Hey there! Welcome to the Marketer Of The Month blog!
We recently interviewed Des Traynor for our monthly podcast – ‘Marketer of the Month’! We had some amazing insightful conversations with Des and here’s what we discussed about –
1. The importance of understanding and reacting to competition
2. Coping with copycats – staying focused and making adjustments
3. Acquiring the first customers – personalized approach for effective customer discovery
4. Growth strategy – virality, content marketing, and cohesive storytelling
5. The complexity of the SaaS – communicating a simple, believable narrative
6. Bundling and unbundling of software – consolidation and preference for all-in-one solutions
About our host:
Dr. Saksham Sharda is the Chief Information Officer at Outgrow.co. He specializes in data collection, analysis, filtering, and transfer by means of widgets and applets. Interactive, cultural, and trending widgets designed by him have been featured on TrendHunter, Alibaba, ProductHunt, New York Marketing Association, FactoryBerlin, Digimarcon Silicon Valley, and at The European Affiliate Summit.
About our guest:
Des Traynor is a Co-Founder and Chief Strategy Officer at Intercom, as well as a member of the company’s board of directors. Des has led various teams inside the firm, including Product, Marketing, Customer Support, and Content, and has been personally responsible for the development of even more Intercom functionalities. Des now manages Intercom’s R&D team, which is situated in Dublin and London.
EPISODE 107: Irish Tech Unicorn Intercom’s Co-Founder Des Traynor on Navigating Competition, Copycats, and Customer Acquisition
Saksham Sharda: Hi, everyone. Welcome to another episode of Outgrow’s Marketer of the Month. I’m your host, Dr. Saksham Sharda, and I’m the creative director at Outgrow.co. And for this month we are going to interview Des Traynor, who is the co-founder and chief strategy officer at Intercom. Thanks for joining us, Des.
Des Traynor: Great to be here. Thank you.
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The Rapid Fire Round!
Saksham Sharda: All right, so let’s start with the rapid-fire first one, describe what your organization does in one sentence.
Des Traynor: Help businesses communicate with customers.
Saksham Sharda: How long does it take you to get ready in the mornings?
Des Traynor: 25 minutes.
Saksham Sharda: Most valuable skill you’ve learned in life?
Des Traynor: Explaining things
Saksham Sharda: City in which the Best Kiss of your life happened?
Des Traynor: Dolan
Saksham Sharda: How many speakers can you name at this conference?
Des Traynor: 25
Saksham Sharda: Can you name some?
Des Traynor: Rizwana, the First Lady of Ukraine, me, Huber
Saksham Sharda: In one sentence describe one problem that your organization is facing.
Des Traynor: 2022
Saksham Sharda: How do you relax?
Des Traynor: I play soccer and exercise
Saksham Sharda: A habit of yours that you hate?
Des Traynor: Using the word “like” in my sentences.
Saksham Sharda: Work from home or from the office?
Des Traynor: Office
Saksham Sharda: The most embarrassing moment of your life?
Des Traynor: At this conference when my clicker wouldn’t work that was pretty embarrassing.
Saksham Sharda: How many hours of sleeping to survive?
Des Traynor: Six
Saksham Sharda: Your favorite app?
Des Traynor: There – the note-taking app
Saksham Sharda: Biggest mistake of your career?
Des Traynor: Enrolling in a Ph.D. that I did not finish.
Saksham Sharda: What is it in?
Des Traynor: Computer Science education.
Saksham Sharda: First movie that comes to your mind when I say the word technology?
Des Traynor: Hackers
Saksham Sharda: How many cups of coffee do you drink in a day?
Des Traynor: Five.
Saksham Sharda: Your favorite Netflix show?
Des Traynor: I was gonna say Game of Thrones, but it’s not on Netflix. “After Life” – Ricky Gervais.
Saksham Sharda: One thing you want to say to Elon Musk for having bought Twitter?
Des Traynor: Good luck.
The Big Questions!
