BI 320: How JazzHR is Succeeding Selling Recruiting Software to SMBs in the Middle of COVID
June 30, 2020
Selling software that handles the HR processes of 6000 small businesses is no easy feat. Having the majority of them renew every year is no less challenging.
Pete Lamson, the CEO of JazzHR, believes a good product, engaging customer support, and competitive price are the keys to acquiring and retaining customers.
How is Pete selling software and retaining customers long after? Find out in this episode.
Pete Lamson, the CEO of JazzHR, believes a good product, engaging customer support, and competitive price are the keys to acquiring and retaining customers.
How is Pete selling software and retaining customers long after? Find out in this episode.
Episode Highlights
[00:13] — Pete talks about his background and JazzHR
● Pete has been the CEO of JazzHR for four and a half years.
● He used to be in a startup called Carbonite, a company focusing on online backup.
● JazzHR was founded to help small businesses recruit more effectively.
● Most small businesses have relationships with major job ad boards. However, they have no real efficient process to manage candidate flow through all the steps of recruiting.
[03:23] — Product–market positioning
● The primary focus is not the competitors, but the customers
● Dwell on the five customer-facing questions.
● Strong competitors push the company to innovate, but customer experience is still the priority.
[05:19] — 3 things that drive customer acquisition & retention
● A really good product
● Reliable customer support
● A competitive price
[09:45] — Funding for JazzHR
● The company is backed by venture capitalists and has now finished fundraising.
● The business is breakeven, and they spend their income on growing the company even more.
[10:53] — 2 ways of selling software and bringing customers on board
● Direct customer acquisition is selling the software directly to end-user customers.
● Indirect selling makes use of channel partners who resell the software to their own customers to strengthen relationships.
[15:10] — The most effective customer acquisition system
● JazzHR uses an inbound model. The goal is to first introduce the software to the customer before you even sell it.
● Many companies have homegrown recruiting solutions, which means most are unfamiliar with Pete’s software niche.
● JazzHR educates and helps small businesses understand that they may have a recruiting problem and introduce them to an affordable solution.
● They offer a free trial or demo and focus on customer support to improve conversion rates.
[18:11] — Average order value & lifetime value
● JazzHR’s AOV is $2400 annually, and their LTV is $11,000.
● The most critical metric JazzHR has is retention because it drives the company’s lifetime value and enterprise value.
[19:19] — 3 JazzHR plans
● JazzHR has three plans. Hero is a lightweight solution for small businesses with under 60 employees.
● Plus is for companies that have hiring teams that need more HR functionalities and features.
● Pro is a full-function solution for larger companies with 150 or more employees.
● The company’s annual retention rate is 85%.
[21:32] — Marketing for selling software
● Being inbound focused means more webinars, content marketing, and blogging.
● The entire website is search engine optimized.
● Nurture customers who have raised interest even if they haven’t purchased yet.
● Social media is also a significant factor in marketing.
● JazzHR has 20 people on its sales team.
[24:00] —The impact of the COVID-19 pandemic
● Most companies have a culture of having everyone physically in the office
● A completely remote work setup has an impact on productivity and processes.
● The downturn of small businesses and rising unemployment has affected the HR industry tremendously.
● JazzHR’s team shifted its focus on catering to industries that currently need it most, such as healthcare, technology, and logistics.
[33:17] — Deciding prices and selling software upgrades
● Be frugal to be able to offer low prices.
● Customer feedback is essential in market research. Trial and error is part of the process.
● JazzHR understands that increasing their pricing plans may be too much for small businesses. Thus, they constructed the software to be modular.
● Earn more income through expansion revenue.
● Selling software upgrades is a combination of in-app, email, and newsletter marketing.
[38:31] — Lessons learned from onboarding customers
● They don’t charge for onboarding, unlike some competitors.
● They look at utilization metrics regularly to check if the customers are having a great product experience and getting their money’s worth.
[42:06] — JazzHR’s process
● For software with unique clients, companies prefer to be flexible and have a general flowchart instead of a rigid process.
● Not having proper processes in place has gotten the company in internal friction and conflict.
Resources links can be found at https://brightideas.co/selling-software/
[00:13] — Pete talks about his background and JazzHR
● Pete has been the CEO of JazzHR for four and a half years.
● He used to be in a startup called Carbonite, a company focusing on online backup.
● JazzHR was founded to help small businesses recruit more effectively.
● Most small businesses have relationships with major job ad boards. However, they have no real efficient process to manage candidate flow through all the steps of recruiting.
[03:23] — Product–market positioning
● The primary focus is not the competitors, but the customers
● Dwell on the five customer-facing questions.
● Strong competitors push the company to innovate, but customer experience is still the priority.
[05:19] — 3 things that drive customer acquisition & retention
● A really good product
● Reliable customer support
● A competitive price
[09:45] — Funding for JazzHR
● The company is backed by venture capitalists and has now finished fundraising.
● The business is breakeven, and they spend their income on growing the company even more.
[10:53] — 2 ways of selling software and bringing customers on board
● Direct customer acquisition is selling the software directly to end-user customers.
● Indirect selling makes use of channel partners who resell the software to their own customers to strengthen relationships.
[15:10] — The most effective customer acquisition system
● JazzHR uses an inbound model. The goal is to first introduce the software to the customer before you even sell it.
● Many companies have homegrown recruiting solutions, which means most are unfamiliar with Pete’s software niche.
● JazzHR educates and helps small businesses understand that they may have a recruiting problem and introduce them to an affordable solution.
● They offer a free trial or demo and focus on customer support to improve conversion rates.
[18:11] — Average order value & lifetime value
● JazzHR’s AOV is $2400 annually, and their LTV is $11,000.
● The most critical metric JazzHR has is retention because it drives the company’s lifetime value and enterprise value.
[19:19] — 3 JazzHR plans
● JazzHR has three plans. Hero is a lightweight solution for small businesses with under 60 employees.
● Plus is for companies that have hiring teams that need more HR functionalities and features.
● Pro is a full-function solution for larger companies with 150 or more employees.
● The company’s annual retention rate is 85%.
[21:32] — Marketing for selling software
● Being inbound focused means more webinars, content marketing, and blogging.
● The entire website is search engine optimized.
● Nurture customers who have raised interest even if they haven’t purchased yet.
● Social media is also a significant factor in marketing.
● JazzHR has 20 people on its sales team.
[24:00] —The impact of the COVID-19 pandemic
● Most companies have a culture of having everyone physically in the office
● A completely remote work setup has an impact on productivity and processes.
● The downturn of small businesses and rising unemployment has affected the HR industry tremendously.
● JazzHR’s team shifted its focus on catering to industries that currently need it most, such as healthcare, technology, and logistics.
[33:17] — Deciding prices and selling software upgrades
● Be frugal to be able to offer low prices.
● Customer feedback is essential in market research. Trial and error is part of the process.
● JazzHR understands that increasing their pricing plans may be too much for small businesses. Thus, they constructed the software to be modular.
● Earn more income through expansion revenue.
● Selling software upgrades is a combination of in-app, email, and newsletter marketing.
[38:31] — Lessons learned from onboarding customers
● They don’t charge for onboarding, unlike some competitors.
● They look at utilization metrics regularly to check if the customers are having a great product experience and getting their money’s worth.
[42:06] — JazzHR’s process
● For software with unique clients, companies prefer to be flexible and have a general flowchart instead of a rigid process.
● Not having proper processes in place has gotten the company in internal friction and conflict.
Resources links can be found at https://brightideas.co/selling-software/