• Properly aligning go-to-market motions
• The key drivers of growth for each type of customer
• An introduction to the Bowtie Funnel (warning: mind-blowing)

RevOps Class 3 Recap (Go-To-Market, The Growth Model, and Data Model-part 1)

The Revenue Engine Framework

Foundation is Key

If a house is not properly constructed, it will fall. The paint might be pretty, and the door might’ve been hand sanded from the finest materials, but if the foundation and overall construction is weak, or if the materials were arranged out of order (the roof can't be the foundation!), it will fall.

In the same way, if a business has a poorly constructed revenue engine framework, it will fail. The company logo might be pretty, and the website might’ve been handcrafted by the best graphic designer in the business, but if the models don't interplay correctly, or if they are arranged out of order (the tech stack can’t be the foundation!), the business will fail.

Order is Essential

A properly constructed revenue engine framework (from the top down) looks like this:

• RevOps Fundamentals
• Tech Stack
• Math Model
• Data Model
• Growth Model
• Sales GTM, Marketing GTM, Customer Success (CS) GTM
• Business Model

What is a GTM Strategy?

A Simple Definition

GTM (go-to-market) strategy can be challenging to define. It’s one of those things people with MBAs think a lot about. One method of simplification is to break the definition up into two parts: motion and tactics.

Very simply, a GTM strategy is a plan that details how an organization can engage with customers to convince them to buy their product or service and to gain a competitive advantage. This is the “motion” aspect of the definition as it involves how your sales, marketing, and CS teams are interacting.

The second part, “tactics,” revolves around pricing, sales and channels, the buying journey, new product or service launches, product rebranding, product introduction to a new market, TAM, ideal customer profile, competitive analysis, and messaging. Your motions are critically important as they will tell you if your tactics are working.

Sales GTM Motions

There are many different methods an organization uses to deliver a product or a service to its customers. These are commonly referred to as sales motions. Sales motions can vary from one another in a myriad of ways including having different structures, different proposal types, different CPQ needs, and different RevOps needs. Here are five sales GTM motions:

Product Led Growth

• Customer acts as marketing and sales
• Many times, your marketing and sales teams are your products
• Relies on word of mouth

Inside Sales (1-Stage)

• Full cycle AE
  • Take an inbound call from the first call all the way to the end
• Low touch, not many stages, not many meetings

SDR/AE Sales (2-Stage)

• Aligned with an outbound motion (SDR)
  • Sales Development Rep (SDR) does meetings, discovery calls
  • Account Executive (AE) does demo and closes deal from beginning to end
• Typically done this way because SDRs specialize in turning prospects into potential clients and AEs specialize in persuading potential clients and finalizing the sale

Field Sales

• Vertical alignment
  • Specific amount of accounts you’re assigned to (typically 10-100)
• These are not customers, you have not worked with them before
• Higher contract values
• Custom proposals to close deals

Named Accounts

• Large entities (e.g. Amazon)
• Knowing people and identifying upcoming projects
• Multi-million dollar deals
• 9-18 month sales cycles

GTM Motions and Structure

Your Business Model is Your Foundation

Let the revenue engine assembly begin! As a refresher, the foundation of any revenue engine framework is the business model. Recognizing whether your company is a perpetual ownership model, a subscription model, or a consumption model will dictate the motions and proper alignment of the remaining models.

The Revenue Engine Framework Interplay

The revenue engine framework interplays in the following order:

1. Business Model
2. Sales GTM
3. Marketing GTM
4. CS GTM
5. Math Model
6. Data Model
7. Growth Model
8. Tech Stack

The revenue engine is a continuous process, not a one-and-done deal. It’s not just about getting customers, it’s about keeping them and growing them. The GTM motions are important because they provide your company with an understanding of your customers and, in turn, provide you with the revenue to keep the lights on.

Q:  Would you say HubSpot’s focus is consumption as the way you increase recurring revenue is by increasing profits of current clients?

