The New GTM Playbook (With Sid Kumar)

The majority of revenue comes after the initial sales. A 5% lift in retention can lead to a 20-95% increase in revenue. But most companies neglect the customer side - so we need a new playbook.

That's exactly what we talked about with Sid Kumar, VP of GTM Strategy & Planning at Databricks.
 

• (00:00) - Introduction
• (02:23) - Meet Sid
• (03:05) - The Need for a New Go-to-Market Playbook
• (03:17) - Defining a Connected Go-to-Market Strategy
• (04:52) - Challenges in Customer Journey Mapping
• (06:02) - Practical Steps for Creating a Unified Customer Journey
• (12:28) - The Importance of Keeping It Simple
• (16:48) - Adapting Go-to-Market Strategies for Different Segments
• (17:34) - Diagnosing Revenue Leakage and Efficiency
• (24:20) - Entering New Markets: Challenges and Missteps
• (24:57) - Unpacking the New Playbook: Customer First Approach
• (25:24) - Reframing Marketing and Sales Alignment
• (27:14) - The Role of Customer Success in Go-To-Market Strategy
• (30:50) - Breaking Down Organizational Silos
• (38:42) - The Evolving Role of Revenue Operations
• (42:30) - Always Planning: Adapting to Market Changes
• (45:49) - Conclusion and Final Thoughts

Sources
Winning by Design, CS as a profit center
Hubspot & Pavilion RevOps survey

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This episode is brought to you by Growblocks. Finding and fixing problems in your GTM shouldn't take weeks. It should happen instantly.

That's why Growblocks built the first RevOps platform that shows you your entire funnel, split by motions, segments and more - so you can find problems, the root-cause and identify solutions fast, all in the same platform.

***

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✉️ Newsletter: revenueletter.substack.com 

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Creators & Guests

Host

Mikkel Plaehn

Head of Demand at Growblocks

Host

Toni Hohlbein

CEO & Co-founder at Growblocks

Guest

Sid Kumar

Global GTM Strategy & Planning @ Databricks | ex. HubSpot, AWS | GTM Operator | RevOps Leader

What is The Revenue Formula?

This podcast is about scaling tech startups.

Hosted by Toni Hohlbein & Mikkel Plaehn, together they look at the full funnel.

With a combined 20 years of experience in B2B SaaS and 3 exits, they discuss growing pains, challenges and opportunities they’ve faced. Whether you're working in RevOps, sales, operations, finance or marketing - if you care about revenue, you'll care about this podcast.

If there’s one thing they hate, it’s talk. We know, it’s a bit of an oxymoron. But execution and focus is the key - that’s why each episode is designed to give 1-2 very concrete takeaways.