Saksham Sharda: Okay, so that’s the end of the rapid fire. We’re gonna go on to the bigger questions now. The first one is how do you deal with competition and copycats? And how do you view the large number of companies that have added chat?
Des Traynor: Competition and copycats I see as different things. I have respect for competition, and I have less respect for copycats, but I understand the role of copycats. I know what they’re trying to do. And you know, sometimes it’s a good strategy like it’s formalized in like Harvard Business Review language, the Fast Follower Strategy, right? How do I deal with competition? So the cliched thing that I’m supposed to say to you right now is we don’t care about competition, we just talk to our customers, right? That’s like this sort of “101 How to Speak to Press” answer to the question. And maybe I’ll just try and like assume I think all the stuff that everyone else does. But I’d also just maybe add, like, it’s useful to understand how the industry and the landscape are evolving around you. And it’s useful to see where your competitors are digging or investing or like experimenting because they will find stuff. Like generally speaking all of our competitors, I have massive respect for…they are great companies, you know, it should be no surprise. So you have to assume that they’re doing some good stuff. And that they will have some hits and those hits will change the landscape. So you do have to be kind of quite aware of it. So I think the idea is like, yes, you listen to your customers, and yes, you have your own opinions about the world. But you don’t ignore the reality of the landscape that’s changing under your feet as well. With copycats, I think you have to work out like oftentimes people tried to do a copycat of Intercom, and what they find that most of them like, they last a couple of years and they struggle or they find a weird niche at the very bottom of the market or in a very specific vertical, like Intercom for hotels or something like that. Generally speaking, you don’t like it if it’s a pure pixel, rip-off copycat…and we’ve had some like pretty big ones over the years as well. I think in general, they’re just following your roadmap because their customers are looking at you. If they have an edge over you like something like “hey, well, they’re attached to something else that makes sense” or they are an extension of a product that already exists or whatever, you watch your customer base behavior. And if they seem to think that there’s value over there, then you need to react to that. If they don’t think there’s value over there and this person is just found a new type of customer that you weren’t previously prioritizing. Kind of like let it happen. I think like there’s a phrase I often come back to which is “startups die by suicide, not homicide”. And I think it’s Paul Graham or someone whot said that…Ron Conway, maybe. But do you know, it’s not what they do to you, it’s what you do to yourself in reaction to it that is often what hurts you in these cases. So I think it’s more important to like stick to your principles. And just like if they find a significant edge that is unique, and you actually credibly believe customers should switch, then you have to react and reaction usually looks like roadmaps or a service adjustment or marketing adjustment or whatever. But most of the time, if you’re in if you’re operating from a position of strength, and you actually believe in your own company, and believe in your team, you should kind of tune out copycats, but you should always observe the competitive landscape.
Saksham Sharda: So, Ironically, it then also is a game of copying from your copycats as well?
Des Traynor: Yeah, work at what did they see? So like a classic example of the Intercom copycat would be: “We’re Intercom but we’re like $4 a month or whatever.” I like that always has what I call its ‘false traction’ moment: everyone signs up. And like holy shit, this thing’s only four bucks a month! And then inevitably, they run straight into a wall of reliability problems, service problems, support problems, like downtime, it’s like turns out operating like live chat and like operating chatbots and messengers and email and push and SMS and all that sort of stuff. For like, hundreds of millions of people in real-time, every month is expensive. You have to pay a lot of money to Amazon or to Azure or whatever right? And then of course, where does that money come from? Well, it comes from the money you’re making off your customers, and $4 a month, that’s not profitable, right? Like, there’s a reason why I say like, the Holiday Inn isn’t disruptive to the Four Seasons, right? They’re just two different businesses with two different service models. And you shouldn’t try and kill your business by trying to stretch to cover both. So sometimes they will find an edge or an angle that makes sense for a specific cohort of customers. But oftentimes, they’re experiencing a kind of a false birth or false moment where like, they think that they’re kicking off. But actually, their problems are only beginning.
