Having founded one of the most successful start-ups in Estonia – Pipedrive, Andrus has moved on to his next venture called Outfunnel, a sales-centric marketing automation tool promising to merge the gap between sales and marketing. Given the nature of the product, Andrus is no stranger to B2B marketing. Launching a start-up means a lot of juggling between different departments which gives him a great outlook of all business aspects. I tried to pick Andrus’ brain on the lessons he has learned during his long journey as a leading startupper.
· What’s the concept behind Outfunnel?
Outfunnel is a sales-centric marketing automation tool. Despite there being a lot of good marketing or sales automation tools, I have yet to see one that merges the two. It’s hard to combine existing tools. The outcome is either lacklustre or terribly costly. Outfunnel integrates data from both departments, meaning everyone has a view of what’s going on in the company. We started by integrating available tools, but the goal is to create a universal solution easily compatible with other software. It’s never a good idea to be a small player in the middle because you’re dependable on two stronger parties.
· How is Outfunnel doing today and what’s the ambition?
Outfunnel was launched back in spring 2018. Within a month we got our first paying client. We’re currently working with around 100 clients. There’s five of us at Outfunnel and we’re actively searching for new people. Most start-ups fail within a year, hence we’ve managed to cross the first milestone and the feedback has been very positive.
Packages range from 15-99€ per month. Given the amount of clients we have – it’s not an enormous sum. Then again, there are billions of dollars within the marketing automation industry. Outfunnel’s goal is to resolve this problem in the best possible way, thus becoming an influential player on the market with a strong share-of-voice. It’s not about size as much as about reputation. We went for English speaking countries first, but we already have clients from 20 different countries.
· Can you describe the customer journey? How does one find Outfunnel?
Today we can distinguish two separate journeys. The first is based on Pipedrive’s existing clients who are looking to get more out of the software or a solution for a very specific problem (automating newsletter campaigns for instance). Others find us through Google. Search and partner marketplaces are very important for Outfunnel.
· Would you say reputation and awareness are important for Outfunnel?
Both are absolutely crucial for any kind of company. This interview is a step towards greater awareness. I wasn’t hoping to gain any new clients from this rather than provide some legit advice and grow the brand. Considering that giants like Facebook and Google are constantly increasing their prices and there’s more competition in SEM than ever before – long-term brand building is the only way to go. Consequently, we’re now talking about events, ads and content.
· I assume your experience with Pipedrive can be easily implemented to Outfunnel?
You can certainly draw parallels, but 9 years have passed since Pipedrive was founded. Channels are very different now. Saying that, people still use the same methods when looking for solutions: Google and friends. That’s why Outfunnel has optimised its initiatives towards these two. There are a lot of options when it comes to search (from SEO to social media), but it’s a bit trickier with reviews. You need an outstanding product, a clear message, a good overview of the triggers that push your customer and a strong brand that people will recognise.
If we look at some key principles start-ups should follow, then I would advise you to invest 99% of your energy into finding the first customer and 1% into building your brand. As you grow stronger, you’ll have more resources for the latter. Focus on early adopters, who are more interested in the solution rather than the brand. They will spread the word if the product is good enough. Ask for recommendations/reviews. The vast majority of customers will never buy a product they’ve never heard of, hence you need a strong brand. We’re still working with the first batch who mostly find us (not the other way around). We have website with a blog section, social media pages, Quora and partners (Mailchimp, Pipedrive).
· Be it B2B or B2C, reviews in relevant media play a huge role in business growth. Any tips here?
Marketing software reviewers are mostly quite open to newcomers. Alternatively you can create an account and wait for reviews, but I would advise you to approach this strategically. Ask your clients for reviews. It requires a lot of work but it will be worth it in the end. Fancier reviews are important if you’re targeting huge corporations. SMEs are looking for good marketing tools and opt for a community based approach. Small yet relevant community sites is our primary focus now. Results come from simple user-to-user recommendations. During 5 years Pipedrive didn’t have a single professional review. That didn’t stop us from growing?!
· What’s your take on social media?
Organic reach has plummeted in recent years, but it’s not completely useless. For start-ups it’s about employer branding and boosting your content. Social media is good for brand growth and awareness, not for sourcing leads. Personally, I don’t see it as my go-to marketing channel. I’m sure there are companies who can prove otherwise.
· Do you engage in active sales? LinkedIn is gaining muscle as an influential sales channel for a lot of companies.
Outbound marketing means higher prices. Considering our rates, I don’t think it’s a good approach for us. I’m a true believer in the inbound approach because it’s easier. Your product attracts clients not the other way around. It requires a lot of patience (6-12 months) and a significant amount of financial resources, but as an entrepreneur you should never expect quick results.
To be honest, I think there are quite a few things out of balance in today’s marketing. LinkedIn Inmail is a perfect example of that. Bombarding people with cold messages is unfortunately a common practice by now. I love marketing when it’s done with integrity.
· What’s your view on email marketing?
Email works quite well (even by spamming). However, the more you spam, the more you irritate people and as a result, filters become harsher and we all lose a good channel.
As a marketer you should put some effort into what you’re doing, that includes email. Firstly, take every possible step for people to give up their email addresses willingly. Offer some value. First you give, then you take! Secondly, do your homework. It’s better to send newsletters to fewer quality contacts. Find your ideal customers and talk to them first. Moreover, I’ve noticed a trend where you keep getting emails until you reply actively. This is criminal! We don’t have the right to throw out so much garbage into the atmosphere, please don’t go beyond 2-3 reminders. And finally, don’t use cringey sales jargon - work on your copy.
· Content marketing is plagued by the same disease. What’s the balance between sales and dignity?
Content marketing puts people first. Bad content doesn’t gain any traction, hence there’s no harm done. Of course the amount of content is exponentially growing and you need to put in a lot more work in order to raise awareness. Good news for professional marketers because amateurs are out of the picture.
The sales element really depends on your target. People who google marketing automation software are looking for technical details and are probably quite willing to make a purchase meaning that you can have a stronger sales element within your content. People searching for abstract terms are further away from the final deal. They’re looking for educational material. At this stage it’s wise to gather their contacts in order to stay in the picture once they’ve moved further down the funnel. And then finally, you have the people who will never buy your product. Just make a sexy visual for social media and hope they’ll remember you. Everything you do should be divided between these three groups. When you’re at the beginning of your journey, focus on the client with most purchase intent. The more you grow, the more you can invest into other target groups.
· Outfunnel operates on a global market. How do you prioritise regions?
We started by spending a lot of money in order to identify key regions with most interest towards our product. You target several regions at once, look at the data and calculate the lifetime value of each region’s client. Half of your marketing budget will always go to waste. Thanks to digital marketing you now know which one. I cannot emphasise enough how important it is to experiment. Every company should allocate at least 25% of its budget to experimenting. You shouldn’t see it as wasted money, your investing into education!
Interviewed by Hando Sinisalu.