[00:00:00] Mikkel: If you improve retention by just 5%
[00:00:02] your revenue growth, that can increase by 90%
[00:00:06] so why do so many companies ignore the customer side of the business?
[00:00:10] Sid: half of the folks, these are go to market leaders, acknowledge that they did not have a single unified view of what their customer journey was for their company.
[00:00:20] Mikkel: That's Sid Kumar, VP of GTM Strategy and Planning at Databricks and former SVP of RevOps at HubSpot.
[00:00:27] And if you want to be like those big players, it's time for a new customer centric playbook.
[00:00:31] Sid: go to market is a team sport.
[00:00:33] We need to think horizontally. We need to break these silos down. We need a common language to talk to each other, in pursuit of delivering those customer outcomes.
[00:00:41] Mikkel: In today's episode of The Revenue Formula, we walk you through what this strategy should look like and how to align your go to market to get you there. Enjoy!
[00:00:54] Toni: Mikkel. I do it.
[00:00:55] Mikkel: Let's go. Okay. So you know what I was doing by the way tell me this weekend so you've been to my place and in the backyard we have like a slope. It's almost like a moat to the neighbor. It's filled with trees. It's a wall.
[00:01:08] Yeah. It's like a wall. And these trees, they grow like three meters. I don't know how much that is in feet by the way, but they grow quite significantly every year. So they take all the sun. And it was at that point where. They had a height where probably you want to get a professional for some of those trees.
[00:01:23] Toni: But hey, come on, look at yourself. You are a professional. But
[00:01:26] Mikkel: me being, you know, totally good with tools. I'm so happy
[00:01:30] Toni: that you still have both hands.
[00:01:32] Mikkel: So we were like me and my neighbor and a couple of guys chainsaws, just working an entire day, chopping trees in half and cutting things down and no one got hurt.
[00:01:44] Nothing broke. It was actually amazing. But the thing is, you really discover. You know, muscles you didn't realize you have. So what I'm wondering, Mikkel, how are you going to bridge this to introduce it? I'm never going to be able to bridge it. I'm never, I'm never going to be able to bridge it.
[00:02:00] Sid: you started with ladders and, and chainsaws. I, you know, I wonder, I was
[00:02:04] Mikkel: you have the tool part. Yeah. You have the tool part. We're in the realm of RevOps.
[00:02:08] Sid: Yeah. Tools and good, good process,
[00:02:11] Mikkel: Yeah, yeah. No, I guess it's because there's so much changing, you know, I'm changing stuff in the backyard, but in our industry, lots of stuff is changing as well. And I'm really happy because I've been looking forward to this conversation we're about to have.
[00:02:23] First off, Sid, thanks so much for joining on this show.
[00:02:27] Sid: Excited to be here. Thanks for thanks for the invite. Looking forward to the conversation.
[00:02:31] Mikkel: So we kind of joked a bit off air that your name has been hovering around the office a little bit because we had a previous colleagues of yours on the show. We also had I guess you could say co workers now on the show from Winning by Design. So really happy to have you here. And I think what we've focused on in a lot of the previous episodes is a lot has changed over the last 12, like maybe even 24 months, even, not just.
[00:02:58] It's not just anymore the win rates and the tough environment, it's also technology and there's so much coming at us.
[00:03:05] And I saw a presentation you made where you said it's, it's time for a new playbook for go to market and for revenue operations. And that's really what we're going to unpack here today.
[00:03:17] And I just want to start off at, let's say the, the, the first side of this question, what does a connected go to market look like for a successful business?
[00:03:27] Sid: Yeah, I think it's where it really all starts. I think it's it, it's working backwards from what your what the experience is that you wanna deliver to your customers and prospects. And I think the word customer really is important in taking a very customer centric approach to thinking about what that buyer's journey looks like for you.
[00:03:48] And it might differ by segment, for example, but being really intentional about defining that getting buy in and, and just having a single version or view of that across the company. I think is a real important starting point. I see a lot of you know, that, that, that survey that you were referencing that we did last year with Pavilion.
[00:04:09] I mean, half of the folks, these are go to market leaders acknowledge that they did not have a single unified view of what their customer journey was for their company. And, and, you know, it's, it's almost like not having a map. And then you're starting to figure out where all these other you don't, you don't have a unified view as a company on where you're trying to go.
[00:04:31] What are the experiences you're trying to deliver? What's the impact you're trying to deliver to your customers and prospects in each part of the way. And then it just becomes a lot harder to orchestrate the resources, the strategy. Around a growth plan if you, if you don't have that starting point. So I think that is the place to start.
[00:04:52] Toni: I mean, what, what we sometimes see is obviously go through product market fit, go to market fit, all of those stages. And you kind of stumble into your customer journey, right? I mean, I think it's fair to say that probably almost no one has a properly documented to your point, but everyone has it, right?
[00:05:07] It's, it's there to a degree, right? Well, do you think that or rather kind of how would you do it actually, that people, once they enter, let's just say you have a revenue leader entering the organization, revenue operations, or, you know, another, another position actually either try and put this in place or start a process of then thoughtfully reverse engineering, right?
[00:05:28] Because to your, to your previous point You kind of need to understand what the outcome needs to be. And then, you know, find your way back to how do you, how are you going to get to this outcome? And, and if you stumbled into it because of, Hey, this is how companies are built. Right. Kind of what's your, what's your take on how can you start this conversation for people to actually force this remapping or this maybe first documentation and then reworking this?
