{"id":24792,"date":"2020-10-08T18:16:43","date_gmt":"2020-10-08T17:16:43","guid":{"rendered":"https:\/\/www.intercom.com\/blog\/?post_type=intercom-podcast&#038;p=24792"},"modified":"2020-10-12T09:51:51","modified_gmt":"2020-10-12T08:51:51","slug":"scale-atlassian-from-freemium-to-enterprise-sales","status":"publish","type":"intercom-podcast","link":"https:\/\/www.intercom.com\/blog\/podcasts\/scale-atlassian-from-freemium-to-enterprise-sales\/","title":{"rendered":"Bought-in and paid for: how Atlassian bridges the gap from freemium to enterprise sales"},"content":{"rendered":"<p><iframe style=\"width: 100%; height: 200px; border: 0 none;\" src=\"https:\/\/art19.com\/shows\/828246d1-e75c-4b41-a882-671aff845a93\/episodes\/59eff81a-c199-471e-9c99-3583e4f61273\/embed?theme=dark-custom&amp;primary_color=%23d7b4e5\" scrolling=\"no\"><\/iframe><\/p>\n<p>Freemium\u2019s a great way to acquire lots of customers relatively quickly and easily, but the job of converting them to using a paid product is where the rubber meets the road. And the challenge is a lot harder in an enterprise context, where the buyer and the user aren\u2019t necessarily one and the same person.<\/p>\n<p>Many businesses struggle to strike a balance between freemium\u2019s light-touch customer engagement with the more involved enterprise sales process. For every company that\u2019s executing the freemium model successfully, there are hundreds more that struggle and the tension it can create between sales, marketing, and product teams.<\/p>\n<p>But if anyone knows how to walk this tightrope and make it to the other side, it\u2019s <a href=\"https:\/\/www.linkedin.com\/in\/kristen-habacht-80288780\/\"><span style=\"font-weight: 400;\">Kristen Habacht<\/span><\/a>. She was <a href=\"https:\/\/trello.com\/en\"><span style=\"font-weight: 400;\">Trello<\/span><\/a>\u2019s very first sales hire in 2010, built the company\u2019s sales and account management teams, and was <a href=\"https:\/\/bridge24.com\/blog\/trello-advice-on-freemium-saas-to-aspiring-entrepreneurs-with-kristen-habacht\/\"><span style=\"font-weight: 400;\">instrumental in scaling its business from 5 million to 25 million users within two years<\/span><\/a>.<\/p>\n<p>Kristen joined <a href=\"https:\/\/www.atlassian.com\/\"><span style=\"font-weight: 400;\">Atlassian<\/span><\/a> when it acquired Trello in 2017, where she is now Global Head of EDR Sales.\u00a0Like Trello before, Atlassian has a non-traditional sales model. Yet that hasn\u2019t stopped them making big inroads into the enterprise market.<\/p>\n<p>For the latest episode in our <a href=\"https:\/\/www.intercom.com\/blog\/scale\/\"><span style=\"font-weight: 400;\">Scale<\/span><\/a> series, Intercom\u2019s Dee Reddy caught up with Kristen to find out how freemium can drive enterprise sales, how it changes the interaction with the customer, and why it fundamentally affects the relationship between sales, marketing, and product teams.<\/p>\n<p><em>Listen to the full episode above or check out Kristen\u2019s key takeaways below.<\/em><\/p>\n<h2 id=\"let-the-product-be-your-sales-guide\">Let the product be your sales guide<\/h2>\n<p>Right off the bat, Kristen acknowledges that the <a href=\"https:\/\/www.intercom.com\/blog\/podcasts\/scale-how-vidyard-uncovered-a-multimillion-dollar-growth-lever-by-moving-down-market\/\"><span style=\"font-weight: 400;\">freemium model<\/span><\/a> isn\u2019t a universal cheat code for winning sales. Making it work means taking a <a href=\"https:\/\/www.intercom.com\/blog\/podcasts\/hubspots-vp-of-marketing-and-growth-kieran-flanagan-on-product-led-growth\/\"><span style=\"font-weight: 400;\">product-led approach<\/span><\/a>, so it might not suit every business. \u201cYou have to really think about what you\u2019re selling, where your product reaches, how you can support that before you go forth and do that,\u201d she says, before adding:<\/p>\n<p>\u201cThe idea of saying, let\u2019s give people something that is useful for them, let\u2019s let them use that at least at a base level to really understand if it\u2019s going to fit their work and their life, and then let that product guide that sales process, I\u2019m a huge believer in that.\u201d<\/p>\n<p>Product-led is a mindset that shifts a lot of the power in the sales relationship to the customer. Today, customers have a lot more choice when it comes to discovering product options independently, and <a href=\"https:\/\/www.gartner.com\/en\/sales\/insights\/b2b-buying-journey\"><span style=\"font-weight: 400;\">they\u2019ll only interact with a vendor\u2019s sales team when they\u2019re ready<\/span><\/a>. As Kristen says:<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-24797 size-full\" src=\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-2.png\" alt=\"&quot;Freemium and product-led are things that let people have agency&quot;\" width=\"1700\" height=\"361\" srcset=\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-2.png 