Background for new subscribers:
Crush Sleep is a productized-service administering the leading insomnia treatment, Cognitive Behavioral Therapy for Insomnia (CBT-I), and providing sleep related accountability.
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This week was a bit of a “thicket” week. One where things felt confusing and took longer to coalesce into action than I would have liked. Thicket weeks happen to me often and they are insidious. If this is something you experience, let me know how you deal with confusion like this.
There were many different pieces that mutually informed each other so I needed to find a proper ordering of which was the most true so I could untangle them.
The main things I was trying to get clarity on were
Pricing – What services would I offer and at what prices? What would that imply for margins?
Traction Goal – I’m structuring a traction plan from the book Traction and the pricing/margins informs what my first Traction Goal is going to be. The pricing will inform the acceptable CAC in the traction goal.
The things I now see as the roots that inform everything else is the pricing structure of mybodytutor.com and the existence of competitors doing low-touch, high-margin CBT-I delivery via apps. I used My Body Tutor’s pricing as a strong guide because they are a profitable business offering high-touch packages like mine. I then applied adjustments to compensate for my much lower brand trust and preference for customers over revenue early on so I can improve the delivery of the product.
From there I could create my first Traction Goal: find a channel that can acquire 22 customers a month with a max CAC of $120. That would prove that I can “coast” on this business and more-or-less tread water financially while building it.
I got that $120 number from this article which is a great reference for bootstrapped growth. It’s nominally about paid ads for subscription businesses but the numbers are derived from statements that are applicable for any traction channel and any way of calculating LTV. $120 is just LTV/3 which is a good start that I’d like to get down to LTV/5 eventually.
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