[00:05:52] Sid: Yeah. To your point, there are likely elements of it. It's a question of, is there a unified view of it? That that's the real question.
[00:06:02] I think you could certainly start with an inventory of like what exists and how, or you certainly should start with an understanding if you're a new leader of how is, how are each of the go to market functions operating in service of the customer?
[00:06:16] And how do they view what their North Star outcomes are? How do they define success? And what are the activities, initiatives, etc that they're driving to go do that? So I do think it's important to have that inventory as you go across marketing, sales, the different functions within customer success and getting that understanding.
[00:06:36] Now, if you get too caught up in the current state, You sometimes are working you know, working up from that as opposed to working backwards from your customer. So, I think there's a balance. It's almost like you go do that inventory, go understand what are all the different motivations and what are all the outcomes everyone believes they are driving.
[00:06:58] Then you step back and maybe I almost have a clean sheet of paper and bring those, those same go to market leaders into a room. Virtual room, you know, maybe a physical room would actually do some whiteboarding and, and, and say, what, what do we envision that, what do we envision our customer journey should look like?
[00:07:19] What are the experiences? What are the specific impacts we want our customers and prospects? To experience from the time they get to become aware of who we are, what we do, how we can solve their pain points, and then, you know, follow that through from a commit onwards to how do we make sure they realize that value and become loyal and expanding customers.
[00:07:43] And I think if you start there and really obsess about those activities and initiatives and what, how do you know you achieved that outcome with the customer? Or prospect, if they're not yet a customer, and you obsess about that, you then start to say, okay, this is what, if we do all these things, do we believe we'll achieve our new customer acquisition objectives?
[00:08:11] Do we, will we achieve our NRR, our GRR, our revenue growth objectives? You start to look at it that way, and then if the answer is yes, then great. If not, where do you think you need to really up level? The, the set of capabilities or the magnitude or volume of those outcomes to, to go achieve. It's almost like these are the things that need to be true in order to achieve the company's financial objectives.
[00:08:40] But you do it in service of delivering on these customer objectives along the way. And underneath each of these, you start to say, okay, what's the, what are the North Star outcomes? What are the leading and lagging indicators? And who is accountable? And you start to see that you start to see like that, that, that there's multiple functions that touch each of these different phases and it doesn't become, you start to break those silos down just in that conversation where you think the, you know, maybe the post sale side is just a CS issue, but it really isn't, you know, it's, it's everybody, everybody's job to make sure the customer is getting value and impact.
[00:09:21] And then you start to imagine what are the roles that sales plays in that, making sure they sell to the right. ICP sell to the right set of customers with the right set of use cases. How does marketing help from a digital engagement and, and scaled set of touch points to, to drive you know, activation, regular usage, et cetera.
[00:09:43] So that's, that's how I'd frame it.
[00:09:45] Toni: And, and you mentioned, you know, you know, previously you dropped the word or the term growth plan. Would you say that these things that you just mentioned, kind of these objectives and the, you know, who needs to do what in terms of accountability and how all of these So then driving your, your, your growth objective.
[00:10:01] Are they all defined into this growth plan for you? Kind of, is, is that the the vehicle that you then use to, you know, create that at the beginning of the year, whenever you create it, but then also to carry through that plan?
[00:10:14] Sid: Yeah. Yeah. The growth plan is an output. I think that's, that's, what's important to realize. The revenue, revenue growth renewals, like all the components of it, new customer acquisition, those are all outputs. And I think you can obsess about outputs or you could also obsess about the inputs and the activities and the engagements that get you to those.
[00:10:39] And I think there's not enough focus on the, the leading indicators. The input metrics that drive those. So, yes, ultimately, you're, you're, you're trying to achieve a set of company objectives. What I'm suggesting is, if you work backwards from one of the set of customer and prospect objectives, and then how do you bring those two together, so that you, you have a singular view of, okay, I know if I want to achieve these company objectives, these are the activities, how do In this volume, in this quality, in this quantity, et cetera, that I need to be doing at every step along the customer journey.
[00:11:23] Does that, does that make sense, Toni?
[00:11:25] Toni: So absolutely. And it's like, it, it does play. So that's why I was kind of asking that one, you know, follow up question. It does play extremely well into what we're kind of, how we're thinking about the world here at Growbox, some of the problems we're actually solving. And, and I, you know, I swear Sid doesn't know any of these things.
[00:11:39] Our guests usually don't check out Growblocks. com, but it was it was a very kind of bang on comment, which, kind of used to kind of do a very subtle game.
[00:11:47] Sid: I saw some smiling, I saw some smiling over there, so I figured I hit on that resonated there.
[00:11:53] Mikkel: Yeah, I was also gonna ask a leading question. That's all good. It's all good. But, but it's, it's It seems like what you'll end up with here, it's the growth plan is the initiative. It's, it's kind of who's accountable, but I'm also wondering sometimes when you hear people say you need a unified view of the customer journey, what is it actually?
[00:12:11] What, what is it you end up with? Because is that a, you know, you've done a massive mapping exercise in a Miro board that says these are all the stages and steps. Is it the bow tie? What, what do you recommend folks do here to, to just get practical?
[00:12:26] Sid: Yeah. Yeah. It's, it's a great question.
