Jared Barol: Vertical Strategy Isn’t One-Size-Fits-All: How to Invest Smarter, Not Faster

Business. Business. Business.

Welcome to Go-To-Market, a podcast for RevOps, sales, and marketing leaders to dive deep into industry insights and best practices. Go-To-Market is sponsored by Fulcast, the go-to-market cloud. My name is Amy Cook, and I'm so excited to introduce my good friend Jared Burrell, VP of Go-to-Market Operations at CopyAI. Jared, how are you?

I'm doing great. What a great start to the new year.

Oh, absolutely. And thank you so much for being on the podcast and for being willing to share with us your insights today. Super excited.

Me too.

Thank you. Well, well, Jared, just to start off, can you tell us just a little bit about your background and how you got started in RevOps?

Yeah, sure. So I took the long way around, I like to say, and I've had a lot of different, done a lot of different things from import and export businesses to starting social media companies. And then I had every sales job that there is. And, you know, my hot take for the morning is that anyone who goes into RevOps needs to first work in sales. I think it's a must-have to get into senior-level RevOps roles.

Oh, I love that perspective. And I'm sure all of the sales leaders who are listening to this podcast are cheering for you right now because that's one of the things that I know is a sticking point sometimes between sales and RevOps and feeling like the other person doesn't understand them. So I love it.

Yeah, totally. And I think like that's actually what helped me really understand also from the inverse, you know, what's missing from a, a support function, which RevOps is, but you know, we have a customer, our customer is sales and marketing, uh, and customer success depending on the business. And so, you know, I, I worked from SDR, AE, REP, SE, SE leader, um, into various strategy and, and operations roles and product as well. And then moved into, you know, proper go-to-market operations, revenue operations roles, uh, big companies like Salesforce, small companies as well. Um, and spent some time in private equity.

So Salesforce was in, you know, SaaS, it, it touches every industry. What were some of the other companies that you worked in and, and what industries were they in?

Yeah, I mean, to your point about Salesforce, you know, I, at Salesforce, I ran the go-to-market operations function for Salesforce Industries. So we had 33 different industry sectors.

Oh, wow.

Responsible for across 7, we call it industry groups. At other companies, ad tech, a lot of ad tech work. More recently, a company in the reputation management space called the digital front door for your B2B to C businesses or your B2C businesses.

Well, so, so when you were running Salesforce Industries and you're spanning the 33 industries, you got a really good bird's eye view into those vertical types of go-to-market strategies.

Yeah. And actually we changed a lot of it while, while we were there. And so one of the things that my team and the content teams worked on was building out a better strategy around How do we think about the points at which we want to invest more in a given vertical? And so what we built out is maturity model, nascent to maturing to scale industries and what level of investment will be needed for each and what will be the drivers to make us move, you know, say, hey, we're going to move X industry segment from nascent to maturing. Here are the signals we're going to look for. Here's what we're going to do in return. Advice and so on. And that was a really interesting piece of work because, you know, I think it's super applicable to most companies. Salesforce, a lot of people think of as this behemoth at the time, you know, it was very large, 80,000 to 85,000 employees. But we were working on the micro scale. We were working on teams with 3 product managers, for example, for covering an industry or, you know, handfuls of sellers, you know, one team of SEs covering an industry segment for enterprise, for example. And so while Salesforce is a massive company, it doesn't mean that every organism inside of Salesforce behaves in that way.

Yeah.

Right.

When I was at Simplus and we were working very closely with industries, I worked especially in healthcare industry. And so it was a lot of fun for me to work with a customer and Salesforce, and we would go to market in certain areas. One of the ones I remember was during, I was at Infosys, Simplus had been acquired by Infosys, and I was at Infosys running the partner marketing for the Salesforce practice over there. And we were trying to wrap our arms around this crazy thing called COVID and what it meant and how to do business virtually and how to support the healthcare population and the frontline workers. And so it was very interesting being from that, you know, coming at it from that angle. And so Infosys put together a vaccine management offering that I thought was quite compelling. And we used that and we used some specific healthcare vertical go-to-market strategies in order to get that out into the world. So I am super interested in this conversation right now. Should every company do a vertical marketing strategy? What's your perspective on that?

So short answer and long answer. Short answer is no, I don't think everyone should, not at the same time. You know, a longer answer, let's use emphasis healthcare, for example.

