From Trend to Tactic: What‘s Here to Stay in 2021
We asked the experts...
At the end of 2020, we asked the leaders of Insight Onsite's Centers of Excellence what has changed in their area of expertise. Explore what they believe to be the new normal.
Sales & Customer Success
Marketing
Talent
Business Development
M&A
Product & Technology
Innovation Briefing: 60 minute Agenda
Choose to hear from 2 Technology Solutions
5 minutes
Introductions
25 minutes
Topic Overview We invite a senior member of our investment team shares the latest trends in this particular topic. This is an exchange of ideas. This is our late-stage investor point of view on a specific topic.
Solution A: 15 minutes
Company Presentations Listen from the most innovative NextGen solutions. Depending on the number of solutions that you want to hear from, each one will get a 15 minute segment based on your choice.
Solution B: 15 minutes
Closing remarks
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Innovation Briefing: 90 minute Agenda
Choose to hear from 3 Technology Solutions
Solution C: 15 minutes
Remote Selling is here to stay (even after the pandemic). Companies that train their reps in effective video and email communication and who embrace new technologies will have a significant advantage over their peers. Re-evaluate your tools to ensure that they’re meeting the needs of remote selling. Revisit your message and make sure your team can deliver it effectively. Your opportunities to reach people are diminished during the pandemic so each one needs to count. Normal management activities take on a heightened importance. Each year companies revise their segments, evaluate their team’s talent and resource needs, and set a vision for the new year, but given the uncertainty and pressures of 2021, these become essential activities that can make or break a year. Trust your people – remote work life pushes us to function in a more asynchronous environment. Given that people are juggling schooling for children, taking care of parents and a hundred other tasks, they work at times that make sense for them. Regular team calls can be more challenging and burdensome on the team. Give team members some lassitude to work asynchronously. As long as productivity and results are achieved, the “how” can be fluid.
2020 changed a lot for sales teams as they adapted to the pandemic. Some of the changes are here to stay.
A quick review of last year’s changes:
Sales teams had to fundamentally shift from a focus on in-person meetings to being 100% remote. To enable customer facing roles to work remotely and be productive, companies invested in training and upskilling their teams on how to engage with customers more effectively over the phone and email (including virtual backgrounds to appear professional while working in bedrooms, kitchens and basements). Most verticals saw a drop in new logo business as customers tightened their budgets. So, sales teams searched for new revenue sources and found them in cross-selling and expansion of business with existing customers – sometimes offering favorable terms if they could increase share of wallet. Customer Success came to the forefront. The conversation focused on protecting the base which led to a heightened focus on assessing churn risk not just at renewal, but throughout the customer’s contract. This has become a major priority for most SaaS companies and is a core focus of CROs and CCOs.
The pandemic isn’t over yet and, while there are many positive signs, we need to assume that for at least the first half of the year, 2020 work practices continue. Here are our 4 take-aways as we kick off 2021.
2021 is shaping up to be another interesting year where the new normal is anything but normal. One thing is clear: sales management and selling software will never return to the way it was in 2019. Successful sales teams will adjust and learn new skills. When we come out the other side, they’ll be poised to capture even greater growth.
The only thing that marketers can depend on in 2021 is that change is the constant. But after 2020, where marketer had to both deal with the endemic change already occurring and fluidly responding to the evolving business landscape, it is not going to get easier 2021. Ultimately, successful marketing has never been about doing the same tactics year in and year out, but always about being ready for what is next. We got this!
Events are not dead…they are just different
Marketers who will be successful in 2021 will learn these lessons and begin to get ahead of the curve of change.
Customers were demanding to be known
A 2020 recap of marketing impact:
The only thing that marketers can depend on in 2021 is that change is the constant. COVID should be viewed as the “great accelerator,” as many nascent disruptions simply got accelerated. Marketers were on the front lines of these great pivots and were forced to respond rapidly to multiple new realities.
