SaaStr Podcasts for the Week with Zoom and Menlo Ventures — September 20, 2019

 

 

 

 

Ep. 266: Janine Pelosi is the CMO @ Zoom, the next-generation enterprise phone system. Prior to their very successful IPO, Zoom raised funding from some of the best in the business including Sequoia, Emergence Capital, Horizons Ventures and 2 of my favourites in the form of Matt Ocko @ Data Collective and Dan Scheinman. As for Janine before joining Zoom, she spent 11 years at Cisco where among many incredible achievements she led worldwide demand gen for WebEx and led their worldwide digital marketing team with a $25M annual budget.

Pssst 🗣 Loving our podcast content? Listen to the start of the episode for a promo code to our upcoming events!

In Today’s Episode We Discuss:

* How Janine made her way into the world of SaaS and came to be one of the leading CMOs today with Zoom.
* How has the role of the CMO changed over the last 5 years? Would Janine agree with Jason Lemkin that “the role of the CMO is to execute the vision of the CEO”? What makes Janine and Eric’s relationship so successful? What makes Eric the special leader that he is? How does the changing power of the CMO affect their relationship with the CEO?
* When is the right time for startups to hire their first CMO? What should they look for in that ideal candidate? What should they have in place in terms of infrastructure, prior to hiring the candidate? What does the right onboarding process look like for a CMO? Where does Janine see many going wrong when hiring their first CMO?
* How does Janine look to create alignment between sales and marketing? Why does Janine not believe in having the labels of “MQLs and SQLs”? How does Janine look to reduce the friction when handing off between marketing and sales? What are the common causes? How are we seeing marketing also blend with customer success?

 

Ep. 267: SaaS is about creating long-term value for your customer, and being compensated appropriately for that value as a business. Learn actionable monetization tips from a Product/Growth operator turned VC.

SaaStr’s Founder’s Favorites Series features one of SaaStr Annual’s best of the best sessions that you might have missed.

This podcast is an excerpt of Naomi’s session at SaaStr Annual 2019.

Missed the session? Here’s what Naomi  talks about:

  • How to avoid underpricing your product
  • Fitting your businesses’ product to the market

If you would like to find out more about the show and the guests presented, you can follow us on Twitter here:

Jason Lemkin
SaaStr
Harry Stebbings
Janine Pelosi
Naomi Ionita

Below, we’ve shared the full transcript of Harry’s interview with Janine Pelosi.

Harry Stebbing: Welcome back and you are listening to the official SaaStr Podcast with me, Harry Stebbings @hstebbings1996 with two Bs on Instagram and it would be great to see you there. But to the show today, and we have a CMO who’s created marketing campaigns with their company that we’ve all seen, we’ve all engaged with, and for a product that we all love. And so with that, I’m very excited to welcome Janine Pelosi, CMO at Zoom.

Harry Stebbing: For anyone that’s been living under a rock, Zoom is the next-generation enterprise phone system. Prior to their very successful IPO, Zoom raised funding from some of the best in the business, including Sequoia, Emergence Capital, Horizons Ventures, and two of my favorites in the form of Matt Ocko at Data Collective and Dan Scheinman. As for Janine, before joining Zoom, she spent 11 years at Cisco, where among many incredible achievements, she led worldwide demand gen for WebEx and led their worldwide digital marketing team with a 25 million dollar annual budget.

Harry Stebbing: I do also have to say a huge thank you to Santi at Emergence for suggesting some fantastic questions suggestions. I really do so appreciate that, my friend. However you have heard quite enough from me, so now I’m very, very excited to hand over to Janine Pelosi, CMO at Zoom.

Harry Stebbing: Janine, what can I say it is such a pleasure to have you on the show. I’ve heard so many great things both from Eric and from Santi at Emergence. So thank you so much for joining me today, Janine.

Janine Pelosi: Thank you for having me.

Harry Stebbing: Not at all. But before we dive in, I do want to kick off a little bit on you. So tell me, how did you make your way into what I always call the wonderful world of SaaS, but come to be CMO at one of the greatest startups of our time with Zoom?

