INBOUND 2021: HubSpot Spotlight

My name's Mike Hart. I'm the global CIO of Avis and Young. One of the challenges we were facing with our previous CRM was the fact that they didn't speak to one another. But a larger challenge was just the industry perception within commercial real estate of all of our competitors being on either Microsoft Dynamics or Salesforce and Avis. And Young is very much thought of as that challenger brand within the industry that we do things differently. We think about data, we think about technology, we think about how we go to market with our various products in a different fashion.

Hi, I'm Dave Mattson, CEO of Sandler. We consider ourselves a scaling company, which in my mind means that we're never satisfied with what we did last year. We're always competing against the, you know, the large mega organizations. So we've got to make sure that we're always looking for the smartest way to do things. We're always looking for where the puck is going to go to in our industry, which is constantly changing. But that's why we went with HubSpot, because they allowed us that flexibility as the industry changes. We didn't have to change platforms.

So if I look back four months before we rolled out the HubSpot instance, we had about 1600 users in North America, of which we only had 23% adoption, and that was of the existing Salesforce platform. When you have only 23% of your revenue producers using a CRM, it's ultimately a loss. It's ultimately something that is not adding value to the overall organization. In the last four months, we've actually already gotten it up to a 90% adoption rate amongst those 1600 brokers.

Nobody wakes up as a leader saying, today's the day that I've got to change a platform. But, you know, we were at a point where, as you start to look at all of our offices throughout the world, you needed a single view. And we had huge data gaps, actually, and we needed to expand. That CRM should be your best friend. It should be a silent sales manager. It should be a silent salesperson that's helping you, a coach on your shoulders, giving you the information that you need to run a business. And that's really what HubSpot allowed us to do by giving us the data so we could make those decisions. And we felt very confident and, you know, we had that conviction that we were heading in the right direction. So that's really what it did for us.

