The Signals of B2B Category Creation | Featuring Anthony Kennada
How do you know when your marketing efforts are merely distinguishing yourself among your competition or creating a brand new category that needs a name and identity.
One’s a harder lift than another.
Newly appointed as CMO at Front, Anthony Kennada knows the challenges ahead. While leading marketing for Gainsight, he forged a new path for “Customer Success.” His front lines experiences combined with lessons learned from HubSpot and others make up the basis for his newly released book, Category Creation.
In our interview
, we discuss:
- What is Category Creation?
- Is creating a new category a good idea for every company?
- Are Gartner and Forrester still relevant?
- The signals that you should pursue category creation
- Lessons learned from being a CMO
Anthony has been inspired and pushed by the work of Dave Gerhardt.
In our interview, Anthony discussed Is Category Creation Right for You? In his book, he presents a list of signals. He has given us permission to provide this helpful list of questions at no cost. Click the button to the left to receive your copy of the signals.
Anthony’s book is available in print, audio, and digital formats at Amazon, Audible, B&N, Books-a-Million, and all major book outlets.
Golden Spiral has shepherded several clients into new categories. Read more about our experience in this critical endeavor:
Category Creation: The Power of Defining Your Buyer’s Problem
Do You Have What it Takes to Be a Category Creator?
10 Category-Creating SaaS Companies
Transcript
Mark Whitlock: How do you know when your marketing efforts are merely distinguishing yourself among your competition or creating a brand new category that needs a name and identity. One’s a harder lift than another. How do you know what you’re doing or what you should be doing?
Hi, this is Mark Whitlock with Golden Spiral with another interview with a thought leader in the B2B tech world. I’m going to be speaking with Anthony Kennada, who is the new Chief Marketing Officer for email SaaS product, Front. And Anthony has spent time at other B2B tech companies as well as a venture capital company, specializing in funding companies like yours.
So I wanted to sit down with him and talk to him about his new book, Category Creation, and talk to him a little bit about what he sees as the main challenges. Golden Spiral, as you know, is an integrated, full-service marketing agency. And from time to time, we’ve had the task of helping companies create a brand new category for their SaaS products and I wanted to talk with Anthony some about that.
So here’s my interview with Anthony Kennada. You can also read the full transcript or the short article derived from today’s interview.
So I’m pleased to be interviewing Anthony Kennada today, the newly appointed CMO at Front. Anthony, tell us about Front and tell us how you got there.
Anthony Kennada: Yeah, thanks so much Mark, appreciate you having me on. So Front is, I’ve officially been there now for about a month. The company really is kind of challenging the idea of where does work productivity start from. We’ve kind of created all of these different apps that we can go into, different tabs that we keep open to go and and find our ability to be productive. But at the end of the day, the most common, ubiquitous channel for communication in business is still email and we’ve tried to kill email over the years. We’ve tried to do a bunch of things to get rid of it, but email still is the heartbeat of how companies communicate. And so Front’s approach is, let’s not give you another thing to have to check, but rather let’s make email kind of come into the 2020s from the business context perspective. So they’re basically supercharging the email client to help companies be more productive at work.
Mark: So Anthony, you’ve released your first book, right? Which is on category creation. Why category creation for your first foray into publishing?
Anthony: Yeah, so my… Previously I was at a company called Gainsight that I joined pretty early. And Gainsight basically observed that we’ve gotten so predictive as marketers and salespeople in predicting our ability to hit the number, but as companies are getting moving to a subscription business model, SaaS is becoming more prolific.
Now, it’s getting super… Just as important to kind of save and retain and expand our relationships with our customers as it is to get them in the first place. But we didn’t have this sort of predictive way of knowing if a customer was going to leave us or if a customer was showing signals that they were going to grow.
And so our approach to that was to really help evangelize a new practice called customer success, which would sit alongside sales and marketing and be able to carry this kind of retention, renewals, expansion kind of number. Now the challenge is that role didn’t really exist. There was a niche community of people who called themselves “customer success managers.” But what we didn’t have was a company in the market that was fighting for them, helping advance the interest of that profession and also developing technology, operationalize that job.
So we found ourselves in a position when we were first starting out, okay, how do we do this? How do we position a problem and a solution in our products that no one’s ever heard of before. It wasn’t a typical kind of disruption playbook where there’s a competitor in the space or people at least fundamentally understand the problem by name. We had to go and create that awareness.
