174: Agility Is the New Growth Strategy (w/ Kathleen Booth)

Ali (00:01.518) Welcome to Move the Needle. I'm so excited to sit down today with Kathleen Booth, the Senior VP of Marketing and Growth at Pavilion. If you're a go-to-market leader, chances are you've heard of Kathleen, you've heard of Pavilion.

They're the number one private community for go-to-market leaders, and you've probably seen Kathleen and her team's work before. I've been dying to get into Pavilion myself for a while, so I'm excited to get to sit down with Kathleen, a big reader of the newsletter, which is always full of really smart insights that your team is running. So Kathleen, welcome. Kathleen Booth | Pavilion (00:06.

181) Thank Kathleen Booth | Pavilion (00:29.529) Thanks, Allie, I'm so excited to be here. Ali (00:32.398) Excited to have you.

So I'm going to dive right in with some of the recent research that you wrote up for Pavilion around confidence levels that go-to-market leaders have in hitting their growth targets. So you've talked a lot about market volatility that's going on right now, that confidence levels in hitting targets have decreased by 10%. Respondents who said they were very concerned about hitting their growth targets was at almost 30%, which feels really high. and you cover a lot of the reasons why in your post, which everyone should go read.

can share that out in the notes, but maybe you could summarize for us here a little bit. What is going on right now that's got everybody on high alert? Kathleen Booth | Pavilion (01:10.371) Yeah, it's, we live in interesting times, right?

Isn't that the curse that everybody always talks about? I think there's a couple things. One is, you know, the thing we're all sensing and feeling viscerally, which is just a tremendous amount of uncertainty. Uncertainty is the new normal.

Not only because of, you know, AI, I think is just making the world tremendously uncertain, but obviously there's tariffs and there's legal and regulatory changes. There's geopolitical uncertainty that we're living through. Ali (01:15.512) Thank Kathleen Booth | Pavilion (01:40.

409) And in fact, there is actually a United States uncertainty index graph that measures this and it measures sentiment around how people are feeling as far as uncertainty. And the last measurement they took, which I think was at the end of Q1, had it at the same height that it was at the highest point during COVID. So if you can imagine, COVID as a pandemic felt like a black swan event, something we'd never experienced in our lifetimes before. Ali (01:59.

662) wow. Kathleen Booth | Pavilion (02:08.299) And there was tremendous uncertainty from that. And this is like equal to, if not higher to that.

So there's data to back up what we're feeling. You know, it's real, everybody's feeling it. And I think in addition to, you know, economic uncertainty, rising interest rates, volatile markets, there's this, this also idea that like budgets are somewhat constrained. And I don't know if constraints the right word or just on hold.

I think a lot of people Ali (02:12.184) Wow. Kathleen Booth | Pavilion (02:36.463) have money, but they're pausing spending because they don't know what's coming tomorrow.

And so there's this attitude that we're going to wait it out, but the end, the day that you can like wait it out in toll never seems to come. And so it's causing a lot of disruption and AI is doing the same thing, which it's, you know, causing changes in buying behavior, buying processes, the competitive landscape. And then I think layered on top of all of that is the fact that there is pressure from boards and investors. to deliver results because many VC and PE firms haven't, well, particularly VC firms haven't had an exit in a while for a lot of their portfolios.

And that's putting pressure on everybody to show that they can achieve growth. So lot going on there, but I'll stop there. Ali (03:05.112) Mm-hmm.

Ali (03:12.674) Yeah. Ali (03:22.062) So, yeah, absolutely.

One of the reasons I'm a little bit happy to not be in a VC backed firm, VC backed company at the moment, but a lot of pressure there going on for sure. That makes sense. You advocate in your article for one of the things that go-to-market leaders need to be doing right now is leaving behind rigid adherence to an annual plan and they need to be a lot more flexible, more agile, shift towards a dynamic planning model. Can you talk a little bit more about what that shift would look like?

Kathleen Booth | Pavilion (03:49.35) Yeah, so we recently had our CRO summit and we talked about this there because there's a lot of data that, you know, change is the new constant. As I said, there's data to back that up, but there's also data that a lot of revenue organizations don't actually deal with change very well. And so For example, according to recent research by Gartner and their chief sales officer report, two thirds of sales organizations revise their strategy more than two times a year.

But 66 66% of heads of sales say they struggle to adapt their strategies in response to those changes. And 65 % of them struggle to shift budget and resources. So like We know things are changing, the change is happening and yet we are largely failing to keep up with it. And that's compounded by the fact that interestingly the same report has data that shows that only 13 % of the typical chief revenue officers work week is spent on long range planning.