1700w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-2-300x64.png 300w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-2-700x149.png 700w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-2-768x163.png 768w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-2-1536x326.png 1536w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-2-600x127.png 600w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-2-1400x297.png 1400w\" sizes=\"auto, (max-width: 1700px) 100vw, 1700px\" \/><\/p>\n<p>She predicts that this strategy of letting the product guide the sales process is the future of tech:<\/p>\n<blockquote><p>\u201cI think that\u2019s where a lot of the future of sales and tech in general is going to go to some extent, which is to really let the product guide the people. They want to talk to sales, if it\u2019s helpful, they want to talk to a partner in that conversation and feel they have the agency on their own to make those decisions. And a salesperson should be the person helping them make sure that they understand the right deployment and those kinds of things, but they don\u2019t want to be hard sold; nobody wants to be hard sold.\u201d<\/p><\/blockquote>\n<h2 id=\"crowning-the-customer\">Crowning the customer<\/h2>\n<p>The beauty of the freemium model in an enterprise setting is that the supplier due diligence process is already much further along. That\u2019s because the customer has already identified the business need, vetted a bunch of products, and then run the proof of concept trial. As Kristen puts it:<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-24798 size-full\" src=\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-3.png\" alt=\"&quot;We don't work to land any new customers. We let our marketing and our product drive that decision. There's never a point where as a sales team we're going after folks that don't already know Atlassian and love Atlassian&quot;\" width=\"1700\" height=\"649\" srcset=\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-3.png 1700w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-3-300x115.png 300w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-3-700x267.png 700w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-3-768x293.png 768w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-3-1536x586.png 1536w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-3-600x229.png 600w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-3-1400x534.png 1400w\" sizes=\"auto, (max-width: 1700px) 100vw, 1700px\" \/><\/p>\n<p>When a customer is close to reaching a decision about upgrading from the free version to a paid license, they\u2019ve seen the product up close, they\u2019ve played with it, and they can see its value to their business \u2013 so they\u2019re already convinced and on board. Kristen says:<\/p>\n<blockquote><p>\u201cThis really does tend to be something where people have had a pain and they have found a solution to that pain, which is what your software or tool does, and that you are just helping them understand the right way to implement it in their organization. I think people want to buy like that.\u201d<\/p><\/blockquote>\n<p>For comparison, she reaches for an example outside the software world: car manufacturer, Tesla. Tesla\u2019s <a href=\"https:\/\/www.investopedia.com\/articles\/active-trading\/072115\/what-makes-teslas-business-model-different.asp\"><span style=\"font-weight: 400;\">direct sales business model<\/span><\/a> has driven it to being the world\u2019s leading producer of electric vehicles, <a href=\"https:\/\/www.statista.com\/topics\/2086\/tesla\/\"><span style=\"font-weight: 400;\">with more than 367,000 units delivered in 2019 and revenues of $24.6 billion<\/span><\/a>.<\/p>\n<p>\u201cPeople don\u2019t want to go to a dealership, they want to be able to make those decisions on their own and then have somebody help them execute what they\u2019ve decided,\u201d she says.<\/p>\n<h2 id=\"shortening-the-sales-cycle\">Shortening the sales cycle<\/h2>\n<p>Enterprise sales conjures images of fleets of sales teams, feet on the street, hustling hard to reach customers, and endless rounds of pitches to win over multiple stakeholders. It\u2019s a model that seems completely at odds with freemium where there are far fewer touchpoints between the company and its customers.<\/p>\n<p>Naturally, many elements of traditional enterprise sales still remain: the larger the customer\u2019s organization, the more there will be people on the legal side who will want to review a contract, on the IT side who want security reviewed, or on the procurement side who want to haggle over the cost.<\/p>\n<p>Atlassian handles this by offering the same price to all customers \u2013 \u201cthere\u2019s a fairness to that, I think that customers really appreciate,\u201d Kristen says. This echoes the philosophy behind <a href=\"https:\/\/www.intercom.com\/blog\/podcasts\/scale-how-atlassian-built-a-20-billion-dollar-company-with-no-sales-team\/\"><span style=\"font-weight: 400;\">Atlassian\u2019s distribution flywheel<\/span><\/a> where the product, marketing, and sales teams work together to remove as much friction in front of the customer\u2019s path as possible in a transparent manner.