Janine Pelosi: Well goodness. So it was quite a few years ago, I had the opportunity to start, actually, as an intern at WebEx before the Cisco acquisition. So I was able to get my hands in a lot of different areas within the business, within marketing. Anything from, you know, e-commerce, to our first banner ads, emails, SEM, you name it, PR. And so, you know, if you think about where Zoom has come, I have been here going on five years now. You know, it didn’t start as this magical unicorn, right. It just started as a group of people who were trying to build something pretty awesome. So looking back, I’m really happy that I made the decision to come and join Eric.

Harry Stebbing: Totally, I couldn’t agree more there. But I do want to ask, you know, you said about Cisco there and I do want to ask, you were there for eleven years in total between Cisco and WebEx according to my very credible LinkedIn counting. So what was your biggest takeaway from that eleven year journey?

Janine Pelosi: You know, before the Cisco acquisition, it was, I mean WebEx was a lot of fun. It was one of, kind of, the early great SaaS companies out there. I mean it really built that whole web touch model, if you will. What I learned after the Cisco acquisition was a lot probably about politics. The group that I was in was actually made up of the WebEx acquisition and so all of, kind of, our marketing initiatives were run outside of corporate marketing. Which is a very interesting dynamic for a company like that. So we were able to, kind of, stay scrappy and get things done, but over time it becomes hard to keep the decision making fast and decisive. And that’s what you need to stay competitive. And why I eventually turned my attention to Zoom.

Harry Stebbing: Totally get that and, yeah, the challenges of scale for sure. I do want to kick off though today with your role itself. So CMO, because we chatted before and you said to me the role of the CMO has gotten larger. So double clicking on this, what in your mind, was the role of the CMO and how has it changed today?

Janine Pelosi: You know, I can’t really talk to what was the role of the CMO, but what I can talk to is the way I see it. And I say I lead with a business hat and then I put on my marketing hat as needed. And I think that allows me to do marketing in a way that is in context to the rest of the business, right. If you just think you have a great marketing playbook and you’re running that and don’t think about what else is going on that you need to be taking into consideration, then you end up failing, right. I mean if you bring in a bunch of leads or opps or build a massive brand and you’re not able to, you know, have a sales force or a channel or anyone to take advantage of that demand, then you fail. So it has to be, kind of, a collective effort with all the leaders and teams within the company.

Harry Stebbing: Totally with you in terms of that collective effort. I think the common question that I get from a lot of early stage startups is, I don’t know when’s the right time to hire my head of marketing, CMO style function. When do you advise startups is the right time to hire that CMO?

Janine Pelosi: Yeah, I mean I’m very lucky that I get to work with a lot of early stage CMOs and founders today, when they were sitting in the seat that I was five years ago, and what I always say is hire somebody that gets shit done. You might even want to find the person that’s one level below the CMO or VP. That person that understands how things work and what makes an impact is who you want to bring in initially, in my opinion, that knows what they need to build and the team they need to surround themselves with.

Harry Stebbing: In terms of the get shit done, whenever I kind of hear that especially applies to the marketing function, I’m always interested, today given the date of centricity that we see, do you think marketing is more an art or a science and how do you think about that?

Janine Pelosi: It has to be both and I think Zoom has proven that. I mean, I’m a firm believer that people don’t wake up in the morning thinking about your brand. I’ve said before, like I don’t really use the term demand generation. I think it’s kind of silly, like it’s all marketing you’re going to do stuff that drives demand and you’re going to do stuff that captures it. And you have to look at that funnel holistically, Google search and SEM is so successful because they’re hearing the radio ads. They are seeing the billboards, they’re being exposed to other things. They’re not just going to naturally, you know, end up searching for your brand. I mean, yeah, there’s some element of awareness that you can get there, but it all works together. And you have to look at that funnel from a return standpoint, from an ROI standpoint, collectively.

Harry Stebbing: I do want to get into the funnel in a lot more detail, a little bit on. I do just want to finish in the final comment on, kind of, the expansion of the role of the CMO. With the expansion how does that change the structure of the relationship between the CMO and the CEO, and what is that optimal relationship?