A:  HubSpot is not a consumption model, they are a subscription closer to paying monthly,  sometimes you even pay quarterly and they're trying to go to annual subscriptions.  They want cash.  What is consumption is how they track marketing contacts and how many seats because they recalculate and they’ll prorate.  So it’s this combination of both, and you’ll see a lot of companies they've become more sophisticated as they’re combining this consumption type model so they can charge you more and they can constantly upsell and upgrade your contract through proration and so that’s where HubSpot sits.

Q:  My sales cycles are based on the persistence of students to graduate towards degrees, would you align it to subscription?

A:  I would need more information, but my assumption is people are only paying if they get a degree and at the end of that then they pay in full and so that is a consumption model.  It’s a type of consumption model where you are bearing all the risk and you are only getting the benefit if someone finishes.  So part of thinking about this is, who is bearing the risk?  

Q:  If I sell a hardware product only with no contract for service, am I a perpetual ownership business model?     

A:  Yes.  Yes, you are.  

Q:  How can one transition themselves from SalesOps to RevOps? 

A:  One of the things is the number of functions you know.  Revenue operations is a field of study.  It’s like biology, inside biology there are specializations, like you need to know organic chemistry.  Sales Ops is a field of study within revenue operations that is specifically studying your sales cycle.  So from your SQL all the way to contract signed, and understanding how to optimize and how to make that most efficient.  Marketing Ops is to the left of that, and CS Ops is the right of that.  So how you transition is honestly the best way to transition is getting into a role and you need to be able to speak the data model, that’s how you;re able to transition to revenue operations because you can speak all conversions, all metrics at all time and be able to translate that into a go-to-market.  

Q:  Recent data from Gartner says the majority of buyers are comfortable spending about $50,000 without speaking to a rep and are more with the inside sales model for larger purchases.  Has this impacted your view of the Sales GTM motion?

A:  Yes, it has.  This 2-Stage point is we are moving to a world where buyers, we’ve lost control in a good way, are more informed than ever.  They are educated buyers and don’t want to do a discovery call, they want to go straight to demo, they want to see the product work.  They have authority to already buy, and so this 2-Stage model, people are maturing out of it where they don't have SDRs until a bit later and they're not using SDRs, they’re using full cycle AEs.  There’s people like us, RevPartners, our deals are actually closer to about this $60,000-$100,000 range and we don’t use 2-Stage, we do but we have 1-Stage full cycle reps and we have this mix between 1-Stage and 2-Stage.  So this is happening in the market today.       

Q:  Where does ABM fit into this?  Thinking it is 2-Stage SDR motion.

A:  No.  So ABM, by definition, means account based marketing, and account based marketing means you’re selling to companies; it means you have a list made out and you’re specifically going after larger companies.  How they buy is different.  And so if you’re doing that, your sales team needs to be focused on that as well.  So traditionally in this stage it doesn’t make sense to do ABM approach, it’s a lot of money to do ABM well.  So I’d say ABM is not traditionally done in the 2-Stage although it can be because these aren't hard lines in between the two.  So I’d spend most of the time getting really good at creating interest through prospecting outbound.

Q:  Would you say from left to right the GTM motions companies tend to choose Salesforce over Hubspot?  Considering that, is Hubspot planning to move prospecting functionalities?

A:  I’ll answer this from a HubSpot perspective.  I come from a Microsoft dynamics admin background and a Salesforce background where I was running revenue operations for Salesforce stack.  Salesforce has almost every one of these GTM motions, but most built out for enterprise and field sales, and volume and they are a multi-billion dollar company and they are extremely big.  I fell in love with HubSpot when I met it, but HubSpot is now moving to Field Sales and enterprise motions.  So the capabilities and functions of their products have increased as such where they are now doing ABM approaches and Field Sales and they have Named Accounts where they are sailing in and trying to uproot Salesforce.  But you notice they don't have certifications, they don’t have that same brand recognition yet, they don't have people dedicated to say, “I’ve made my entire life doing sales inside of HubSpot”, so it’s going to take time.  I predict HubSpot is going to take a larger and larger market share from Salesforce and it’s one of the reasons I bet on it, I have a business that’s built on doing HubSpot.

