GitLab’s Hila Qu on What B2B Companies Can Learn About Growth from B2C
Every business wants growth, but how growth is defined and achieved can be very different depending on the kind of business you’re talking about. Even just comparing the differences between how growth works for B2C versus B2B at a very high level, it’s easy to see that there are differences at each stage of the customer journey.
Despite these differences, there’s a lot B2B and B2C can learn from each other when it comes to growth.
We had the chance to talk with Hila Qu on a recent episode of the BUILD Podcast. Hila has a unique perspective, having worked in both types of businesses. Since 2019, she’s been the Director of Growth at GitLab. Previously, she was the VP of Growth at Acorns, a consumer app for micro investing.
In conversation with Blake Bartlett, she walked us through how B2C and B2B growth strategies compare across each phase of the customer journey from acquisition to retention and expansion.
To make sure we were all speaking the same language, Hila first took a moment to define her terms. To differentiate between how B2C and B2B define growth, she focused on two specific elements: goals and where the growth function lives within an organization.
B2C businesses, she says, focus primarily on user growth—mostly active users, and so forth. Their aim is to convert as many people as possible as quickly as possible. B2B growth, on the other hand, tends to focus more on revenue—ARR, and so forth. This is in part because, depending on the nature of the product and the pricing structure, the number of users may or may not have that much influence on the overall bottom line.
Within a B2C organization, growth is usually pretty closely aligned with the marketing team. “At Acorns, my team included user acquisition, CRM marketing, and growth product.” Hila says. “Together with product, the growth team owned the user growth quota to drive active users.”
In a B2B company, growth is applied much more broadly, taking a cross-functional, multidisciplinary approach that includes sales, marketing, customer success, product, and others. “When I joined GitLab, I was starting a new product-led growth team within the product organization,” Hila says. “We own part of the revenue growth—not the sales quota, but the self-service, product-led revenue growth funnel.”
These key differences between how B2C and B2B companies view and manage growth are driven by and influence growth’s relation to various parts of their respective customer journeys.
Acquisition is shaped by the sales funnel and the channels that drive people into it. As Hila explained, the B2C funnel is very direct and short. It’s all about individual productivity and immediate gratification, so it doesn’t take long for a prospect to get from point A to point B. The B2B funnel, on the other hand, is built around a much longer sales cycle that can take months or even years, and which involves all the various stages of consideration, evaluation, negotiation, and so on. This process can involve a whole team, or even an entire organization, which means there are a lot more steps, and getting buy-in requires more effort.
The channels that drive traffic to these funnels are also different. B2C relies heavily on paid channels combined with some referral and some organic. The strategy is to cast as wide a net as possible to catch as many “fish” as possible, and drive the number of users up. In contrast, B2B leans more toward slow-and-steady channels that help build relationships and community over time. This includes channels like content, conference, and webinars—all of which tend to require a lot of up-front work, but pay off over the long term.
Hila also noted that, more and more, B2B companies often have two different funnels—one more traditional sales-led funnel, and a product-led funnel. Which one applies can depend on the nature of the customer. Hila explains
“Individual users need to be able to use the product quickly and experience the value if you want to convert them right away,”
“But a company might also be doing team acquisition within a mid-market or large enterprise company, which will be a slightly different funnel with different tactics and steps.”
In addition to her growth roles at Acorns and GitLab, Hila also spent some time working for Sean Ellis at GrowthHackers. During that time, she learned the value of focusing your attention and effort on activation.
“One of the first things I learned from Sean was that if you have ten developers on your team, put five on new product and the other five on new-user activation,” she says. “Because whatever cool features you’ve built won’t matter if your activation doesn’t work.”
Unsurprisingly, B2B activation is typically much more complex than B2C activation. B2C activation involves one person taking what is usually a very short journey from start to the aha moment of experiencing value. B2B activation, meanwhile, can involve teams or entire companies. Hila looks at activation as a set of tiers:
- User-level Aha: “This level of activation can apply, for example, to an individual GitLab user who has finished some basic setups and maybe committed their first set of code,” Hila says. “At that point, they have solved a problem, and found the product feature useful.” She notes, however, that this user-level aha moment is not always enough. It’s just the starting point.
