2. HubSpot’s Current Position
Leader in Web 2.0 and Inbound Marketing
Unique product
At a crossroads
1,000 customers
Goal: accelerate growth rate and increase
profitability
Segmenting customers
Adjust pricing model
Supplement inbound marketing?
3. Profits vs. Growth
Profit
Owner
Ollie
Marketer
Mary
Growth
January
2008
December %
2008
Increase
Cost
$1,000
$5,000
Leads
1,370
3,000
218.98%
Current
Revenue
$250/
month
$500/
month
Opportunities
74
300
405.41%
BreakEven
4
months
10
months
New
Customers
35
115
328.57%
Churn
Rate
4.3%
3.2%
Expected 23.26
Lifetime
months
31.25
months
Lifetime
Profit
$10,625
$4,814
4. Segmentation Strategy
Further segment Owner Ollie
Offer two packages
Appeal to Marketer Mary
Lower churn rate
More time and money, less sensitive to price
Constitute majority of new customers
Greater utilization of analytics
More resilient to adverse economic conditions
5. Owners’ Package
Incentivize use of CMS
Reduces churn rate
$250/month with use of CMS
$315/month without CMS
Annual Contracts
Encourage owners to use HubSpot
Reduces churn rate
Guarantees profitability for at least 1 year
Generate content demonstrating added
benefits with continued use
6. Marketer Mary’s Package
Raise price to increase profits
Annual contract
Focus on analytics, less on websites
Develop more robust tools
Become a marketing analytics leader
Inbound marketing geared toward Mary
Generating data demonstrating success of
Hubspot and inbound marketing
7. New Pricing Structure
CMS Owner
Ollie
Non-CMS Owner Marketer Mary
Ollie
Cost to Acquire
$1,000
$1,000
$5,000
Current Price/
Month
$250
$250
$500
Current BreakEven
4 months
4 months
10 months
New Price/Month
$250
$315
$625
New Break-Even
4 months
3.17 months
8 months
Churn Rate
2.1%
5.5%
3.2%
Expected Lifetime 47.62 months
18.18 months
31.25 months
Current Lifetime
Profit
$10,905
$3,545
$10,625
New Lifetime
Profit
$10,905
$4,727
$14,531
9. Inbound vs. Outbound Marketing
Don’t use outbound marketing
Hurts brand image
5-7 times more expensive
Already turning away 50% of leads
Demonstrate to potential customers how
inbound marketing works for HubSpot
HubSpot employees’ passion for inbound
marketing
10. Solution
Address both Marketer Mary and Owner
Ollie segments
Capture greater value from Mary going forward
Implement annual contracts
Adjust pricing
No outbound marketing
Editor's Notes
Already have good growth, how much more can they ask for?
Positioning by competitor: competition has higher prices and annual contracts already