As anyone in the SaaS world knows, sometimes it takes a few tries to get a thing right. Whether you’re talking about releasing a new feature, breaking into a new market, or adjusting product-market fit, sometimes finding a working solution requires coming at the challenge from a new (and even unexpected) direction. This is exactly the approach Brian Lafayette, Director of Strategy at Meetup, and his team took in order to crack the code on how to reach and engage their B2B market.
The story of their success involves overcoming internal skepticism, facing up to past failures, and then forging ahead with a product-led growth strategy that not only helped them reach their original goals, but also provided the added benefit of uncovering an unanticipated earning opportunity that they now forecast could account for up to 30% of future revenue.
And, like so many success stories, this one starts with failure.
The Situation – Shaky Ground
“This definitely wasn’t the first time we’d tried to connect with the B2B audience,” says Lafayette. “Meetup has been building local communities for thirteen years, and the team here had experimented with a number of strategies including Meetup Everywhere, corporate Meetup sponsorships, and even branded perks and incentives; but nothing seemed to stick.” Despite these failed attempts, it was clear to Lafayette that the B2B audience represented a worthwhile opportunity. In fact, he knew that some businesses were already running groups on Meetup. The problem was that these businesses had to use a workaround in order to achieve the scale they needed in terms of the number of groups they wanted to run and the geographic spread of those groups.
To accommodate these “edge” cases, the Meetup team hacked their own system so they could manually override the three-group maximum that was in place for individual users. Despite the awkwardness of the process, Lafayette was intrigued and encouraged by the fact that none of the companies that signed up for this modified subscription ever canceled.
The catalyst for Lafayette’s reengagement with the challenge of serving the B2B audience was a phone call from Google Developers Groups. They were running about 700 groups all over the world, and they were looking to consolidate and unify those groups on one platform. Discussions with their developers, who had been running the groups independently across a variety of platforms, indicated that the general preference was to use Meetup. From there, the conversation opened up to talk about requirements, and the ball was rolling.
The Plan – A Detailed Model and an Aggressive Goal
Very early on, Lafayette was emphatic about building something that would meet not only Google’s immediate needs, but that would also serve the long term vision for Meetup’s overall business. “We’re an independent company,” he says, “So, even if Google was knocking on our door, the leadership team agreed that we needed to be strategic about how to move forward. We didn’t want to let this one project become a distraction from other things we could be working on.”
Past failures to connect with the B2B audience had left the leadership team feeling skeptical about the viability of another attempt, so Lafayette’s first step was to get leadership buy in. To do this, he built a model to forecast the growth potential of the B2B business. “We set a really hard target with a minimum goal of $10 million in five years,” he says. “We then defined the criteria that would allow us to meet that goal: how many paying customers, how many groups each customer would have to be running, and the overall mix of customers based on the different price points we planned to offer.”
This detailed plan served several purposes. First, it helped to sell the concept internally based on the revenue potential. Second, it gave the leadership team an easy out by clearly articulating the conditions the team had to meet in order to keep the project alive. And, finally, it provided very concrete guidance for the sales team. “We essentially had a model that forecasted trajectory, and then — as the inputs came in — we could update that to show we were still on the right path,” Lafayette explains. “The model also gave our sales team super-specific, month-by-month targets that made it easy for us to see exactly when they were falling short, so that we could make proactive changes to improve conversion.”
The Research – The Good, The Bad, and The Unknown
With the plan approved, Lafayette’s next step was research. “The first thing we did was bring in people who had worked on the past sponsorship, perks, and Meetup Everywhere projects,” he says. “We asked what went wrong and learned that the common point of failure was an assumption that large numbers of Meetup groups could be run by a centralized administrator without the support of local people on the ground.” In addition to shedding light on a major customer-side problem, this observation also provided an important internal insight for Lafayette, “Discovering that long-distance group management was a key problem helped us realize that if what you build doesn’t leverage your core product, then — even if it does kind of work — you will lose support quickly because the project will be viewed as a distraction from the core business.” Meetup’s core product had always been about facilitating and mobilizing local groups. The previous attempts became a distraction because they used different ways to facilitate local interaction. For example, with Meetup Everywhere an entirely different website was built, and the Meetups didn’t appear in the company’s core product. “It was something completely separate from our core product that didn’t really make it any stronger,” says Lafayette. “Now, With Meetup Pro, organizers use all the same tools as our individual product, but the central administrator can push notifications and other items out to them.”
