HubSpot's Data Enrichment Misstep Signals a Brand Identity Crisis
- Vincent Grippi
- 10 hours ago
- 5 min read
For years, HubSpot has been the poster child of permission marketing, the idea that marketing should be welcomed, not forced. They’ve taught countless brands how to build trust and helped define the playbook many marketers still use today.
But that goodwill took a hit when HubSpot launched a controversial new product in the sketchiest way possible. In this post, I’m breaking down what Hubspot did, why their customers revolted, and how the bad move is really a symptom of a company having an identity crisis in the AI era.
HubSpot Introduces Contact Discovery
On June 25th, HubSpot announced a new product called Contact Discovery, set to launch in August. To support the product, Hubspot conveniently updated its Terms of Service over the Fourth of July weekend…you know, when everyone’s busy eating potato salad and blowing their hands off with fireworks.
Contact Discovery was designed to let marketers find and add brand-new business contacts to their CRM without buying lead lists or stalking people on LinkedIn. The entire prospecting workflow would run inside HubSpot.
In advance of launching Contact Discovery, HubSpot rewrote several of its legal documents - everything from its customer terms to its data processing agreement. Here’s where things got sketchy, though. Rather than announcing the changes clearly, they casually slipped them into their community forum as part of a routine legal notice.
But the changes weren’t routine. They were big. So big that customers came chasing after Hubspot with digital pitchforks. And within days, HubSpot pulled the new terms.
Hubspot’s Data Enrichment Snafu
So, what changed? Simply put, HubSpot changed who's allowed to use your data and what they're allowed to use it for.
The changes centered on HubSpot's enrichment tool, which automatically fills in missing details on your contacts, like job titles, company info, email addresses, and their usual bedtime on weeknights. Under the old terms, when HubSpot filled in a contact for you, it pulled from its own database. But under the new terms, it pulls from, well… you.
That means your data could be pulled into HubSpot's commercial database and used to fill in the blanks for other customers, including competitors. And it ranged from basic contact data all the way down to whatever HubSpot's tracking code picked up on your website.
Now, I know what you’re thinking: how is this even legal? HubSpot rewrote the contract, that’s how.
The key change was in the data processing agreement, which outlines what a vendor can do with your data. Under the old one, HubSpot was a data processor, meaning it could only handle your data the way you instructed. Under the new terms, Hubspot named itself a data controller, meaning HubSpot, not you, would decide what your data gets used for.
This is like hiring a dogsitter to watch your dog while you're gone, only to find out he's been swabbing its DNA and selling the samples to Purina. Kind of weird. Kind of brilliant… but definitely not OK.
I know what you’re thinking: how does this guy always know what I’m thinking? But you're also thinking that surely users could opt out of something like this.
Well, two problems with that…
First, it was opt-out, not opt-in. Customers were enrolled by default and had to exit themselves. And there wasn't one single exit. There were three.
One for AI model training, one for enrichment sharing, and one for the data their tracking code collects on your site. Miss any of them and you're still in.
The second problem is that opting out meant giving up HubSpot's enrichment altogether. It was all or nothing.
Needless to say, marketers didn't take kindly to any of this, and just four days later, HubSpot's Chief Product Officer, Duncan Lennox, issued a public apology. He reversed the terms completely and promised any future enrichment feature would be fully and transparently opt-in. While this was an admirable move, the fact is that he never said the idea was dead.
Why HubSpot Wants a Shared Dataset
Reading between the lines, HubSpot isn’t actually ditching the shared dataset idea, they’re rethinking their approach.
But why? Follow the money.
Enrichment used to be a paid feature, until this spring, when HubSpot made it free for paying users. Now, HubSpot didn't make it free because they’re the Santa Claus of B2B data. They made it free because the data stopped being costly.
Contact and company data used to be a moat you paid a premium for. Then AI made scraping that data cheap and easy for everyone. So, Apollo started giving enrichment away, Clay slashed its prices, and that whole category of data got commoditized.
Free enrichment turns licensed data into a growing cost for Hubspot, so it needed a cheaper source: YOU. Because enrichment is free, more users are likely to turn it on, which means their own CRM data gets shared in return.
So why'd this land so badly?
For starters, nobody wants to hand over their customer data, and you shouldn't have to lose a feature you pay for just to say no. Second, nobody signed up for this. Apollo and ZoomInfo do the same thing, but they're data vendors - you agree to that trade on day one. But you buy HubSpot to keep your data safe, and overnight they wanted to turn it into a product.
That’s about as off-brand as it gets for a company that’s preached about trust for 2 decades. That would be like your bank taking the money you trusted them to protect and using it for gambling …oh, right.
Hubspot’s Brand Identity Crisis
This whole mess is really a symptom of something bigger. The mad dash to go all-in on AI is giving Hubspot an identity crisis.
Their original audience was marketers and small businesses. Now they're pandering to go-to-market teams, a crowd having an identity crisis of its own.
The entire GTM space was built on the aggressive growth-hacking tactics that took over tech in the last 20 years. But over time it became less market-focused and more marketing-focused, conflating strategy with their tech stack. A huge portion of that community believes AI "unlocks" infinite content and outreach automation, as if their customers are lines in a spreadsheet. They're not.
If anything, the emergence of AI has exposed just how flawed those tactics were in the first place. Trust comes at a premium now. Your customers don't give a shit what tools you use behind the scenes. They only care about the value you deliver and the values you live by.
Like I said, HubSpot was the poster child for trust in marketing. But now they're rowing against everything they built the brand on, like permission marketing and inbound. They now position themselves as an agentic CRM for GTM teams, chock full of confectionary AI features that fail to live up to their hype.
They've even jumped on the AEO bandwagon, which at this point is widely known to be a grift. And if all those signs aren't enough, HubSpot went and renamed their famous conference from INBOUND to UNBOUND, which sounds like an unmade Pixar movie.
What's Next For Hubspot?
Look, I've said since day one that the best place for AI in marketing is inside your CRM and your automation tools. HubSpot is right to evolve with the technology. But you can evolve your technology without ditching everything your brand stands for. And nowadays, your brand is everything.
Hubspot picked a bad time to gamble with trust. Plenty of teams are already questioning whether they need expensive CRM, while others are vibe-coding janky CRMs of their own. That said, Hubspot has to be super careful running back its data-sharing plan. You can recover from a bad product decision, but recovering from a broken brand promise is much harder.