Brand Bites EP 2 : HubSpot!

Episode 2: HubSpot's Journey to Product-Market Fit

In this episode, we dive into how HubSpot revolutionized the marketing world with its inbound marketing solution in the early 2000s. Discover how HubSpot identified a gap in the market, refined its product for small businesses, and grew into a SaaS giant by championing the inbound marketing philosophy - the key strategies, pivotal decisions, and lessons learned along HubSpot's journey to achieving product-market fit and transforming the way businesses attract, engage, and delight customers.

Transcript

SPEAKER_00 0:11

Hello everyone and welcome back to yet another episode of uh Think Brand Pod. I'm so happy to be bringing this to you um with my knowledge and of course a lot of examples in the marketing space. Um I'm uh like last week, like the time uh last week we delved into uh the world of Netflix um and how they've mastered the dam Sam song, which is the total addressable market, serviceable, uh serviceable available market, and serviceable obtainable market. Uh I think their unique approach of the of the founders on uh understanding their market from resonating from their own uh pain point about the market was so instrumental to their success, and for me that was such a big takeaway of how they actually serve you know they served an underserved market and addressed it in the most amazing way, and it's it's the company, and they kept kind of reinovating themselves uh to always address the market of where it was headed before its time. I think that's the unique vision uh of Netflix that was just amazing to go down to and understand. And today um I think I'm turning my attention to another digital market house uh powerhouse hub spot. So um I'm very excited for this episode because I think um in the process of marketing, once you've there's these are the steps, right? Like there is a there is a prompt pain point, uh, you gotta solve the pain point, you want to understand how big the market is, and then the next step is obviously the product market fit. Um and I think HubSpot did it so beautifully with their inbound marketing um strategy, uh, which which is so valuable to learn from, and how did they arrive at this product market fit of which is which has worked so beautifully for them, making them one of the most successful SaaS companies out there. Um, I think that's what I'm trying to do with each episode. It's not just what we know or what they did well. I really want to discover how they did that, how did they get to this place, understanding that because, like I said in last episode, there are no new problems. Uh, I think these whatever we are facing today have existed in some form or capacity, and then the route that was taken to solve these problems is how people have created these uh amazing companies that exist today. So let's go down the rabbit hole of HubSpot. So let's dive in, right? Um, we're talking about early 2000s when the digital landscape was really changing. Uh, the dot-com movement happened, uh, the rise of the search engines started. So, this is the time when there's a shift in the market, and how buyers are actually engaging in the market and buying in the market. And in around 2004, two MIT graduates, Thirmesh and uh Thirmish Thirmesh Shah and uh Brian Halligan, these two gentlemen decided that they are you know observing this trend which is changing in the market, and now is the time to uh you know introduce some a platform that can help in this new buying behavior. So uh this new buying behavior was obviously about uh the consumers taking control of their buying journeys, uh, they were seeking out information, reviews, recommendations, um, you know, online before making a purchasing decision. Now, this is a very new trend uh in the market because now it's not what to just not just word of mouth but also in a different way access to a lot of information. So, again, just the way Netflix uh uh you know uh founders recognize the new market. Similarly, Hubspot uh founders recognize this shift, which is which is great. And in 2006, HubSpot was born, and the mission was to help businesses with something called as inbound marketing, very very common term today, but back in 2006 it was something new, something that was just being introduced to the world. Um, the inbound marketing, which is basically it's a strategy to focus customers through relevant relevant and valuable content of your own product, your own services. Um you know, you are building your own uh high-quality cur content, which is then optimizing with search engines, and you know, you're using social media to um or the other platforms to draw the attention of potential customers to grow the brand organically. So, this is this was new, this was uh absolutely a new trend in those days, and have spot caught on to it. Um, they created a software uh which provided the tools to execute this strategy quite effectively. Uh, like you could do blogging, social media to email marketing, uh CRM. I mean, their platform offered a comprehensive solution for these businesses, right? Of all sizes who could um attract customers, convert, close, delight customers. Like, just imagine how difficult for small and mid medium businesses uh as a as as they wanted to grow, how difficult in those times it was for them to grow and thrive to find new customers. Um, and I think HubSpot really solved that problem for them. So it's it's it's amazing to uh see that as companies uh were you know trying to latch on to this trend, uh HubSpot gave them the the tools, the necessary tools to do so, and hence the inbound marketing, uh you know, it was born the the concept of inbound marketing for the bond. Uh for the uninitiated HubSpot actually, which is today valued at about 1.3 billion in revenue, um is is something that is trusted by thousands of businesses worldwide. Like, if anyone hasn't heard of HubSpot, uh it would be very, very surprising if you're here in a marketing uh podcast, hearing a marketing podcast, because it's really one of the biggest names out there um in the field of uh CRM and social media management. So I really want to now go and figure out how did they actually do it, which is what my promise is with this podcast. How the how of all of this, right? How did they find this product market fit with smaller businesses? Uh, which was it was quite a journey, let me tell you that. So that's what we are going to be digging in next. Um, about how did they come to this great revelation of who to go after and find the correct uh product for them. So let's go. So um the next thing I really wanted to uh you know throw some light over is that the journey to