While some marketers were shocked when events were cancelled early in the pandemic, for many, it was a strange relief. No longer did they need to go to events simply to be “seen” or spend a disproportionate amount of their budget on this tactic with a weak ROI. Many of the best marketers were already building out their digital marketing muscle to drive demand gen. COVID only made this less of a progression and more of a mandate.
Live events were declining in importance
The overuse of email as a core tactic was waning prior to COVID. Equally important, mindlessly spending on paid search to drive a funnel without a coherent content and organic strategy was already being scrutinized as it was driving higher CAC. But the jump in ad rates for key search terms, as every business shifted their marketing dollars to digital, required marketers to take a new approach.
There was much being said about the importance of personalization and account based prior to COVID. But the reality that customers would ignore messages, SDR outreach, and digital ads that did not deliver a more personalized experience was sobering for some marketers during the early days of COVID.
“Rinse and repeat” tactics were losing their effectiveness
What worked in 2020…will not work in 2021
Marketers need to chart a new event strategy that includes, live, virtual, and hybrid. They will need to determine which tactics to leverage at the appropriate point of the buyers’ journey. Target customers are now more willing to do virtual, but it will be the appropriate event mix that will drive success.
Long live personalization
Personalization is a catch-all term for data driven marketing. If marketers want to connect, they will need to stand out and speak to their targets in ways that show they know them. Marketers will be required to harness intent data, algorithms, and multiple data sources to deliver account focused tactics that are personalized to particular customer pain points and delivers solutions that make sense for these targeted organizations.
2020 saw marketers bring back creativity. As they say, necessity is the mother of invention. Marketing leaders were forced to chart new paths, experiment with new tactics and messaging, and try things that were outside of their comfort zone. This was good for them in responding to COVID and will become the new normal. Over-reliance on any single group of tactics will simply not achieve the results that marketers will be required to deliver.
Talent: Diversity & Inclusion
Amidst all this change, HR leaders were also confronted face first with issues surrounding diversity, equity and inclusion. With the murders of George Floyd, Breonna Taylor and Ahmaud Arbery (to name only a few of those lost this past year), companies reckoned with how to discuss and address matters of DE&I in a way that was authentic and impactful. This included a self-examination of the makeup of their own workforce and company practices. Looking ahead to 2021, we anticipate this renewed focus on DE&I will continue. Diversity will no longer simply be a “nice to have” but the standard – and human capital teams will be central to this mission.
This year upended the workforce in many ways – and HR was central to managing through this disruption. Suddenly, HR leaders went from a supporting role to the center of the storm during a massive human capital crisis. From shutting down offices (nearly overnight) to dealing with employee health and safety concerns, a lot of responsibility fell on HR leaders’ shoulders.
Far too often, companies tend to source talent from the same exact pools – same schools, same events, same recruitment networks. As a result, companies are competing for the same top candidates. This often leads to a win-lose scenario where some companies will snag the highly sought-after top performers, while others will have to resort to less qualified talent. Additionally, recruiting in the same pools, creates a look-a-like effect within the workforce – with people from similar backgrounds and education. Over time, both will weaken the overall makeup and effectiveness of a company’s workforce. By expanding where companies source talent, including at HBCUs, at multicultural recruitment events, and through channels that represent a more diverse pool of candidates, they will find new gems and naturally build more heterogeneous teams. While there was a lot of change that impacted HR this year – most of which will have a lasting impact on the function – one of the biggest (and long overdue) effects, will be a continued rigor around diversifying the makeup of teams. With more diversity of thought, cultures, and backgrounds, software companies can ensure the products and services they ship are built for the many, not the few.
So, how can they accomplish this? Short answer: It is time to fish in new ponds.
Business Development: Insight IGNITE
2020 impacted large corporations like everyone else – travel, meeting with colleagues, engaging with customers and innovation changed fundamentally. Corporations had to build a framework that supported the new digital-first reality.