[00:12:28] I would say the, the one thing I would say is keep it simple. You know, you don't have to over-engineer this, and I think that's where a lot of these. Fall down is if you try to get too intricate and too complex, it slows these things down and then you, you end up not getting the buy in that you need.
[00:12:45] So I think almost keeping it simpler and then iterating over time you know, I think the bow tie is a, is a great starting point to, to look at a customer journey and then if it needs to be tweaked. Based on the specific model or if it's a PLG type of engagement at HubSpot, we called it the customer centric operating model and it was really attract, engage, delight.
[00:13:09] So three, three phases. And within each of those, there was a couple of, you know, sub phases that talked about what are you trying to do and attract. You're trying to drive awareness. You're trying to drive consideration. What does that mean in context of what you're trying to do with customers and prospects?
[00:13:26] Who's going to do those activities. Then you go to engage, you know, this is where you're, you're really, you're starting to get into the sales territory, but without even talking about functions, talking about what are the activities you want to do to engage a customer who's already aware, has some intent, is starting to consider you, how do you continue to progress them and, and ultimately drive a commit.
[00:13:49] And then when you talk about delight, how do you really obsess about you know, making sure they're activated quickly. They're, they're, they're starting to really activate the sets of capabilities and features that drive the use case that solves our pain point. And, and we were touching on that a little bit before Mikkel, like I think we should, we can double click there.
[00:14:11] And then you do those things well, then how do you create a loyal customer who's going to continue to you know, renew with you, expand with you and be a, a word of mouth advocate for you. And that's where the, it becomes a flywheel, right? Rather than this linear, this, this linear view of the world. So it's, it's a great point.
[00:14:34] I think where it doesn't have to be this intricate, you know, look at every scenario type of type of exercise. I think there are nuances between segments and geos, but you get to an 80, 90%. aligned view that's that that you could just say, okay, I'm going to go have a go to market meeting. And for that go to market meeting, I need to have a view of what go to market looks like and what is a go to market journey and what is the customer or prospect going to experience.
[00:15:06] So you do need some level of alignment there, but start, start simple, iterate over time.
[00:15:14] Mikkel: But you know what, I think that's really wonderful to hear because I can see a listener going, Oh, HubSpot, they probably did a 10x mapping and something exercise. We need to like really get into the details. And just here, like, keep it simple. You can get to the 80 percent and then go. I think that's that's super powerful as well.
[00:15:34] I
[00:15:34] Toni: think, I think a nuance here, kind of thinking also about what, what Jacco and Dave are talking a lot about is kind of the revenue factory, right? And that, the idea there is, is the linear piece and kind of the I would say almost the HubSpot flywheel is, is not linear kind of, obviously, right. But the realization, you know, keep the, the process kind of simple.
[00:15:54] You know, not every tick box in the CRM needs to be its own stage or something like this. But, but to your point, Sid, right, kind of, you know, adjusting this a little bit to different geos, to different segments, to different product lines and so forth. Right. I mean, obviously at a, at a scale of HubSpot, that is.
[00:16:13] 1000 percent what happened. I'm like pretty sure about that. But those are those nuances that come to play. We then really have those, I don't know, maybe subdivisions within this organization that basically kind of almost operate like a, one of the other companies that are listening here right now.
[00:16:27] Right. And they're basically kind of need to figure out in their own ways. And some of those things are overlapping, how to attract, how to engage, how to delight. Maybe I'm kind of mixing things up, but a basic kind of doing that still nuanced in a way where it really fits for. the specific then target customer in that geo, in that segment and so forth.
[00:16:47] Sid: that's exactly right.
[00:16:48] I think the, the other way of saying it is think about where do you have distinct go to market motions and, and how do you think about that journey? Like if you have a PLG motion, what does that look like and what are the, what does that look like from beginning to end versus if you had a you know, a combination of a digital plus human type of engagement model as you're starting to move more up market.
[00:17:12] Thank you. What does that look like? And how do you want that experience flow to be? So I think it's like, it goes back to what I was saying earlier. If you work backwards from what do you want the experience to be, and what do you want the impacts to be felt at every part of that flow and think about where does that differ and where do you need to make those adjustments?
[00:17:31] Because that one size won't, won't fit all.
[00:17:34] But I think at a broad level, it's a. It's a starting point to, to really start to also diagnose, going back to our point earlier on efficiency you know, you know, no more of growth at all costs that we keep, we keep talking about it. It's how do you go diagnose it and figure out where do you have leakage in your revenue, you know, in your assembly line, to use the, use the factory analogy.
[00:17:59] Where is the leakage? Where is the inefficiency? How do you diagnose it and then who's going to be responsible for, for addressing that? I think that's what it also starts to give you a picture of is you, you get a lot of data.
[00:18:12] Mikkel: So I think let's actually hop into that because we've talked now about the, let's say the connected GTM, which is an integral part of a successful business at the end of the day. But now we also need to be efficient. And I think before we started, you said, well, what do you actually do about that as a business?
[00:18:28] So I think let's, let's, let me maybe throw that ball over to you and hear your take on that.