And so we found ourselves creating a category as we were doing a bunch of different things, but there weren’t resources for how to go about and do this. And so what I wanted to do was basically canonize a lot of the different things we learned over the years and sort of creating a new category, building a big brand. I wanted to get research from other folks that had done it as well. And so the hope is that entrepreneurs, founders, marketers that want to go and do this now have a tactical playbook that they can go and use to execute on creating their own category.
Mark: A lot of the folks listening to this interview right now are familiar with the Gartner Quadrants. Is that kind of where you’re headed here? Let’s create a new quadrant and there’s radar screen and have that go out of there. Is there something else at work here?
Anthony: I dedicate a whole chapter to this actually. If we were to write this book maybe a few years ago, the whole book would be all about how do we influence Gartner and Forrester and these other analysts to write a quadrant, create a quadrant or a wave about the thing we’re working on. And we find that we spend a lot of money. We spend a lot of time and resources trying to influence them. But it’s such a black box in terms of how that actually happens. And so I think what we’ve found is there’s been a lot of trends that have sort of moved us away from needing a intermediary to say this is a category created. Customer voice is more powerful and accessible than ever before. So there’s review platforms like G2, TrustRadius and so many others that are giving us an ability to show market leadership by letting the customer say it.
And just our ability to just connect with the market at large through content marketing, through events and some of these different programs you kind of don’t need to have a magic quadrant necessarily. And I’ll give you a quick example. Gainsight, seven years in working with the analyst community, there is still no magic quadrant for customer success or wave even though they have customer success teams at those analyst firms, but according to LinkedIn and their economic graph kind of that they kind of populate, customer success is one of the top three fastest growing jobs in the world for the last two years.
And so what matters more to me, I think as a marketer at the end of the day, I think the fact that we were able to help advance this profession and build our TAM and sell software into that market, matters more to me than whether a Boston based analyst firm tells me that what we’re working on is real or not. So a little fire in my voice there, but it’s just I think the times are definitely changing. The analysts have a good role to play, but they’re not the… It’s not a requirement that they validate you.
Mark: Yeah, we’re fans of G2 as well. But even at G2 in some ways, you have to figure out who you are and how to position yourself there. One of the things I found most helpful in your book is actually incredibly early in the book and that is a series of questions that you go to identify whether or not category creation is the tactic that they should take. Walk us through a couple of those questions to help us get a focus.
Anthony: Yeah, because I think you know you write a book on this and you do some speaking and people are interested. I want to create a category, but the reality is two things. One, it’s a scary thing and if you have a business as a pretty clear disruption opportunity that the path to sort of success in that is much more streamlined than creating categories. It tends to be a longer term strategy.
The other bit is I don’t think you can sort of start day one saying we’re going to go create this category. You kind of like see these signals that you’re referencing and you start to have these thoughts of, “Gosh, maybe we’re not like the other businesses that have gone on and disrupted existing markets”. And so some of the signals are there’s no incumbent competitor in your space or at least a big winner. There might be other folks that are starting to talk about the same things you are, they might be at a similar stage, but there’s no Oracle, Salesforce, large vendor that has run away with the market. Two, you’ll find that there’s a niche group of people who believe in what you’re saying. They’re giving you some signal that, “Gosh, like we, you know, early validation that, that at least your messaging, if not your product is on the right track.” But it’s more what you’ll find is there’s a larger group of people that don’t get it.
And so you spend a lot of time working on positioning and messaging, trying to get people to understand the problem that you’re solving in the market. Because as humans, we’re just trained… We create cognitive references for things and it’s hard for us to look for that white space in our brains to fully understand new ideas. And then the other thing is like some of the tactics. You might go and tried bidding on keywords on… From a SEM perspective, “God, no one’s really searching for this thing that we’re talking about, you know, there’s no media coverage, you know, I don’t know where we would sort of execute a PR strategy.” A lot of these unknowns are some signals that you’re not trying to disrupt Salesforce in the eCommerce space or what have you. Actually, we’re trying to carve out our own space.
Mark: And when you come to our website at Golden Spiral Marketing, click on this interview, Anthony has been kind enough to give us permission to use the list to these questions to help you identify whether or not category creation is something that you should be pursuing.
Now I’m going to ask you a question that I’ve been asked a few times along this way, kind of from a different angle, but there’s an old adage that says if you’re researching something or trying to accomplish something or what have you, and you can’t find anybody else that’s doing it, that’s because you’re a pioneer or everybody else has tried and failed and you shouldn’t go there because there’s not a market for it. How do you get a dividing rod or a crystal ball? What do you need to figure out whether or not you’re being a pioneer or whether or not you’re on a fool’s errand?