Janine Pelosi: I mean, I couldn’t do my job effectively if Eric and I didn’t have trust. I mean, trust is, I think, what it all comes down to because going back to art and science you have to believe in certain things and lead with common sense in certain aspects of what you do. And of course you have to support it with metrics and KPIs that keep everybody on track and rolling in the right direction and knowing where to invest and double down, but if you don’t have that element of trust, it’s just an uphill battle. I mean I wouldn’t be here today if I didn’t have that trust with Eric.

Harry Stebbing: I mean the trust is core and when I spoke to Santi before the show, he said about your relationship and how strong it is. Can I ask, how is it so special working with Eric and what makes Eric so special to work with?

Janine Pelosi: Um, and I’ll say too, Santi is a special person to work with. That’s one of those great relationships as you build a company, that you get to build, and so we’re happy to have him as part of our team. But with Eric it’s–I think what makes him so unique, I would say, which drives him being special, is the fact that he is very practical. I say a lot like across the leaders of the team here, in what we look for when we hire, we look for people that are self starters. That are motivated. Above all that…focused. Eric is a very focused leader. You know, I think him and I both share a unique ability to kind of cut through the crap, if you will, and focus on the things that really, really matter and I think that’s allowed us to execute at a level that is really unprecedented.

Harry Stebbing: I do want to dive into the funnel today. We touched on it there and really starting on the sales and the marketing functions because it’s often sometimes a point of tension in scaling SaaS startups, so if we start with that and probably the hardest question of all, how do you create an alignment between sales and marketing Janine?

Janine Pelosi: I’ll go back to trust. Greg , who’s been our head of sales for the past, I think, a little over six years now. We just brought in a new CRO, actually Ryan Azus, who I’ve had the privileged of working with in the past, like you have to have a relationship and have trust. Like, I’ve also been known for saying I don’t use MQLs and SQLs. Like, I understand the value they can add to a funnel, but I also firmly believe that words matter and if you put those little things like Ms and Ss in front of quantifying leads, then it sets a tone that this is what somebody thinks is important and this is what somebody else thinks is important. And for us, we collectively, when we put together annual plans, when we put together how we are going to go to market, we do that as a united front, so I’m very close to our sales team. I have their ear, they have mine, and it’s a relationship that has once again allowed us to scale.

Harry Stebbing: Can I ask, is it challenging to create accountability and ownership by removing that attribution, almost, from the function?

Janine Pelosi: No, because we still have all of the attribution. We are watching everything, we have all of our stages of opportunities. You know, if you really peel back what is a lead, it’s something–some people use the term “at bats.” I think that’s kind of funny, but you know it’s a direction, it’s a hand raise, and when you take out some of those words that have become–I feel like marketing is all about all of this lingo. I also don’t want to fill my head with things that are just going to be distracting, so I do think we are a very practical organization. I want our sales team following up on people that have an interest in our business. Whether you call that an MQL or an SQL, I don’t really think it matters.

Harry Stebbing: No, I do agree. Especially in terms of the buzz words around it. In terms of the funnel itself, you know, you’ve seen the progression of Zoom’s funnel, you saw WebEx, and Cisco’s. I have to ask, where do you think you most often see the breakdowns in the work in the effective funnel?

Janine Pelosi: At Zoom, and this was true for WebEx as well, we have a strong premium model and we have a product that is inherently viral, right. I believe, obviously, Zoom works a hell of a lot better than WebEx, but when people are out there marketing for you, you have to have an incredible engine internally to take advantage of that demand. And making sure that you’re able to throw it over the fence, if you will, from somebody who is in your freemium engine over to somebody that makes sense to actually have an inside sales reps call on is what is incredibly important. And I think that’s what you’re not going to find if you’re just looking at CPLs and CPAs from your outbound efforts.

Harry Stebbing: I’m so pleased that you said about that kind of throwing it over the fence between the freemium and the actual kind of cause itself and that kind of interaction. How do you think about optimizing the hand over process and what can be done to minimize the friction?