[00:18:34] Sid: Yeah. I think so we started, you start with a defined unified view of what, what your, your customer journey looks like. We start there. I think that, you know, the next is really just, I think understanding you start to get into the functional discussion of roles and responsibilities. Understand at, at each of those steps, what are, what are the, what are the activities, what are the actual engagements that need to take place at each of those areas of the, of the journey to deliver on what you just collectively agreed needs to be the outcome.
[00:19:10] Who needs to, who, what skills are required to go deliver that set of activities? And then you start to get into the, the capacity. And the actual number of people, or if it's a digital engagement model, that, that goes and delivers that. It, it forces you to really start to ask, if this is what I'm trying to achieve at this particular part of the journey do I have the right people delivering the right sets of outcomes?
[00:19:42] Do they have the right skills and do I have enough of them or do I have too many of them? You start to also see where do you have overlap. Where do you have an opportunity for roles and responsibilities clarity? Then you start to get into incentives. Do you have incentives aligned between individuals?
[00:19:59] And you start to look at, like, how much overlap do you have? Do you have multiple people you know, really forcing, driving a lot of behavior around one aspect of the, this journey, but then there's another aspect, call it usage or activation that you don't have as much focus on.
[00:20:21] And then you start to think about resource allocation and, and how do you start to really think about with the, with the people you have, do you have the right capacity? Do they have the right skills? And are they driving the right sets of are they taking the right actions? And can you measure the impact of those actions at a granular level to say, okay, this, this individual, if they have the right skills, they take this particular action here, then this is the customer outcome that I should see.
[00:20:52] Or this is the change in behavior that I should see for a customer that this individual interacts with, with that engagement. Okay. It starts to, you start to really think, get into a resource allocation, discussion, you start to get into what activities should be done by people, where do I have an opportunity to go drive automation, or leverage, leverage AI to go Digitize some of those activities or some of the undifferentiated heavy lifting. That's, that's how I would start to start to peel that back, Mikkel.
[00:21:27] Toni: Do you, do you sometimes do it the other way around? Basically and I don't want to use this top down bottom up thing because I don't think it necessarily fits here, but. you know, things have changed in the last couple of years and we talked on the show also, also even with Jacco about, you know, SaaS maybe has lost go to market fit, you know, many, many teams at least, right.
[00:21:47] And, and, and one of the first steps there is actually kind of to look at, you know, maybe CAC Payback or LTV or CAC or, you know, whatever you want to choose to assess the efficiency, the overall efficiency of those assembly lines, basically I guess if you have a well running machine, by the way, and don't get me wrong, I think then this is kind of what you just said there.
[00:22:05] I think this makes total sense. But you know, you know, you assessing a business, you know, in, in your current role and or having someone listening, assessing their business maybe, and asking those hard questions. Would you, would you maybe recommend them to, you know, or would you say like, Hey, you can actually also start the other way around and kind of say like, okay, where are we doing poorly and now let's.
[00:22:26] Let's zero in and figure out why we're doing poorly.
[00:22:29] Sid: yeah, exactly. I think you have to get surgical on it. I mean, you can't focus on everything. So I think a couple of thoughts there. I think one is looking at the bow tie or equivalent of that bow tie at a, at a segment level or at a, you know, distinct go to market motion level. And from an aggregate perspective, I think you hit on it, Toni, it's look at what is, what do the economics look like from an LTV to CAC perspective?
[00:22:55] Is it, you know, somewhere in that three to five, you know, window, or is it materially higher or materially lower? And I think you can decide. Do you need to invest more, or do you need to be, you know, thinking about how to get more efficient? Right? That could be a place to, to look at to go get started. Then the, the diagnostic is, okay, within that, if you find that there's a segment where, you know, you don't have go to market fit, to go back to, you know, Jacco's uh, point there, and you're operating at a, at a 2ECC, you know, two, two LTV to CAC of two, right? You then want to understand, like, why. That's where you start to go diagnose and go look at, let's go look at, you know, the conversion rates between the different aspects of the factory and the assembly line. Where is the leakage? And then you can start to go diagnose and say, okay, well, is it, is it a skills issue?
[00:23:58] Is it a process issue? Is it, you know, a tools, you know, or systems capability? You start to be able to go. Diagnose like where is the the, what is the cause of that leakage? But then you can also, you can also then start to unpack questions like, you know, is it a pricing packaging issue?
[00:24:20] You know, assuming you have product market fit, but maybe you don't have it for that market that you're trying to go in or a particular segment you're in, or you went in too early into enterprise, for example, and you're not quite ready to have gone into enterprise.
[00:24:33] You're really a small business, mid market company. Your LTV to CAC in that segment is great. You have opportunity to improve, but you prematurely entered a market where you, you don't have product market fit. That's, that's, that's clear. And you certainly don't have a sustainable GTM motion that, that fits that market.
[00:24:57] Mikkel: So I kind of feel like I want to unpack this new playbook just a little bit more for the listener. You've mentioned, I think we talked a bit about the let's say the accountability piece and assigning targets. One of the other points that you made, Sid, was, well, we've been very internally focused.
[00:25:13] It's time to bring the customer first, which always sounds great. What does that mean? How do you, how do you get there? What should the RevOps and go to market leaders be doing here?
[00:25:24] Sid: Yeah.