Foreign 2021 thanks for joining. And a special thanks to HubSpot customers and partners all over the world. Now, I had hoped we could be together in person this time, which is ironic because I'm not really an in person kind of guy. I follow the pajama principle. If an activity requires me to change out of my pajamas, I avoid it on principle. But even for an introvert like me, the pandemic has been challenging. We've spent a large amount of time with a small number of people, relationships have been tested, behaviors have been shaped, and in my case, a copious amount of pizza was consumed. This led to what I'll call some personal growth. About £11 worth. To offset this, I bought a standing desk. Well, in theory, it's a standing desk. In practice, I've never actually stood at it. I prefer sitting. But as it turns out, in order to get the benefits of a standing desk, one has to actually stand. Who knew? If only sickness tracking were a thing. On the other hand, there's my son, Sohan. This is a photo of him when he's two years old, beta testing the latest iOS. Sohan is geeky and endorsy, just like me. But Sohan's 10 years old now and he's been cooped up for months because of the pandemic. And so his indoorsiness was overcome by his desperation to get some time away from the parental units. So Sohan decided to try boating camp. This is where he learned kayaking and sailing with a bunch of other equally desperate kids. Sohan enjoyed boating camp much more than my wife and I thought he was going to, or that he thought he was going to. But then one day Sohan got back from camp and said the words that I found super scary. We need to talk, Daddy. Some of the older kids at camp have been using age inappropriate words. And yes, Sohan uses phrases like age inappropriate. So I sat him down, I said, sohan, you're going to hear these words your entire life. Everyone makes their own choices. Just because they're using these words doesn't mean that you have to use those words. So we had a good chat. Pretty good parenting. Now, the scariest form of we need to talk is when it's followed by about our relationship. We need to talk about our relationship. Have you ever gotten those words in a text or an email? Or even worse, in person? Usually when someone says that to you in person, they want to talk, like right now. In real life, talking about relationships can be uncomfortable. But as my hero Ted Lasso would say, it's like riding a horse. If you're comfortable while doing it, you're probably Doing it wrong. And speaking of doing things wrong, we have some work to do on our customer relationships and it's holding back our growth. In a recent study, it was found that 27% of people had in a customer experience that was so frustrating that it ruined their day. And one out of ten had such a bad time that it made them cry or nearly cry. We're talking tears here. Last time I cried is when someone put black olives on my pizza. Who would do that? But there's good news. This is something we can work on and we can improve, but we all have to get on board and we have to start with a conversation. So I'm going to say on behalf of all customers everywhere, the four dreaded words, we need to talk. We need to talk about how this relationship is so one sided. The only time you reach out to me is when you want something. It's always about you and never about me. Now it's understandable that customers feel this way. The CRM is usually just something the salespeople use. And making customers happy is a customer support team's problem. In many companies, customers sit at the periphery of the organization. Instead, they should be the center of focus for every team across the entire company. Now, one of the things that gets in the way of customer centricity is, is something I call funnel vision. It's like tunnel vision, but it cleverly uses the word funnel and it's even less fun. With funnel vision, customers become so myopically focused on converting prospects into leads and leads into customers, and then they stop there. There's a better model. It's called the flywheel. With the flywheel, and instead of just doing a prospect to lead and lead to customer, it continues in a virtuous loop. And you convert customers into delighted advocates. People that are so happy with their experience that they will tell their friends and colleagues this leads to, well, more leads. Now some of you are probably thinking, wait a second. Didn't Brian introduce the idea of the Flywheel at inbound 2018? Yes, he did. So why am I bringing it up now? The reason is, at HubSpot, we have embraced the flywheel in a big way. The largest team at HubSpot is the Flywheel team. It consists of marketing, sales and customer service. And we hired our first chief customer officer to lead that team. And this has worked wonders for us in terms of aligning everyone around solving for the customer. So if you want productive customer relationships, stop forcing your customers into a funnel and think flywheel. And to get that flywheel really Spinning. Well, you have to delight customers. And it turns out a generic, impersonal experience just doesn't delight. So here's what non delighted customers have to say. We need to talk. We need to talk about how you don't even know me. I know you have other customers, but I want to feel special. I want to feel understood. I want to feel connected. So why do customers feel disconnected from us? The culprit is this insidious, sinister thing I call the underpants gnomes effect. Now, I can't take credit for this Harvard worthy, brilliant business concept. It's adapted from a South park episode, a source of so much business wisdom. The underpants gnomes are these little gnomes that go to great lengths to steal people's underpants. Not just new underpants, all underpants. Like, no underpants left behind. Here's their grand master plan. Phase one, collect underpants. Phase two, question mark. Phase three, profit. So they accumulate this giant pile of underpants and they have no idea what to do with them. Companies have a similar problem, but instead of collecting underpants, they collect customer data. And of course, the goal shouldn't be to just collect customer data. The goal should be to use that data to deliver a more customized, more connected customer experience. So why do companies fall prey to the underpants gnomes effect? To understand this phenomenon better, we take