A Product’s Journey, Finding Your Niche and Getting Started

Building products without guaranteed market acceptance requires bravery and resilience, traits commonly found in many entrepreneurs.

I was fortunate to be a part of some small product journeys in the late 2000’s and early 2010’s. One such experience is the topic of discussion here for those looking to start an online business.

The post will go over how we found a niche, built a product for it, saw it grow, and the challenges we faced. I will also share some insights on a go-to-market vs organic growth comparison.

In a future post, I will discuss the metrics you need to monitor to maintain product health and measure sales growth.

Where’s My Market?

WordPress was the thing to be involved with back in 2004/2005. With blogging taking center stage, everyone and their cat was setting up their blogs.

In my experience, it wasn’t until the end of 2005, with the release of WordPress 2.0, that it took center stage.

The ‘market’ for selling plugins/themes was almost non-existent, as the open-source ethos of WordPress made most developers release them for free. It is still the driving force behind the CMS today, which is fantastic.

But everyone has bills to pay.

Finding My Niche

Would the market ever develop for designers in the WordPress ecosystem? I thought to myself as I tried to figure out ways to make a living with it. The odd theme design jobs were great, but not consistent.

As demand for premium plugins and themes grew, I decided to create something.

Finding Owen Cutajar, my developer partner, was a stroke of luck. I cannot emphasize enough the importance of having a great partner to work with. Before I approached him, I already had an idea of what I wanted to develop.

For a time I had a store on eBay as a side hustle. We sold clothing, jewelry, and all sorts of things. It was the only reliable site where you could host auctions.

So I did, what any entrepreneur would do, I decided to disrupt the market. Seeing as how everyone was gravitating to a certain platform, why not allow them to do more with it?!

We created an auction plugin, the first of its kind for WordPress, and named it WP Auctions.

Build It, And They Will Come

We released the initial version of the plugin in 2007/2008, after a few months of ‘beta’ development. It was a lukewarm response. I think the first sale happened a few weeks after the launch.

But it wasn’t until 2009 or early 2010 that the plugin started to take off. Waiting close to 2 years for traction is tough. It creates a lot of doubt. In the meantime, we continued to try different things.

We also released a free version on WordPress.org. First, to give back to the community as we strongly believe in the concept of open source. Second, it turned out to be a great driver of organic traffic to our premium version.

The market eventually noticed that you can use this plugin to hold auctions. Instead of the only option at that time, eBay.

That was when our hockey stick growth chart began. As each new version release added features, our user base grew. Introducing a multi-user option helped the revenue bar tick up a bit.

We were approached regularly by charities and people wanting to use the plugin to raise money. It was a great feeling receiving their thank you notes and how much they could raise because of it.

As our sales grew, the first competitor appeared. Yes, it took almost 2/3 years before someone released another plugin.

That was a gratifying feeling, knowing you were the first in the world in an untapped market.

1st Acquisition Offer

The best part was that we got an offer from someone who wanted to acquire it. I remember quoting a price that was around 2.5/3 times our yearly revenue. They didn’t seem to think they could make their money back.

We hit that target the next year.

2nd Acquisition Offer

We were hitting a healthy 5-figures in yearly revenue by now, cue the 2nd offer. I once again quoted a price of 2.5/3 times our annual recurring revenue (ARR). I believe it was in 2011. They didn’t think the plugin would make them that much money.

So they built a competing product (which shut down in a year).

We hit the acquisition price I had quoted – the following year as revenue. You can high-five me here -✋

I’m not sure when the 3rd offer came, but yes as you guessed they didn’t think they could make their money back. We hit that target in 2012/2013.

Go To Market vs Organic Growth

We laid out a go-to-market strategy – mind you, I call it that now, back then it was just ‘the plan’. It revolved around making sure everyone thought of the plugin when they thought of auctions.

As you can tell, it does fall short of a few major things. Today, I would pay attention to niche customer targeting, create value by explaining how it addresses pain points, and track some metrics.

Another important element of the “GTM” was pricing. Our only reference was what other plugins were costing and we kind of just came up with a price. But it wasn’t until a few versions were out that we reached a price point that kept sales steady.

Today, I would look at market demand, competition, and perceived value before deciding on cost.

Implementing the above steps seemed natural without any elaborate schematic to reach more users. I couldn’t have done more as product development and support always took a chunk of my time.

But knowing what I know now, we should have invested more in marketing.

Looking at the organic side of the business. My key performance indicators (KPIs) at the time were just website traffic and sales. I should have paid attention to many more metrics.

On the one hand, our Net Promoter Score (NPS) was decent. Early reviews provided us with direction to make our product better.

SEO-wise, we had the market cornered for the targeted search keywords. Our in-house efforts rewarded us with the #1 spot for ‘auction plugin’, and variants, for the better part of a decade.

Even so, you still need to market.

So, what happened?

Year-over-year revenue growth was 100%+ for 4 years in a row. Everything was going great until it wasn’t.

I relied too much on organic growth, without optimizing for the metrics I was not measuring. I also unintentionally paid less attention to the GTM strategy, by relaxing on advertising. Even though, we were doing discount offers, plugin add-ons, free installation offers, and more…we only relied on search engine traffic.

Your GTM strategy needs to be marketed, otherwise, it’s just an acronym.

There’s a reason why the biggest retailers online advertise on their brand name keywords, and a lot more.

Fast forward to today. Since 2022, the plugin has moved on to new owners who are doing some great work with it.

In my next post, I will share the top factors that blinked red for product growth and were early warning signs.

Read it here: A Product’s Journey, 5 Warning Signs and Rescue Tips

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