"I bet Klaviyo's conversion rate dropped when they launched their new positioning on the homepage."

I was having a conversation with a marketer at a competitor of Klaviyo, and she pointed out that the new positioning was a pretty drastic change.

Up until recently, Klaviyo had been known as a marketing automation platform for ecommerce businesses.

Their secret sauce was their tight integration with Shopify, along with powerful email and SMS capabilities that worked in many different countries.

But all of a sudden, they took a big pivot:

→ they changed product categories from marketing automation to CRM

→ they broadened segments from ecommerce to all of B2C

This marketer's take was that all the people coming to Klaviyo's website looking for marketing automation would see the new positioning and say, "Wait a minute... I don't need a CRM." And then they would bounce.

Klaviyo is not an early-stage startup.

They are a publicly traded company with a market cap of $ 9.36 billion.

How could the executives be so foolish to jeopardize that hard-earned web traffic?

I have no insider access to the minds or discussions of Klaviyo's leadership, but here's my guess why it was worth the trade-off:

1) Putting the positioning on the homepage makes the strategy real

If positioning doesn't get actualized... did it actually happen?

I'm assuming that the leadership felt the need to announce to the world (keeping in mind the PR that comes with it) that this was a REAL shift for the company.

2) Putting the positioning on the homepage forces adoption by internal teams

You can imagine that if this shift stayed in a PowerPoint... it would be much harder to make sure teams actually used the new positioning.

When a high profile prospect got on a sales call and said, "so you guys are like a marketing automation platform, right?"

It's likely many salespeople (especially in a company as big as Klaviyo) would simply default to the old story.

But by getting the positioning front and center on the homepage, then customers would be asking, "so tell me more about your CRM capabilities" and sales teams would need to explain the new narrative.

3) The leadership understands positioning in a longterm bet

Short-term conversion rates are the WORST way to evaluate a seismic positioning shift, and the leadership understood this.

Klaviyo is playing long game and including this messaging throughout all their go-to-market channels (you'll see it in their ads, content, sales pitches, etc.)

The idea is that once this new positioning had a chance to permeate throughout the market, the conversion rate would gradually increase — only with higher value clients wanting to pay more money for the new angle.