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Moderators:

Andy Brice
Successful Software

Doug Nebeker ("Doug")

Jonathan Matthews
Creator of DeepTrawl, CloudTrawl, and LeapDoc

Nicholas Hebb
BreezeTree Software

Bob Walsh
host, Startup Success Podcast author of The Web Startup Success Guide and Micro-ISV: From Vision To Reality

Patrick McKenzie
Bingo Card Creator

Almost successful

I'm reaching the point where my web app is doing well, but is not quite earning me enough to completely quit the day job, I wonder if anyone else is in this frustrating position?

I would really appreciate any pointers as to how I can improve my offering or website http://steelbeamcalculator.co.uk/ ? - Just to need a good push to get to the point where I can finally quit the day job.

Thanks in advance.
Kevin Taylor Send private email
Wednesday, June 26, 2013
 
 
Patrick (http://www.kalzumeus.com) and Andy (http://successfulsoftware.net), both Moderators here, have a lot of great advice on software marketing on their respective sites.  They both also offer consulting engagements. 

If you haven't already, I'd suggest you start by looking at their sites.
Jason Send private email
Wednesday, June 26, 2013
 
 
Just wondering if you could approach the steel manufacturers with a view to them licensing the product for their own website. It might be that "occasional" users would prefer that, rather than signing up for what seems like a six-month minimum. I'm thinking about small builders, who might use steel a few times per year. OTOH, maybe have a £5 one-shot deal, where you get one calculation/report for trivial cost.

Apologies if you've already been down that route. Just thinking out loud.
Scorpio Send private email
Wednesday, June 26, 2013
 
 
Nice, professional looking site.

Have you considered joining various social media sites like LinkedIn, Google+, participate in various discussion groups? I didn't see any links to those on your site.

Both LinkedIn and Google+ have groups and other means of target specific demographics of professionals.

There was a post the other day questioning the value of LinkedIn. I didn't respond but when I've participated in comments and/or made my own posts I see significant bumps in traffic.
Patrick Hughes Send private email
Wednesday, June 26, 2013
 
 
1. Nice site, generated PDF report is good.

2. Don't tell people you almost make living from this. It is too easy to copy and you will have hundred competitors tomorrow.

3. Are beams the only kind of calculation in mechanics of materials one needs? Expand your calculator and offer other types of calculations that you can sell to other customers.

P.S. Why do you limit beam length to 10m in paid version?
B2B Send private email
Wednesday, June 26, 2013
 
 
Thanks everybody for your input

@Jason I am an avid reader of Andy's blog, had a quick look at Patrick's blog, some good posts will check out some more.

@Scorpio I did consider a one-shot deal, but people doing calc's for £5, would be a support nightmare. Although I might look at some different pricing options, for say 3 or 1 months.

@Patrick Hughes - Glad you liked the site, I have not had great success with social media, but will try LinkedIn and Google+, the construction industry is decades behind everyone else.

@B2B Not too worried about competitors, I see Andy, Patrick, Joel etc are happy to discuss their business on their blogs, doubt it has done them harm, unless anyone knows otherwise? We are planning to add additional calc' types as we go, our customers do not need to design beams longer than 10m.
Kevin Taylor Send private email
Wednesday, June 26, 2013
 
 
I assume that you can't install structural steel beams in the UK without someone signing off on the plans who has the technical skill to do the same calculations themselves.  Functionally, you don't have anything to offer the only people who would be interested in paying for your service.  But it is a nice website, and steel beam vendors and technical staff for construction companies probably aren't very good at designing websites.  So maybe your opportunities are there.
Howard Ness Send private email
Wednesday, June 26, 2013
 
 
Won't a mobile app be better in your case?