Cost take out was also at the forefront as the duration of the crisis became apparent, with tighter budgets across the board. For some companies cost could be reduced through the acceleration of cloud transformation and automation programs. The need to complete these transformations was pushed to the top of the boardroom agenda, and the role of the CIO was thrust to the fore.
there were two types of response to this seismic change:
For sectors where the crisis substantially diminished their ability to operate (e.g., airlines, hotels), their option set was more limited and they were forced into survival mode, prioritising cost reduction over continued digitisation and innovation.
Those corporations whose core business was less affected by the situation, or for whom digital was already a priority, were able to ramp up digitisation quickly and innovate through the crisis. They responded by adapting their working model (e.g., embracing Teams or Slack), their IT architecture (e.g., shifting to the cloud), and in some cases their business model (e.g., going direct to consumer).
2020 impacted large corporations like everyone else – travel, meeting with colleagues, engaging with customers and innovation changed fundamentally. Corporations had to build a framework that supported the new digital-first reality. All industries were affected by the pandemic. While virtual and remote work had already been a growing trend, most organisations were planning a multi-year re-balancing of their workforce. Instead, the vast majority were forced overnight to transition to a virtual workplace. One leading financial services organisation moved ~200K colleagues to remote work, in just 11 days. The scale of the change was unexpected and unprecedented.
looking back, we see commonalities in the steps that companies have taken to adapt their digital posture.
Since customers and employees are virtual, improving digital customer and employee experience became imperative. This was reflected in increased interest in tools that supports continuous product development and applications that enable remote productivity and collaboration.
The virtual workforce led to a scramble to support and secure an extensive virtual footprint. As a result, there has been a significant up-tick in demand for cybersecurity technology, in particular, end-point security and secure permissioning.
2020 broke the dichotomy between the two modalities that IT leaders typically pivot between, namely innovation and cost containment. Because the pandemic struck so fundamentally at the way G2000 companies operate, organisations were forced to innovate through the crisis, and many used it as a lever to digitise and become more customer centric. The CIO had the strategic impetus to accelerate digital-first adoption precisely because innovation drives competitiveness and can also lower cost.
In an accelerated change environment, talent gaps were also more apparent. Cloud, develops, continuous deployment, among others, all require new roles and skills. Enterprises have an accelerated need to train people, to ensure technology adoption and to automate tasks.
The acceleration of innovation in digital change looks to continue in 2021, and we may even see a permanent shift to this high pace. We already know that the virtual or hybrid workplace will be a permanent part of the office landscape. For CXOs in the IGNITE community it’s more important than ever to be plugged in to the ScaleUp software ecosystem, able to access the technology that will drive change. This also means leaning on personal networks to learn from others and investing time in cultivating and growing new connections – even if they’re virtual for now.
Enterprise Automation
M&A activity across the Insight portfolio did not miss a beat with Insight’s ScaleUp companies closing 66 acquisitions in the first 9 months of last year (compared to 82 in 2019 over the same period). As many companies reevaluated their product priorities through COVID and WFH, they made the decision that ‘buy’ was a faster, more cost effective way than ‘build’ for key roadmap items that were slightly outside of their core focus areas. Sometimes that ‘buy’ was also a means of quickly adding a team of people that could do the ‘build’ faster than hiring (i.e. acquihire). In 2020, we saw companies make acquisitions for more product and team acquisitions than in-line consolidations (customer and geographical expansion) compared to previous years, as small, single-feature companies struggled to get traction faced with the tightening of customer budgets during COVID. Riding out 2020 together as a larger ScaleUp platform with more scale, flexibility, and resources proved highly attractive to both acquirer and acquiree. For targets, the motivation for founders was the opportunity to join a larger organization and roll in their stock at a higher value, along with the upside from being part of a company with a proven go-to-market motion — founding teams can focus on building great product, while the acquiring team can focus on execution and customers. As we kick off 2021, we believe that markets will continue to pay high multiples for growth, both organic and inorganic. As companies build out strategic plans for the year(s) ahead consider all avenues to achieving your growth targets. Insight fully expects to welcome many more acquisitions to the portfolio!