The rest is firefighting. So like, if you know all this change is happening, you already know you're struggling to keep up with it. And only 13 % of your time is going to this strategic level stuff around change, you that includes change management amongst other things. Ali (05:04.

46) Oof. Kathleen Booth | Pavilion (05:17.753) Like we have this recipe for real you know, disaster. Ali (05:23.

456) Yeah, all those are tough stats. Kathleen Booth | Pavilion (05:25.477) Right? No wonder everybody's stressed out.

Ali (05:28.622) For real, the firefighting feels really, really prevalent. So have you run across, heard any examples, maybe even from the recent summit of companies that you think are doing this pivot really well? Kathleen Booth | Pavilion (05:40.

736) You know, I've heard some anecdotes and I think the examples that I would draw on are there are companies, for example, like HubSpot, which runs agile marketing sprints to adapt pretty frequently, Gong regularly updates its ICP and messaging. Then there's companies like owner.com, Kyle Norton, who's the CRO there as a Pavilion member, and I follow his work really closely. they're growing like crazy and he's really leaning into AI to help him respond and adjust.

And I think he's probably at the forefront of that. So I would really watch closely what they were doing as a great example. Ali (06:21.998) Sounds like some good podcast guests for me to reach out to as well.

Thanks for sharing this. What role does data play in shifting to a more dynamic planning model? What would be the most important data to be looking at and how would that inform some more responsive and agile decision making? Kathleen Booth | Pavilion (06:24.

229) Yeah. Kathleen Booth | Pavilion (06:38.073) So I think we know change is going to happen. And there are two different ways that data can really help.

One is that I think if you have a good data collection and analysis system, it can provide some early signals that change is coming or that it needs to come. So that then can buy you more time to manage that change. But I also think data can help justify a lot of these pivots we're feeling because The other dynamic that I think we're seeing out in the world is difficulty of teams to adapt when change happens. Like there's a lot of stress on teams and on the people that work for us.

And so the more time we have to introduce these things, the more we're able to plan and, and help people understand why they're happening. think that can help smooth some of the bumps that we otherwise might feel. So data is important for that reason. And we can get into like the exact, like KPIs and types of data if you want, but I think, you know, clearly data around growth, things like real time sales, pipeline velocity, conversion rate trends, customer engagement metrics, retention.

Ali (07:38.53) Mm-hmm. Ali (07:45.006) Mm-hmm.

Ali (07:50.957) Mm-hmm. Kathleen Booth | Pavilion (07:59.59) intent data signals.

And then like one thing I'm really enjoying doing right now is diving into some of the qualitative data that we're seeing through our sales call recording software and listening with all this economic volatility, really trying to get more data backed trends on how often is pricing coming up as an objection. You know, things along those lines that will help us understand how we need to adapt. And so I think right now the most important data Ali (08:10.733) Yeah.

Ali (08:20.107) Okay. Kathleen Booth | Pavilion (08:29.133) is really around like buyer intent combined with velocity and close rate metrics, because I think the biggest change we're seeing at least is around sales cycles and how conversion rates and time to close is changing.

Ali (08:43.232) Yeah, that makes sense. I think you had also mentioned in your article really paying attention to those conversion rates by ICP and maybe shifting focus from the ICPs that are not converting to the ones that seem to be like maintaining some traction. Kathleen Booth | Pavilion (08:50.

671) Mm-hmm. Kathleen Booth | Pavilion (08:58.073) Yeah, yeah, absolutely. Ali (09:00.

898) Why do you think so many teams are so slow to pivot? They know they should, they can't seem to get it together. What are some of the things that are slowing teams down? Kathleen Booth | Pavilion (09:10.

361) Yeah, I mean, think there's the concept of sunk cost bias is real, right? Like you've invested, you and your team have invested in the way you do things, like the way we've always done it, right? The systems, the campaigns, all of those things. And so that's one element.

And I think that's true, you know, even in times that are not characterized by extreme volatility. I think there's a fear of failure. There's some comfort in doing things the way that they've always been done. There's also internal politics.

You know, to roll out change at this pace and scale, really need a lot of buy-in across the organization. And there are a lot of companies that suffer from bureaucracy, slow decision-making, poor internal alignment. And I think all of those things can like feed this inertia that happens where companies are not able to keep pace with what's happening. Ali (09:39.

15) I think. Ali (09:56.59) Mm-hmm. Yeah, that makes sense.

Do you have any strategies for overcoming some of those challenges? Kathleen Booth | Pavilion (10:04.641) I mean, I think there's some specific things that, that caused them that you can look at. One is like too many layers of decision making and approvals.

