Win by Focusing on Your Core Users

0:08Hello and welcome to another episode of the duct tape marketing podcast. This is Jon Jantz. My guest today is Shane Murphy Reuter. He's the president and go-to-market, I guess you just call that GTM, don't you? At Calendly, the platform helping individuals, teams, and organizations create better meeting experiences by simplifying complex scheduling. He's focused on driving brand awareness and demand by ensuring alignment between sales, marketing, and CX. So Shane, welcome to the show. It's great to be here. Yes, we shorten it to GTN, but call it whatever you want. Yeah, no, it's awesome. You're a big fan of the show, so great to talk.

0:47Thank you. So I'm going to talk about, I'm going to ask this question in the context of Calendly, but I think that this applies really to a lot of businesses out there. I mean, Calendly started as a small idea of a technology for scheduling, just scheduling, and it's certainly grown to something much bigger. That's something that I think happens to a lot of companies. You want to talk a little bit about, and I know you haven't been there from the beginning, but you want to talk a little bit about the evolution of that thinking in Calendly? Yeah, yeah, of course. Well, I've actually only been at Calendly now, I think four months.

1:21I like to write it down, you know, the expectations are lower. And so, yeah, I haven't seen the journey from inside, but actually I've known Tope, who's the CEO of Calendly for about five or six years. So I've been very much watching it from the sidelines. And I would say also, if you look at my background, the companies that I tend to join are at a very similar stage to Calendly, where they've, you know, invented some new technology to solve some sort of pain point for a customer type and then have that exponential growth when they sort of like crack the market a little bit to get that product market fit.

1:54And then they start to think about, well, okay, we're, you know, maybe growth is starting to slow a little bit in that original market and where to go from here, you know? And I think Calendly has been on that journey. Originally, we solved just that scheduling problem, that one problem, right? How do two people schedule a meeting together? And it's been very, very successful. But now the question is, well, how do you extend from here? And I think a lot of companies get that wrong, frankly. Like, I think there's broadly two paths, right? You either take the technology that you've built and apply it to different markets, or you take a target market or a customer segment that you have strength with with your original product and then extend the product offerings that you provide to those customers.

2:39And certainly Calendly's strategy from here and hopefully very, very soon we'll be launching our second major, major product is to really extend the products that we offer within a certain target market because we just believe there's massive opportunity there to solve other points in the relationship management lifecycle for our customers. So it's been, yeah, I've been here four months, but I think that Calendly is on like a pretty classic journey that I've seen a lot of companies go through. Do you feel like you are on the journey to define a category or you have defined a category? You mentioned relationship management.

3:12I don't know that people would have applied what Calendly initially started doing to that term. I mean, do you feel like you're categorizing, you know, a new way of working? It's a great question. I think scheduling our original product, we created the category, right? We are now basically the Kleenex for scheduling, which is amazing. I think the challenge, though, with it is different categories of different towns, right? Different total addressable markets. And I think for scheduling, it is a relatively narrow use case, right? Like, while it's extremely important for our customers, it's narrow, but we have this incredible hook into the customer, and so how can we add more?

3:54And to be fair, I think for a go-forward strategy, you think about relationship management software more generally. No, I think the new areas that we'll go into are existing categories like, I don't want to give up our product roadmap, but you can imagine the types of other relationship management softwares that are out there, like the CRMs, et cetera. I think where our unique advantage is really in the customer types that will go in service. And I think that if we can build the software with hyper-focus on kind of these SMBs and solopreneurs, I think that we can have great success relative to the incumbents that are in the market.

4:30So to answer the question more directly, I think we've done this category creation thing with scheduling, and we'll continue to hopefully dominate that market. From here, though, I think it's more about innovating within how we deliver in existing categories. I'm sure you maybe talk about this in closed-door meetings. maybe worry about it even sometimes. But how does a company like Calendly, especially in the early days when you essentially created a product that had a certain set of features and the Microsofts, the Googles of the world could easily squash that, one day wake up and say, we're going to do that.