[00:25:24] I think it goes back to when we were talking about the, the, the, The buyer's journey, it's taking a customer in lens in terms of defining that versus a function out. And I think if you start function out, you know, that's where you start to get your silos
[00:25:40] Toni: Yeah.
[00:25:41] Sid: and you start to, you start to say, well, what is marketing's objective?
[00:25:44] It's, you know, then you'll start to get things like it's driving awareness or it's driving consideration and it's driving, you know, demand, you know, top of funnel. You, you start to get those types of answers versus saying. In the you know, in the early part of the customer journey, what are the, what are the activities and outcomes we hope to achieve to bring a prospect or a customer to be more aware of us, start to consider us and, and start to you know, become part of that, that opportunity cycle.
[00:26:20] It's a, it's a simple reframing,
[00:26:22] Toni: Yeah.
[00:26:23] Sid: but it, you start to now not view this as a marketing discussion. It's a full company discussion, which marketing may play a heavy, the heaviest role there, but does sales play a role? Probably. Does the CS play a role? Probably. Because all of those are part of like the closed loop side of how do you keep getting smarter about answering those questions based on what you're learning further down the journey.
[00:26:50] And I think that's where Jacco talks a lot about this. Like, how do you create a closed loop system? That you're continually learning and refining and whether it's, you know, a flywheel or whatever analogy you want to use, it's, if you're thinking about the, the, the TAM, the ICP that you think is like a set forget, it really isn't.
[00:27:14] The market's changing so quickly and are you learning from your engagements with, you know, with, with your prospects, with existing customers, right? Where are you winning? Why are you winning? And are you feeding that back into your continual iteration of where do you have great product market fit and how do you apply your go to market motions to it?
[00:27:39] So it's a subtlety Mikkel, but I think it's a, it reframes the discussion and I think opens up a very different set of conversations. And you also start to realize that there's a ton of interplay From a go to market perspective, from a function standpoint, across that, that, that journey. So it's not very, you know, linear.
[00:28:07] Toni: the, the reframing here feels very subtle, obviously. But I think it's pretty impactful. And, and the reason is the following there's a lot of conversation out there that the sales and marketing alignment kind of typical, typical topic has actually to do with, you know, marketing needing to drive revenue and not MQL.
[00:28:26] So whatever, whatever metric you want to choose here. And number one, I like that. You almost personalize the conversation by not saying it's a revenue number, but it's a customer. This is all, this already, that triggers other things in someone's brain. And then number two really, you know, once, once it's personalized, you then think about like, okay well, how do I get that perfect customer Mikkel?
[00:28:50] How do I attract him or, or, or Jane or whoever, and, and then have that conversation. Right.
[00:28:56] And I think this is This is a much more healthy way to approach it. And yes, ultimately, and also to your previous point, that will end up, you know, reflecting back into some metric targets that need to be achieved
[00:29:09] Sid: Yeah,
[00:29:09] Toni: in the funnel and yes, and those, those metric targets, if they are achieved, they will reflect back and, and revenue and recurring revenue, right?
[00:29:17] Kind of
[00:29:17] these things are connected, but the, the starting point needs to be that cannot, you know, so to speak that this cannot be the starting point. It's actually kind of whom do you affect rather than the outcome.
[00:29:27] Mikkel: So I'm obviously the marketing person in the room and I just have to say, number one, thank you for not saying demo request is the objective for marketing.
[00:29:36] And, number two, and numbers just cool it, cool it. And number two is when you reframe it like this, you also actually enable to have a very different strategic conversation. Because if you, if the three of us have a company together and we go into a room and you go, Hey Mikkel, it's revenue, then am I going to do customer meetups?
[00:29:58] Am I going to help with a help center? Am I going to help warming up the outbound opportunities being worked? Like all of that is just no, I'm not going to waste any resources on that. All of a sudden you can have the conversation on some of those initiatives where You might not be able to quantify directly, but you collectively can agree that it's an important initiative for that
[00:30:17] customer.
[00:30:18] And I think that is important. And that's especially where I think a lot of marketing folks, they, they quite frankly get screwed.
[00:30:25] Toni: Question from my side. Why do you think this goes wrong so many times? Because I don't think it's only, Oh, you know what, instead of this revenue word, we're going to use customers now.
[00:30:33] And suddenly everything's going to work out great. And why do you, why do you think the, the, the, the chain falls off so many times when you have. You know, I don't even want to say, you know, misalignment sometimes even infighting in the organization. Right. Why, why do you think that happens?
[00:30:50] Sid: You know, I just think it's organizations grew up in a very functional way. I think it starts with that. I think, you know, reporting lines could be different. You have, you know, we've grown up in this world of, you know, marketing is a discipline, sales is a discipline. CS is a discipline, right? And CS is still, I think, one of those that's, that's continuing to evolve, but marketing and sales have, you know, been around for a while, and they, you can get very deep And you get very you can get very siloed just by going, because they've gotten so specialized, right?
[00:31:29] Their, their sales and marketing were around for forever in B2B. And I think it's a good question. I think it's just because they've gotten so specialized. They're very mature functions that are pretty well understood. When, when you say marketing in B2B, it has a set of capabilities and a set of Activities you have to go do, same with sales.
[00:31:48] They each have, you know, significant critical mass in a B2B organization. And you know, reporting lines can obfuscate that a bit. Do they report to the same leader? Do they not? How are they being metriced and measured? What do they believe their objectives are? And it's simple things like, you know, if marketing believes the success outcome is leads.