a look at the evolution of CRM. Way back in 1993, a software company called Siebel launched the first legit CRM, or customer relationship management system. They took every customer and made it a record in the database. So now the entire company had this shared system of record. Super useful. The problem was that you had to buy your own hardware and then install the Siebel software on it like a caveman. Seven years later, Salesforce came along and they had a brilliant insight. There was this thing called the Internet and all the computers were connected to it, and you could use the Internet to deliver software better. Hence came the first cloud CRM. Subsequently, all CRMs, or most CRMs are on the cloud now. Seven years after that, HubSpot came along and we had a novel insight ourselves. There's this thing called the Internet, and not only are computers connected to it, but people are connected to it too, including customers. And we could use the Internet not just to deliver software better, but to deliver a more connected customer experience. Now, what do I mean by a more connected customer experience? Well, number one, the CRM should connect teams within your company. Marketing, sales and service should all be on one unified system. Two, it's not Enough just to connect teams within your company, you should connect your company to its customers. Customers want to have a window into their relationship with you. They want to be able to log in and view their data and interact with it. They want to be able to self service when appropriate. Customers don't want to just have an emotional connection with you. They want to actually have a real digital connection. And third, it's not enough just to connect teams within your company and your company to its customers. You also need to connect customers to each other. This builds trust because customers gain confidence when they can talk to other customers. But more importantly, by connecting customers to each other, they can get the most out of your product or service because they can learn from other customers. HubSpot's investing in this in a big way with something we call the HubSpot network. The HubSpot network connects the millions of people in the HubSpot ecosystem so they can discover each other, learn together, and help each other grow better. So some of you are thinking, okay, that all sounds awesome, but we just are not able to do this at my company. Now the issue may be the systems. We need to talk. We need to talk about the effing systems. And note, I'm not using a word from Sohan's expanded voting camp vocabulary. I'm talking about the Franken system. The Franken system is a CRM monstrosity cobbled together with software, parts, applications built by different people in different companies with different design goals. It's the result of decades of mergers and acquisitions and frankly, it's a disjointed, bolted together mess. Too many databases and too many core applications that all do things their own way. There's no consistency, there's no cohesion and ultimately there's no control. No control. Now, it's fine. Companies tell themselves late at night and it is fine. If you're a Fortune 1000 company with tens of thousands of employees and you have an army of CRM consultants with pitchforks and process diagrams, it's fine. But for the rest of us, it's not fine. Because a Franken system causes us to spend all of our time trying to tame the monster instead of taking care of our customers. Now, if you have a Franken system, let me say it's not your fault. I'm giving you a virtual hug right now. It's not your fault. Nobody intentionally unleashes a Franken system in their company. It just sort of sneaks in and it grows. And then it makes it much harder for your company to grow and the result of a Franken system is a frustrating disjointed experience and very, very annoyed customers. Customers like me. So recently I leased a Volvo sight unseen over the web. Now you know I'm a parent not because I got a Volvo, but because I was excited to get a Volvo. And honestly, the purchasing experience was awesome. I didn't have to talk to a single carbon based life form. And then it came time to make my first monthly payment. Instinctually, I pulled up the Volvo app. No dice. The app can beam signals into space and unlock my car from three continents away. But it won't let me send Volvo money. So I go back to the website where I leased the Volvo. Strike out there too. Evidently it's a marketing and sales website, not a send Volvo money website. Pro Commerce and payments are a big part of the connected customer experience. And commerce is all about convenience. So I Google it up. Evidently there's another website for payments called volvofinancialservices.com. yep, that's the actual super catchy website name. So I try to register. It asks me for an account number. I have no idea what that is or where to find it. And Volvo's online knowledge base was not helpful, primarily because of its complete absence. So out of desperation, I contact Volvo. To their credit, they respond promptly. The account number is in the letter that we mailed you. The letter that you mailed me. I responded, I have no such letter. Is there another way? What I should have said was the 1900s called on their rotary phone and they want their fountain pen and parchment paper back. Volvo responded, no problem. You can call our customer service department with your vehicle identification number. They can use the VIN to then look up your account number. And you can use your account number to then register for the website. And then you can use the website to then submit a payment. Now, I'm going to spare you the details of what happened after that because it might make me cry or nearly cry. This is a ridiculous but true example of what happens when you have a Franken system in place. Your teams are disconnected and your customers are disconnected from the company. The dream is to have a single, unified, cohesive, uncomplicated CRM. A CRM that was built for creating a customer centric, connected and customized experience. A CRM that was built by people that care with consistent design goals. One of the primary goals being easy to use by actual humans. That's the dream. And speaking of dreams, we need to talk. We need to talk about the future. It's fun to dream and to Imagine where the world could go. So let's geek out a bit on the