5:07How do you kind of ward off that? Or do you worry about, again, I know you've grown to the point where you probably have more market share and scheduling than some of the big people that could have done that but do you ever sit around and worry about hey we have to create more features or get more hooks in so that we're not just this one trick pony that gets squashed yeah that's a great it's a great question and for sure i think if you look at it from the outside you you may imagine that something like scheduling is very very easy to replicate and i think this is where this hyper focus on your most fervent customers is so important if you talk to the majority of our customers, their time is their money.

5:50A lot of them actually sell their time. If you're a coach, you're a therapist, et cetera. And then others are, if you're in sales, your time is how you get out there. And therefore, an incredible scheduling experience is really important. So for sure, there are many competitors out there, lots of competitors. But because they just don't have that hyper focus like we do around the true intricacies of the details of the problem set of our customers they have not been able to compete and for what it's worth when we look at our data for sure we're hearing a little bit more about other competitors popping up as you would expect as any company scales but in reality it's not impacted our business in the way that i think from the outside in you would expect and so we actually think that we have a better opportunity need to disrupt other incumbents than the other way around, given just how critically important this is for our customers.

6:44They're not going to go and buy a slightly less good product. They're just not going to do it. They want the best. You know, one of the things I've seen software companies do as they, as they grew is like, oh, let's take on this and this and let's do email and let's do, you know, the CRM part of it. And it makes a lot of sense, right? It's like, oh, I've got this end-to-end product, but then they make compromises in every single category because it's very hard to have the one thing that fits all. I mean, is there any danger you think in trying, you know, for somebody to actually start trying to take market share by adding, you know, more product that's already out there and actually diluting what they're good at?

7:21It is an absolute risk and one that you need to be extremely careful of. And so every company I've worked at as we've gone on this multi-product journey, there is a constant debate around how much resource should you put into continuing to improve your core product versus how much should you put into new innovative areas so it is a is it a bait and we will never stop innovating on our core of scheduling i do think though as you think about like the product areas that you move into the question has to be well what's your unique unique advantage to win there and i don't like i've seen companies just sort of go we're just going to go in there we're going to build in And they say, well, okay, well, you really thought about the strategy and it can't just be like a price thing, right?

8:05That's not enough. And I think typically that unique advantage tends to come from, as I said before, one either is some sort of technology advantage that you have. I'll give an example of Webflow where I worked at last. Webflow's unique technology advantage was that built a way for you to manipulate code in a visual environment. And very easy for them to take that technology and move it beyond just building websites. into how you build other types of technology. They have a technology advantage they can apply to different markets. For Calendly, I think the reason Calendly has been so successful is our two things.

8:42One, I do think that we have a unique penetration within a type of customer that I mentioned before that we really understand and can, as we go into these new areas, make sure that we're addressing their unique needs for a new product. Because like cars, right? before it used to be Model T, any color you want as long as it's black, which is fine when you've got a technology advantage like Harry Ford had. You had a technology advantage, so you mass market it. Now, that's crazy because that technology advantage no longer exists. You have every million type of car for different types of very specific segments of the market.

9:19And so as we think about our go-forward product strategy, I think some of it, I wouldn't say we necessarily have a technology advantage, but I think that we have a data advantage in being hooked so clearly into our customers' most important thing, which is their time and the data around that. And then we have a unique advantage, I think, in making sure that when we build those new product areas, they're beautifully connected and integrated with scheduling and that we build for that segment. And we don't try and build the Model T. We try and build a very, very, very tailored experience for the customer set that we know that we have the greatest right to win in.

9:56And for what it's worth, we also believe that the incumbents in the relational management software market have left that market behind. And so I think there's a great opportunity for us to win. But back to your original question, yes, of course, we need to balance and make sure that we're not underinvesting in our core. I use the phrase internally at companies that if you kill the cash cow, nobody gets milk. and so yeah you want to make sure that the the core business which is for us scheduling continues to we continue to innovate in one of the things that's really tempting as companies grow to the size that Calendly has now I mean some of your original customers clicked on a button signed up it was just them in their in their house you know doing scheduling and it worked for them it was awesome it was easy no friction and now you're starting to have enterprise that that security and adoption and, you know, uptime and, you know, all these kinds of things really have to be sold.