Q:  How important do you think it is, at least initially, to stay focused on a target?

A:  Super darn important.  It’s actually one of the most common mistakes people do.  They do too many GTM motions at once because they’re afraid one of them won’t work.  More companies die from indigestion than from focus.  You die more from eating too much than not eating enough.  More companies die from indigestion than starvation.    

Q:  How do you know or find how your customers are buying?

A:  How you know where your customers are buying is you go to the customers and (you should have a customer list) the customers you like working with the most, that have been the most profitable for you, go talk to them and just diagnose how did they buy.  Take that information, we'll talk about in our data model a closed-loop data model, and help that inform how your GTMs happen.  It should be a closed-loop system and we’ll talk more about that later. 

Q:  Is this the path every business goes?

A:  Almost every B2B business, yes.  This will be a path that is at least helpful to think through for every B2B business.

Q:  I think a lot of leaders get confused and consider selling a pro product to enterprise brands and they’re doing enterprise sales.  How can you make that distinction tactfully?  

A:  Someone at Amazon is using Airtable.  I was a Salesforce user at C Spire, which is a billion dollar telecom company, and you what I used for my meetings?  HubSpot.  I was doing a PLG motion in HubSpot but I was at an enterprise company.  Talking to executives and being able to talk their language say hey we have a PLG or like a 1-Stage very quick service with a low ACV and we have someone at Amazon and we have someone at Costco.  Them using our product is not indicative of our sales motion.  How they buy is indicative of our sales motion, and they bought through us.  If they were 1-Stage they did it Inbound on our website, we had two conversations and they purchased.  That is not enterprise sales, we do not need an enterprise sales team, we need people out of college to answer phones and we’re teaching them how to do it.  It’s how you set up sales, how you set up marketing, how you set up CS depends on how people buy.

Q:  Isn’t community and engine also applicable for SMP or enterprise?    

A:  Yes.  The question isn’t is it applicable?  The question is what is the most useful?  Enterprise businesses, and we talk about that reputation in brand certifications, there’s an extremely strong Salesforce community called Trailhead.  I was in the military before and when I was getting out of the military there was a program for vets called Vet Force and you’d go through the program and it was an awesome community and it’s how I cut my teeth inside RevOps so I learn it and get into some sandboxes and start blowing things up.  That was a community play, but the community was not based on feel good community, it was based on very difficult certifications and the entire community was helping people get certifications so they could then get a job at a company that has Salesforce.  Which is different than the HubSpot community, right?  You’re not getting a certification, what you’re doing is you’re answering very specific questions and sharing stories and it’s just a different play and has a different feeling than a community built on certifications than one that’s built on meet ups.  So you're right, they’re applicable, just know they’re done differently.   

Q:  What is the difference between volume and segment for CS?

A:   Segment means it’s segmented in a specific way.  So segmentation may be by vertical, an example being I have an ABM and I’m going after the real estate industry and I’m going after the education industry and so I would have CS teams because their use cases are different so I need CS teams that understand how to implement my product for education-based institutions and for real estate institutions that are in commercial real estate because how they use is different and they’re paying a lot of money and I want to make sure I’m servicing them well, that’s the difference.

Q:  Do these metrics apply equally to service or are figures approached different still B2B? 

A:  This is the business that RevPartners does.  We have contracts from $60,000 upwards of  $150,000.  We have a 1-Stage GTM motion and we are only selling to SMBs.  So when you’re looking at these, your ACV, and that goes to this mid-market, your contract values on service firms tend to be a little larger and but to still be contract because they're not buying a product you’re buying some kind of service, usually it’s an outsourced portion so they tend to be a little larger and still have, they don't have an enterprise GTM motion.  An example of a service firm that does have an enterprise GTM sales motion is BCG (Boston Consulting Groups).  They have these large, multi-year implementations that are millions of dollars as large contracts.