And so I think, I do think a lot of companies are looking at flattening teams, for example. One trend we've seen that came up at our CRO summit is that more companies are returning to full cycle selling. So instead of having like your SDR and then your AE and then your CS team running expansion motions, they're having like one sales rep who owns prospecting, closing and growing accounts. And that's one way to simplify things.

So then if you do need to roll out change, it's easier. And in fact, for the recent EBSDA report that they partnered with us on for a sales benchmark report shows that organizations that are practicing this kind of like radical role simplification, where you have your sellers all condensed into one kind of full cycle motion Ali (10:36.203) Okay. Kathleen Booth | Pavilion (11:01.

581) are actually four and a half times likelier to hit their growth targets. So there's data to back how that kind of simplification can really have an impact. I think the other thing is lack of transparency and timely data access. So like to your point, the more you can get your data dialed in and make it transparent, share it with the team, like the more you're gonna be able to develop buy-in.

And then the last is really this just like over attachment to long-term strategies, despite what we're seeing in the market. Ali (11:05.645) I Kathleen Booth | Pavilion (11:30.371) And that's a cultural challenge.

Like, this is something we're talking with our team a lot about right now, which is like, you have to embrace change. Like sometimes we do our ENPS surveys and people are like, things change all the time. It just feels very unsettling. And it's like, I think there comes a point where you have to determine are people who are change averse the right people for your team?

And in some cases, the answer is going to be yes. And in some, the answer is going to be no. Ali (11:38.296) Thank you.

Ali (11:54.67) That's a point, especially in go-to-market. It's just, there's no, like you said in the beginning, the unprecedented times are all the time now, right? There is no normal.

We talked a little bit about velocity metrics, the metrics that would be the most important to focus on in a market like this. Any other ways that you're hearing or in your conversations with go-to-market leaders where they're thinking a little differently about metrics than maybe they were a year ago? Kathleen Booth | Pavilion (11:59.237) Yes.

Kathleen Booth | Pavilion (12:03.34) Exactly. Kathleen Booth | Pavilion (12:22.605) Yeah, I think the biggest thing is like, there's a lot that we always want to track, but I think the focus needs to shift a little bit more onto leading indicators like pipeline velocity, leak conversion rate, sale cycle length, as opposed to lagging indicators, which would be like total revenue and growth.

The leading indicators are the things that are going to let us predict the future as far as like, I'm starting to see this. I know a change is coming. I can get ahead of it. I can position myself competitively.

And so I think having a closer eye on that and getting more granular to the point that you mentioned earlier, like conversion rate by ICP. You know, I also think with all the stuff happening with SEO and generative engine optimization, like I'm looking at conversion rates by channel, you know, the difference between our paid ads and our SEO efforts and direct traffic and things along those lines to try to understand how. Ali (12:57.262) Yeah.

Ali (13:04.94) Yeah. Kathleen Booth | Pavilion (13:18.457) this shifting landscape is impacting the intent of the people that come to us through our marketing efforts.

I also think, you know, you need to start thinking about what metrics are gonna help you identify changes to the market more broadly. Are there customer signals in the product that are gonna help you see that? Ali (13:25.976) Mm-hmm.

Kathleen Booth | Pavilion (13:44.805) This all really is very dependent upon your product itself. But the things that are going to help you point to a change that are coming are the ones that I'm looking most closely at right now. Ali (13:48.

27) Mm-hmm. Ali (13:54.466) That makes a lot of sense, right? Because then you're informing like action that can be taken now instead of just looking back historically and not being able to pivot quickly.

You've talked a lot before, not just now, but also now about using defensible metrics, how go-to-market leaders need to get really well versed in especially talking to finance and the board about not just brand marketing and maybe vanity metrics, but speaking the language of the board and the CFO. Kathleen Booth | Pavilion (14:00.557) Yeah. Ali (14:24.

4) Can you talk a little bit more about how a savvy go-to-market leader could start to make that shift and tell that story better? Kathleen Booth | Pavilion (14:32.62) Yeah, I think it all starts with recognizing that there's a difference between reporting on the metrics that are linked to your role specifically and elevating yourself to the level of the board and the CFO and really becoming more literate in the unit economics of the business. That's something that we, as a community, are very focused on educating our members about and educating them that it's something that's important for them, right?

Like I always say, when you get into a go to market leadership role, the assumption is that you're already good at your role. Like if you're a CMO, you're already a good marketer. What a company is looking for at that point is for you, yes, to do your role well, but to like be a true partner in the business and to assume that leadership role where you're adding strategic value. And so that means like understanding Ali (15:19.

