You are currently viewing The Crisis of Disconnection: Why Itโ€™s Time to Rethink Your Growth Strategy [HubSpot Data]

The Crisis of Disconnection: Why Itโ€™s Time to Rethink Your Growth Strategy [HubSpot Data]

This post is a part of The Crisis of Disconnection, a thought leadership series examining the latest research and insights to uncover how businesses can meet their growthย goals, even amidst unprecedented changes to the way we work.

If thereโ€™s a topline takeaway from the researchย that prompted us to call The Crisis of Disconnectionย by name, itโ€™s this. The growth challenges you faced in the last decade wonโ€™tย be the growth challenges you face in the next decade.

If youโ€™ve been following along, weโ€™re glad youโ€™re back. If youโ€™re just joining us now, weโ€™re glad youโ€™re here.

To recap, here are four things keeping the savviest leaders we know up at night:

  • Businesses once in hyper-growth mode are now struggling to grow. One in three businessesย are already citing โ€œslowed growthโ€ as a top challenge going forward.
  • Painfully high expenses and increasing costsย are leading businesses to re-evaluate their software spend, the tools in their tech stack, and how that impacts their bottom line
  • Tried-and-true methods for generating demand are becoming less reliable and more expensive. Nearly two-thirds of businesses agree that sales engagement is struggling more now than pre-pandemic.
  • 81% of businessesย agree that COVID-19 has fundamentally changed the way we live, work, and connect โ€” and โ€œthe new normalโ€ is still largely TBD.

Youโ€™ve seen the data. Youโ€™re tracking the trends. But how will The Crisis of Disconnection manifest in yourย business?

Disconnection in Context: Challenges for Go-to-Market Teams

Letโ€™s take a closer look at the three overarching disconnects with material impact on scaling companies:

Broken links and numbered points describing workplace challenges causing disconnection

Whatโ€™s not pictured, and adding a sense of urgency to it all? The macroeconomic fluctuations that seem here to stay. Oscillations in supply and demand, rumors about an impending recession, and decreased access to capital are causing leaders across industries and functions to re-evaluate how to invest in growth.

Letโ€™s consider each core complexity โ€” and its consequences.

1. Disconnected Data and Systems Leads toย Decreased Efficiency and Value to Your Business

If having a streamlined tech stack with clean, connected data feels like an increasingly pressing priority, youโ€™re one of many re-examining their CRM solutions (for good reason).

One in four businessesย today say disconnected data and systems are among their chief concerns as they grow. And the ever-popular point solution approach isnโ€™t without problems.

Consider the Impacts to Your People

Impact 1: Proliferating tools are creating complex, bloated tech stacks that are increasingly hard to use, integrate, and maintain.

The number of martech solutions is up 24%ย from 2020. Additionally, new sales productivity researchย shows:

  • Sales reps use just 62% of their tech stack.
  • Sales reps spend 41% of their average workday not selling, costing companies approximately 38% in revenue per quarter.
  • 74% of CRM buyers feel their teams have to switch between too many tools to get the job done, and 76% are using 3 or more applications to manage their relationships with customers
  • Only 27% of marketers say their marketing data is fully integrated with the tools they use, and 22% of them find it difficult to share data across teams.
  • Marketers spend an average of 3.55 hours each weekย collecting, organizing, and analyzing marketing data from separate sources.
  • Psychologists have found that switching gears and logging into disparate tools can eat up as much as 40%ย of an employeeโ€™s productive time.
  • A lack of unified data can block progress for individual contributors and make reporting an all-day affair for managers.
  • Itโ€™s harder for both individual contributors and team leads to deliver tangible ROI.

Impact 2:ย Disconnected systems lead to decentralized data, which causes teams to spend more time searching for answers and less time focusing on high-value activities.

Impact 3:ย Frequent context-switching results in productivity loss at every level.

Consider the Impacts to Your Bottom Line

According to our research, companies with less connected data & systems are seriously disappointed in the ROI of their tech stacks:

  • Only 13% of businesses that have a mostly or entirely unintegrated tech stackย report excellent ROI.
  • Businesses that report worse connectedness of their dataย also report substantially worse ROI from their tech stacks.
  • Businesses that use 11 or more point solutions see 2.5x higher total costย of ownership than those that use just one.

