HubSpot CTO talks mid-market marketing

Image courtesy of HubSpot

While large corporations have the resources to engage enterprise level solutions, and small teams may find that free tools suffice, mid-level companies often find themselves caught in-between. In the second part of our interview with Dharmesh Shah, he discusses how such mid-level companies can also benefit from content creation as a marketing strategy.

This interview has been edited for length and clarity. The first part is available here.

What advice would you give to mid-level companies who cannot afford enterprise software like Salesforce, but find the free internet tools inadequate for their needs?

So that’s interesting. That is what we call the mid-market. That’s HubSpot’s sweet spot. That’s the customer base that we actually go after. We’re not in the kind of sub-five-employee range and we’re not up in the enterprise with Oracle and those folks, so it’s that mid-market.

And what we’ve found across those mid-market companies is that content creation still works: making an investment in regularly blogging or video or tutorials – whatever their medium of choice is to get the story out there and publish useful things on a consistent, regular basis.

Many of our customers who don’t have the internal expertise, will hire an agency to just do marketing for them to some degree. And that’s worked out well both for us and for our customers. It’s ingrained in these companies because we’ve been doing marketing that old way for so long. So we have a bank of four thousand solutions partners that can help these mid-market companies.

But our position to them is that you want to build your own asset. You want to build on your own land, so to speak.

The metaphor we use is that when you take out a billboard or even advertise on Google, you’re essentially renting time on someone else’s media property.

They’re getting the attention and you then say, “Oh, I will pay you to show my thing on your property.”

And it’s literally rent, right? So the day that you stop paying that rent you don’t get that attention anymore. It goes away. The difference when you create content is actually you’re building a durable asset because it’s on your land.

But it seems to be harder to quantify the kinds of benefit that content generation brings.

So we have blog posts that I wrote 13 years ago when the company started that today still drive traffic and we get leads and we get customers 13 years later, right? So what’s happened across a long period of time is that HubSpot has hundreds of thousands of pieces of content now that are out on the internet. We also get a bunch of traffic from Google and elsewhere so we’ve got 10 million plus visits coming to HubSpot properties, mostly organic.

I understand that it can be hard to adjust because we’re so used seeing immediate returns. The nice thing about advertisement or methods like that is we can say “oh, I spend $100,000 or whatever it is and I immediately see kind of traffic and hopefully some amount of leads come in”. And so I can understand the temptation and that’s fine.

I’m not saying turn that off cold turkey and move it completely over to content generation.

But start taking some portion away from events, away from kind of classic advertising—hire a freelance writer, start getting some blog content out there, see what the feedback is from your community.

And it’s not just traffic generation, it’s also conversion.

If you get someone through advertising when they’re coming on your website, yes, they’ll read your product, maybe they’ll look at your pricing or whatever. But if you have very pointed blog posts around who’s your ideal customer, tell us some customer case studies: that content is super useful in the sales process. It’s not easy but it’s effective and it beats the alternatives over the long haul.

Another issue is that the correlation between a good quality post and the amount of traffic it gets is just very tenuous at best. Some companies struggle by spending a large amount writing good blogs, while their competitors game Google with articles that look like spam but get a ton of hits.

They do, but at the end of the day you can’t meet payroll and pay expenses with hits, right? You’re going to have to someday convert those hits to the company. So yes, you get the vanity metrics of, “Oh, we got 100 thousand people to this blog post that was of relatively low value but had a clickbait headline.”

That happens, but if you’re trying to build a real business, the idea not to get tempted by those vanity metrics.

You have to measure it all the way through to say, “Okay: this article generated this traffic. We got these leads converted to customers and dollars in door.” This is partly what HubSpot helps with, showing “here are all of the blogs that you’ve written. Here’s how many hits it got, but then here’s how many people signed up and became a lead… also, of those that end up actually buying the product which products did they buy and how much revenue?”

And then you will often find is that the clickbaity low-quality things are a great preventative. This number will be huge, but you made zero money on those articles.

But surely by the sheer scale of it you should see some returns at least?

Sometimes you’ll make some just because you will get some people that are in your target list. But the thing is, you think “okay, well I’m going to put this low-value blog post out there with this clickbaity thing and my worst-case scenario is that I get zero traffic.” That is actually not the worst-case scenario. The worst-case scenario is you get a little bit of traffic, but you hit your brand.

So people that would have bought from you are like, ”Oh, this is one of the companies that puts crappy content out there. I’m less likely to buy from them than if that article had not been posted.” So the actual worst-case scenario is like a negative outcome, not a zero outcome.

There seem to be parallels between the content creation you advocate and the free tools that HubSpot offers.

We have a series of free products now and features that go into that free product have been growing every year. We add more and more stuff to that. And so we think for companies that are budget conscious, those tools are great and we are happy to have hundreds of thousands of customers enjoy those free tools and then we’ll meet them over the head.

It’s not like, “Oh, we want you to either buy the paid product or we want you to go away.” It’s not like that at all. We’re very welcoming, and we keep them there.

There are customers for whom free tools are not quite there yet, and yes, the paid products can get somewhat expensive, relatively fast. Our hope is that by virtue of the free products, they’ve kind of at least experienced some of the value and then we have some trust to say, “Okay, well, we’re not doing a drive-by sale.”

The enterprise dealer’s like, “Okay, we’re going to have some slick salesperson sell you out a thing that’s going to take you two years to implement. And you may never, ever use the software.” So it’s like we want you to use the free product for a while so you get a sense for what HubSpot is like and then there’ll be features like, “Oh, I want to be able to also do this” and then that kind of compels them to move into the paid version.