Anthony: Totally. And I think there’s a lot of truth to that. I think initially you need the sort of courage and audacity to try. And so starting from a place where you might hear some of the things that we just talked about and say, “I think this could be us. Can we run some experiments and see if there’s any good signal again that we’re going towards being pioneers versus being on a fool’s errand.
And so some of the things that we’ve done and we did a crazy one against that, so I don’t recommend everyone doing this. We planned a conference six days into the job for customer success people. But what we really were doing, we were throwing out some early stage content that had nothing to do with our product, the content that was serving this persona that was trying to solve some challenges and they were trying to get a seat at the executive table, justify their existence to the board. Like a lot of the different pieces of the big questions they had, we wanted to create some content and community to help answer those questions.
And so for us, 300 people came to that event and we only had like five customers at the time and there was this kind of energy in the room that was like, “Gosh, this was like one of the best things that we were able to be a part of for our young industry.” And so that gave us the signal, “Gosh we should do more of this,” and kind of keep pushing in that area. So I would say the starting point is having the courage to try something, whether it’s your own industry conference or some other kind of experiments. But then it’s really important to know when you’re not getting that validation back from the market. So if we had that event and five people showed up or it was a dud or potentially a waste of money, we might’ve said, “Look, maybe it’s not customer success, maybe we should take a challenge or position against Zendesk in the support space and say, “This is like proactive support.” And then there’s an existing market there, a TAM that’s well-defined. We can go in and run in that direction. So I’d say try it and then be paying close attention to the data.
Mark: You talked about trying to figure out that division between what is success and what is maybe we were not hitting, hitting there. What tips do you have for figuring out the size of the audience to be able to make a good determination whether or not it was a success or not, because a lot of these markets are limited, you’re laser focused and so a crowd of 50 could be an incredible sign of that. So how could you figure that out? What tips do you have for us?
Anthony: I don’t know if it was necessarily that the 300 people mattered. What mattered is… Because there was no way for us to size the market outside of a LinkedIn search for customer success managers and getting the title and all that sort of stuff. But like for us, we knew that our market was at least initially SaaS businesses. And so that was sort of the end state for us. And so in the early days it wasn’t that we were so focused on quantitative kind of returns from some of these programs. We want it to move the ball down the field. So if we got a hundred to 50 to one thing, we wanted to get like 60 to the next and just showing incremental progress that we were being able to scale a lot of these programs and that we were able to maintain a quality and NPS kind of value for the different stuff, different things that we were producing.
So I think it’s tough to size early markets. I would champion a kind of spirit of experimenting in the early days to figure out what those benchmarks are. Yeah, it’s one of the hardest things I think about new categories, some of the benchmarks don’t matter. They just don’t work for new markets.
Mark: So would it be fair to say you were kind of looking more at energy and response from the audience that came, more than a number?
Anthony: I think so. It was definitely feedback. Energy, sure. But also would you come again? Would you invite your friend, some of these, or colleague? Being able to get that feedback back from the community because you’re right, in new categories, typically it starts as a niche and your goal as a marketer is to help expand that niche out and make it mainstream. But certainly feedback from those that are already enrolled in the profession are already enrolled in the market and getting them to validate, “Yes, I’ve received value from that.” What they’re saying is, “I’m willing to bet on you as the brand to go and keep doing this kind of stuff for us.”
Mark: Now our company, Golden Spiral, is a B2B tech marketing firm, a full-service agency here and so we specialize in SaaS products from fintech, healthtech, cybersecurity, business intelligence, and something that we’ve seen over time, a lot of our customers are road weary. They’ve been around for a few years. They’ve had a few hits and misses and they’re looking to gain new traction. Maybe they’ve got a new product coming out because a part of their business has ended up being the thing that’s grown more than anything else. So they may be changing their focus and direction by a few degrees based on the success they’ve had more contemporarily. How does a company that’s remaking themselves and looking at an opportunity for a new category, what would you say to them?
Anthony: I think a few things. Every product is regardless of industry, is sort of on a path to I believe commoditization. So it’s becoming easier to develop technology, to host it on AWS. There’s this whole no code movement now that’s really getting folks the ability to build applications and test and iterate before hiring even a technical co founder. So the bar to bring a product to market is getting lower and lower. So sort of leading with product IP as the differentiator for the business is a challenge. And so any company in new markets or maybe operating in crowded spaces and are seeking to break out, really could benefit from building brand IP.
