Last week featured a web start-up that failed in figuring out how to make money by offering their service. That's both sad and common. So to be positive this week, lets look at a company that seems to have nailed the money part of the start-up game.

Months ago I wrote about Jott, a service that provides a platform which enabled users' to dictate messages via their cell phones and have those messages transcribed to text and then delivered to them via email and SMS.

I became a beta tester around February. For me, Jott made good on its promises and provided a valuable service that saved significant time and helped me prevent things from slipping through the cracks. Over the next few weeks I found that I was averaging between 5-7 Jotts per day, using it for both personal reminders and work 'to do's'. Essentially, using Jott provided much more than just easy and efficient reminders - it gave me piece of mind that I wouldn't miss anything important.

Make Money: Keep your Customers

Around late August to early September Jott came out of Beta and continued to offer a free version of the platform supported by an ad network, but expanded to offer two additional tiers of service with full capabilities.

I'll admit, when the switch was made I was not a happy camper. As a beta tester I had been able to use the full platform of services including individual emails, the ability to set text and email reminders days out in the future and access to bolt on modules to link Jott with other applications. In the switch I was bumped back to the bare bones and felt that I, as an early adopter, should have been "grandfathered in" on the full platform.

To Jott's defense, I did receive multiple emails informing me of the date of the switch and the options that would be available for me to purchase. Knowing my own personal inbox habits (which I would bet is similar to most of you) I do tend to get trigger happy with the delete button when cruising through emails sent from services I subscribe to. I'm human, and very busy. While I'm sure folks at Jott were measuring open and click-through rates on these emails, an additional push on social networks might have helped to increase awareness. Just my opinion, though.

After receiving yet another email from the Jott team regarding the upgrade I took a chance and emailed Doug Alley, Jott's VP of Business Development with my questions on why they chose the route they did, and some of my opinions on alternative strategies.

Jott Responds

Doug was quick to respond with a very professional email and a detailed explanation, siting some very important things to remember about monetization:

• Start-ups need to keep their lights on so their services can't stay free forever
• People are willing to pay a reasonable fee for services that provide them with good value and consistent delivery on the promise
• Information Privacy is critical to fostering and keeping adoption high. Monetization from data mining can be a slap in the face to the end users

I appreciated Doug's fast and professional response. I believe that a companies willingness to address feedback from their customers' speaks volume about their culture and brand. Doug didn't once apologize for the decisions he and his associates made - and that was OK. He stuck to his guns and went to great lengths to support his line of thinking.

What Doug did do was respond to a customer who felt neglected and left behind. At a recent transportation marketing conference, I heard Ann Minor site that over 68% of customers leave because they feel like they are not receiving the attention they deserve, where as only 14% leave a provider because they are not satisfied with product or service itself.

The result is that because Doug made an effort to pay attention to my concerns, I upgraded my account and am again a happy customer. And additional features like Outlook plugins, an iPhone app, and Twitter links put the icing on the cake.

Moral of This Story

Monetization is not just about developing a pricing structure that works. To be truly successful in growing your revenue and keeping customers, companies need to engage with their customers, really listen, really communicate, and turn them into raving fans of their business.

Then the money will come.

Here's a great article by Read Write Web that Doug turned me on to. What I think is most interesting is the comments from the readers...