Hubspot

Kenan-Flagler Business School        ALISHA GANDHI

Marketing 741        SECTION 9:30am

Executive Summary

We recommend that HubSpot targets B2B customer category over the B2C companies. Additionally, we also recommend that HubSpot should target its marketing strategies to acquire Marketer Mary’s.

Target Market Selection

Should HubSpot cast a wide net or narrow their focus? Effectively argue that HubSpot should narrow their focus using frameworks we have discussed, as well as points from the case.

As the needs of each customer vary in terms of the specifics expected from the inbound marketing tools provided by HubSpot, the company should focus on providing inbound marketing tools that specifically meet the needs of the B2B companies and Marketer Mary’s. But within that group it should cast a wide net so as to attract majority of the market share. Also, in comparison to HubSpot’s competitors, the company has the advantage of having an easy to use and cheaper product. Thus, playing to these strengths HubSpot should tailor its service offering to match the demands of these two customer segments.  

Should HubSpot target B2B or B2C customers?

We recommend HubSpot to target B2B customers because:

Strategic Reasons:

Businesses have increased the portion of their marketing budget that is dedicated to inbound marketing, therefore as more money is spent by businesses in this area the companies will become more cautious of the optimal use of their resources and hence, have a higher probability of requiring inbound marketing services.

Quantitative Reasons:

1. The Customer Lifetime Value for B2B customers is 1.88 times more than that for B2C customers.
2. Also the Potential Market Value for B2B customer segment is 1.8 more than that for B2B customer segment.
3. The Churn Rate for B2B is 3.3% vis-à-vis the 6% for B2C customer segment suggesting that HubSpot will have a high retention rate for B2B customers.

Yes, B2B customer segment will be receptive to the product, but only if HubSpot tailors it product to meet the specific needs of this customer segment. For example, HubSpot’s inbound marketing strategy tool should focus on providing easy to use and comprehendible analysis for the companies. As HubSpot’s freeware was a great hit among its users, the company should try and maximize the reach of its freeware so as to have maximum potential customers try their product and hopefully convert these potential customers into confirmed sales.