evolution of the web and how we got here. Way back in the 1990s, when Volvo first started mailing letters with account numbers, we got the first generation of the web. And the potential was mind blowing. It made me giddy with excitement and gave me goosebumps. That early web was read only in order to put content on the web. You had to know HTML and FTP and other acronyms or you had to have a distant cousin that worked at Best Buy and New Dreamweaver. With this early web, businesses could take their marketing brochures and turned them into websites. And sure, some of these early websites had ugly colors and blinking text, but they were an important first step towards creating a connection with a customer in a way that brochures never could. Fast forward 15 years. It's 2005. Brian and I are classmates in graduate school. This was the time that Web 2.0 came on the scene. Web 2 was the new, new thing. It was read, write. You didn't have to be a technical wizard in order to get content on the web. Even mere Muggles could do it. This made me giddy with excitement. Goosebumps again. And Brian was excited too. And that's what led us to start HubSpot. Now, some have speculated that we started HubSpot just so we'd have a place to play ping pong. It wasn't that. Well, it wasn't just that. With Web two came this massive shift in buyer behavior. And change equals opportunity. And what we saw was that businesses could now create a blog, they could engage in social media, and they could otherwise add value to customers before they tried to extract it. We called this process inbound marketing. And it was a game changer. So over the past 15 years, I haven't really felt that same level of giddy excitement, no goosebumps like I had with Web one and Web two until now. Now I'm feeling this massive shift that feels even bigger than a shift from Web one to Web two. But before we jump in, a quick cautionary note. This segment is rated FP Future predicting future. I'm going to give you a peek into what I think the future might look like. It's not a peek into the HubSpot product roadmap. You'll see some of the amazing progress the HubSpot product team has made on our CRM platform in just a few minutes. Okay, so what has me giddy with excitement? What's giving me goosebumps now? 15 years later. It's what some are calling, wait for it, Web three. Shocking. I know. We techies are super awesome at creatively naming things. Here's what has me excited about Web three. Web one was about information. Web two was about interaction. Web three is about decentralization. It's about putting power back in the hands of the people. It's the way the web was always meant to be. Now, some of you probably have a few questions. One, what the heck is he talking about? Two, why should I care? And three, what should I do? Great questions. In the current Web2 model, your data is split up and fragmented and owned and controlled by a handful of massive tech companies running massive networks. In a decentralized web3world, you own and control your data. Data like your purchase history, your preferences, your connections, your credentials. You own and control all this data, so you get to decide which companies that data gets shared with. And if anyone's getting paid for access to that data, it's you. Now, some of you are wondering, okay, that sounds fine. Why should I care? How does this matter to my business? The reason we should all care is because this new Web3 model will provide us a new direct way to forge connections with our customers and our prospective customers. Instead of advertising to the masses that we know little about over these big networks, we can forge direct connections with prospective customers and we can give them a customized experience based on data they willingly share with us. It's a much more efficient and much more trustworthy model. Now, this feature is still years away, but the pieces are already starting to fall into place. We have cryptocurrencies like Bitcoin, decentralized application platforms like Ethereum, and decentralized social networks like BitCloud. These all give us a glimpse into the future that's coming. So what should you be doing? Don't worry, I'm not going to suggest that you start moving all your data to the blockchain or that you start buying Bitcoin. What I am going to suggest is you embrace the idea that we're in the age of the customer. Embrace the idea that over time, customers are going to have more and more power and they're going to be equal partners in their relationship with us. That's what the future looks like now. The future is awesome, but it's still the future. And chances are you're kind of thinking about how to grow today. So let's come back from the future, get out of our time traveling deloreans, and let's recap what we talk about in terms of Customer relationships. Here are things no customer has ever said. You know, I'd love to introduce myself to you for the 43rd time. I've been meaning to get to know as many people in your company as possible. Transfer me to whoever you want. You know what this relationship needs is more management. Customers don't want more management. They want more magic. They want to experience a moment that makes them smile. They want to tweet about a company, not at a company. They want to feel connected. And our businesses want that too. Your growth over the long term is a function of how much customers love the experience you give them. So give them an experience that makes them stand up from their sitting desks, brush aside their pizza, and to gush with friends over coffee about how awesome the experience was. It's time to abandon funnel vision, put to rest the Franken systems, and put aside the frustrating underpants gnomes effect. Your CRM platform should help you deliver a better, connected, more customized experience that's focused on the customer. The CRM should put the customer first in the design, not just in the acronym, because better customer relationships lead to delighted customers. And that's what fuels all of our flywheels. That's how we grow better. And with that, I'd like to introduce members of the HubSpot product leadership team. They'll be talking about the HubSpot CRM platform and the development that's happened this year. I could not be more thrilled with the progress they've made in helping you deliver on the dream of customer relationship magic. Thank you.