finding their product market fit was not a sweet sailing. Um we always look at things in hindsight and see everything worked out, but whenever we are taking a journey, there always are ups and downs. That's just how it works. And similarly, HubSpot had a similar uh, you know, journey of finding their perfect product market fit. Um obviously, um HubSpot initially tried to sell a marketing automation software uh directly to small businesses, but they didn't have much of success at that point of time. Um they obviously were hopping on the uh you know their value proposition, which was in about marketing is good is the next best thing, but they were obviously finding it difficult for uh consumers or their small businesses to identify with that. So I think one of the first things that they did uh in this journey was to offer educational content and training programs, which I think is such an important piece to the puzzle because a lot of times uh um I think there are startups and companies which are trying to solve a problem or envisioning how this problem can be solved with better in better ways in the future, and currently whatever uh everyone is using or comfortable with cannot totally understand this uh unseen future, right? Like you're trying to sell them how it's gonna get easier, this is the next best thing, this is the trend, but not everybody is buying in, you know, are or are that those kind of people who who want to uh gamble away their money into things that are potential but not already proven. So I think because HubSpot relies this for small businesses who, any which ways are very, very uh you know, very judicial with their budgets, money resources, the first thing what they did was they used their own platform um as a medicine, right? Um, they uh on its wounds. I mean, they started using educational content, uh, training programs to build that following. There's uh even today, if you go, there's a whole HubSpot Academy that exists that you can learn so many things from. And as if you're a new marketeer, I would highly recommend to use Hubspot Academy as your base ground to learn everything that's happening uh in marketing today, and how you can like grow from strength to strength if you're just starting out, and they have been able to achieve that only by you know constantly um investing in this this kind of content, building it out, getting some loyal followers, and in those days, these small businesses owners and mareteers they they really liked this approach where this was all this educational content coming to them at no cost. I think this really helped a business build its awareness, and kudos to the uh you know the Hubspot leaders who thought that this is how they could establish thought leadership in their market. And today we talk about thought leadership in such a thin-spread way. But this is truly, I would say, the epitome of thought leadership where uh you've churning out content of what inbound marketing is going to be in the future and training people, um, you know, the future, yeah, the future of how people will buy. I think the another thing that they did uh as part of their uh you know foray into small businesses was that they they were probably the first people to uh offer a freemium model. I think freemium is way basically is a very common term today, but in those days it was hardly uh any company which would offer you access to features for free, right? And as a software, you have all this access given to you, uh which is very very attracting for small businesses, right? Like if you're offering a business a future, unseen future, and you want them to gamble their money away into something that is still not been proven, I think the best way to start doing that is by you know, is what they did, and a lot of companies do today is by giving away the freemium, uh, you know, try it try out the software. I think today the premiums have been curtailed to a very shorter period of time of uh seven days or 14 days. I think that's the max I see on most Saa softwares. Uh, but earlier back then, um, obviously they were given this kind of freaming for a larger time to build gain trust, and I think that is another great learning today that if you are really starting out fresh in the as a product as a company, a longer freaming will help you build more uh more customers and lower churn rates. I think, and also these kind of customers will also give you really true feedback on how to build a sustainable product, uh, you know, before wanting uh them to sign up and start paying you uh to build that trust, which would be great. And but this journey was not really easy, right? Like there were some things that um hubspot did and they could not totally capitalize on it. They also HubSpot also uh had a you know a uh sales product like HubSpot sales where they wanted to optimize the selling process, but they could not do that, that didn't that just didn't fly. Um, they also I at some point um HubSpot had a idea of having its own social media network called inborn.art, but even that didn't uh fly. Um I guess in short, uh it's it's just an idea that uh for a company to have survived this long, obviously it has seen its ups and downs, and they as a product market fit they constantly understood what was working, which which service or which feature or which part of their product was is working more for their consumers rather than pushing everything in a go and saying that let's like you know everything must be a success. I think they the idea of how aligning your product features to what the market actually needs and you know trimming out the fat is how they went about it, and uh, courtesy to you an amazing substack article that I I I read on Productify. Uh, there's something called as uh you know finding the core, which is I think a great way of looking at product market fit, and from uh and the other other part of it is finding the adjacent cores for growth momentum. That is something that I really want to talk about next because I I read this article and I was like, wow, this this this amazing insight. Thanks to these uh amazing writers of this content. Uh, I think is the there are some signals that you can rely on once you're like looking at your product market fit, and let's dive in that next. Okay, the last segment for HubSpot uh mastery of product fit uh market. I think, um, as I said, based on this article, excellent article that I read, there's some signals uh that you can use to find the core because um whenever I speak to companies and clients, I think that is where the struggle is that they're trying to find the core which is most working for them uh in this market, and uh taking HubSpot's