[00:32:13] And sales believes it's revenue. Is there a translation layer of, are you jointly accountable for pipeline?
[00:32:20] Toni: yeah,
[00:32:21] Sid: And this is where I see you need that horizontal, you know, connective tissue, which RevOps often plays that horizontal connective tissue. And I think CS is going through a, a whole redefinition.
[00:32:35] In and of itself, right, right now, and really shifting much more towards obsessing about you know, customer value usage, utilization, and, and, and you do that well, you then earn the right to get the renewal and, and drive expansion. It's a great question. I, you know, welcome your, your feedback there too.
[00:32:58] That's my sense. These, these are orgs that have grown up this way. Have done things a certain way. They're, they're mature functions that have had a set of metrics that have defined success. And I think it's this movement now around, okay, we can't, you know, go to market as a team sport. We need to think horizontally.
[00:33:18] We need to break these silos down. We need a, a common language to talk to each other. Unified set of data, common language, shared processes.
[00:33:28] Toni: yes.
[00:33:29] Sid: In pursuit of delivering those customer outcomes. And if we do those, then the company will achieve its objectives. And I think it's just a you know, a shift in the way we have to operate.
[00:33:41] And, you know, Mikkel, one of the things I said in that talk you were referencing earlier is, you know, there, we talk about alignment all the time, go to market alignment, and it's, it's such a, I think it's a weak word because it's, you could just say, yeah, we're aligned, but are you, are you truly collaborating?
[00:34:01] Are you truly connected? Do you, you know, if you ask sales and marketing, for example, like what's your ICP, do you have clarity over what accounts you're, you're going after in your, in your, in your TAM, who the right buyer personas are and what the, what the use cases are. If you, if you get different answers, then, you know, are you truly, you know, truly collaborating?
[00:34:27] Are you truly connected? Because the cost of that just gets exponential, right, as you, as you start to go further down the journey, the cost of acquiring the, the wrong customer
[00:34:41] Mikkel: Yeah. I mean, so we've talked about CS often being the forgotten child of go to market. And a stat I saw. Also in the presentation from the pavilion survey was the amount of time revenue operation spent per department. Can you guess how much time was spent on CS? You know the answer. Probably you remember.
[00:35:03] Toni: I'd say, I
[00:35:04] Mikkel: don't
[00:35:04] Toni: know,
[00:35:04] Mikkel: 15%. It was a blip on the, on the bar. But then there was another interesting stat from Winning by Design, which is if you improve retention by 5%, I think was the number. your revenue growth will increase like 90 percent. Yeah. Right. And we just talked about being customer first and not operating in these silos.
[00:35:29] How do we make that shift then to make sure that the actions we need to take day to day also then happens?
[00:35:37] Yeah, it's a great question. I, and I think that is where we need to be spending a lot more time. As I think there's been over the past, you know, 18, 24 months, you know, so much focus on the new customer acquisition side, you know, and that's become a lot harder for a number of reasons, right?
[00:35:58] Sid: And, but we haven't spent nearly enough time talking about our existing customers and asking basic questions like, okay, they bought product XYZ. What was it? What was the specific pain point they were trying to address? When we, when we sold them the product and how are we measuring up to that? You know, did they get, and even like, are you, are you, are they getting activated in a very short period of time?
[00:36:27] Whatever that looks like for your company. Have they started getting have they started onboarding and leveraging those specific features, the specific capabilities that accrue back up to solving that pain point? And we have a, you know, I think there just needs to be an obsession over that, that set of questions, because then you start to get into, okay, where, where have I done a great job with my existing, with my customer base and making sure that I, I, they are getting that value.
[00:37:01] Where have I not done a great job and what do I need to do to go address that? And I think one of the, the, going back to our earlier point on, on roles and responsibilities, I think the roles on the, you know, post commit side have been just, just not well defined in customer success. There's so much variability, unlike what I was saying before, Toni, like marketing and sales, very well defined functions.
[00:37:31] You know, some variation, but when you say marketing B2B or sales B2B, there's, there's a set of functions, a set of roles. I think that's still evolving on the CS side. Is renewals part of CS, or is it part of sales? Who owns expansion? Who owns you know, is support part of that, or is it part of product? You know, and then I think, and then it's like, what is the definition of a CSM's role? And, and then it goes back to, well, how are you incenting and measuring them? Are you measuring them on a lagging indicator like NRR? Does a CSM know what activities they need to take with the customer to go influence, you know, NRR?
[00:38:15] Or do you need to get more, do you need to get more specific and say, we're going to talk about utilization, we're going to talk about usage, We're going to talk about a, a deep understanding of of, of, of like these use cases and work with the product team to say, I need deep telemetry into, into my customer usage patterns. And what's that? What does that look like? Yeah. Yeah. Yeah.
[00:38:42] Toni: You know, lots of folks listening will be revenue operations, revenue operations leaders. So, and since you, I mean, you're like Mr. Revenue Operations kind of, since, since we have you here you know, also, obviously I have to ask you the question because the same thing that you just mentioned and talked about with CS is true for revenue operations, right?