Janine Pelosi: You know, I’m known for going in and playing in Salesforce, and pulling up opportunities or leads and sending notes to individual reps and asking why they went home with an open lead or why it’s taken three days between activities. Like, I think it’s just important to stay practical and I can’t underline that enough. Like when you have the ability to understand, you know, if somebody’s gone and spent 20 minutes on a certain product page of yours. I think it’s important to let a sales rep know that so that they have the information and that might be the point at which you bring them from your marketing automation into an actual lead in Salesforce. But that’s going to be… that’s going to vary for every business that you’re in. You just need to determine when does it make sense to actually put a body on it versus to have marketing nurture.

Harry Stebbing: I do have to ask, we spoke about ownership and accountability earlier. We had Joe Chernov from Pendo on the show recently and he said that marketing have to be held accountable to a number tied directly to revenue. Would you agree with him here and how do you think about KPI setting for the marketing team specifically?

Janine Pelosi: Hundred percent. So we, you know, I have revenue targets on top of marketing, I also lead our online business, which is a combination of our e-commerce, obviously, as well as our sales reps that are covering anything that is ten employees and below. So this is very transactional, high volume. If you really think about what it means to be driving towards revenue. I have our teams that are running digital campaigns thinking about our line in the fashion of if i gave you a dollar, when are you going to give me back that dollar and when are you going to give me back three and when are you going to give me back five. Versus everything being about CPLs and CPAs. We measure everything in ratios and we take a very conservative approach to the lifetime value that come up with those metrics. So it’s going to vary for every business that you are in but it’s a… it basically goes down to the principles of if I’m going to invest somewhere, when am I going to get my return back and then when am I going to start seeing dividends above that.

Harry Stebbing: Can I ask how do you think about brand marketing and the common statement from marketers that the traceability in terms of data and ROIs and discovering true ROIs so challenging. How do you think about that with regards to brand marketing?

Janine Pelosi: Well, I mean it can be challenging unless you actually step back, and, once again, I’ll probably use the term practical 20 times over this podcast, but you know, we take a geographical approach. I mean now we’re in multiple countries, multiple cities across the globe. I think we are in 28 different markets, you know, in the U.S. alone, and you can look at what’s happening if you test right. And every business is going to have those indicators of demand, whether it’s people searching for your brand or organically returning visitors searching for your category, free sign ups to your website, leads, etc. Whatever that might be for your business, and then you track it and you baseline it and you see what happens afterwards.

Janine Pelosi: I don’t want to say it’s not rocket science. I mean we have built a whole attribution and methodology internally that we’ve been working through for the past five years, but it started very scrappy and very small and we built on that over time. I think every business just needs to step back and that’s where… you know, look at the examples in the best practices, but then you always have to put it in reference to your own business and I think that’s where a lot of people fail. They don’t put it in reference to their own business when they actually go to put it in action.

Harry Stebbing: I do want to ask one more question on the funnel itself and it’s really you know… in terms of the amount of information between marketing and different roles especially in sales we spoke about earlier. I think we are seeing especially with kind of the rising of importance of content and marketing teams creating great content but that being pushed down, almost into a customer success role in many cases. How do you think about marketing being pushed down the funnel to that post sale and would you kind of agree with seeing that kind of merging of customer success in marketing in many ways?

Janine Pelosi: It’s totally merging, right. I mean if you think about most businesses don’t aspire to be a one trick pony, right. So that means that after you even get that initial sale for one product or one portion of your product, you’re going to want to cross sell and up sale. And, which means there needs to be a very succinct program between your CSM team and how you frame that and structure your communications to your current customer base and what you do with folks that are earlier on in that prospect funnel. It just has to be consistent, especially depends on the business that you’re in but for us, right. If end users aren’t using the product… they aren’t going to renew, right. That’s SaaS. And so you can’t rest on your laurels of getting that initial customer. Which means that all of the marketing the traditional marketing team’s going to be running has to work for both those prospects and for customers. So there really isn’t a line at Zoom. It just might be different folks that are pulling the trigger.

Harry Stebbing: Now you said the word practical a number of times and so I do want to dive in before the quick fire round. Really a kind of theme of missed buzz words and what marketing can’t do. So if we are being practical, what can marketing not do in your eyes, Janine?