>> I see Andy, Patrick, Joel etc are happy to
>> discuss their business on their blogs, doubt
>> it has done them harm, unless anyone knows otherwise

May be they were discussing their businesses for their ultimate goal to offer consultancy services.
Gautam Jain Send private email
Thursday, June 27, 2013
 
 
I think one formula for success is

growth rate = remarkableness of product x number of existing customers

by which I mean (1) you have to have a product that is so good people want; to tell their friends colleagues about it. I think you may have that.

Then (2) the barrier to huge success is just getting more and more people to know about it. The more know about it, the more people recommend it, and it grows like that.

So I guess what I'm saying is if you do quit your job use then use your time to focus on getting the site known out there in the industry, to increased exposure to your remarkable product, rather than tinkering with the site itself.

(one small thing I noticed, on the front page is says unlimited access for just £50; the report page says £60 a month)
Nick Moore Send private email
Thursday, June 27, 2013
 
 
@ Howard Ness

Calc's and plans can be carried out by anyone in the UK, but they have to be signed off by Building Control who check that all complies with the Building Regulations. Generally the only people with sufficient experience to use our product are Structural Engineers, Architects or Building Surveyors. Not the sort of thing to botch as structural safety depends on calc's being correct.

@Gautam Jain

I used to have a simple iPhone app priced at £2.99 after Apple and Luxemburg vat I only got £1.82, so decided to drop the app. Apps not good for a small niche.

@Nick Moore

I'm a freelancer, so I am gradually decreasing my work and doing more marketing. It's £50 for 6 moths unlimited access, perhaps I need to make this clearer.
Kevin Taylor Send private email
Thursday, June 27, 2013
 
 
>May be they were discussing their businesses for their ultimate goal to offer consultancy services.

Get consulting work is one reason (among many) that I write a blog. However my product business is (by far) my main focus.

Competition is a fact of life in any viable niche. Are other people suddenly going to launch competitors to http://steelbeamcalculator.co.uk/ just because he said he is nearly making a full time living with it? I doubt it. They would need a fair amount of domain knowledge. Also most other programmers appear to be too busy writing yet another social media app to bother with a niche like steel beam calculations.
Andy Brice Send private email
Thursday, June 27, 2013
 
 
Andy, fair point I have nearly 19 years experience of working in the construction industry, not something you could easily copy.
Kevin Taylor Send private email
Thursday, June 27, 2013
 
 
@Kevin,

If you get signed up look me up and add me as a connection. I'm in a related industry so many of my connections are also in related industries.
Patrick Hughes Send private email
Thursday, June 27, 2013
 
 
"the only people with sufficient experience to use our product are Structural Engineers, Architects or Building Surveyors"
And how do these specialists manage to keep buildings from falling down without your online calculator?  You can have a killer website, blog the living crap out of your expertise, show the world how to market; but if no one really needs your calculator, you only hope is to sell the convenience of going to your website instead of opening Excel and/or the spec sheet from steel beam suppliers. 

Take the value you would assign to that convenience and halve it for every additional customer.  Your first paying customer will think it is worth half as much as you do.  The second paying customer will think it is only worth half of what the first paying customer thought, and so on.  I never was much good at math, but I think that's a logarithmic curve.  Then graph what it costs to provide your service per customer.  If the cost curve never gets below the revenue curve, you got a problem.
Howard Ness Send private email
Thursday, June 27, 2013
 
 
@Howard Ness

I have been conducting a similar experiment over the last 30 months but with fee paying customers. I have proven that profits exceed costs, no need to guess what value customers place on the product.
Kevin Taylor Send private email
Friday, June 28, 2013
 
 
"I used to have a simple iPhone app priced at £2.99 after Apple and Luxemburg vat I only got £1.82, so decided to drop the app."