Saksham Sharda: So speaking of intercom itself, how did you guys go about marketing and acquiring your first customers, and then over time acquiring customers?
Des Traynor: Our first 100 customers, we got by emailing them and asking them to use the intercom was pretty blunt. It’s funny, though, because whenever I talk to startups about this, they say, how did you have your first customers? And I say, “Oh, I emailed them, and I can show you like the first 10 pages of my Gmail account”. It’s just me emailing people saying, Would you like to try this product Intercom, it’s going to help you talk to your customers. And you know, my conversion rate was pretty 1 in 10, which meant maybe I sent like, 1000 emails or something like that. But every email was handwritten like I designed specific screenshots.This is like in 2011, there were just tools to automate some of this now, but I like to design a specific screenshot of how the intercom would look for that particular customer. And, over the course of I want to say like a month, we started growing customers and customers started talking about us. And that got us to 100. Whenever I tell you in founders out, they sort of say, “Hey, Des, is there not an easier way to automate all this?” And I think I’m wary of people who aren’t willing to put those arrows in because every single email you send, you get a reply some of his replies a wait, what does it do and you refine your pitch, or sometimes they’re asking for like proof points, and you refine your email, sometimes they don’t reply at all, and you realize you’re not getting enough attention. And then sometimes they try it and don’t sign up because they didn’t find value. So I think you shouldn’t automate away stuff. That’s customer discovery. It’s for sure. Like you could use outreach or sales to spit out millions of emails, but you’re trying to understand how to grow your business. You’re not just trying to automate it away. So I think like, it’s good to put into kind of the grafted hard yards at the start, while you’re still learning.
Once we got our first 100, how did we grow from there, it was a combination of like intercom benefits from a little bit of virality in the sense that you see intercom in other products. You see it on websites, it says powered by intercom, you click it, it tells you what our product is. We also put a massive effort into content marketing, like I wrote, I guess like 90 or 95 of the first 100 blog posts on the intercom blog. And it was all about stuff that our target customers would want to read. And we put a great effort into like marketing those blog posts like making sure we’re resonant and relevant in the right communities and just generally growing the awareness of the intercom itself. And that kind of helped propel us onward said when someone said you should try to intercom things people say “oh, like the thing I saw on that site, or Oh like the blog posts I just saw, or talk I just saw it as gave or whatever”. So it was just a full-on assault of like content and virality I think is how Brian built. We also like probably disproportionately orders, we put a lot of investment our CEO own put a lot of investment specifically into like the design of our landing pages, we are always obsessed with telling a cohesive story from start to finish. And over the years, we’ve evolved our methods but like we had some cool versions where we would have like a set of animals explaining the story of intercom and the Lemur would be the customer and the giraffe would be the business or whatever, and like it was a very like children’s storybook style. The simple, easy-to-understand story that I think just really resonated with the market. I just kind of it just gave people a fondness or affinity for intercom, which helped as well.
Saksham Sharda: So do you think the complexity of SaaS software or like there are being so many Micro-Saas companies around just makes it un-understandable for like the modern customer? Unless explained in a really broken-down way?
Des Traynor: I think yes, is the short answer. And I’ll say more, because obviously, yes isn’t a great answer. I think we all believe that I’m passionate about products. And I care about how businesses support their customers, and that’s what I’m all about. But I have to realize, our customers don’t care about that as much as I do. So they’re not going to read all the nuance on all like the 11th bullet point or whatever on the page. You need to start with, a simple, believable, explainable narrative as to why you are the best at what you do. And if you can’t get that point across, you will always kind of struggle if you’re relying on the nuance, if you’re relying on people putting the research in. Sure, you can go and engage Forrester and Gartner on Dell, like they’ll do your homework for you and come back to you with like a simpler graph or positioning or whatever. But like, I think the more nuanced on like foresee your differentiation is, the harder it is to just follow, right? And as a result, customers will like, you know, if a customer has to put in, like so much research just to work out why you’re a little bit better. It doesn’t work. I think with the proliferation of SaaS, there are just not so many tools in the stack. There’s like martech tools gotten so many support tools. There’s like plenty of like bots and chatbots and all that sort of stuff these days as well. I think that has muddied up the messaging a bit. So if you want to stand out, you need a compelling brand, a compelling brand promise, like what you’ll do, and clear examples that are just very hard to dispute or question and very easy to understand. And then ideally any in-product usage and activation are very easy to get to as well. And I think if you have that you can stand out from the crowd, breading people underestimate.