10:56How do you message, first off, we can talk about operationally as well, but how do you message to such distinctly different sales channels? Yeah, it's a great, great question. I think about this through two different lenses. The first one is obviously the who you're going after. And for what it's worth, typically in enterprise companies, particularly for a company like Calendly, the user within that company tends to test it out first. And the user is the person that has that problem. So a salesperson within an enterprise company will go, this is really painful scheduling. I've heard by Calendly, I'll go check it out.

11:36And they'll come in through our PLG funnel, our self-serve funnel. and how you sell to them and the message for them is extremely similar as the message to a solopreneur in SMB because they are the user. They have this actual direct pain of the plot it solves. And so I think that in a lot of ways that is consistent. Now, of course, if you've got that person in your funnel, who is the user within an enterprise, your job now is to use other channels to go and directly target the procurement team, the security team, the actual economic buyer with very targeted messaging. And this is typically through a sales team.

12:15We can also be using things like account-based marketing to go do that so that you bring your enterprise value proposition to them. And this is like classic in SaaS. This is why if you go to most SaaS websites, unless they are purely focused on the enterprise market, the homepage will be very directed at the end user and they will have an enterprise section which tells their full enterprise value proposition and their pricing and packaging. Most of the packages are designed for the actual users and they've got an enterprise package designed for those other people that you're trying to sell to.

12:48And so I think it's about, and finding the balance of that depends on your business and the degree to which it's like your opportunities in the enterprise versus in the SMB. And so I think you need to do both. But I think my key point there is that even in the enterprises, there are, where you're going to get the adoption is getting a end user to love it because they end up becoming what we call in the, in sort of go to market, the champion. They're going in, hey, boss, we've got to use this thing. Here's how much time it will save me. If you don't get the champion, if you don't get that user to care, the procurement team, the security team, they don't give a shit.

13:26Oh, sorry. Shouldn't have said it. They don't care. And so I think that's the key thing that I think oftentimes people miss. So is part of what you've been brought to do is build a sales team or is there already a sales team that's on the ground? Yeah, we already had a sales team. So when I joined, Alan Lee had already gone on the journey to build an enterprise product offering, an enterprise sort of package and team. I think what I'm trying to do is blend the self-serve and sales experience in a more natural way. So again, a lesson that I've had, pretty much every single company I've worked for in B2B has had a combination of self-serve or product-led growth and sales-led growth.

14:07And typically speaking, they tend to be pretty siloed on islands. And so what happens is you either have this experience for the customer that's fully self-serve, maybe a reactive support team, but pretty much self-serve. and then if you're willing to buy the enterprise package, now you go through this like really human intensive experience. The SDR goes to the AE, goes to the, you know, account management team with implementation. And it's like, it makes actually no sense if you think about it from first principles, why it would be such a binary distinction between the two. And so I think a lot of companies are now realizing, you know, things like velocity sales or, you know, much more softer touch sales to still support the customer.

14:48but also get out of the way if they want to just like adopt and use and so the team had already started to do some of that work but it's it's a lot of what i think about a danger is how to how to how to blend the two in a more natural way just get rid of a few of the acronyms that would help right so so have you have you found and this may this may be a tough question for you to answer you may not want to answer this but have you found that that the role that you've been brought into play is new. And has that required a mindset shift because of the way the company's grown, because of the company culture?

15:22Again, you don't have to talk specifically about your experience as much as I'm sure other companies have experienced those kind of growing pains too. Yeah, it's a great question. Like I think what a lot of companies are starting to realize is, and in my experience is that particularly technology companies are founded by technologists. And so a lot of the time they start self-serve, right? They go, well, we can just set up a sign-up link and people can just buy it. And then at some point, a board member or somebody said, hey, we've got larger customers here. You need to build an enterprise offering.

15:53They go and hire a head of sales from some enterprise company. And that person brings a playbook and drops this very classic sales experience on top of the self-serve base, creating this sort of siloed nature and this kind of like, and so I think a lot of companies, and there's probably been about 10 years of evolution of that happening. A lot of companies are starting to really feel the pain of those things being so disconnected. And so it is becoming more common to bring in a person running all of go-to-market, particularly in companies where they have both experiences in their business for all the reasons that I described.