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-24795 size-full\" src=\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-2.png\" alt=\"Atlassian's distribution flywheel (graph)\" width=\"1700\" height=\"1169\" srcset=\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-2.png 1700w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-2-300x206.png 300w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-2-700x481.png 700w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-2-768x528.png 768w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-2-1536x1056.png 1536w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-2-600x413.png 600w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-2-1400x963.png 1400w\" sizes=\"auto, (max-width: 1700px) 100vw, 1700px\" \/><\/p>\n<h2 id=\"meeting-the-needs-of-an-enterprise-buyer\">Meeting the needs of an enterprise buyer<\/h2>\n<p>With enterprise clients, the person who is using the product isn\u2019t necessarily the person who\u2019s buying the product. As Kristen tells it:<\/p>\n<blockquote><p>\u201cYou might have 1,000-plus people using it, but those 1,000-plus people might be in 10, 20 different departments. So you still have to aggregate that up and figure out if it\u2019s going to be the head of IT that\u2019s going to be buying this or if it\u2019s going to be the head of marketing or some other group. So you still have to find your personas, you still have to find your decision maker, you still have to make sure they have authority and budget. Those core components of <a href=\"https:\/\/www.intercom.com\/blog\/announcing-the-21st-century-guide-to-lead-qualification\/\"><span style=\"font-weight: 400;\">BANT<\/span><\/a> (budget, authority, need, and timing) still exist, it\u2019s just the process to get through it is a little bit different.\u201d<\/p><\/blockquote>\n<p>It all comes back to giving the customer agency: they initiate the contact with sales when they need help through a particular part of the buying process. In the freemium-to-enterprise world, the job of sales is to be there when the customer calls on them, rather than rushing would-be buyers through the funnel. Instead of a pushy, always-be-closing approach, everything\u2019s on the customer\u2019s terms, Kristen emphasizes.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-24800 size-full\" src=\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-4.png\" alt=\"&quot;It's not that customers don't want to talk to sales. It's that they want sales to be a partner and to help them get through the process. That's where, from a cycle perspective, we help them and that's why our cycles are shorter than the average enterprise sales world.&quot;\" width=\"1700\" height=\"731\" srcset=\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-4.png 1700w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-4-300x129.png 300w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-4-700x301.png 700w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-4-768x330.png 768w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-4-1536x660.png 1536w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-4-600x258.png 600w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-4-1400x602.png 1400w\" sizes=\"auto, (max-width: 1700px) 100vw, 1700px\" \/><\/p>\n<p>And from the seller\u2019s side, there\u2019s less investment needed in nurturing leads through a lengthy pipeline, so the customer acquisition cost is lower. ProfitWell estimates that freemium reduces <a href=\"https:\/\/www.profitwell.com\/blog\/freemium-tradeoffs\"><span style=\"font-weight: 400;\">CAC by 15%<\/span><\/a>, as there\u2019s <a href=\"https:\/\/blog.hubspot.com\/service\/freemium\"><span style=\"font-weight: 400;\">no overspending on paid marketing channels or sales processes<\/span><\/a>.<\/p>\n<h2 id=\"aligning-sales-marketing-and-product-teams\">Aligning sales, marketing, and product teams<\/h2>\n<p>When the freemium-to-enterprise model works well, it also removes some of the tension that can exist between sales and marketing teams. In Kristen\u2019s experience, having shared goals and metrics can go a long way to fostering a healthy relationship between sales and marketing. She\u2019s also found it\u2019s helpful to unify the sales and marketing functions into one, rather than having two competing teams vying for the CEO\u2019s attention.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-24799 size-full\" src=\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-5.png\" alt=\"&quot;We're seeing more and more where companies are hiring a CRO or some other role where sales and marketing are rolling up together.