448) Mm-hmm. Kathleen Booth | Pavilion (15:28.388) customer acquisition costs and lifetime value and how that breaks down by segment and cohort. That means understanding the P &L.

It also means looking at metrics that are really clearly tied to revenue and pipeline health and customer retention. In Pavilion, we refer to it as a bow tie using Winning by Designs model. So like the left and the right side of the bow tie. being the left side being sales and marketing, the right side being retention and expansion and upsells.

And so tying all that back to how it translates into revenue and financial health for the business is crucial. And then I think it's not enough to just like have the data and understand the metrics. The piece that really separates great leaders from just good ones, I think is how is your ability to tell a story with the data. Ali (16:00.

119) Okay. Kathleen Booth | Pavilion (16:22.476) And so it's how you are able to show correlation between your agility driven decisions and improvements to the metrics. So, know, how closing deals more quickly or getting better lead quality is going to help drive those, those bigger numbers and, and long-term growth.

So I think, you know, when it comes to like presenting to the leadership team or the company or the board, Go-to-market leaders need to make sure they're aligning metrics with the financial language of the business around ROI, cost efficiency, growth predictability, again, CAC, LTV, things like that. Ali (17:04.288) Mm-hmm. That makes sense.

One more reason to join Pavilion, right? I didn't have this question on the list, but since we have a couple extra minutes, if I can sneak one in, you talk a lot about brand marketing as well and how to tell that story and talk to the board about that. could imagine, especially like as the market gets more volatile, it becomes harder and harder to keep justifying investment in brand marketing, even though we all know like long-term the value of that. Any advice on how to balance that in the storytelling, especially when you're talking to like your CFO on board.

Kathleen Booth | Pavilion (17:42.723) Yeah, I mean, this is a conversation that I think marketing leaders everywhere are having right now. The good thing is there's a lot of research actually right now that points to the importance of brand, both like research, for example, from companies like Trust Radius that speak to the role that brand plays in the buying process. So I think you want to be a person who stays on top of that new research and collects that data and has it in their back pocket and is able to tell a story with that of like, here's how buyer behavior is changing.

Here's why it's changing. Here's what the data says. But then there's also a lot of data that's even more concrete. Cause like, I think people hear that and somebody who's not inclined to invest in brand can still kind of be like, I don't know.

I don't know if that's right, but there's actually a lot of really good data coming out now around how large language models index information and the brand, the brand signals that they look at, and how important that is. And I think, you know, this is something at least that I found that most leaders are willing to hear and listen to, which is like, Hey, if you want to get found in search engines, if you want to, if you want to be on anybody's radar, when they, when it comes to purchasing decisions, like this is hard, cold, hard facts on how these algorithms are working.

Ali (18:39.534) Yeah. Ali (18:44.206) Thank Ali (19:00.

12) Mm-hmm. Kathleen Booth | Pavilion (19:07.486) and things that we need to invest in. It's funny.

Like I actually joked to our CEO Sam Jacobs recently. He came to me and he's like, I think we should do more press releases. And I just broke out laughing. And I was like, you know, that there's like a meme about CEOs who say that, right?

Like that's, that's a joke in the marketing world. But at the same time that while that is true, it is also true that PR Ali (19:17.575) No. Ali (19:24.

534) Alright. Kathleen Booth | Pavilion (19:32.429) is increasing in importance and brand is increasing in importance. like, he's not wrong.

I mean, there's a way to do it, right? That works well. But I just thought that was funny because like, I think even one or two years ago, a CMO would have been like, that's silly, you know? And, by the way, that's the joke that we all tell as the CEO is like, we'll just fix it with more press releases.

Ali (19:36.941) Right. Ali (19:45.966) You're good.

Ali (19:51.273) Kathleen Booth | Pavilion (19:52.185) But it's come full circle and I really do think brand is important. And I think the good news is that that conversation is getting elevated a lot more.

So it is about having the right data. It's just like what I said earlier, you need the data, you need the research and you need to be able to put it together and tell a compelling story and link it back to how it's gonna drive growth within your business and what you should, like what you're gonna be able to expect to see from it. You have to be able to set some targets. Like if we invest X, we're gonna see Y and here's how we're gonna know it's working.

Ali (20:17.996) Yeah, that's so funny. It's such a good example of how all the old things are becoming new again. It's all coming back around.

