Introduction of X Led Growth
PLG (Product Led Growth) for SMB Self-Service Business & SLG (Sales Led Growth) for Enterprise Sales
In my experience, a common challenge for B2B SaaS products is using digital channels to market and sell to different customer groups. The common groups are small/medium businesses (SMB), mid-market businesses (MM), and enterprises (ENT). Buyers amongst these groups have similarities and differences, and the differences make it hard to market and sell to each group effectively.
By constantly iterating, testing, and doing customer research, we recognized that with our buyers, we could simplify and divide into two groups: Commercial (SMBs and smaller MMs) and Enterprise (larger MMs and ENT).
With this insight, in collaboration with two key peers, we decided our best strategy was to focus on the Commercial segment first. Even though the deal size and contribution to the business were smaller, we had significantly more prospects and deals to iterate faster. Below are two memos that summarize the learnings and plan as we made progress toward defining, operationalizing, and monitoring our self-serve Commercial product-led growth efforts.
Unified To/Through/In XLG Motion
This business case proposes a new growth marketing initiative to improve coordination, efficiency, and performance within GitLab's marketing efforts. Our current challenges, including declining traffic and suboptimal conversion rates, necessitate a change in approach to drive better results and maximize pipeline and ARR. This business case outlines a proposed team structure, roles, and shared principles and metrics to foster greater alignment among the Digital Strategy, Digital Experience, and Growth teams.
The proposed "To, Through, In" motion focuses on leveraging each team's core competencies and creating a seamless user journey from initial attraction to conversion. The benefits of this initiative include enhanced coordination, increased efficiency, improved performance, scalability, and a culture of continuous improvement.
We seek the support of the Chief Marketing Officer and VP of Integrated Marketing to endorse the proposed team structure, allocate necessary resources, champion cross-functional collaboration, and establish regular check-ins to monitor progress and results. Implementing this growth marketing initiative will better position GitLab to address current pain points, drive growth, and maintain our leadership in the DevSecOps market.
Proposed Team Structure And Roles
To: Digital Strategy Team
Responsible for driving inbound marketing tactics to generate traffic to the Marketing site.
Key responsibilities include SEO, paid advertising, email marketing, social media marketing, and content marketing strategy.
Collaborate closely with the Digital Experience and Growth teams to ensure alignment on the target audience, messaging, and campaign goals.
Through: Digital Experience Team
Responsible for creating and optimizing customer-centric, product-led growth experiences on the Marketing site.
Key responsibilities include user experience, user journey optimization, and engineering.
Collaborate closely with the Digital Strategy and Growth teams to ensure a seamless transition from traffic generation to a free trial, account sign-up, or license purchase.
In: Growth Team
Responsible for conversion-focused design and product-led growth initiatives to turn prospects into customers and engage users within GitLab’s product.
Key responsibilities include conversion rate optimization, user onboarding, product usage analysis, and A/B testing.
Collaborate closely with the Digital Strategy and Digital Experience teams to ensure alignment on user journeys and conversion goals.
Current Pain Points
Declining Traffic: The current YoY decline in traffic indicates that the existing approach to driving website visitors should be more effective. This decline has the potential to impact the overall pipeline and ARR negatively.
Inefficient Coordination: A lack of alignment and coordination among the Digital Strategy, Digital Experience, and Growth teams can lead to redundancies and inefficiencies in marketing efforts, resulting in wasted resources and missed opportunities.
Suboptimal Conversion Rates: Current conversion rates from the Free Trial Signup page are lower than desired, highlighting an opportunity for improvement in turning prospects into customers.
Lack of clarity in targets, planning, and reporting around the two main customer journeys: self-service vs demand to Sales. Currently, we have better sophistication around the touched-demand journey than self-serve.
The current state of GitLab's marketing performance, as evidenced by the Validation data, highlights the need for a more efficient and effective approach to growth marketing:
MoM: -23.41% percent change
YoY: -30.94% percent change
This past Q4, we had a -0.5% YoY decline in traffic
Benchmark for Business Software was -1% YoY
According to a benchmark study, our rate of new visitors was 7.8% below average, while returning traffic was -0.1% below average
Trial CTA click rate (all free trial CTAs)
MoM: +10% percent change
YoY: +5% percent change
Conversion rate from Free Trial Signup page
MoM: -23% percent change
YoY: -34% percent change
With the current challenges and the potential for even greater declines in performance, now is the ideal time to implement a more coordinated and efficient growth marketing initiative to drive results and reverse the negative trends.
Benefits Of Proposed Initiative
Enhanced Coordination: The proposed team structure and a shared set of principles and metrics will lead to better alignment and coordination among teams, reducing redundancy and ensuring everyone is working toward the same goal.
