LandlordMax Sales Revenues
It’s been an interesting ride getting LandlordMax to where it is today. We’ve had many bumps and twists along the way, and we’re still in the thick of things. The good news is that we’re definitely showing revenue growth, even amongst the real estate market downturn in the US (the majority of our customers are from the US). I won’t get into it here, but I think this is good business wise for LandlordMax. Its unfortunate for the people who will lose their investments but I believe it will strengthen the astute real estate investor. In my personal opinion the real estate market downturn will reduce the number of “hobby investors” and lead larger real estate portfolios by professional investors. Whether this is good or bad overall is another question, but I do suspect this will lead to more sales of LandlordMax (our average customer has anywhere between 5-1000 units). In any case, this ia a discussion for another day.
Getting back to LandlordMax, I decided to quickly create a graph of our sales revenues (not profits, just revenues) over the last few years which you can find below. I didn’t have the data for version 1.00 easily accessible and hence it wasn’t included (it was only two months before we released 1.02 anyways). As well, these numbers are approximations. In any case the graph below gives you a ballpark idea of where we stand in terms of revenues.
As you can see we’re definitely growing! Our best revenue for a month in 2004-2005 is now pretty much our worse revenue for a month in most of 2006 (excluding the first two months) and all of 2007.
I also included the major released of LandlordMax along the way, to see what impact they had. Version 1.00 to version 1.02 did have an impact, but again unfortunately I didn’t have easy access to those numbers to display in the graph. Actually if you look at the graph, all new major versions seem to have positively affected our sales revenue except for version 1.08, which didn’t seem to do much either way.
This is an interesting anomaly because if you look at the release notes, we definitely added a lot to the software with version 1.08. My guess is that we didn’t as many new “major” features as we thought, they were probably considered more as enhancements and niceties by our customers: more reports, a Late Fees button, accounting filters, due dates, partial payments, etc. With all the other versions we added at least one major component. For example in version 1.02 we added the concept of landlords, in version 2.12 we added pictures, table sorting, etc. For version 3.11 we added huge performance enhancements, receipts, preferences, etc. For the upcoming version we anticipate (this is not an official list of features, this is what we’re currently working on and hope to have available for the next release if all goes well) adding Quickbooks support, charts for the reports, etc.
All around it’s very exciting to see the sales revenue climb over the years. As you can clearly see from the graph, we’re about to beat our best fiscal year (our fiscal year ends in the fall). To be honest, we’ve already beaten it by 10% as of last month and we still have some months to go! Very exciting times!
· May 21st, 2007 · 12:05 am · Permalink
Congratulations Steph. It looks like a really exciting graph. What do you think caused the drop in sales from May-Aug 05?
· May 21st, 2007 · 1:29 am · Permalink
Hi Dan,
It could be a lot of factors… One my future plans is to overlap this graph with a lot of the marketing we did, not to mention other things that happened within the company.
For example, some of the negatives we experienced during this period which might be responsible for the lower revenues was our hosting provider.
For example we were using Eapps.com which was a disastrous choice for us. They had all kinds of stability issues, sometimes we would be down for hours at a time, even a full day! And we weren’t paying a few dollars a month, we were in the hundreds of dollars a month in hosting. If remember right, we were paying just under $200 a month for a managed solution. Today we pay substantially more than that, but it’s still enough that you wouldn’t expect the kind of service we were getting for the price we were paying. Yes they did send us an explanation email saying how one customer had created an insane amount of traffic in no time which brought down their network, but it still didn’t explain why my particular box was going up and down all the time for reasons unrelated to the box.
We had tried to go for a higher end service but ended up paying a lot more for a less. By late 2005, only months after started there, we became so frustrated with them that we moved to another provider called ServInt.com. This has been one of the best decisions we made in terms of hosting. They’ve great for us since! Approaching on two years now.
Another reason may be our Google Adwords campaign. For a period of several months (around that time) I tried to drastically reduce our spending on Adwords to see if there would be a noticeable difference (as well it was frustrating me to pay for Ads when our server was unstable). Therefore this could also be very related… By the way, we also spend about ten times more per month on Google Adwords than we did just two years ago.
That was not our best summer and I do remember the stress (especially with hosting). The good news is that even with this we were able to squeak a profit. It wasn’t much of a profit, but a profit nonetheless. Although we had lower revenues, we also had lower expenses; I drastically reduced our whole advertising budget until we had the hosting issues resolved because I viewed it as wasted money.
Other things that might have escaped your attention (at least without an insider tip) is that about 30 days after the start of each new year we generally get a small spike in sales. This is because each year around the beginning of the year Multi-Housing News does a review of LandlordMax in their monthly real estate magazine. This generates extra publicity for us and as soon as the 30-day free trials start to expire we see an increase in sales.
There are many other factors that can change our monthly sales: a successful press release, a prominent article on this blog, an Adwords campaign change, etc.
What’s really hard for us is to determine what actually caused the spikes and troughs because of the 30+ day delay from when a person first tries LandlordMax to when they actually purchase it (the majority of our customers purchase it when the trial is over or just about to expire).
· May 21st, 2007 · 3:03 am · Permalink
I love numbers, and numbers like these look easy to love (especially for you). The interesting thing to me is the fairly stagnant growth rate for the first two years, then beginning in 2006 your sales took off.
I’d love to read the story behind that.
· May 22nd, 2007 · 9:04 pm · Permalink
Hi Nick,
I plan to write a follow-up sometime in the next little while going over some of the events and how they affected our revenues (overlaying this graph with some of the interesting events). Some are surprising others quite expected.
We’ve tried a lot of things over the years and its always amazing to me what works and what doesn’t.
· June 26th, 2007 · 12:20 am · Permalink
[…] The list of new major features for this version has changed quite substantially since we initially started working on it. For example, we anticipated offering QuickBooks support but that’s been postponed to another future version. The costs to benefit just doesn’t align right now. Integrating with QuickBooks is just too expensive and time consuming as compared to the number of requests. We even looked at purchasing third party components to alleviate this but we’ve only had limited success. We’ve already spent a significant amount of time and money on this feature and its unfortunate to have to postpone it again. I’m just glad we’re able to avoid the “sunk cost effect“. […]
· April 3rd, 2008 · 5:16 pm · Permalink
[…] been almost a year now since I last posted our sales revenues at LandlordMax (May 2007). Therefore I figured today was as good a time as any to update our progress and growth. You can […]
· June 27th, 2008 · 10:51 am · Permalink
Hey…why do you allow ads that advertise your competitors?
· June 28th, 2008 · 12:48 pm · Permalink
Hi Dan,
Mainly because I use Google Adsense and you can’t really control it without some effort (not a lot but some), and blocking them just hasn’t been worth my time. You see the Adsense conversion rate on this site is pretty low, the ads don’t appear in “premium” spots. I’ve even been considering dropping Adsense altogether from this blog.
Anyways, at some point I probably should, but right now I have other tasks I need to complete that have much higher ROI. That’s pretty much the real reason.