Okay.

You know, healthcare was one of the largest industry groups at Salesforce. And so we— that was our scale bucket, two industries, healthcare and financial services that were scale for us. And what that meant was it had hit a certain revenue volume We saw a very significant market traction plus ways we could expand. We had a robust partner ecosystem which we started, which we started to invest in at that maturing stage. But by scale, the partner ecosystem could grow and expand on its own because we had built enough enablement material and invested in the partner enablement and partnerships as well. And so you can't do that overnight. Well, you can, it just costs a tremendous amount of money and have uncertain returns.

Right.

So instead, what I recommend almost all the time to my consulting clients I've had, companies where I've worked, and what we did at Salesforce is we looked for— initially we looked for customer pull first and foremost. You have a generalist product, you think it's going to be good in healthcare, maybe, and hey, maybe there's an insurance application here too. And you would, you look for the customer pull. And you start seeing where you can start having a network effect being developed. One of the biggest things about vertical SaaS is that network effect, effect. You know, Bench Sites and David Spence, they published something a long time ago about this topic, about how one of the key differentiators and why vertical market SaaS can grow so fast is because there's this almost co-op compete model in each vertical where competing for the customer, but everyone's generally pretty friendly amongst them in, in, in that industry. And so if you're looking around for a, a service platform that helps with insurance provider, insurance companies and providers, there's not that many of them and they talk. And so your customers start becoming your sales teams. And this actually really drives down the cost of sales and marketing for vertical as you verticalize. There's some metrics I saw from mid last year, mid 2023, where general SaaS market, you know, sales and marketing as a percent of net new ARR was something around 249, 248%. Vertical market SaaS, it was around 170%.

Wow.

So, so it can be significant.

That's a big difference.

Massive driver. Yeah, massive difference.

That's interesting.

Leveraging customer pull.

Absolutely. Just as to double tap on that, when I was running an agency for 15 years before I got into technology, um, I was in, uh, the nursing home business, and I started out as the director of marketing in one business, um, called North American Healthcare. It was an amazing experience. And then you start to realize that not only are they all friends, but a lot of them are related to each other too. So all of a sudden I knew people from Ensign and Sunmar and has been in Covenant Care and all of these different businesses because they all are so intermingled. And I think that happens in a lot of industries. They all wanted to know exactly what the other person was doing in order to, to make sure they stayed, stayed up to date and also, um, in a friendly way competed with each other.

Totally. And I mean, again, I'll keep using healthcare because I think it's a great example of vertical that we can separate out for a lot of really good reasons, but I think we'll cover soon. But there's HIMSS, right? It's this massive industry conference every year in Vegas, and it is the most friendly industry conference that I've been to.

I love going to HIMSS.

It's fun. People are nice and people share about products, talk about customers, talk about strategies. It really is how can we get this industry to be better positioned to help our customers? And when you see formations like that in a sector that you're targeting, that's a good sign that it's an investable sector because it's going to exist with or without you and it's going to continue to expand and there's a need to fill gaps there. Whereas I love that kind of a counterexample might be in the media space. Actually, it's a decent counterexample. Now it's a rapidly growing industry. It obviously has tremendous TAM inside of it, but it's way less friendly and it's more difficult to sell into in certain ways as well.

I think that, that makes sense. You know, it's funny, I really enjoyed working with HIMSS when I was at Infosys, and we did a series of really fun webinars in conjunction with Salesforce, Infosys, and HIMSS, and a customer. I thought it was just a fabulous experience all the way around. Another example is we got a whole bunch of Salesforce operations leaders together at various payer companies, and we did a vertical roundtable. It was virtual at the time because again, during COVID but we got a fun celebrity guest speaker to talk to us and we mailed everybody wine and we had a great time. And so that, that industry stuff, it yielded so much for us.

Sure. And then from like the Salesforce perspective, you just hit another point, which is that's kind of— that's again, as we enter that maturing model, It's your CABs, it's your PABs, your customer advisory boards, your partner advisory boards where you can, and you start investing in those types of activities because, you know, do this, the key metric to go from nascent to maturing is do we have a substantial amount of revenue? That's really the only question. And if yes, then let's start investing in making it a, an ad that this revenue into something that we can continue to sustain and grow. And you start investing into partners. You invest into customer advisory boards better and the product advisory boards more. Whereas at Nascent, where it's just still a choice that you want to make, it's a packaging play more than anything else.

