In 2016 our plugin business had a 28% growth in revenue over the previous year.
During the end of the year break, I took some time to analyze what this number really means and if this metric should be the most relevant one to focus for the years to come.
To put things in perspective, during the last 4 years, since we’ve focused on building and selling WordPress products, we saw a yearly growth with values ranging from 28% to over 100%. This came mostly due to us constantly improving our plugins, offering great support, as well as taking advantage of the growing WordPress market share.
That being said I think we tend to not appreciate enough what just went by, and simply rush to set targets for the new year. I feel this makes it more about the destination, not the journey.
That’s why I’ve decided to look back at how 2016 unwinded, in our first “year in review” post.
For a more condensed version of our first year in review check out this infographic.
Our company revenue comes from three plugins, all of them using a freemium business model:
At the beginning of last year, shortly after launching Paid Member Subscriptions, we decided that in 2016 our main focus will be on improving and consolidating these three plugins.
I’m quite happy with how things turned out in terms of development. In 2016 we shipped:
24 releases for Profile Builder, 4 of which were major releases which added complex functionality like:
In terms of Add-ons, we added 5 new Profile Builder add-ons to the list:
Paid Member Subscriptions
Paid Member Subscriptions core got a lot of attention in 2016. Based on user requests we constantly pushed to add more functionality, making it more robust and flexible.
There were 25 releases for Paid Member Subscriptions in 2016, which added functionality like:
- Full integration with Profile Builder, offering support for paid user profiles. These two are now 100% compatible.
- Manual/Offline payments support
- AffiliateWP integration
- Display restricted post preview to non subscribers
Also, we launched 3 new Paid Member Subscriptions add-ons:
WordPress Creation Kit
WCK got some attention as well last year, however I think we could have done better and I’m hoping to give it more love this year.
It has over 20.000 active installs on wp.org, and a pretty high rating which tells us people find it really useful and easy to use.
There were 21 new releases for WCK in 2016. Some of the most important updates included:
- Transition from serialized to unserialized fields, in terms of how we store the custom fields data.
- Added support for new custom fields types, like: Maps, HTML, Phone, Timepicker, Colorpicker, Heading, Currency
We also released a free Client Portal plugin, simple yet very handy if you’re looking to create private pages for users that only administrators can edit.
Since we’re releasing updates regularly, we needed a way to do proper testing. Manual testing ends up taking a big chunk of time if done properly, so last year we started writing automated tests for our plugins. It quickly became clear that this is the way to go.
Razvan was the one with the initiative and he also implemented the initial tests for Profile Builder. Even though we’re still doing manual testing to a significant extend, we will continue to write more automated tests and hopefully reduce manual testing in 2017.
Our team grew with 3 new people last year: Andreea, Geo and Patricia. Andreea is handling the administrative part of the business, Geo joined our support team and Patricia will focus on improving our marketing and communication efforts.
Therefore, Cozmoslabs is now powered by a team of 10 people. While a growing team has its challenges, it also makes for a very rewarding experience.
I really enjoy spending time with all of them and am grateful for the support they provide. Since we’re sharing the same office, scrubbing elbows on a daily basis creates a pretty strong connection.
Also, I’m proud to say that 2016 was our third year in a row since we switched to a 4 day workweek, by taking Fridays off. This is something that I care deeply about and plan to keep in 2017, since it’s one of the key ingredients for our team health and happiness.
In terms of growing the team further, for now I’m pretty comfortable with this number and don’t see us needing to add more than 1-2 team members in 2017.
Instead of growing the team too fast, I’ll be looking at ways in which we can further increase our productivity and skills. But, then again, you never know what life throws at you, so it’s good to stay flexible in terms of hiring.
One thing we can all do in 2017 more often is getting out of our comfort zone.
Whether this means exposing oneself to new technologies, replacing old habits with new ones, public speaking, writing more or simply doing things differently once in a while. I feel this is something that will help us grow both individually and as a business.
Last year we published 33 posts on our blog. While this translates to almost 3 blog posts/month, most of them were focused on highlighting a new piece of functionality that was included in our plugins.
