HubSpot Memorandum

Memorandum

To: Brian Shalligan, Dharmesh Shah

From: Diego Benítez Concha

Cc: Robert McCullough, Mike Volpe

Subject: Recommendations Marketing Strategy HubSpot

Date: June 28th, 2019

Introduction

The following document presents recommendations made to the company HubSpot

regarding:

What should be the company’s main target

New alternatives of Customer Supporting Services
Developments in the Software Portfolio Offering
Change in the approach to measure the success of following an Inbound Marketing
Strategy

These suggestions are attempting to improve HubSpot performance and to solve the
main challenges that it faces. Additionally, the text includes a detailed Analysis and Final
Conclusions. This work was based on data provided by HubSpot, plus market research.

Recommendations
HubStop can continue targeting all customers, but its main target should be the
Marketers.

HubSpot must offer a premium consulting at start-up offer, pricing this option 25%
above the non-premium fee and offer consulting of just 1 hour for $125.00.
HubSpot Memorandum

The portfolio must include an extra option according to the needs of specific clients.
HubSpot should introduce a tool in the company's site where potential clients can
calculate their service prices with the features they prefer.

HubSpot must continue with its Inbound Marketing Strategy. Changing it towards
an outbound strategy could profoundly affect the relationship with the customers.
They need to change the measurement of the ROI of social media with metrics
related to Brand Awareness, Engagement, and Word OF Mouth.

Analysis

I analyzed this data using a Decision Matrix (see Exhibit 1). The chosen criteria
were related to the issues of the company, such as Pricing Strategy or Profitability,
Engagement & Loyalty, and Opportunity. Although the costs invested on closing
a sale with Marketer client are 5 times the ones as the Owner's, the Churn rate is
lower. With the actual prices, the Marketer's sales model surpasses the Owner's
by the 17th month (see Exhibit 2). Also, the Marketers percentage of New
customers was double compared to the Owners (see Exhibit 3). Finally, not only
the B2B business seemed to be more likely to use Inbound marketing, but also
there's a low rate of churns, and we can see that the Marketers share of new B2B
clients it was around 70% each month (see Exhibit 4).

Right now, the onboarding consulting fee is the same for both Owner and
Marketers products give the clients a new choice of just 25% more they can have
an opportunity to increase the revenues, being an attractive price for the additional
help. Also, breaking the consulting time, from 5 hours to 1 hour could mean in a
more appealing option for the Owner segment since they don't have a lot of free
time. Salesforce can enhance this new supporting mode in order to decrease the
Churn Rate. Personal Relationship over the months can increase the
recommendation in 26% (see Exhibit 5).

Since this is a multitenancy software that can be helpful to a broad type of

businesses (see Exhibit 6), HubSpot needs to add a customized option to its offer.
HubSpot Memorandum

These are the advantages of this type of software, and HubSpot should take
account of that.

Although the recommendation is to continue with the inbound marketing strategy,

it is crucial to follow a traditional approach regarding the measurements of the
HubSpot time and money investments. In 2008 the company had an average
monthly sales hit rate of 3.8% (see Exhibit 7). Changing into a more traditional
ROI measurement (see Exhibit 8), can help the company to improve its
effectiveness.

Conclusion
Considering the information provided, StubHub should:

Focus its main target to Marketers. This will maximize the number of B2B
Business, which are more likely to follow an Inbound Marketing Strategy.

Change the scheme of Onboarding Consulting, adding a Premium option and

offering a cheaper and more appealing consulting session improving the
customer service and maximizing the benefits for the clients.

Develop an additional package to its portfolio so potential customers can

customize its software according to their specific needs. They could do this
picking the features in the HubSpot website.

Be faithful to their Inbound strategy but redirect the way they track the
performance of their practices. Manage the numbers of social media activity with
metrics such as Brand Awareness, Engagement, and Word OF Mouth.
HubSpot Memorandum

Attachments
Exhibit 1:

Exhibit 2:

Customer Balance with current costs and fees

Owner Marketer
$10,000.00

$8,000.00

$6,000.00

$4,000.00
Balance*

$2,000.00

$-
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

$(2,000.00) Month

$(4,000.00)

$(6,000.00)
HubSpot Memorandum

*Balance = (Consulting Fee at Start-Up + Monthly Fee) - (Cost to acquire customer)

Exhibit 3:

New customers end 2008

80%

70%
Percentage of new customer

60%

50%

40%

30%

20%

10%

0%
Oct Nov Dec

New Owner Ollies New Marketer Marys

Exhibit 4:

Total B2B 34 56 59 70
New Marketers B2B 21 42 43 49
Percentage 62% 75% 73% 70%
HubSpot Memorandum

Exhibit 5:
 HubSpot Memorandum

Exhibit 6:

Full article:

https://medium.com/swlh/5-reasons-to-choose-multi-tenant-saas-architecture-for-your-
application-c823241660dc

Exhibit 7:

2008
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Leads 1370 1000 1286 1571 1857 1857 2143 2143 2429 2714 2714 3000

New 35 45 55 65 65 75 75 85 95 95 105 115

Customers

Sales hit
2.6% 4.5% 4.3% 4.1% 3.5% 4.0% 3.5% 4.0% 3.9% 3.5% 3.9% 3.8%
rate

Average Sales Hit Rate 3.8%

HubSpot Memorandum

Exhibit 8:

Full Article:
https://sloanreview.mit.edu/article/can-you-measure-the-roi-of-your-social-media-
marketing/