Hmm. So tell me more about that. What do you mean by the packaging play?

Sure. So have you ever heard of the phrase glo-cal before?

Yes, but I don't know what it means.

Okay.

Glo-cal is a combination of the words global and local, and it has to do with when you're entering new international markets that you want your your product to be global, which means 70% of your product sales and marketing efforts is global in scope. 30% is local. Meaning you're not— and this is like kind of a general nice rule of thumb that will differ based on industry, based on market. Healthcare in the UK is good. It does not fit that model because of the single-payer model they have there compared to the US. Right. But if you were talking about selling into restaurant technology, for example, What you, what you'll see initially, early on is your primary differentiators are going to be language on your page. It might be some use cases more specific to that local market, but it's a packaging play. And so you're taking what you have, you are modifying the wrapper on it. You're building out some landing pages that are dedicated for that new market. Or if we're taking, moving back to the industries away from geographies, it's a question of Okay, think Salesforce. So it's changing language on an account, on an object, an account object, or create creation of some custom objects that are more specific to that industry. But we're not changing the architecture much, if any, in this, you know, the very, the most it might be we're going to hide a standard object that isn't relevant in this industry and we create some back channel connections to have the other objects function. But the one that we hid is still there, acting as a kind of a mediation layer in the back. And so we're not changing anything. And that's how we would— and that's how I recommend everyone enter a market with, you know, a new landing page, try some new ABM strategy, package up some solutions to make it easier to buy and use your existing customers to help you do that and see what you can sell. If you can sell that, then there's a whole host of questions you should ask and answer. And before you start that, there's a few as well, which we could talk about if you like. But that's, that's all you do to get into nascent. If you start getting that customer pull, you start getting companies wanting to buy these packages, and maybe you go through 3 or 4 iterations on what these packages look like and you understand, hey, this is the direction we need to go to be successful. We need to add on X, Y, Z. Pause. Go through a decision matrix. Is this the right move for our business? If yes, start investing in it. And that's what I would— in my head, that's where I'm saying, okay, we're putting this from nascent into maturing. Which means now that we need to agree that if we're going to invest in product, we also need to invest in marketing, we need to invest in enablement, we need to invest in, we need to invest in potentially new sales staff, potentially, not always. I don't, you know, just because you're going into a new industry does not mean you need to hire a whole new sales team to support that industry. But usually it does.

Interesting.

Because most, you know, as you were talking, we were talking about PIMs. The people who go to those conferences know the people who go to those conferences.

Yeah.

And if you have a seller who's been selling at that conference and in provider or payer for 10 years, 15 years, the relationships that they have built are incredibly valuable. And if you're going to invest heavily into product to develop a line to sell into an industry, you do not want to start breaking in brand new into that industry. It will take you too long. So you start hiring experienced sellers from that industry, and that's where that next new sales team comes from.

That makes a lot of sense. This is so amazing, Jared. I feel like we're developing, like, I'm getting a bird's eye view of this playbook that's pretty baked in your mind. And I'm also, I might as well tell our listeners that, that you have actually worked with us to, to write a very strong article on how to do this exactly. So I'm super excited to be able to share this along with the podcast, this step-by-step guide to, you know, how this is going to be working. And some of these insights are just absolutely phenomenal. And, you know, talking with you about it brings up all of these different questions that I have. I wish that we had more time on the podcast for this, but What is the best way to get in touch with you if someone has a question about verticalizing the strategy or if there's something that you could point them to? What resources would you recommend?

So I'm, I'm very responsive on LinkedIn. Okay. And this article is going to have some resources in it already, including a mathematical model that I've, I've used last 8 years, 9 years on how to put up a framework around this decision process. That would be the first resource I would, I would look at. And then reach out. I can point you to other things as well. I love talking about this, whether it's new geographical entry points or new vertical expansion. Just this topic of making your market strategy broader is one of my favorites.

Oh my gosh. Well, thank you so much for joining us, Jared, and I really appreciate your time and look forward to, you know, rocking it together with you as an advisor this coming year.

Thank you. Meet you, Amy.

Thank you. Business, yes, that's business. Business, yes, that's business.