Why HubSpot Is Competing With Itself (And Why You Should, Too)

Christopher O'Donnell
ThinkGrowth.org
Published in
5 min readJun 21, 2016

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Has paranoia wormed its way into the lifeblood of the business? Everywhere you turn, there’s competition. And if they’re not looking to take a piece of your business, they’re looking for the whole darn thing.

Why, then, would companies purposefully join that list to be yet another competitor actively working to disrupt themselves?

The old adage — there’s one direction left to turn once you’ve climbed the highest mountain — comes to mind.

For organizations, what’s good for business today may send you plummeting to your demise tomorrow. So how do you ensure that you’re still around in the future?

One man who knows a thing or two about planning for the future is Warren Buffett. He coined a phrase that’s become the household approach for businesses looking to answer that very question. He called it the “moat play”.

Like castles of yore, the moat play is nothing new. It’s a competitive advantage, one that effectively wards off those trying to scale your walls. And while Buffett spoke of economic moats, the principle is the same for all businesses today — especially those in the ever-changing technology space.

A Tale of Two Companies

One moat play in particular is to look at market penetration S curves.

In short, they represent the lifespan of a product once it hits the market: from introduction, to growth (or market fit), through to maturity or mass adoption. More often than not, the curve eventually trends downwards to the final stage of decay.

With the right strategy around S curves, companies can do their fair share of planning for the future. However, companies failing to heed the inevitability of plateauing, and yes flatlining, will find themselves losing market share to competitors.

Let’s take Netflix, for instance. Its chief executive Reed Hastings understood this principle. Even a quick look at the company’s name tells the story. Hastings knew DVDs, be it by mail or in stores, was not the only future to plan for — the internet was.

By innovating a way to use the web and integrate with other products, Netflix’s streaming video effectively staved off disruption. Once-giant Blockbuster found themselves scrambling to react, and are now in the pantheon of distant memory.

Not all organizations fare so handsomely. Take Sonos, a hifi wireless speaker company and a company HubSpot was fortunate enough to call neighbor for some time. Sonos rode its first wave of wireless speakers like a regular Nikki Van Dijk.

However, today the company finds itself having to pivot. Sonos says they are refocusing on paid streaming and voice recognition technology. They also had to lay off a number of employees to shift gears, too.

Sonos’ future market share is evaporating because of artificial intelligence and voice recognition technology. The company that did innovate for this type of disruption? Amazon.

The online retail giant’s latest Alexa-enabled Echo product is taking Sonos’ market share and carving out its own audio ecosystem.

Had Sonos made even smaller plays in voice technology, they could have chipped away and made a stronger moat play around their product. Now, their products find themselves on an island, while Alexa finds her way into more and more households.

What Can Your Company Do?

Actively working towards disrupting yourself affords companies the opportunity to innovate with laser focus and continue to grow market share.

Here are four ways to create a lasting moat play and plan for that great unknown we call the future:

Acknowledge

Companies need to live and build in the future, not today. If you’re not living in a constant state of being uncomfortable, you’re not prioritizing the longevity of your company.

Remember, competition is all around you and refusing to acknowledge the need for a moat play will be death by thousand papercuts. Or a quick walk off the cliff.

Allocate

Future-proofing takes resources. Dedicate teams in your company whose sole purpose is to research, plan, and build with the hopes of disrupting your own business.

At HubSpot, our marketing department has allocated resources towards future-proofing in areas we feel may (or inevitably may not) be avenues for future disruption. Either way, we don’t want to wake up one morning to find ourselves left at the dock while the ship has sailed. It’s crucial that we put it out in the open and examine.

Assess

Once you’ve put the resources behind future-proofing, it’s important to take stock of what they bring back. Don’t be afraid of testing in the market — even if that means jetting right on past beta.

At HubSpot, we assess our own possible disruption through free tools like Leadin and HubSpot Sales, formerly known as Sidekick for Business.

Adapt

From organization leaders or the newest hire employee, everyone in your company should be aware of and ready to adapt to changing markets. There is no end to innovation. Our friends at Logmein innovated using the same infrastructure they’d built up over the past years, something that would have take significant investment by other companies. Adapting gave them a second S curve and all of us got Join.me because of it.

If technology has taught us anything, it’s that we are only in the early stages of the technological history. Had we never adapted our findings from Sidekick for Business, we would never have been able to refine our latest HubSpot Sales product.

When you’ve done something well enough, you deserve a trophy. But businesses that fail to continually compete against themselves, turn those very same trophies into anchors.

You’re always going to have competition, but you know your product best. No one is better suited towards solving for your company’s future than you.

Want to see what self-competition looks like? Click here to check out Leadin.

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