Even as you walk along the halls of Web Summit here, people underestimate how semi the whole world gets, like if you walk up and down the alpha stage or beta stage where all the early-stage startups are, like, we do email marketing analytics, we do marketing analytics for email, it’s just like, you’re kind of your head, a sponge, listening to all these pitches on top of each other. And then you’re trying to imagine what the world looks like when your Mar tech stack includes like 27 of these things, and how they all talk to each other. So no wonder when somebody comes out like to take the lens off the intercom for a second, let’s say, MailChimp, or HubSpot, or someone comes out and says, “We will take care of all your blind needs, we have a complete single suite of tools”, you can see how people are like, “Oh, thank you” because that relieves me of you know, the 27 decisions plus to like the whatever it is 27 times 26 integrations that you have to get to make the whole thing work. And I think that’s just we’re going through a phase of like the world of software is one of like, bundling, and unbundling, and I think we’re going to rephrase of like, you know 2022 is accelerating this, we’re seeing a lot of like consolidation back onto like, even if there are two better individual tools, I would rather if I can do my support on like, you know, my support and my automation in my chat, bots, auto ML platform got to be better, even though it might be like, even if there is an edge to every individual tool, the complexity is just never worth it. And that’s been our experience as well.
Saksham Sharda: But speaking of that, then intercom has added so many categories, and they’ve been able to handle the challenging positioning issues of doing quite a lot. What do you have to say about that?
Des Traynor: I think it’s a complimentary question. I think we can be pretty clear about what the intercom is and what it does. But whenever we end up in a discussion with a customer, you have to go a level deeper immediately. Right? So like, I think maybe as an umbrella brand, people get the idea to intercom equals, like, you know, communication between businesses and customers probably inside your product or on your website. And that’s what people get when you like if your business comes to us and says, “Hey, we’re talking about buying intercom very quickly, we need to like break out of that mold and say, who in your business? You say sales. Oh, okay. Well, then let’s talk to you about our current use case or its support.” Okay, let’s talk about why we’re better at support. But I think like the pressure, having more than one offering for more than one buyer, the pressure is not just on the product team, and like Well, that’s a lot of software to build. It’s also the brand architecture on the brand umbrella and making sure that you can have a narrative at the top that doesn’t out rule a support buyer, or saying engage or engagement buyer, right? But at the same time, like entices them to go one, and click deeper to find out what’s in it for them. Because oftentimes, you know, when you have a suite of tools, it’s often the case that there’s no one purchaser, right there’s like, you know, we sell support to support teams, we sell engagement to marketing teams or product teams or whatever. And I’m like, you know, to aggregate all that up, we end up with like two different teams still two different purchasers on like two different competitive landscapes. So you have to say like, Thank you for the form in which you raised the question, but I’ll just say it’s hard work like that complexity does not come for free. Sorry, it did. Markets come with a heavy cost and complexity is not free.
Saksham Sharda: Will you repeat that last sentence, again?
Des Traynor: Sure. That complexity, like it, adds up. So you might think, hey, we can sell support software on as let’s say, onboarding software, like the product or something like that. You get extra revenue from selling more things. But you get a lot of complexity. And I think one mistake of this generation of software companies is a chronic underestimation and how much complexity hurts both in terms of dollar cost, productivity cost, understandability cost, like complexity is expensive. And you should price that in when you make any decision.
Saksham Sharda: So this is a bit of an overarching question and it is, what is your approach to the product?
