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Hubspot Case

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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.

HubSpot is still a young firm that is trying to satisfy the needs of a very large market. This can prove rather difficult. If they chose to focus on a narrow segment/industry, the engineers can work to build the product for that specific industry. Once the product is in good shape to satisfy the needs of that industry, they can venture out into other industries as well.
It also makes it easy for HubSpot to standardize its processes across all customers. The narrow focus also eliminates some of the pricing challenges that come with targeting clients from multiple industries and segments.

Should HubSpot target B2B or B2C customers?
-Use a mix of qualitative (strategic) and quantitative (CLV, market potential) facts to argue your point. Do not restate points from the case, but use them to support your decision.
-Will this group be receptive to the product? I.e., is HubSpot providing value to these segments? Is there competition in this market? Is HubSpot well positioned to serve these customers? Are there any other outside forces we should consider?

HubSpot could target the B2B segment for a couple of reasons. Firstly, customers within this segment generate a lifetime value of $7368.4 for HubSpot, over two times that of a B2C customer. Secondly, most B2B companies have higher budget allocations for inbound marketing compared to the B2C companies. Since B2B’s typically sold complex products that required buyers to undergo in-depth training, they derived more value from HubSpot’s inbound marketing tools. This is also reason to believe that B2Bs have much lower churn rates that B2Cs. Data shows average churn rates for B2B segment has been much lower (3.3%) than the B2C segment (6%).

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