While this is absolutely fine, in 2017 I would like to focus more on writing detailed technical tutorials or content that provides valuable insights for our readers (not necessarily related to our plugins).
Here are our 5 most popular posts from 2016:
Looking at the list above, you’ll quickly understand why I think this year our content efforts should lean towards writing more tutorials solving a painful issue with code or lessons and tools we discovered that can help our customers improve their own business.
Offering outstanding support for our plugins has always been a top priority and something we constantly push ourselves to achieve.
This is also one of the most challenging aspect of running a WordPress plugin business.
Let’s jump in and look and some of the support data from last year:
- Number of Tickets Opened: 9476
- Customers Helped: 2575
- Number of Tickets Resolved on First Reply: 46%
- Average First Response Time: 14h 21m
- Average Response Time: 18h 33m
- Average Tickets per Day: 26
- Most Tickets opened by a Single Customer: 25
It will be interesting to see how these numbers evolve throughout this year. Moving forward we’ll look at ways to reduce the number of support tickets we receive in 2017 while also increase the revenue per ticket.
Another thing worth mentioning is the fact that in 2016 we noticed a decrease in our refund rate. I think this is mostly due to our products becoming more mature and flexible, being able to accommodate quite complex project requirements.
Challenges and lessons learned
Even though we pushed hard on polishing, adding complex functionality and making our products more robust in 2016, this wasn’t enough to see the same percentage of revenue growth as we expected.
It became pretty clear that as the WordPress products market matures, you need to work harder to obtain the same amount of visibility and growth.
Building a solid product is simply not enough anymore. Constant improvements can take you only up to a point. This being said I’m looking to improve our marketing and communication processes in 2017, which have been pretty inconsistent in 2016.
Another challenge of working and improving multiple products at once is that it’s pretty hard to focus on just one. Should you grow the new ones to a more mature state or improve the existing ones that pay the bills?
We don’t have separate teams working on different products, because we felt it’s healthy that each team member gets accustomed to every plugin code base.
However this means we’re constantly prioritizing and allocating resources, especially when it comes to development. We’ll have to think and see how to improve this in 2017.
Moving Forward. Goals for 2017
Here are some of the things that we will work on this year:
- launch a new plugin (more on that soon)
- implement recurring subscriptions for all our products
- write more
- improve our marketing and communication efforts
- experiment with new technologies
- reduce the number of support tickets we receive and increase revenue per ticket
- reach more people with our products
- develop more relationships with people involved in the WordPress community (get in touch with someone new on a weekly basis)
What about growth?
So, is growth a good metric to focus on?
It all depends what you’re sacrificing for the sake of growth. Growth by itself isn’t necessarily a good indicator. While I’m the first to admit that business growth is healthy, it needs to be correlated with profitability, team happiness, synergy and personal development.
If growth ends up affecting your health and disrupts your work-life balance, you should probably reconsider your priorities. It’s also unsustainable. Growth for the sake of growth is most of the times a bad idea.
Therefore I’m pretty happy and grateful for our 28% revenue growth, even though it was the lowest growth rate since we started selling WordPress plugins (somehow normal when your yearly revenue increases).
In 2016 we were profitable enough to be secure as a business, all while working 4 days/week and spending quality time working together. I’m grateful for this.
Also, if you look at the list above you’ll notice
all (most) of them are goals we can control. We haven’t set any revenue goals, because I don’t think you should stress too much on them. They are normally a consequence of putting in the work. Sometimes they will exceed your expectations, other times not so much.
As long as you did your best, there’s no reason to worry about those.
However, since numbers are fun, I’m going to throw in some revenue goals for 2017 as well (and promise we won’t obsess too much on them)
2017 Revenue Goals
- Grow overall revenue (hopefully more than 30%)
- Double revenue for Paid Member Subscriptions
- Grow a new plugin to 5k/month
We’ll see how far off I was next year. Till then, I predict 2017 will be another great year!
P.S. If there’s anything you would like us to build in 2017, feel free to let us know in the comments section below.
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