I know I asked you a lot of questions about what other go-to-market leaders are doing because Pavilion has such a unique view on that. I'd also be curious if you want to share, there any pivots that you and your team are doing, particularly based on the market and what you're seeing? Kathleen Booth | Pavilion (20:39.762) boy.

think we're, do we do a lot of different things? We're constantly experimenting. Right now we're very focused on unlocking some new performance channels because so much of our growth historically has come from word of mouth. But that's difficult to control and scale.

And so we are really doubling down on paid ads and doing a lot of experimentation every month on different channels and messaging and using our ads as like a testing ground that can inform our broader messaging strategy, our value proposition, et cetera. We're also in the middle of a pricing and packaging exercise. And I do think that that's like a really important thing to mention in the context of this conversation, which is that pricing is a really Ali (21:29.326) Hmm.

Kathleen Booth | Pavilion (21:29.494) effective growth lever that should be part of your go-to-market strategy. And there's a lot of data that shows that as companies get larger in size, their pricing discipline improves and rigor. And so tends to be that a lot of startups don't have very good muscle memory around how to do pricing, but at the same time, they're trying to use it in a very ad hoc way to drive growth.

So a great example of this. is SBI does research on pricing. They have a price intelligently report. And we all keep hearing about AI, right?

Everyone's like, you have to have an AI product. And what a lot of companies are doing is they're positioning AI as an add-on to their core product. And I thought this was fascinating. SBI came out with data and found out that only 20 % of customers will buy AI as an add-on and only 8 % of them will actually use it.

So like of a hundred and net new customers, only 20 are gonna buy it, only eight will use it, which essentially what that means is that packaging, like it's not just pricing, it's packaging. How you incorporate AI really matters. And like, this is why not having more sophistication around pricing and packaging can hurt us. I think it's really easy to like, Ali (22:28.

684) and Ali (22:40.045) Mm-hmm. Kathleen Booth | Pavilion (22:49.464) change packaging and pricing in a very ad hoc way, but that's disruptive and it's full of friction for customers and prospects.

And so it's only really worth doing those things if you're taking a data backed approach, if you're have a high degree of confidence, it's going to work. And, you know, there's a lot of data out there that these like random acts of AI marketing, they don't work. And so, I think, you know, that's one of the things we're really focused on is taking a disciplined approach to pricing and packaging and Ali (23:04.334) Thank Kathleen Booth | Pavilion (23:17.

026) making sure that when we roll out changes, they're informed by strong research. Ali (23:22.646) Awesome, makes sense. Sounds like we're going through some similar exercises.

Any other insights that you can share, anything that we left out in terms of what some of the top go-to-market leaders are doing and what maybe the rest are missing? Kathleen Booth | Pavilion (23:37.538) Yeah, I think A lot of go-to-market leaders tend to think of agility as like a survival strategy. They're like, things are changing a lot.

We better, we better get, you know, be more agile, but it's really not. I mean, we talked about how this 'changes is a new constant' and so agility is the growth strategy. you, to be able to do that well, I think the piece we often forget as we get so focused on like the tactics and the channels and the strategies is like, it has to start with culture. And you need to foster an internal culture where agility, data responsiveness, and continuous learning, particularly around things like AI, become core competencies.

And so I think what I'm at least seeing right now is a lot of companies and leaders taking a hard look at the people on their teams and asking themselves, are the people who got us here the ones that are going to get us there? Ali (24:06.894) Hmm. Ali (24:33.

398) Any final thoughts or advice that you'd like to share? Kathleen Booth | Pavilion (24:37.639) you know, I mean, I think a lot of what we talked about can sound scary, but I think the biggest piece of advice I would give is that, you know, Every time there's massive change like this, there, it represents risk, but it also represents massive, massive opportunity. And I, at least at Pavilion, the outlook that we're taking is that the companies that invest in growth at times like these, the ones that double down and and don't pull back and get and allow the fear to paralyze them.

Those are the ones that are going to emerge really strongly from this period. So I would just encourage people to, you know, obviously get the fundamentals right and work on that agility and take a close look at your team. But at the same time, like don't pull back from investing in growth. Ali (25:22.

4) Yeah, I like that. Let's end on a high note. Where can people find you? Where's the best way to get more information on you and on Pavilion?

Kathleen Booth | Pavilion (25:30.957) So on Pavilion, you can just go to joinpavilion.com and lots of information on there. And for me, LinkedIn, I'm very active there.

And if you mentioned that you heard this podcast, I'll definitely accept your connection request. Ali (25:45.794) Awesome. Alrighty.

Thank you so much, Kathleen. It was a pleasure. Kathleen Booth | Pavilion (25:49.059) Thanks, Allie.