Building off of their initial learnings, Lafayette’s team then interviewed current businesses that were using the workaround solution. “We talked with existing customers about possible features, what would be most interesting to them, and how they were using Meetup for their existing groups,” Lafayette says. “We also had the price discussion so we could begin to understand the different price thresholds.”
The First Step – A Landing Page for a Nonexistent Product
Insights from the research phase (internal conversations, customer interviews, and also analysis of historical pricing trends) pointed toward a segmented approach. “We saw that for-profit businesses would be willing to pay a lot more if we could offer them a few simple enhancements,” Lafayette says, “So we narrowed our focus to the audience segment with the willingness and ability to pay a premium for a better value and then created a tiered pricing structure that addressed three customer types: big for-profit businesses, small for-profit businesses, and nonprofits/startups.”
While Lafayette had a strong hypothesis, he had no way to be sure that the price ranges the team had defined were viable. To validate whether they could sell the product at the target prices, Meetup’s product, engineering, design, and sales teams had to take the offer to the market. “Essentially, before the Pro product even existed, we created a landing page for it,” he explains. “We added two quick features: a map page that displayed the customer’s network of Meetup groups in one place as ‘My Network,’ and an admin page that allowed owners to message all members across all groups simultaneously.”
With this modest minimum viable product in place, the team was ready to start working toward meeting the sales goals outlined in the forecast model.
The Sales Strategy – Small Changes with Big Effects
“We started off thinking we might be able to get new companies to bring their groups onto the Meetup platform,” Lafayette recalls. “But, it didn’t go that well. We quickly realized that the approach didn’t work because it was kind of difficult for someone to run meetups if they had to start from scratch, not understanding how it all works.” After that false start, the team was pleasantly surprised to see a lot of unexpected interest from existing customers on the old, hacked “product.” In addition to upgrading many of those customers to the Pro version, the team also got some leads through a kick-off event they ran on an industry forum.
But, where the team really started to gain traction, was when they began making subtle, in-product adjustments to reduce friction in the customer experience. Though the changes were small, they made a big difference in helping automate the up-sell process:
- They featured Meetup Pro prominently in the help section.
- They began routing people who tried to add a fourth group directly to sales. (In the past, people who tried to exceed the three-group limit would be denied and would have to write the customer support team for a manual override.)
- They implemented a simple, third-party form that allowed customers to sign up for the Pro product without having to call a support or sales person.
- They removed the step of having customers sign a comprehensive master service agreement (MSA), a requirement that was creating a bottleneck with legal departments.
- They enabled credit card payments. (Previously, the only method of payment was by mailed check.)
Each of these changes might seem inconsequential on its own, but together they helped to create a much more efficient customer experience that enabled a self-managed up-sell for customers who were already familiar with the Meetup product. “We realized that we were getting way, way more traction with people who already had some groups and activity on the network because they already understood the value of Meetup and the role it plays in their organization,” Lafayette explains. “From there, it was just a matter of helping them see how easily they could upgrade to Pro so they could manage their groups in a scalable way.”
The Future – Focus, Proof Points, and Smart Scalability
Roughly seven months after the Pro product launched, the user base has grown to more than 200 organizations that between them run more than 5,000 paying groups. Perhaps even more impressive than the subscription numbers is the fact that, so far, the product has 100% retention. “One of the keys to our retention rate is that we kept the original hacked solution ‘product’ as a kind of backup option,” Lafayette says. By doing this, Lafayette ensures that customers who don’t convert to the Pro product after their three-month trial still have a product option on the platform.
“We essentially use the original solution like a down-sell,” he explains. “For people who don’t want to pay for the full upgrade, we can offer a solution with fewer features (no admin page, etc.) at a lower cost that allows them to maintain all of their existing groups and add as many new groups as they want.” On the back end, the team has removed the formerly awkward operational process by simplifying the infrastructure so that both the Pro product and the down-sell option use the same billing system. After updating forecasts, Lafayette believes that by keeping people on the platform, this “down-sell” product will eventually account for about 30% of future revenue.
After their initial success with Pro, Lafayette and his team are now working on the most efficient and profitable way to take the product to the next stage. At the moment, Pro is still flying somewhat under the radar because the team isn’t ready to open it up to the full Meetup user base. “We’re not yet ready to handle the demand,” Lafayette admits. “Right now, we’re focused on engaging only the most highly qualified customers and figuring out what’s left to prove in the product to confirm that this is a business we want to invest in for the future. We’re hoping to find those proof points as quickly as possible so we can build out anything we need to have to support the scaling of the product, and then tell all 17,000 of our likely-to-upgrade customers about it.” Sounds like Meetup Pro will be a product to watch.