example, I think there is a great way to um understand how we can use these signals to to enhance the product market fit and and make sure that uh this becomes the guiding principle, the North Star, the core of your uh you know game plan here when it comes to you know your product market fit. So let's go. Uh I think the first signal as mentioned here, I think is great. Um, it's about having a profitable customer base. Uh, so see, small medium businesses, SPs, they're always tight on budget, they're always trying to survive um in a way which is judicial to their uh earnings, and these kind of organizations always need uh all-in-one kind of a solution, and it has to be affordable. I think which this is where HubSpot absolutely killed it. Uh, I think this was something that they did so well, so big claps there. And I think uh uh this is where they really hit it off with their customers who really value affordability and efficiency, which is all in one. So that's number one. I think the number two thing that I really liked, and I think there was uh something that they did so well, and it's a signal for every company who is looking at offering a solution or a product to the market, is like including the critical parts, right? Uh, that's a signal when when view saying oh it's an all-in-one solution, all-in-one cannot have everything, it needs to have the critical stuff, no fluff, right? So, in case of HubSpot, I think there were four critical elements that they offered, which was email, social media, content, and CRM, and and I think that is something which which they stuck to, and obviously, these four critical elements for any SMB would be so great to reach out to their target audience because those are the touch points that inbound marketing was is totally based on, and and offering the critical features here to your uh from HubSpot to these SMBs, I think they absolutely nailed it. They uh they understood that we can do much more, but we have to have these basic pillars if you really want to keep capturing this market. So, kudos, and I think the next one that I really want to include uh that I've seen at it is like about the right methodology. So, you could have the tech stack that can offer multiple things, but I think with HuffSpot, what they did was they made sure that their backend is totally always optimizing for SEO. Um in the digital landscape, that's the game changer where you're optimizing all the content, all the relevant things that you're doing, the inbound practices, and they are totally aligning with the target audience, they're reaching the target audience. Which which SMB wouldn't appreciate that? That's that's the critical part of the business. They could do all the work, but if it's not reaching the right audience, uh, you know, then all of this is of no use. And I think with HubSpot, their their back-end tech, everything supported it so well that they every every small medium business was able to represent whatever they do to the right audience. So, again, pick kudos. Uh, and lastly, I uh I think the differentiation is something that everybody works on because that is what m sets you apart, and the focus on inbound marketing, catching on that trend, make you know, believing in it, working on it, making it so big that was the differentiation. And Hubspot was almost like the OG in that, right? It's the original, and they captured on that inbound uh marketing proposition so hard, and they still do. I think that's the differentiation, and that's why they have they are so popular uh for small and medium businesses that they found the score, and and the score was so strong that they are going strong even today. So, again, kudos to HubSpot all over. Okay, I think by now you know that I'm a HubSpot uh fan, and absolutely uh, you know, understanding in this case study, uh, this was marvelous to understand how they worked on their product market fit, and there is no one right answer. Obviously, all of this has happened over the years, and for companies who are working on their product market fit, of course, you have to go with your version one that you think is best for your clients, but the process is long. Um, it's always going back to the drawing board, understanding what's working, and then going back out in the market and testing it. Uh, there's another small thing that is included here uh that I have read about, and I think it's very interesting to mention that while this is your core, uh, of course, there are adjacent cores that uh as businesses we try and approach. Just because small medium businesses is the core, that should be always the strongest place where you deliver your best. But there obviously are adjacent cores, like uh HubSpot has tried to attract uh enterprise uh companies, bigger companies for their uh you know solutions, but uh obviously they are not as successful, say compared to a sales force or a marketto, but they are trying and but they know that that's an adjacent core for them, that is not what they want to go after because they're the their bet bread and butter is the SMBs, and I mean there are government agencies that they want to go after, there are educational uh sectors that they want to go after, and this is a great learning, right? As a company, you always want to have more sustainable portfolio where you're serving different needs, but I think that's the idea uh that I understood from this is that having a core and an adjacent core, and it's kind of like a priority uh shift, like what's your priority, but what you can also work on side by side and see how that grows for you. So, again, I think I am an absolute fan for everything that HubSpot is doing. So, here you go, and thank you so much for listening in to this episode. I am extremely grateful if you're tuning in and listening to me. Um, I'm new in doing this kind of podcast where I'm trying to talk about existing knowledge, trying to simplify complex things into a very simplistic ideas that can are still relevant and can be used. Uh, by no means uh I'm trying to uh you know say that I'm an expert of all of this, I'm learning as you are, and I hope that uh this kind of content. Is is really helpful, and yes, I I am hoping to see you in the next episode. I have some really interesting more such case studies on relevant to SaaS marketing coming up. I hope to see you on the other side. If you have any comments, suggestions, uh observations, please leave them here in the comment. You can also find me on LinkedIn and Instagram. Uh, both think brand forward, and you'll find me. Uh, so please uh reach out if you have any suggestions for me, and I'll be happy to include them. Have a great, great day. Bye.