Des Traynor: Start with an understanding of the problem. That’s the first, you know, you can’t build a product until you understand the problem. And the understanding of the problem has to be specific enough to speak to the hearts and minds of the people who experienced the problem. And yet abstract enough to cover all of them. So like, you can’t be like customer communication software for dentistry, right, because you’re going to rule the rest of the market. So you need to find the right level of abstraction where the markets are big enough, but also, specific enough such that everyone gets it immediately. It’s a one-to-one mapping between problem and solution. So first principles, start with an understanding of the problem. Secondly, think big, start small and move fast. So you have to understand the overall thing you’re trying to build, you also have to have a path of what’s your release version 0.01, where you can kind of fire at a tracer bullet and see actually what’s happening. Like, let’s ship this thing and see if people use it. And then speed is just essential in any startup because I’m a huge believer in like the speed of iteration of any product team or any company in general, is like, probably the biggest factor in like whether or not they’ll be successful is how quickly they can ship and learn. So that’s our second principle. So think big, start small, and move fast. And then the third is just to understand that shipping is like the beginning of the process. It’s not the end, right? I think that’s something a lot of software teams do. They like to burn the midnight oil, get the thing live, and then sit back and relax. But, once it goes live, that’s game time, that’s now when you’re walking onto the pitch, not when you’re walking off it. And that’s the time when you need to be like drinking the customer feedback, reacting quickly, tweaking, knotting adjusting, etc. And I think if you don’t get that you’ll produce shelfware, it might be beautiful shelfware. But if people aren’t feeling the products alive and adapting to their needs, they won’t use them for a long time. And then they’ll just sit on a shelf somewhere.
Saksham Sharda: And speaking of which, then what do you have to say about reacceleration? And why startups are doing that?
Des Traynor: I think every startup that I’ve talked to has had what I think the kids referred to as a banger of 2021. Right? It was the strong year 2021. And I think 2022 hasn’t slept as much to speak in the language of their children of today. And I think a lot of people are noticing that, like, you know, things that they started doing in 2021 aren’t paying off the way they thought they would in 2022. And in some cases, the rate of the trajectory of their growth has adjusted or adopted or shrank, or not met their expectations. So I gave a presentation here, about reacceleration. And just really just two core ideas. And one is that the first and primary source of acceleration in any business is by finding your target customer, your ICP your Bullseye customer, people have different phrases for it. And making sure that your business is as simple and optimized for them as possible. And simplicity is a really important piece of that. Because I think, again, during good times people add complexity, they throw in more products, more options, more types of tactics, etc, more acquisition channels, they just throw everything out the wall, because the times are good and everything seems like it’s working. Because the underlying tectonic shift is working right? All of that shit costs a lot of complexity. And complexity slows things down, right? You’ve got loads, more price plans, more products, loads, more acquisition channels, loads, more like types of customers, etc. So the first job really in any acceleration project is to find what are we doing. What was the healthiest core of our business? And how do we optimize the entire company around that? When you’ve done that, then you have the opportunity to layer things on top knowing that by layering anything else on top, you do run the risk of adding complexity, right? But generally speaking, the options I talked about a lot are like you can move upmarket, so selling the same software to bigger customers usually comes with a heavy cost from an R&D perspective, you have to add a lot more features. Or you can say the same customer, but we’re gonna sell them more things. So maybe they use you for support, but maybe they also use a different tool for something else and you go and build a version of that different tool. Now you’re selling two products to the same person. So you increase your ACV which can be a source of acceleration. The third option is within your existing customers sell into different departments. So different buyers, the same customer. So in that case, it’s similar to the previous but except carries an additional marketing challenge you need to know to break out of there like the sales department into whatever product department, so you have a marketing kind of challenge as well, along with the Innovation Challenge. And then lastly, like there’s like verticalization, so that you say like, Hey, I noticed we have a lot of customers in the FinTech space, let’s go hard at fintech. And that would be in producing domain-specific language, potentially tweaking or skinning your product specific to that customer, different routes to market possibly different price bonds, if it makes sense. And that’s another source of acceleration note, I will still go back to my first point, say you only do those things, once you’re sure your base is solid, if your base isn’t solid, none of this shit will help you.