On the flip side, companies see greater ROI when data and systems are more connectedย and CRM tools are all on one platform:

Statistics proving the importance of integrated technology in the workplace

But whyย does connection & integration of your tech stack make such a difference to ROI? To answer that question, letโ€™s take a look at how ROI is calculated:

ย ROI formula depicting the pieces of an ROI calculation

As you can see in the equation above, total cost of ownership is one of the major factors in ROI ย โ€” as TCO increases, ROI decreases, fast.

And, as weโ€™ve learned in our research, ย having more point solutions leads to significantly higher cost of ownership, primarily driven by the increased personnel costs associated with using multiple tools.

So, even if a business is getting the same gains from their tech stack, using too many point solutions is likely going to decrease their ROI compared to a company that has consolidated more of its tools on a single platform.

As you can see, streamlining your tech stack does more than reduce friction between your systems and data. It reduces your total cost of ownership. It makes you more likely to weather the volatility ahead, with 52% of businessesย with excellent data connectedness reporting they feel well-equipped to grow and thrive, despite the current state of the economy. And it connects your sales, marketing, and service teams (the importance of which weโ€™ll talk more about below).

2. Disconnected People Leads to Decreased Sense of Community and Satisfaction

As you may have guessed, disconnected systems donโ€™t just lead to disconnected data โ€” they also contribute to feelings of disconnection between teams.

At the risk of stating the obvious: the way many of us work took a 180 in 2020. No fewer than 80%ย of U.S. employees say the crisis materially affected their daily work lives. Within a year,ย Zoomย generated a mere $4 billion in revenueย (a 53% increase year-on-year), with meeting participants increasing byย 2900%.ย  Many of us had to learnย โ€” and are still learning โ€” how to collaborate digitally instead of in-person.

There have been some upsides (access to more diverse talent, time saved commuting, meetings attended in pajama pants), along with some challenges.

Statistics describing current workplace challenges employees are struggling with

What does this mean? The playbook for attracting, supporting, and retaining employees is โ€” you guessed it โ€” changing.

Statistics describing current workplace challenges causing disconnection

Employees clearly crave connection and are more likely to feel dissatisfied without it. Whatโ€™s equally true? Creating moments of connection is more challenging in an increasingly remote world run on siloed systems and partially accessible information. And as The Great Resignation is already showing, the consequences of ignoring how employees feel โ€” inside and outside of work โ€” wonโ€™t be insignificant.

3. Disconnected Customers Leads to Decreased Interactions and Opportunities to Delight

If youโ€™re getting the sense that these disconnection challenges are compounding, you arenโ€™t wrong. Disconnected systems, data, and people are all contributing to another problem โ€” brands are facing more hurdles as they try to connect with their customer base.

Before we double-click on the data and what it means for you, hereโ€™s a high-level summary (with a spoiler: what worked then wonโ€™t work now):

Chart showing current workplace challenges that are causes of disconnectivity

In case you donโ€™t want to take our word for it:

  • Customer acquisition cost (CAC) is up. 49%ย of those who track CAC say it has increased in the past year.
  • 42% of businessesย cite increasing costs to reach prospects/customers as the main obstacle standing between them and continued growth.
  • Organic growth is diminishing. The average SaaS blog grew -1.6%ย last yearย and Google takes more than 65%ย of clicks.
  • More than 30%ย of marketers say that they are experiencing average-to-no returns on their digital marketing investments.
  • 80%ย of marketers report that getting rid of cookies will have a mild to major impact on their advertising strategy, and just 36%ย of marketers overall feel completely ready for impending data privacy changes.
  • Businesses have already spent an average ofย $1.3 millionย on General Data Protection Regulation (GDPR) compliance and are expected to spend $1.8 millionย more.

What does this mean for your business? Itโ€™s getting harder (read: less effective and more expensive) to reach potential customers. And if/when you do reach them, itโ€™s getting harder to exceed their expectations (with fewer insights about their personal preferences than ever).ย Without a single source of truth about customers, itโ€™s harder for teams to deliver personalized, connected customer experiences.ย Although 80% of marketersย consider personalization the key to increasing revenue and enhancing customer experiences, HubSpotโ€™s research shows that over half of marketers are missing critical data on their target audience that prevents them from delivering that personalized experience.ย 

So where does that leave todayโ€™s go-to-market teams?

Next Steps

So far, weโ€™ve covered the โ€œwhatโ€ย and โ€œso whatโ€ associated with The Crisis of Disconnection.

In the final installment of this series, weโ€™ll cover the most important question of all. Now what?

Stay tuned for our next post, and in the meantime, learn how HubSpot can help you connect all the dots.

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