If I was shopping for something critical to my work I would be put off by a price of just £2.99. Is there anything in the app store that stops you pricing it at £100 or more?
Ducknald Don Send private email
Sunday, June 30, 2013
 
 
Not sure anyone would pay £100 for an iPhone App or would they?, when it comes to proper work, I always switch on the laptop
Kevin Taylor Send private email
Sunday, June 30, 2013
 
 
@Howard Ness
"Take the value you would assign to that convenience and halve it for every additional customer.  Your first paying customer will think it is worth half as much as you do.  The second paying customer will think it is only worth half of what the first paying customer thought, and so on.  I never was much good at math, but I think that's a logarithmic curve.  Then graph what it costs to provide your service per customer.  If the cost curve never gets below the revenue curve, you got a problem. "

That cannot be a good measure of perceived value.
It's a exponential curve that approaches zero very very quickly.
Anyone using that method would never expect more than about 10-20 customers to find their product anything but worthless

If first customer assigns a perceived value of $100, then using your method, the Nth customer would assign a value of
$100*(1/(2^(n-1)))

n=1,    1st customer ~$100
n=2,    2nd customer~ $50
n=10, 10th customer ~ $0.195
n=15, 15th customer ~ $0.0061
n=20, 20th customer ~ $0.000190
n=30, 30th customer ~ $0.000000186

This means your tenth customer perceives the value
at about 20c

Your 15th customer perceives the value
at less than one cent  (i.e practically worthless)

Your 20th customer perceives the value
at about one 50th of  a cent

Your 30th customer perceives the value
at about one 50 thousandth of  a cent !!!


A startling example of  the reverse (exponential growth) is to put one grain of rice on the first square of a chess board, 2 on the next, 4 on the next, doublng each time.
How many grains of  rice would be needed if every square on the chess board was used?
A room full? A swimming pool full? A football stadium full ?
¦
¦
¦
¦
¦
¦
The answer is 18,446,744,073,709,551,615 grains
which would be a pile of rice taller than Mt Everest, and would take all the worlds rice growers about 1000 years to produce!
GreenBean Send private email
Monday, July 01, 2013
 
 
"That cannot be a good measure of perceived value."
Actually, it's an improvement over classic demand functions.  The classic model is that once everyone who needs your product has it, the product has zero perceived value.  In reality, if it is cheap enough, people believe it has some tiny, but measurable value, so they will spend some of their resources to obtain it, even it does absolutely nothing for them.

As a seller, the problem is that customers spend time, emotional and mental resources to obtain products, so even free products have a cost to the purchaser (of which the seller gets nothing in return).

"It's a exponential curve that approaches zero very very quickly."
The velocity of the curve (and maybe velocity is the wrong term, I stunk at calculus) can be affected by the resistance of new customers to buying the product, how easy it is to reach new customers, the size of the potential market, the utility of various features of the product, and other factors that make sense for some products but not others. 

Sometimes, a critical mass of early adopters lowers incremental buyer resistance and makes it easier to reach new customers.  If the product features become more valuable over time, this curve can reverse direction.  In my experience, complex modeling of demand is great for presentations, but you have to start with a conclusion in mind, and make your model fit your conclusion.  I used a simple example to make a point.

"Anyone using that method would never expect more than about 10-20 customers to find their product anything but worthless"
Even if the actual number of worthwhile customers (who are willing to pay more than your variable costs) is 100-200, you have to consider if your product is worth the investment of your own resources.

In the OP's case, he has a product with a relatively small market, and high buyer resistance because potential customers are already performing the same function without his product, and any failures resulting from the use of his product carry an extremely high load of liability.  The only feature of value to his potential customers is convenience of his service over whatever process they are using at the moment, and the value of saving time to complete a process that has deadlines measured in days or weeks, and which can be a source of considerable revenue to the specialist providing the service, is going to be much lower than what it is worth to steel beam suppliers to complete a sale to construction companies. 

In other words, if there is truly value in an online calculator, steel beam suppliers should be all over it.  If they are, how is the OP going to compete, and if they aren't, why is the OP wasting his resources on a business with a very low likelihood of success?
Howard Ness Send private email
Monday, July 01, 2013
 
 
@Howard Ness, some more info' regarding my business and industry, does this change any of your assumptions?

