How Caroline Tsay transformed HP Software’s online channel

While few would argue that the explosion of data and mobile has transformed marketing, embracing that transformation within an enterprise organization of 13,000 people can be a daunting and challenging undertaking.

Caroline Tsay found this out first-hand when she joined HP as Vice President & General Manager of the Software division’s Online Business in 2013.

Tsay is responsible for growing HP’s $4 billion in annual enterprise software sales, and oversees not only product marketing for the online channel, but also engineering, product management, design, sales, operations, and data and analytics.

“When I first joined HP, I thought, we’ll rely on the product marketers and sales reps within the five software business units,” says Tsay, referring to the five areas to which she serves as a business partner. However, she soon found out that the traditional sales and marketing roles focused on large complex products and services sales weren’t incentivized or compensated to focus on end-user audiences coming through an online channel.

“They’re heavy on face-to-face relationships working within a very traditional sales model, “Tsay explains. “And they also don’t see immediate opportunities in seed deals that may later turn into larger opportunities.”

Adding to the challenge was that HP Software had been traditionally focused on the existing customer base. “While we may need different sales and marketing motions for the more complex sale, we had no business strategy around marketing and selling our software online to users within start-ups, small and medium businesses, mid-market sized companies, or large enterprises,” says Tsay. “These are technical professionals like application security engineers, mobile developers, and data scientists, who are trying software online and even buying it or influencing purchase decisions in their organizations — so we really needed to see a shift in our ability to serve that audience.”

So what does a new GM do in that situation? Tsay built her own division from scratch. As a result, she’s transformed the way HP nurtures and sells software to technical end-users. She was heavily influenced by her previous experience at Yahoo!. Working inside a consumer Internet company, she learned how critical the actual product experience is in supporting any marketing and sales efforts.

Caroline Tsay will be speaking at VB’s GrowthBeath Summit in Boston on June 1 and June 2. By invitation only, the summit is bringing together 180 marketing leaders to share and debate strategies for today’s complex marketing landscape. Request your invite here.

“Products have to be modern, intuitive, and easy to use, and it is critical to hire in-house interaction and visual design talent to design such experiences,” says Tsay. When she came to HP, she saw that a lot of design in support of the product experience was outsourced to independent design and marketing firms. Not only did she find this hugely expensive, but the quality of work suffered. Because these firms weren’t embedded with internal teams, they couldn’t really understand the product experience.

Instead, she became intent on hiring design talent who can constantly iterate on product experiences with continued research and user testing. “We’re maniacally focused on every single pixel on the screen, testing, learning, and feeding insights back into how we shape our products and user experience. And being in the Bay Area, we have no excuse not to have that talent.”

She then built out what she dubbed her Technical Management Team (TEM) — a group of technical specialists who work directly with the 6,000 qualified leads that come in each month through the online platform offering trials and freemium versions of HP’s enterprise software.

“The last thing these end-users want is to talk to multiple sales people in a traditional sales model,” says Tsay. So, in addition to marketing automation tactics, Tsay chose to provide them with an all-in-one contact, who speaks their language and can nurture them from the time they first sign on for a trial through to sales conversion.

“The TEMs are highly technical team members who understand our audiences, the competition, and the industry very well,” says Tsay. “This team is essentially doing a lot of what sales development does, what presales does, what inside sales does, and what technical support organizations do.” The goal is to hand-hold their prospects throughout the purchase life cycle.

This Technical Engagement Management Team is, in turn, tightly aligned with Tsay’s product management and product marketing teams. The two sit right next to each other, ensuring a fluid exchange between the two groups.

“There’s a lot of collaboration because these teams are physically located right next to each other,” says Tsay. “The marketers can hear all of the phone conversations that the TEMs have. Then I’ll hear one of the marketing folks come over and say, ‘I heard the prospect mention something about how our product is missing a feature or capability. We need to go back to the product team and address that.’”

Having an end-to-end view into all user activity, marketing execution, and sales processes is critical to Tsay. Coming from more of a technology background rather than a pure marketing background, she’s seen the importance of instrumenting systems, products, and processes to gain visibility into the entire sales process, to measure effectiveness, and to make improvements.

“I can’t tell you how many different people and companies I talk to, who don’t get to see the full end-to-end view of what happens in their business,” says Tsay. “As a marketer, they don’t know, after a lead gets into Salesforce, what happens from there on out, nor do they understand what the sales people are talking to potential customers about and what feedback we get.”

She’s also taken great care to build alliances with the traditional product, sales, and marketing teams in each of the five business units. It’s vital for her to communicate the kinds of benefits and value she can deliver to them, while at the same time educating them on the online platform experience, marketing strategy and execution, and the TEM sales model.

The efforts are paying off. In a head-to-head comparison of reaching users, engaging them, and supporting them throughout the purchase lifecycle — tracking the performance of the new model of sales and marketing against that of the traditional model over a one-year period — the new model came out ahead by 40% in sales productivity (ratio of order value to sales cost).

“Since we built out the organization, our web platform, and the new ways of doing marketing and sales, we continue to see a significant improvement in sales productivity every month, and we also continue to see six times the number of new customers the existing traditional teams are doing.”

Such is the value of transformation.