3 ways to implement a product-led sales motion to unleash PLG’s revenue potential

Product-led growth (PLG), the go-to-market strategy where product usage drives customer acquisition and expansion, is becoming increasingly common among SaaS companies of all stripes. Nearly 60% of this year’s Forbes Cloud 100 companies use a product-led strategy, and 70% of the top 50 allow users to try their product for free before buying or upgrading.

But developing and launching a product through this model doesn’t guarantee success. The traditional top-down enterprise sales model just doesn’t work with the self-serve, freemium user bases of PLG, which can see thousands of sign-ups per day. Blanket email or marketing campaigns aren’t targeted enough, and a 1:1 sales approach just won’t scale.

As PLG companies gain traction, they need to figure out how to analyze and identify which of their users can be potential paying, profitable customers. To drive revenue growth and profitability, the product-led growth model requires a different way of approaching sales: product-led sales (PLS).

Image Credits: Calixa

A PLS model involves giving sales teams product and customer data so they can prioritize users who are most likely to convert quickly and at scale. Unleashing the power of PLG via PLS requires a slightly different approach to data, leads and the role of sales. Let’s take a look at how you need to recalibrate your thinking.

Your free offering, and the features customers get when they upgrade to paid plans should both create a natural conversion path to your enterprise offering.

Rethink your data

To see the benefit of a PLG strategy, you must start by cutting through the noise and creating visibility into consolidated customer data. Data is the foundation you’ll use to uncover the buyer journey, key patterns of user behavior and glean actionable insights. This data has to be easily accessible and intuitive for account executives, support reps and customer success managers at the same time.

Unfortunately, many sales teams lack this type of self-serve access to the data they need to inform their sales approach. It can often take weeks for a company’s central data team to respond to such requests, and even when they can provide the data, it’s often in the form of a static report that may no longer reflect the customer information needed to seize opportunities. Rethinking your data means you’ll have to move beyond fragmented data systems that are bound by manual reporting and are not informed by product usage analytics.

A PLS approach will involve integrating with data warehouses, CDPs, CRMs and other business apps like Snowflake, Salesforce and Segment to create a single view that paints a full picture of your user journey in real time. Streamlining access to this data will mean sales can latch on to opportunities as they have a clear picture of which users are active and which accounts are about to expire.

A product-led sales approach also involves analyzing data on how users are engaging with your product. How many hours or days are they using your product? Which features are they using most often? Are they engaging with your product team to provide feedback on features?

The more sales understands where the user is getting value, which core features they use, how many users are in the account, and who the champions are, the more targeted their sales strategy can be. Rethinking your data increases your chances of upgrading and converting these users.

Rethink your leads

Armed with data on how users are interacting with your product, PLS teams can better identify ideal customer profiles from their self-serve funnel and generate product-qualified leads.

A product-qualified lead (PQL) is a business or user who has found firsthand value from using a freemium or limited feature product. A PQL combines signals from both what the lead is doing with the product and who they are.

The two metrics that define a PQL are Intent and Fit.

Intent translates to how the user or account uses a product. Are they actively using it enough to warrant outreach?

Fit refers to whether they are the right buyer for a product. Do they fit an ideal customer profile within an organization with the right amount of potential users?

Product usage data can provide a more relevant picture of your potential buyer. PQLs also drive efficiency by eliminating time-intensive discovery calls with prospects who’ve never heard of the product. As a result, sales teams that leverage PQLs are 5x more likely to convert than teams that rely on marketing qualified leads or sales qualified leads.

Once you’ve identified your PQLs, it’s time to standardize the actions you’d like your team to take based on their profile and engage with your sales-ready user.

Image Credits: Calixa

Rethink your sales approach

The traditional pre-sales and post-sales approach to the customer journey doesn’t work in a product-led model. Teams need to be aligned to ensure upgrading from trial accounts to paid accounts is a smooth and seamless process, and reps should be thinking beyond pushing closed sales on to customer success. The old adage of always-be-closing is now giving way to an assist-focused, always-be-helping approach.

However, a different approach doesn’t mean that deal volume has to suffer.

Your free offering, and the features customers get when they upgrade to paid plans should both create a natural conversion path to your enterprise offering. Aim for low time-to-value, as it creates the opportunity for your solution to be integrated into their workflow quickly and encourages them to share your product with colleagues.

This opens the door for interest in a paid plan — one with a team view. Eventually, your user may want integrations or more storage. This is when your sales team needs to get involved. This is also where you start to leverage your ideal customer profile to identify which customer journeys you want to guide.

Hitting your sales goals in a PLS motion requires shifting focus from upgrading free individual trial accounts to focusing primarily on high-quality deals that can be sourced from an already paying account. Paid accounts are much more likely to turn into larger deals over time, so the likelihood of growing your overall deal volume will be much higher if you’re focusing on paying accounts.

Rather than considering every sale as an equal opportunity, target annual plans with a minimum user amount, for example.

PLG is here to stay

PLS is centered on the idea that companies should be able to access the data they need to inform a more proactive conversation with their customers, and that this conversation should be rooted in the insights about how customers are already using the product.

Image Credits: OpenView

Each year, more and more product-led companies enter the market, and each year, more at-scale companies introduce a product-led strategy. The number of companies featured in the PLG Index published by OpenView has increased by 33% since its inception. The PLG trend is creating a significant impact across the public markets that hasn’t shown signs of letting up and continues to influence the structure and development of SaaS companies.

The immense growth potential of these companies, and the increasing expectation from consumers that products should be introduced in a self-serve environment, both make it clear that PLS is here to stay.