dedicated one-on-one time with clients, management must carefully assess profit margins, ensuring the price is right to cover the high cost of labor.
Additionally, Vaknin's company pairs its software with a white-collar service model that requires a large pull on the time and resources of its developers and customer service representatives because YouAppi works closely with its clients to ensure positive outcomes.
As he did in YouAPPi, Vaknin recommends carefully identifying which types of clients would be the most profitable to concentrate the company's sales, service model, and technologies to best serve that specific type of client.
In YouAPPi's case, "big fish" clients such as big names in streaming services like HBO turned out to be the most profitable within their business model because these types of companies needed and could afford the products and high level of service offered by YouAPPi.
While this proved to be true for YouAPPi, it's not always the case that the biggest clients produce the biggest profit margins. In service businesses, especially, business leaders must be wary of clients that require a big chunk of time with the most experienced and knowledgeable employees. Working with these clients often ends up costing more than the revenue they bring in is worth. Even if the revenue generated by big-fish clients is significant the profits can often be nominal.
CEOs must carefully track profit margins by clients and job type using unit economics and cost allocation to identify which clients truly are the biggest fish.
“GrowthForce helped our financial manager get the daily tasks done right...enabled us to be able to scale...and more importantly gain insight into our numbers which was a significant evolution in our path as a small business. ”- Peta Hoyes, COO, Tag1
👉 Scaling at a rapid rate, this consulting firm had one bookkeeper who wasn't able to keep up with the company's growing needs. Fast forward to one year later- the company went from break-even to seven figures of profit. See how they did it...
Whether you're managing a B2B company or a B2C business, services that offer true value will always sell best. In B2B, use your marketing to demonstrate how your service will improve operations to bolster the bottom line. In B2C, use your marketing to demonstrate how your service will alleviate your customers' pain points.
Vaknin explained that success has not only come from the fact that their technology is singular and works very well, but that by focusing on remarketing, YouAPPi offers their clients higher value than that which can be found by spending marketing dollars to generate new leads.
YouAppi's technology effectively increases customer lifetime value for clients and reduces the need to spend big on attracting new customers, thereby reducing overall customer acquisition costs for his clients.
So, by focusing on this specific type of retargeting, Vaknin not only accelerated his own company's profitability but has also helped to increase profitability for his clients.
It's Not About How Much You Earn; It's About How Much You Keep
When thinking about profitability, of course, we think about sales and revenue, but it's also essential to remember costs because profitability is not about how much you earn, it's about how much you spend to drive revenue, and how much revenue you keep at the end of the day.
You can be a million-dollar business, but if it costs you $999,999 to get there, you're really only a one-dollar company.
With remarketing of any kind, businesses stand to increase their profits by increasing profitability per customer because it turns out that existing customers are much more valuable and way less expensive to convert than new ones.
Although it will always be necessary to attract new customers in order to grow your business, remarketing is one of the most valuable ways to spend your limited marketing dollars. With remarketing, you'll see a much greater return on investment because the strategy is less expensive than marketing to new customers. As a result, it saves you on marketing costs and also increases the value of your existing clients.
Focus on Your Strengths to Grow Your Company Like a Fast 500
The principles on which Vaknin relied to grow his company fast enough to make Deloitte's Fast 500 list are actually quite traditional financial management concepts. The same strategies can be applied to any business operating in any industry:
- Differentiate your business from your competition
- Identify and focus on your profit drivers (your most profitable clients, services, or other revenue channels)
- Spend smartly to generate the biggest ROI on the dollars you do spend
When you apply these strategies to your own business model, you can increase your profits and enjoy having more power to expand.