Q:  Are you using HubSpot?

A:  If this question is to me, yes I am using HubSpot.      

Q:  What is the most critical metric to choose the GTM motion?  (e.g. I have better conversion rates, better margin enterprise, but have larger TAM and SMB)  Which one is more important?

A:  Hard question.  This is where founders and entrepreneurs have to make a bet, but it has to be an informed bet.  There are two-door decisions and one-door decisions.  A one-door decision means if I walk through this door, I can never go back through it, it is done, it closes, I am locked in.  Two-door decisions mean I can make the decision and if I don't like it and I’m collecting information, I can walk back out.  Almost every GTM decision is a two-door decision.  As you’re seeing companies that are scaling, a lot of times they’ll start and do different products, but at the end of the day you have to choose which one you’re investing in.  You have to choose your exit strategy.  Do you want to have a $100 million company with a large TAM and potentially fail during a scaling process?  However, you might grow and buy a yacht after.  There’s more risk, but more reward.  The other one is an enterprise motion with a much smaller market, but a guaranteed profit and the result is a really good living, but you’ll never be considered wealthy and Forbes will never write about you.  You’re looking at these metrics and you have to decide your end state, which only you can choose, because it will impact what risk you’re willing to take on. 

Q:  When working on Sales GTM motions and Marketing GTM motions, do you find there’s a commonality to how marketing individuals support one salesperson or vice versa?  Does that change when delivery teams become in charge of upselling existing deals?

A:  I would ask some clarifying questions on this, but I will say this:  there is a commonality specifically with 2-Stage where you have an SDR, which is sometimes called BDR/MDR, and we get all those terms mixed up.  Let’s just say we have a person that’s prospecting or marketing owns or someone that;s doing an inside sale, so that's inbound, and they’re fielding the call and that lives with the marketing team and then passing it over to sales.  There’s commonality, is that marketing or is that sales?  Marketing skills look a whole lot like sales skills.  Then, on the right side, as you go to upsells and cross-sells, and this is where marketing fits across this whole funnel, but sales ends.  Sales traditionally end after a six month term or one year term.  Sales relationships end and the CS team takes over.  The CS team is working with the marketing team, and so marketing sits as a support function and that’s where we talk about demand gen versus lead-gen.  So there is a very small lead-gen portion of marketing with two stages that they need to understand, but there’s also this demand-gen that’s being done all at the same time.  Hopefully that was helpful.

Q:  Can you elaborate a bit more on impact in the full funnel?

A:  When you think about this funnel, there is “identify” to “interested” to “engage” to “committed”.  I don’t like closed won, I like customer centric language.  When someone is committed they’re saying they are attempting to work with you to create the impact on my life.  So then they onboard and then they’re ready, they're live, and now, just because they’re onboarded are they achieving the impact you said.  There’s some sort of a trigger.  If you have a six month contract, did they renew?  Yes or no?  If they renewed, they have decided to renew you and now they are moving to recurring impact, which is where you want to go.   

Q:  What are your thoughts between GTM Ops and RevOps?  Is there a difference for you?

A:  I don’t care that much.  I think either one of them is helpful.  RevOps is an attempt to talk about the science of revenue and the full funnel; GTM operations is in many ways the same thing, but I would say the biggest difference is a GTM operations individual is not actually managing and configuring tool sets, usually.  For the most part I would recommend that if you're managing tool sets and you have a database and you’re thinking about creating ERDs and putting everything together, then you're revenue operations.  If you’re just theoretically talking about tactics and you’re making plans and you’re giving them to other people to implement, that’s GTM operations.     

Q:  Is there any future for data analysts in HubSpot?

A:   Yes, data analysts can be wicked awesome inside HubSpot.