16:32Because in the traditional model of having maybe a CMO who runs the self-serve side and a CRO or head of sales who runs the sales side, that traditional model actually beds in the fact that these two things are on a silo. And so I do think that it's increasingly happening that whether they just use the term CRO to own all of it or a president of go-to-market like I am, a lot more companies are doing it now. I'm going to get you in trouble here probably. But do you think that the way that salespeople are incentivized really actually exacerbates that problem. It's a really great question. I actually remember listening to Bill Mesitis on a podcast who was the, he was head of a CMO at Slack.

17:17I think he was at Zendesk, like kind of a goat in the industry. He talked about, I think it was at Slack bringing in for the sales team that part of their compensation was linked also to a customer satisfaction of the sales process. Anyway, I just thought I'd share that. But yes, I do think that there is a, I think in the more enterprise end of sales, having incentivization to ensure that the sales team do a good job of maximizing the revenue potential is important. So like if I'm not incentivized, what I'll do is I'll say, oh yeah, okay, well, maybe I'll maximize the discount that I give. Or I'll say, I won't try and bother multi-product sell.

17:58I'll just say, just get them in on this one product. And so in certain instances, you do want incentives for the sales team to push for the largest value sale as possible. And incentivization with commission structures, et cetera, can be important there. And so, for example, like Calendly, our enterprise sales team absolutely are commission-based. And I think that's the right approach. In a more velocity sales model that I mentioned before, where it might be lighter touch, you're semi-helping a customer, like a support, right? You're answering questions. you're doing somewhat of a value sell, but not the full thing, I do think that you want to be very careful not to have like a traditional model.

18:39And so, for example, at Calendly, we don't write their more salaries. And so I think you just need to apply the right incentive structure based on what are you trying to incentivize these people to do. And so I do think that there is a place for it, as I mentioned, but maybe not across the board on a sales team. All right, let's end today on a product question. I think this might be a record. I think we're 20 minutes in exactly. And then I'm the first mention of AI. So how is AI going to impact the product from what you know so far? Yeah, that's a great question. So I mentioned that we believe this is an opportunity to innovate in the relationship management software space for SMBs and solopreneurs, you know, so the smaller companies.

19:28One of the reasons that up until now, it's been difficult to build this type of software for those customers is that typically those software, types of software need like an army of operations people to set them up and manage them. Like if you talk to companies who have Salesforce or Marketo or any of these, there's like job boards of like, you know, kind of all these ops to manage these tools. And so if you're at SMB, that's really challenging, right? The beautiful thing is that we're going to start entering the space just as AI is getting to the point where they can start automating a bunch of the what used to be a take a lot of operational time and effort and so you can imagine a world where like you know today is CRM even in most cases still looks like one of these sort of like databases right line items just a relational database right yeah exactly right and why does that exist because it was a record keeper it was just a database right in the world of AI that all happens automatically.

20:24Now a CRM or relational management software can be actually about surfacing the insights and actions of things that can truly lead to you creating better relationships. And so I think it's a beautiful time for any company to start thinking about innovating into a new space because you have a blank sheet of paper to define the way you interact with this product in an AI-first way, which I think the incumbents are going to really struggle with. And that's why a lot of the incumbents are doing the co-pilot thing, right? We've got this chunky, hard-to-use software. So how do we use AI? We'll give you a button to help you to figure out how to use a really hard software.

21:06Well, the other way you could do it is actually design it from first principles in a way that's really easy to use. And so anyway, we think that there's a huge opportunity there. And for sure, our Prada roadmap from here is like AI first. And we're trying to think about everything from that lens. Well, Shane, I appreciate you taking a few moments to stop by the Duct Tape Marketing Podcast. Is there anywhere you'd want to invite people to connect with you? I know, obviously, Calendly is where they can find out about the product, but anywhere you like to hang out? LinkedIn is the best one. I used to be in other places, but I think we can safely point people to LinkedIn for now.

21:42Yeah, awesome. Again, appreciate you stopping by and hopefully we'll run into you one of these days out there on the road. Thanks so much, Sean. It was a pleasure. so