&quot;\" width=\"1700\" height=\"553\" srcset=\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-5.png 1700w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-5-300x98.png 300w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-5-700x228.png 700w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-5-768x250.png 768w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-5-1536x500.png 1536w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-5-600x195.png 600w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-quote-5-1400x455.png 1400w\" sizes=\"auto, (max-width: 1700px) 100vw, 1700px\" \/><\/p>\n<p>Having a freemium and product-led approach avoids the danger of building a marketing-led or sales-led organization. Kristen believes it\u2019s an essential pillar that helps the relationships between each team deepen \u2013 which is crucial for helping the company scale.<\/p>\n<p>And as each team grows, they can work closely together and contribute to the product roadmap through their own perspectives, without stepping on the other\u2019s toes. Without a healthy feedback loop, there\u2019s a big risk that adding a feature to meet the needs of one large enterprise customer will throw the entire roadmap off course. Kristen explains:<\/p>\n<blockquote><p>\u201cSales and marketing shouldn\u2019t drive a product roadmap, and product shouldn\u2019t drive a roadmap that isn\u2019t influenced by sales and marketing; there has to be a healthy balance there. We always struggle with that because it gets really easy as a salesperson to say, \u2018well, if you only added XYZ feature, I could bring you a million-dollar contract\u2019. And that might not be at all with the marketing team\u2019s vision for the product, or it might take so much that it would knock off all the other things that they were working on from an engineering resource standpoint.\u201d<\/p><\/blockquote>\n<p>Kristen harks back to her time at Trello, where a guiding principle was that the sales team would never sell or represent a feature that the product didn\u2019t already have:<\/p>\n<blockquote><p>\u201cIt was a really important agreement between us because it said to my engineering and my product team, \u2018I have your back, l am never going to put you in an uncomfortable position. But in return, we\u2019re going to have conversations about what people are asking for, and we\u2019ll make agreements as a team\u2019.\u201d<\/p><\/blockquote>\n<p>Establishing clear rules and boundaries, especially at startups, helps to avoid the understandable fear that engineering teams can have when the first sales hires come on the scene. <a href=\"https:\/\/blogs.gartner.com\/derry-finkeldey\/2015\/12\/03\/living-proof-atlassian-no-sales-people-everyone-is-a-salesperson\/\"><span style=\"font-weight: 400;\">The connected model<\/span><\/a> makes sales, marketing, and product equal partners at the table.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-24794 size-full\" src=\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-1.png\" alt=\"The Connected Model (graph)\" width=\"1700\" height=\"1269\" srcset=\"https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-1.png 1700w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-1-300x224.png 300w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-1-700x523.png 700w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-1-768x573.png 768w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-1-1536x1147.png 1536w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-1-600x448.png 600w, https:\/\/www.intercom.com\/blog\/wp-content\/uploads\/2020\/10\/Kristen-Habacht-Inline-1-1400x1045.png 1400w\" sizes=\"auto, (max-width: 1700px) 100vw, 1700px\" \/><\/p>\n<p><span style=\"font-weight: 400;\">Best of all, it\u2019s a model that connects customers to the products and buying experience they want. <\/span><\/p>\n\n","protected":false},"excerpt":{"rendered":"<p>For the latest episode in our Scale series, Dee Reddy caught up with Atlassian&#8217;s Kristen Habacht to find out how freemium can drive enterprise sales, how it changes the interaction with the customer, and why it fundamentally affects the relationship between sales, marketing, and product teams.<\/p>\n","protected":false},"author":175,"featured_media":24793,"template":"","category":[1],"tags":[],"show-category":[],"coauthors":[408,17956],"class_list":["post-24792","intercom-podcast","type-intercom-podcast","status-publish","has-post-thumbnail","hentry","category-uncategorized"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v28.3 (Yoast SEO v28.4) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Bought-in and paid for: how Atlassian bridges the gap from freemium to enterprise sales<\/title>\n<meta name=\"description\" content=\"In this Scale episode Dee Reddy caught up with Atlassian&#039;s Kristen Habacht to find out how freemium can drive enterprise sales.\" \/>\n<meta name=\"robots\" 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