And so brand has been something that we didn’t talk about in B2B. At least it was like your trade show booth and the swag that you created, that was brand or corporate marketing or something that’s completely away from growth and disconnected from growth. So I think the answer to that question for companies that are looking to reinvent themselves is how can we build affinity with the market at large through a concentrated brand effort. And the idea is that customers, whoever they are, fintech, whatever space you’re operating in, it turns out this is controversial, but they’re humans at the end of the day, they want to get promoted, they want to provide for their families, they want to self-actualize and be fulfilled in their careers.
And your product is a big part of that. But a bigger part of that is what you can do to as a company to help them on their path to self-actualization. And so that could be things like content marketing like we’re doing right now and this conversation, it could be, and this obviously being a podcast is so much different than an e-book or a white paper or some of the traditional tactics that have driven short term outcomes like web conversions and all these sorts of things. There’s events and I know I’ve talked about it already in the community and getting together with other people in the market. As a brand, you have an opportunity to help facilitate that on behalf of customers or on behalf of the market and there’s putting them in a position to advocate, how can you make them be heroes?
The folks that are realizing success and have a story to tell. How can you help capture that story and then distribute it out into the audience? So these are all things that, again, I don’t think you need to be in a new category to really kind of go and focus on, but there’s sort of this next gen marketing approach that’s at the convergence of B2B and B2C, at the realization that we’re all people and we don’t check our humanity at the door when we go to work every day.
Mark: And that’s one of the things we find time and time again. And that’s why our core work with clients early in our proprietary buyer matrix process and our workshop process and trying to help them remember why they started doing this in the first place.
A lot of times they get into product development and they start focusing on the features and what the product will do and they forget there’s a user at the end of it and it’s a genuine problem that needs to be solved and helping them pull back and understand their customer, understand the human side of that is so integral into what we do in working with our clients, especially on branding.
You mentioned human interaction. You talk about B2H in your book and I think it’s funny. We had an event in New York just a few weeks ago where a number of CMOs and other marketing leaders from SaaS companies and B2B tech came together and the thing that walked out of there was that need to be more human. That’s a need that those men and women were feeling in the room, but also something that they weren’t expecting. They were not expecting that interpersonal communication, the peer to peer connection at an event like that and everybody walked away feeling so encouraged at human interaction moving forward. If a company hasn’t been thinking human and been thinking more product or another thing, what’s one practical thing they could do to kind of jumpstart their thinking about B2H?
Anthony: The scary thing is if you’re not thinking about it right, then rest assured that there’s an enterprising founding team out there somewhere that is, that’s kind of growing up in this new era. And so the first thing honestly is talk to your customers. Work with great partners like yourselves, maybe to help kind of build a framework to understand how customers perceive you as a brand.
How are they getting value from your products? What more can you be doing to help serve them, whether from a roadmap capability perspective or understand kind of outcomes they’re trying to drive with you overall. That’s, I think the starting point is sort of the intake and doing it in a way that’s authentic. So there are ways to do that in a text base type form survey that you email out to a bunch of people or it could be the CEO personally messaging a customer and saying, “Hey, I want to hear from you. How can I, you know, how can I shape my priorities for 2020?”
That’s something that our CEO Mathilde just did in a recent email campaign that we helped support her with. So these are the things that I think are the point kind of authentically having a desire to understand who your customers are, how they’re getting value from your products and services and your company overall. And then committing to not just taking all that input and putting it on a Google drive somewhere, but taking it and actually implementing change in your business and giving your marketers a license to get creative on how you want to go and activate that in the world.
Mark: I want to shift gears to talk with you about what it’s like to be a CMO, but before we get to that question, just remind everyone and if your watching this that Anthony’s book, Category Creation is available. There are links here on our website where you can connect to any of the major booksellers to do that. Of course you can find it with your own Google search, et cetera. I encourage you to get it and read it. It’s available not only in a physical book but available on Kindle and available as an audiobook with a very engaging narrator. So I encourage you to pick out that if you’re an audio book guy like me. So before we go, Anthony, I wanted to say a lot of our customers are CMOs or the senior marketing executives at companies. What has been something that you can think over the last few months that’s really encouraged you or challenged you as a CMO to do your job better?