Increased Efficiency: A shared roadmap and close collaboration among teams will lead to streamlined processes, faster decision-making, and more efficient use of resources.
Improved Performance: By focusing on their core competencies and working together, the three teams can drive better results in terms of traffic, user engagement, and conversions.
Scalability: A unified growth marketing initiative allows for more effective scaling of marketing efforts as the company grows, ensuring consistency and sustained success.
Continuous Improvement: The proposed initiative fosters a culture of data-driven decision-making and continuous improvement, enabling teams to iterate quickly and optimize results.
Request For Support
To successfully implement the "To, Through, In" motion and drive better results for GitLab, we request the support of the Chief Marketing Officer and VP of Integrated Marketing in:
Endorsing the proposed team structure and the shared set of principles and metrics.
Allocating the necessary resources (including budget, tools, and personnel) to support the initiative.
Championing cross-functional collaboration and communication among the Digital Strategy, Digital Experience, and Growth teams.
Establishing regular check-ins and progress updates to ensure alignment and visibility into the initiative's progress and results.
By supporting this initiative, GitLab will be well-positioned to improve its marketing performance, drive growth, and maximize its impact on pipeline and ARR. Addressing the pain points and taking advantage of the opportunity to optimize our marketing efforts now will enable us to stay ahead of the competition and continue to be a leader in the SaaS market.
Unified To/Through/In Motion Metrics*
* Sales Cycle Length is specifically for Enterprise Sales Assisted
This work builds on Unified To/Through/In PLG Motion
DRIs: Digital Marketing, Digital Experience, and Product Growth
This north-star performance metric represents the relationship between the cost of acquiring a customer (CPA) and the total revenue the customer generates over their lifetime (LTV). This ratio indicates the efficiency and sustainability of our customer acquisition and retention efforts. We aim to lower the CPA:LTV Ratio to ensure a more cost-effective and profitable customer acquisition strategy.
DRIs: Digital Marketing, Digital Experience, and Product Growth
Focus on driving annual Recurring Revenue (ARR) growth by working collaboratively across teams to optimize customer acquisition, retention, and upselling efforts. Continuously monitor and analyze ARR metrics to identify opportunities for improvement and prioritize initiatives accordingly.
Impressions and Clickthrough Rate (CTR) of Ads
DRI: Digital Marketing
Enhance ad visibility and engagement by refining targeting, messaging, and ad creative. Regularly analyze ad performance and iterate to increase CTR and drive higher-quality traffic.
Engagement Metrics (Site Sessions, Time on Site, Pages per Visit, Bounce Rate, etc.)
DRI: Digital Experience
Optimize the user journey from ad click to conversion by considering the user experience of the Marketing site. Monitor and analyze user behaviour to identify opportunities for improvement and drive higher engagement.
Conversion Rate (Free Trial Sign-ups, Paid Tier Selections)
DRI: Digital ExperienceSupport: Digital Marketing, Product Growth
Improve the user journey from awareness to acquisition by focusing on the user experience of the Marketing site. Regularly test and iterate on strategies to increase conversion rates and drive customer growth.
CPA (Cost per Acquisition)
DRI: Digital MarketingSupport: Digital Experience, Product Growth
Optimize ad spend, targeting, and messaging to lower CPA across customer segments. Regularly test and iterate on ad strategies to maximize efficiency and minimize acquisition costs.
DRI: Product GrowthSupport: Digital Experience
Ensure users quickly discover value in the product, leading to higher engagement and a higher likelihood of conversion. Monitor and analyze user activation patterns to identify opportunities for improvement and prioritize product enhancements accordingly.
LTV (Lifetime Value)
DRI: Product GrowthSupport: Digital Experience, Digital Marketing
Improve product features, user experience, and retention to increase LTV. Continuously seek customer feedback, monitor user behaviour, and iterate on the product to maximize customer value.
DRI: Product GrowthSupport: Digital Experience
Reduce customer churn by improving product features, customer support, and user experience. Continuously gather customer feedback and monitor churn patterns to identify and address the root causes of attrition.
Sales Cycle Length (for Sales Assisted Growth)
DRIs: Digital Experience (for marketing-related aspects), Product Growth (for product-related aspects)
Shorten the sales cycle for Enterprise opportunities by providing relevant content, engaging prospects effectively, and addressing their needs promptly. Regularly review sales processes and coordinate with the sales team to identify areas for improvement and acceleration.
ROAS (Return on Ad Spend)
DRi: Digital MarketingSupport: Digital Experience
Maximize the return on advertising investments, particularly for Commercial opportunities. Continuously test, monitor, and optimize ad campaigns to drive the best return on ad spend.