- Team-level Aha: “Most B2B products have a team element that has to do with collaboration,” says Hila. “Again, using GitLab as an example, maybe the original user invites three team members to join GitLab, and they begin to collaborate. They merge some changes and release a piece of code. They realize that GitLab helps them collaborate and save time because they don’t need to do multiple things in multiple places. That’s their aha moment as a team.” At this stage, however, the team might still be using the free version of a product, so there’s still another activation step to go.
- Organization-level Aha: Once a team has experienced success with a product, they might take on the role of internal champion—pitching the product to their engineering manager, CTO, or other decision maker as a solution to be used across the whole company. “At this level of activation, the customer needs to reach the moment of understanding that the paid option is worth the money in terms of the ROI it will deliver,” Hila says.
Because B2B activation is a much longer, more complex journey, it’s important to hold off on declaring victory too soon. Activating an individual user is a win, but it’s definitely not the end of the story. Full activation may take multiple steps and involve many constituents and stakeholders. Hila says
“Always be activating. Always be onboarding.”
The obvious difference between B2C and B2B conversion is that consumers almost always self convert while B2B buyers are more likely to work with sales. But, as more and more B2B companies begin to incorporate product-led strategies into their go-to-market (or transition fully to that model), there are a few things B2B growth folks need to keep in mind.
One skill that B2B companies should learn from B2C companies is the ability to connect the dots with data in order to uncover upsell opportunities. “A lot of companies I talk with do a great job of monitoring the different teams within a company that are using their product,” Hila says.
“A lot of times, multiple teams will buy a product separately, using their own budget. When there are enough of these ‘dots,’ that indicates an opportunity. Product companies can take advantage by first recognizing that this is happening, then capturing the relevant data, and routing it to the sales team to evaluate if there’s an opportunity to pitch a bigger deal to the organization.”
Another area that Hila thinks is one of the most undervalued and underutilized growth levers—both for B2C and B2B—is monetization and pricing strategies. “Of course, monetization is much more complex for B2B,” she says. “But you also have a lot of flexibility to innovate and experiment. B2B companies have the power—if their products are really solving the customer’s problem—to price their products strategically.”
Retention & Expansion
Product is a big retention lever for both B2C and B2B products, but in different ways. For B2C, the focus is on removing friction so users can experience value as quickly and easily as possible. And it’s about doing a lot of experiments to improve engagement. This might include developing and implementing new use cases that drive usage frequency. Acorns used this strategy when they added a debit card, which encouraged people to log in much more frequently to check transactions. B2C retention can also be positively influenced by the use of channels like emails and push SMS, which keep people in the loop and keep the product top of mind.
In addition to those tactics, B2B companies can also aid retention in other ways. They can, for instance, pay close attention to usage data to get a realistic sense of which features users are actually using. When you understand more about exactly which features have users coming back again and again, you’ll gain valuable clarity about how to build on those successes to continue to improve engagement and activity frequency. Another big opportunity is integrations. “A lot of B2B tools have integrations with other B2B tools, and if you can drive users to set these connections up early, that can be a big retention lever,” Hila says. “The more you can build your own product as a platform, and the system of record, the better chance you have of retaining your customers for longer.”
Growth Strategies B2B Can Borrow from B2C
To close out the conversation, Hila shared a few tips for which B2C growth strategies B2B companies might want to explore.
Break the data silos.
“Breaking the data silos to build a truly 360 customer data and full-funnel view is pretty easy to get in B2C, but tremendously hard to get in B2B. You need to close the gaps between the marketing data, marketing source, channel source, demographics, third-party data, product usage, email engagement, and in-app behavior—it all needs to be linked together to uncover the insights that power growth.”
Increase the tempo of your iteration and experimentation.
“The tempo of experimentation is much faster for B2C because they have a larger sample size, the decision time is quicker, and the funnel is shorter. A product-led approach helps B2B accelerate their rate of experimentation to get quick feedback. They will grow faster because they learn faster and iterate faster.”
Focus on the end users, not the gatekeepers.
“B2B companies tend to focus too much on companies and decision makers and not enough on users. B2B companies could borrow some of B2C’s ‘found factor’ to reach more end users directly.”
And there are things B2C companies can learn from B2B as well. For one thing, B2C companies tend to rely overly much on automation, but they could improve their customer experience by layering in some human interaction. Hila mentioned the email company Superhuman as an example of a company that is weaving the human element into the onboarding and interaction flow in a very effective way. B2C companies that develop a similar approach for their brands will really stand out.
To hear more of Hila’s ideas about how to successfully power growth, tune in to hear the full episode.