[00:39:00] It's kind of still a developing function. Is it. Is it starting to be, Oh, it's really just a sales ops 2. 0, or is it something else? There are some people calling it go to market ops now and so forth. I mean, what, what do you think really is the the, the role that revenue operations, as we are seeing it as an, as an umbrella term for for the go to market what, what is the role of revenue operations in order to achieve some of the things, you know, basically kind of this new playbook that you're talking about, what do you think is the role of revenue operations here that they need to play?
[00:39:30] Yeah.
[00:39:32] Sid: it is. Actually, I do liken it to where CS has gone, you know, in terms of getting defined right now. I don't think the term existed more than five years ago in terms of RevOps. So, I think the comment I've made in the past is it is not SalesOps 2. 0 and it is because I think SalesOps tends, it goes back to you can't just take a look at one piece of So I think about RevOps as the scope should include all go to market teams that are somehow interfacing, engaging with the customer. And that's the sort of broadest definition of it. I've seen it defined in different ways where sometimes it's just marketing and sales. Sometimes it's just sales and CS. I think where you can, you should take as broad of a You know, these are all the functions in the organization responsible for connecting the product with the market and how do you do that most, most efficiently and effectively.
[00:40:43] So that's from a scope standpoint. I think what, when I think about the evolution of RevOps, I think it's becoming much more of that go to market COO and it's becoming the, the, the co pilot with your heads of go to market to say, How do I drive an orchestrated, integrated, go to market motion across these teams?
[00:41:05] Again, with that unified view of the journey, common data you know, what does a tech stack look like that that, that drives the productivity and CX? It's really bringing the you know, that, that operating system to bear, if you want to call it. What is the GTMOS for the company? And how do you continually refine it, tweak it, and make sure it's agile because the market's moving so fast.
[00:41:34] So I think one other point I'd add is, I think the types of individuals that I think will make great, you know, RevOps leaders, deeply, obviously, the foundation of being deeply analytical and a data driven mindset, but I think the second side of the other critical piece of this is a strategic mindset.
[00:41:53] Somebody who's able to collaborate very well, drives change management, and is able to bring So, not only the go to market team together, but product, finance, you're bringing the entire organization together in pursuit of that of that opportunity and and not showing your org chart to the, to the world.
[00:42:12] You know, that's, that's how I think about it. And a lot of focus on the insights and foresights as opposed to, and help you see around corners versus a rear view mirror.
[00:42:24] Mikkel: So I think we can maybe wrap up the playbook with the last question.
[00:42:30] Because right now it's summer and after summer, a new season begins, planning season, right? And we tend to do this annual plan and lock it in and things are just changing so much.
[00:42:44] Sid: Yeah.
[00:42:46] Mikkel: What's changing here with the playbook? How are the businesses and top go to market teams operating?
[00:42:53] Sid: Yeah. That's a great question. Yeah, I think you have to have this always planning mindset right now and, and really think about, well, you know, when you're building, I mean, if you're doing an annual plan, be very, very thoughtful about what are the assumptions, what are your input metrics for each of the different aspects of it, whether it's your demand plan, your Revenue plan, your retention, your MRR plan or your retention expansion plan really deeply understand and stress test those, those input metrics.
[00:43:26] But nonetheless, you're going to, you're going to get things wrong. It's just, this is the way it is. And things are going to change from the time you, you, you build it and have a point of view on those assumptions and things I think having the some level of agility built into The plan where you can revisit those assumptions, you know, regularly, at least monthly, not more often and see where, where every month, look at where did I get it right?
[00:43:56] Where'd you get it wrong? And can you be dynamic in your resource allocation? That's something we, we, we did at HubSpot where we shifted to that type of always planning mentality, where we did do an annual plan, but every month. We were getting together and saying, what, what do we need to, let's go look at it.
[00:44:15] Let's go see how to, how to evaluate those assumptions. And I think it's, I think that's the type of mindset you, you need to have. And I think not being afraid to make change within a year, within the course of a year versus waiting for the following year, I think things are moving way too fast right now and the market, you know, everything that's going on with With, with AI and the pace of change, you know, a year is a, is a lifetime.
[00:44:43] And if you, if you know that you need to pivot, figure out how to do it and how to do it in the most the least disruptive way and be thoughtful about what are those changes you want to make that are going to drive the most impact. But, you know, six months, a headstart is, is a long time versus saying, I'm just going to wait until the next fiscal year.
[00:45:02] Toni: no. And so I totally agree. And I think the, the other thing is also, it doesn't mean or need to be all the time that finance is changing the budget or something like that, right? Kind of the, there are kind of two different planning processes going on. Right. And I mean, HubSpot is a public company. It's not like you changed.
[00:45:20] You budget every quarter, every month or something like that, right? Kind of, it's really the operating plan that's obviously supporting the budget and kind of supporting all of that. There are some nuances shifted around, right? And I think that is, you know, increasingly so also a, you know, I love the go to market COO, rev ops, or COO responsibility to also kind of have this bottom up objective driven, initiative driven plan that obviously needs to align with finance, but can be more flexible, right?
[00:45:48] Really cool.
[00:45:49] Sid, thank you. Thank you so much for joining us.
[00:45:52] Sid: This was fun. Thanks for having me.
[00:45:54] Toni: It was a lot of fun. Yeah. Good to have you on the show. And have a, have a good one, Sid. And I hope everyone kind of listened, really enjoyed this. If you did hit follow, subscribe or like, or whatever it's going to be. See you next time.
[00:46:06] Bye bye.
[00:46:07] Mikkel: Bye.