Saksham Sharda: So speaking of moving off-market, when is the right time to start thinking about moving into the enterprise space?
Des Traynor: I think when you believe that your rate of growth is on course to saturate the markets you’re in, that’s usually the point at which you have to look for new markets. So as in, we have, you know when you can sort of say, Hey, we’re winning most of the deals in this space, we’re emerging as the de facto go-to standard. At the current rate of adoption, as customers exit off your annual contracts and buy a new thing. They’re mostly buying us. And when all of that is true, then you say it sounds like we need a new plan for like, it could be a free year from now or whatever. But at some point, we’re going to run out of customers. So then your option is where do you go? So if you want to go into enterprise, that means going with the market, the best thing to do there is to say, we should talk to our largest customers within our current segment and see what starts to crumble and what starts to break, talk to a few stretch customers, people who can’t serve and work out why can’t they adopt you. And that starts to hint at the origin of the enterprise roadmap, it’s much more complicated than anyone gives credit for people who think it’s just latched on to Salesforce integration and maybe a few bits of reporting, and you’re done. It’s not that at all, it’s full-on Role Based Access Control permissions. It’s multiple different types of reporting multiple different integrations, changes your sales model, changes your service model changes your support model. So you have to really like to embrace it for the challenge that it is. And I think like the guiding principle that we always thought was one step at a time. So it might be tempting to jump from like you know if your target customers like you know, 100-person startups, it might be tempting to say let’s go for 1000-person startups. But that’s like that might be two or three steps too far. And you might find yourself with a big hole in your customer, right where like, you’re good for zero to 100. And then you start being good around 1000. But there’s a big gap here, all your 100-person companies will churn out into a black hole where you don’t support them. So you have to think about this whole thing holistically.
Saksham Sharda: Could you give an example of a company that’s managed to do this well, this transition?
Des Traynor: I think Stripe on Slack comes to mind. Where I think they managed to deploy the enterprise features without junking up the experience for the regular customers. And then they managed to layer on the new product lines that the enterprise customers would need. And realize the additional cost benefits or the price benefits from the enterprise customers. You know, without knowing the internal divider company, I think debited to I’d point to where like, it didn’t feel like the product moved upmarket. For us, it feels like the products have been pretty stationery in a good way as stable as maybes in recent years. But you can see that they’re now winning their customers under like getting all of their right places into Gartner and Forrester waves and quadrants and all that. So there are ways to do it. But the word I just keep coming back to is you need a cohesive strategy. It’s not just a yes, that’s at enterprise you need to think about customer velocity, how quickly the cluster moves between the modes, and not leaving any kind of holes in your offering as well so that people can grow with you.
Saksham Sharda: So the last question for you is of a personal kind of what would you be doing in your life if not this?
Des Traynor: I think the thing I enjoy most is just learning and expanding. Honestly, drivers, my friends, and my family are kind of crazy. I just like to explain things. Even this interview is kind of fun for me, you know? So I would probably be either one of those, Angel Investor/ advisor/ writer/ blogger type people. Or I’d be like a more traditional university lecturer. It depends on this fictional dad’s world. It depends Did I do the intercom thing or not? If I didn’t do the intercom thing at all. Maybe I’d just be a university lecturer. If I did do the intercom thing. I think I’d probably be one of those people who like is known for advising investing in startups and having useful things to say to like early-stage companies.
Saksham Sharda: That was amazing. It was great listening to you.
Saksham Sharda: Thanks, everyone for joining us for this month’s episode of Outgrow’s Marketer of the Month. That was Des Traynor, Co-Founder, and Chief Strategy Officer at Intercom. Thanks for joining us, Des.
Des Traynor: Pleasure. Thanks for having me.
Saksham Sharda: Check out the website for more details and we’ll see you once again next month with another marketer of the month.