Wasn't it great to hear from Dharmesh about the history of CRM? To me, it is just fascinating the ups and downs and twists and turns this market has taken. I am so excited to be here with all of you in person, in the office to talk about how HubSpot is going to move CRM forward into sort of the new era.

Yeah.

One of the things I loved about that was thinking about how we want HubSpot to evolve. And we want to be the number one CRM for scaling companies. And. And for us, that means a couple things. It means it's gotta be customizable, it's gotta be well connected, and it's gotta be customer centric. And we wanna focus on end users to do that. We want to build for the people who are using HubSpot every single day.

Totally.

Yeah.

Even more than that, I think it's so cool how we keep a focus also on like, how do people wanna shop and buy and how can we build a product that's gonna help our customers get there.

That's right.

How many customers have we all talked to that just feel totally trapped by whatever they've done with CRM in the past? It's either they were too scared to get started, they're too scared to move off of it. They've created a monster in some ways, and, I don't know. It's pretty scary out there sometimes.

Yeah, totally. You get into a world where the CRM has been customized to the point where it's like a Rube Goldberg machine and no one even understands how it works anymore. Everyone's afraid to make changes to it. And so you absolutely need customization in the way that you set up your CRM and your customer database. You need it to reflect your business, your customer. You need it to make it work for your company. You know, you need to be thoughtful about the way that you bring that customization into the system.

There's a big difference with a crafted platform that's built to work together. It really makes a big difference in how you're able to use it, how your teams are able to interact really smoothly and have an efficient process.

When we think about customizing the CRM, we don't just want to make it easy to customize the database part of the CRM. We also want to make it easy to customize the CRM for the users that are using the CRM. You know, we think about the end user who's using the CRM, like a salesperson or a support person or a marketer who's in there every single day. We also think about the admin who's setting it up. We not only want to make it easy for the end user, we also want to make it easy for the admin. And then we want to make it easy for the admin to make it easy for the end user in the way that they're setting up the system. I think an example of that is the way that we've created permission templates. So it becomes easier for an admin to add users into the system because they can use these templates. And then once they add the users, the users get set up faster, and the experience is natural for them in the product because they're able to see the things that they're supposed to see, and they're not distracted by the. The things that they're not supposed to see.

Most customers I've talked to have gone about this in two ways, right? One, they've sort of cobbled this together on their own with whatever is out there or two, they've gone with some platform that has cobbled a bunch of stuff together. And I like to call it the cobbling tax, where like, no matter what you do, there's a tax to pay. And I think that's where we're really coming in with this crafted approach and has a big impact on customers and developers and their customers. There's a lot of sort of Runway.

There that's really important because, you know, we know for a fact that the more people at your company who are using HubSpot beyond your sales team, the more likely companies are to grow, have better, higher customer retention, better customer satisfaction scores. And that's why this crafted approach is so critical.

That data was fascinating. If sales, marketing and service all use a CRM, you, you will grow faster and your customers will be happier. I just thought that was incredible and really validating of doing CRM, right?

Absolutely. Going forward, this customization is going to be key. So each of our customers is going to need to differentiate themselves in the marketplace. So both an amazing experience and a unique experience that can really help people remember them and help them stand out. And we keep saying crafted, not cobbled. And I always want to call out that. That doesn't mean that HubSpot builds everything for everyone. So our ecosystem is a huge part of this. If you need to use other solutions alongside HubSpot, we want that to feel seamless too. So we're really focused on the developer experience and on having the integrations in our marketplace and the apps that will help users bring the tech stack together, bring those things inside of HubSpot so that the user's workflow and the user's day to day feels very connected and very seamless.

We want to let people build experiences.

That don't look like their system.

Right.

The experience that your customers have shouldn't look like the way you have your software stack set up. It should look like a really compelling.

End to end experience with a full.

View of the customer.

Exactly.

Typically when you hear about customization, it's about the developer and making anything possible and.