Anthony: Yeah, I’ve been really fortunate over the last, I think it’s four months now, to be in this transition in my career from Gainsight. Six and a half years building that business from literally the first marketing hire, a hundred K of ARR, to 100 million of ARR, the company’s off and running to now kind of getting back in the seat again in the early days. But in between I spent a summer as an executive in residence at a venture capital firm. Really seeing a bunch of different deals and talking to a bunch of different founders that were thinking about category creation or just building human first brands or maybe lessons from the game site story that they might, you know, be interested in.
And so for me, I reflected on this very question for months. And so I think in general, the things that I am sort of excited about kind of taking on and implementing now, really this idea that it’s what we just talked about. It’s finding a way to build a brand, especially in what I’ve recently joined is a very product driven organization, where there’s been kind of good kind of brand or product momentum that, Front’s got over 5,000 customers and really high NPS, very engaged with the company. But we want to go and tell this why story behind the entire business. That’s something that we sort of grew up with against that I’d say from the early days. And here we want to reintroduce the brand to the world.
And so as I do that, I feel like I need to get… Build my muscles again and talking to customers in storytelling, in flexing the creativity a little bit and figure out how are we going to go and bring this vision to market and then compel people to actually believe and engage with us in our content, come to our events, subscribe to our podcast, all of these different things. And so building that muscle I think is something that I get from listening to podcasts like this. I get from interacting with other kind of folks in my position. And CMOs we’re lucky, the marketing community is very receptive to building relationship and networking and getting questions answered. So I think we’re very supportive of each other as far as, at least in terms of what I’ve seen. And so I think it’s that community. I think it’s seeking content and then having the bravery to I guess to do something maybe that hasn’t been done before. Try and fail and hopefully learn a lot along the way.
Mark: Cool. Last question, give us something to look at, to read, et cetera. What’s a book or podcast or article or person that you’ve interacted with recently that’s challenged you, helped you gain a new perspective?
Anthony: Ooh, that’s a good one. You know what’s interesting is I, you might’ve gotten a sense of this from talking to me, but I tend to get a lot of my inspiration from the B2C world more than the B2B world because I deeply believe that these worlds are converging. And so looking at other B2B folks that this… We’re coming off the heels of dream for us, like what Salesforce is doing around business as a sort of channel for change and platform for change in the world is really compelling. There’s a lot of really interesting stuff there, but for me, I think I looked at things like Disney+ that just came out. It’s not a book. So it’s a little bit of a cheat code, but it’s amazing what’s happening in the consumer world and entertainment world around original content. Maybe, actually a great example is if you follow a gentleman named Dave Gerhardt who was the head of marketing at Drift, he recently left. He just launched a Patreon, I think it’s called Patreon-
Mark: Patreon, yeah.
Anthony: Is that what it’s called? Channel where people can pay to subscribe to his content and that’s the only place he’s going to contribute content to, not a medium blog, not this other kind of traditional stuff. And so he’s had a lot of success. People have signed up for this thing. And so he is taking the Disney+ playbook of saying “People will pay for original premium content versus fluff that they can get for free.” And that’s crazy, but it seems to be working. And so those are the types of things that I think we should be paying attention to as a community and asking ourselves, what if we started charging for our podcasts, started charging for our blog posts, what would that look like? And then looking at the examples in the consumer world of how that’s been done well.
Mark: Excellent. I want to thank you Anthony Kennada, author of the book Category Creation, new CMO of Front, so check them out. Those links will be available in the show notes here as well as about the gentleman he just talked about in his Patreon site. So check out Front and check out the things we’ve talked about today and Anthony’s book. Anthony, thanks so much for being a part of today’s interview.
Anthony: Thanks so much Mark. Appreciate it.
Mark: If you’re interested in reading more about Category Creation and Anthony’s book, it’s available in digital for your e-reader, available in print and available in audio. You can find out more by clicking the link within the blog post here at goldenspiralmarketing.com. Also, there were several resources mentioned in our interview. You can find those in the show notes. If you believe you’re headed into the category creation world, do you have a guide? Do you have someone who’s been there and hacked through the jungle with the machete? We would love to talk with you. You can schedule a strategic consultation with us here at Golden Spiral by clicking on the link in the show notes and we’ll be happy to talk with you and find out about your journey and where you’re headed. We want to get to know you better. So all of those things are available in the show notes at goldenspiralmarketing.com/kennada. Again, that’s goldenspiralmarketing.com/kennada. You can also listen to more interviews, at goldenspiralmarketing.com/interviews and if you’re interested in being featured in one of our interviews, click the link in the show notes at goldenspiralmarketing.com/kennada and let us know. We appreciate you and thanks for listening.