In the UK most Architects (or their clients) employ Structural Engineers on a piecework basis to do their steel beam calculations, an Architect could save £thousands by using an online beam calculator. The pain is very real, see testimonials http://www.steelbeamcalculator.co.uk/testimonials.aspx

Only one company in the UK manufacture steel beams, TATA and they don't do an online beam calculator.

Over last 30 months, 558 paying subscribers, many of which are repeat subscribers, some of which have completed their 3rd subscription, gradually improving my sales, year on year. @Howard Ness, I'm doing ok, I would just like some guidance on how I can do better, any ideas?
Kevin Taylor Send private email
Monday, July 01, 2013
 
 
"Only one company in the UK manufacture steel beams"
A quick search in the GTA (population 6 million) turned up 6 big name distributors who can supply steel beams to commercial building contractors. However, only one steel mill close to the Great Lakes might be specializing in steel beams; in which case distributors are competing with each other to sell the same product.  The final consumers of steel beam load calculations are the professionals who sign off on the blueprints before construction starts, so your competition is any entity from the steel mill to your own customers who can supply valid calculations.

"how I can do better"
Concentrate on repeat business, charge more and build closer relationships with your customers.  I don't think architects can stop using structural engineers entirely, so I would concentrate on structural engineers.  If architects "could save £thousands" by bypassing structural engineers, structural engineers will react to protect that revenue.
Howard Ness Send private email
Monday, July 01, 2013
 
 
Your right I need to focus on the customer.

The US, Canada & UK are all different in how they regulate building safety/standards. Even within the UK the regulatory system is different between England and Scotland, I need to be aware of these differences. For example in Canada it is more restrictive as to who can sign off calculations than it would be in England. Generally in England anti-competitive practices frowned upon.
Kevin Taylor Send private email
Tuesday, July 02, 2013
 
 
The easiest customer to sell to is the one you already have. Is there some extra service you could sell them? Maybe different tiers of functionality at different price points?:
http://successfulsoftware.net/2013/02/28/how-i-increased-sales-by-adding-extra-price-points/

Or a completely new service aimed at the same customers?

Perhaps try raising your price for new customers and see what effect it has?

Perhaps upsell them services from other vendors and take an affiliate commission?

Perhaps try and set up some sort of partnership with the steel beam company or with the appropriate professional body (i.e. for structural engineers)?

See also:
http://successfulsoftware.net/2008/12/29/100-ways-to-increase-your-software-sales/
(some of these are now rather out of date)

Also it takes time to grow sales (if you haven't got millions of VC cash to throw around).
Andy Brice Send private email
Tuesday, July 02, 2013
 
 
Thanks Andy,

Some useful actionable tips, I think we could implement a money back guarantee and try a few others. Also some new products, perhaps a timber beam calculator.

Always good to hear from people who are out there making a living selling their products, Andy you are an inspiration.

Time is your friend, patience is a virtue.
Kevin Taylor Send private email
Tuesday, July 02, 2013
 
 
Is there any special input you could give for the self build market? Does a self builder need an engineer to sign off or could they use your calculator themselves?

Perhaps you could sell more services more easily to a less informed market. If I was building my own house I'd much rather use a site like yours than read a structural engineering book.
Jonathan Matthews Send private email
Tuesday, July 02, 2013
 
 
Some self-builders do use our steel beam calculator (SBC) and at least in England & Wales there is no restriction on who can submit calculations for building regulation approval.

Many self-builders would not have the confidence to use the SBC, I could assist these potential customers by adding examples and a how to guide, extra notes and guidance. Educating potential customers on how to safely use the SBC could be key.
Kevin Taylor Send private email
Wednesday, July 03, 2013
 
 
Depending on the size of the market (I don't know) there could be potential to write a lot of articles for self builders for good seo.
Jonathan Matthews Send private email
Wednesday, July 03, 2013
 
 

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