Inorganic growth is an attractive additional growth strategy for ScaleUps. It continued apace in 2020.
2020 saw a rise in ScaleUps (such as Aqua Security and Armory) leveraging Commercial Open Source Source (COSS) models, especially at the infrastructure software layer.
Infrastructure Software
B2B customers are also working from home. With remote selling, product teams have stepped up to support customer acquisition through changes to the product. PLG (product-led growth) is visible in multiple ways from free trials to freemium models to a complete no-touch customer journey. Many software companies have shifted some of the burden of lead generation and customer acquisition to the product, and thus to their product teams. Product Led Growth (PLG) is front and center in 2021 planning for product leaders (Keep a look out for Onsite’s Product Center of Excellence PLG handbook to be released in Q1, 2021).
In software development we are already living the new normal - the pandemic slingshot us forward along a path already mapped out. Some companies may return to full colocation, but everything else is here to stay: the tools needed to better collaborate remotely and the models to measure R&D performance. Will ScaleUps remove their new freemium offerings and shift the burden of new bookings back to their Sales and Marketing teams? Not on your life. More than ever, product is the cornerstone of customer acquisition, retention, as well as innovation.
What areas were accelerated?
Product
The events of 2020 acted as an accelerant on a slow burning fire across product and engineering teams – the changes in working methods were simply a quickening of the trends that have been driving industry practices over the last 10 years.
Remote Work
Prior to 2020 product leaders were on the fence about remote work, with some organizations supporting it, some fully embracing it, and others ardently focused on colocation as essential to problem solving and innovation. As the pandemic hit, ScaleUp software companies faced the stark reality that their development teams needed to be able to work from anywhere. For many, surprisingly, the new work paradigm was as foreign to product teams as it was strange to sales and marketing teams.
The tools needed by teams to collaborate, communicate and to deliver software products have improved. Even if companies already had the basic tools like VPN, cloud-based environments, and collaboration tools, it was evident that most companies have not addressed their tooling issues adequately for remote working and that a wholesale upgrade of tools for work tracking, collaboration, video conferencing and cyber security needed to occur. As we all switched to products like Zoom, Slack or Teams, it became clear that just seeing people and sharing our screens was insufficient. We needed better ways to collaborate, communicate and manage our work. With collaboration products like Mural we were able to think together as a team. With Monday we were able to coordinate our work and escape the constraints of traditional ticket tracking systems, and with Gtmhub we can align our teams to OKR’s set across the organization. When you think about your current tech stack in 2021, are your teams currently flourishing because of the tools they are using or are they just simply able to communicate?
Tools
Visibility & Communications
With remote work we think that we’ve seen something amazing: we think that people have been as productive, if not more productive, than before. We “think” because it has become strikingly obvious that we have very few capabilities to measure performance in software teams. Previously, all of our observations were subjective, so that in a remote world, leaders have scrambled to find ways to provide objective views of performance across their newly distributed teams. Fortunately the events of 2020 have made this gap painfully clear and we are seeing companies like Jellyfish stepping up to fill the gap. After several years of research and working directly with customers to evolve their platform, we are excited to say Jellyfish is providing visibility into how our teams perform in a realistic and an effective way unlike the myriad of tools that have attempted this in the past.
Customer Interaction & Acquisition
This is a trend to watch. For a more in-depth discussion of this topic, see Insight MD’s keynote
The ability to manifest an open standard as code, ensuring that all participants in the market are building to the same chassis. This can commoditize the open layer but significantly increase the value of adjacent layers. With COSS companies can harness distributed brainpower and code check-ins with a meritocratic process from across the globe. Customers and partners of companies using COSS can feel comfortable that they can build on top of a piece of infrastructure without having to worry about access changing over time. High use of the Freemium business model for quick land opportunities, with upsell to a "pro" version that has more features, or a public cloud hosted version. Increased business transparency because users can see the code and can edit if needed. This creates a sense of agency and control, rather than dependency and lock-in.
This trend will continue in 2021 and is enabling a number of specific tactics