Janine Pelosi: I don’t really think in terms of what marketing can’t do. If it’s not something that we can physically do or innovate on then we’re going to influence it, right. If I see a crack in the product, if I see something in our sales process, you know. Anywhere in our business, finance… I’m going to raise my hand and make sure that I make that known so I think if it’s something that you traditionally you know, “can’t do,” you influence.

Harry Stebbing: In terms of another buzz word, it’s ABM. We hear it more and more today. I hear it phenomenally in terms of on this show with many coining the buzz word, though, how do you think about ABM? Is it a buzz word and how do you think about utilizing it with Zoom?

Janine Pelosi: Oh, I think it’s totally a buzzword. I laugh because a few years ago, I had a map of the Bay area, the peninsula on the wall right where marketing sits and we literally would have stickers of where we had ads. We would put where we were running radio. Where we had art, you know, you name it. Buses in San Francisco and then we had other stickers for where our named accounts were. I mean like, that’s ABM, right. I think it’s about getting extremely targeted and you know, having a string through… from what our BDR team is doing, to what our digital ABM activities are, to what we are doing with awareness.

Janine Pelosi: Wrapify is a really fun brand that allows you to wrap vehicles in a really easy way, so I can go and maybe there’s a company that their whole executive team always goes to that one strip mall to that Japanese or Togos for lunch. And I can have those cars do a swarm, right. Like that is ABM. I think that’s definitely one of those buzzwords today but it goes back to really thinking about just how do you get super targeted to, you know, drive a penetration into a large account.

Harry Stebbing: I’m so glad you said that. I totally think it’s a buzz word, so thrilled that we align on that. In terms of marketing playbooks, it’s another kind of buzz word term that I often hear on this show. How do you think about, kind of, the marketing playbook, so to speak. Do you have one and would you agree–we had Maria Pergolino on the show and she said the best CMOs know when to throw that playbook out of the window. Would you agree with that?

Janine Pelosi: The way I think about it, is everybody has their core competencies and you could call that your playbook, right. Like if I think about coming into my seat when I did to join Zoom and was tasked with building the marketing function here. There is clearly going to be things that are my core competencies. And that I’m going to think that we need to hire first for or programs we need to get in place. And then you need to build a really great team that rounds out those competencies, but everybody ticks differently, whether it’s the leader on the team, individual contributors, you name it, and it’s about bringing those playbooks together, and then putting it into context of your business.

Harry Stebbing: In terms of kind of bringing it together, I do want to finish on my favorite element, which is the quick fire round. So I say a short statement, Janine, and you hit me with your immediate thoughts in about 60 seconds or less. Are you ready?

Janine Pelosi: I am ready.

Harry Stebbing: So what do you know now that you wish you’d known at the beginning of your time with Zoom?

Janine Pelosi: I’ve enjoyed the journey so much that I’m okay with the things that I didn’t know and what I’ve grown into.

Harry Stebbing: How do your KPIs differ when comparing revenue marketing to brand marketing?

Janine Pelosi: They don’t.

Harry Stebbing: If you could change one thing about the world of SaaS today, what would it be?

Janine Pelosi: The buzz words.

Harry Stebbing: Who in SaaS marketing today is killing it and why?

Janine Pelosi: I think I’d go back to, actually, it’s relationships. There are a lot of companies right now, who’re doing a lot of really great things and folks that aren’t relying on their peers at other companies to make what they are doing better are failing.

Harry Stebbing: Janine, this has been so much fun having you on the show. As I said, I’ve been wanting to do this for a long time since having Eric on the show so thank you so much for joining me today and its been awesome.

Janine Pelosi: Thank you for having me.

Harry Stebbing: You are a star.

Harry Stebbing: I mean, my word, a quick fire round that is true to its name. That is very rare for this show and if you’d like to see more from Janine you can find her on Twitter @janine_pelosi. It really was such a pleasure to have her on the show today. Do so appreciate all she did in giving her time for the episode and if you’d like to see more from us you can find us on Instagram @hstebbings1996 with two Bs. I really would love to see you there. As always I cannot thank you enough for tuning in and I can’t wait to bring you another brilliant episode next week.

 

Published on September 20, 2019

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