In today's rapidly evolving business landscape, where innovation and user experience reign supreme, traditional approaches to growth are undergoing a paradigm shift. Enter Product-Led Growth (PLG), a dynamic strategy that places the product itself at the forefront of business expansion. But as with many things, this is not a one-size-fits-all journey. Contrary to common misconceptions, product-led growth isn't an all-or-nothing motion, but rather a spectrum where companies can find their ideal balance between traditional sales methodologies and the innovative prowess of their products. There are several gradations within the realm of PLG, each representing a unique step in the evolution from sales-led to product-led growth.
So, whether you're a business leader seeking to revitalize your growth strategy or an entrepreneur embarking on a new venture, it’s important to get through the nuances of PLG's different gradations, from the early stages of integrating product thinking into sales processes to fully embracing a product-led ethos.
For the sake of simplifying every single possible nuance, we consider 4 different gradations:
We'll unravel the intricacies of this transformative approach and shed light on its different gradations.
In the annals of business strategy, few approaches have held as much sway as the traditional sales-led growth model. For years, it has been the cornerstone of how SaaS companies expanded their customer base and achieved revenue goals. This tried-and-true approach hinges on the efforts of the sales team to drive the customer journey forward, with marketing playing a crucial supporting role in leadgen. But, as the industry continues to evolve and customer expectations undergo a metamorphosis, the limitations of sales-led growth have come into sharper focus.
The traditional marketing approach to identifying ICP and defining MQLs has proven to be a veritable experimentation ground, partly because of lacking analytical capabilities on journey transitions. Companies find themselves rather blindly adjusting and readjusting the rules as they try to strike the delicate balance between aiming for a wide audience and finetuning for the most promising prospects.
And while the sales-led growth model has delivered results for countless companies, it's not without its drawbacks. A significant trade-off emerges in the form of resource allocation. Organizations often invest heavily in lead generation efforts and lead qualification. As a result, the cost of acquiring each new customer can skyrocket, impacting profitability and potentially limiting the ability to scale efficiently.
One of the most pronounced challenges of the sales-led growth model is the inherent requirement for leads to engage in conversations with the sales team. While this approach aligns with a sales-driven mentality, it doesn't always align with the desires of modern customers. Many prospects prefer to explore a product on their terms, conduct their own research, and make informed decisions before engaging in direct conversations. The imposition of mandatory sales interactions at an early stage can lead to friction and even deter potential customers who value autonomy and self-discovery.
With the advent of contemporary data platforms offered at remarkably affordable pricing, numerous companies are awakening to the realization that incorporating product usage insights into their qualification criteria can alleviate the challenges mentioned earlier.
Embracing a sales-led growth strategy with a product-assisted approach marks a strategic evolution that capitalizes on the fusion of traditional CRM practices with the power of product usage indicators. This harmonious integration empowers sales departments to not only continue their proactive outreach but to elevate their efficiency and effectiveness by harnessing the wealth of available data.
In this dynamic framework, product usage indicators serve as an invaluable compass guiding sales teams towards the most promising leads. The data emanating from user interactions with the product become integral components of the qualification equation. Each interaction, every feature exploration, and all user engagements are meticulously tracked and distilled into actionable insights, painting a vivid picture of the user's/company’s engagement level, pain points, and potential needs.
By extending the CRM's capabilities to encompass these product usage insights, sales professionals are equipped with a holistic understanding of a lead's journey. No longer confined to a partial view of the customer's interactions, they gain access to a comprehensive narrative that spans from the first point of contact to the present moment. This expanded visibility enables sales representatives to tailor their conversations with a level of precision previously unattainable.
Picture a scenario where a lead has consistently engaged with specific product features, suggesting a deep alignment with their operational requirements. Armed with this knowledge, a salesperson can craft a personalized pitch that focuses directly on addressing the lead's identified pain points and enhancing their experience. The result? A more meaningful and impactful conversation that resonates with the potential customer's needs, elevating the chances of a successful conversion.
Furthermore, the infusion of product usage data into the sales process brings forth a dynamic dimension of timeliness. When a lead demonstrates a sudden surge in product interactions or re-engages with the platform, it triggers an automatic alert within the CRM. This real-time responsiveness equips sales teams with the ability to strike while the iron is hot, reaching out to leads at the optimal moment of heightened interest. The traditional "follow-up" is transformed into a well-timed proactive outreach, significantly augmenting the likelihood of a positive outcome.
In essence, the marriage of sales-led growth and a product-assisted approach results in a symbiotic relationship. The sales team benefits from a refined methodology that amplifies their outreach efforts, while the product itself serves as an ever-present collaborator, providing rich insights and contextual cues. This transformative synergy propels the sales process to new heights of efficiency, effectiveness, and ultimately, success.
Within the realm of PLG, a sales-assisted strategy emerges as a compelling evolution, seamlessly melding the strengths of a product-centric approach with the finesse of sales intervention. This transformative fusion is not a black-and-white comparison, but rather a symphony of automated precision and strategic human touch that orchestrates an even more harmonious customer journey.
At the heart of this paradigm lies an intricate web of automation and insight, where the PLG platform operates as a discerning conductor, guiding the symphony of interactions. This symphony is enhanced through the integration of vital metrics – health, conversion, expansion, and churn scoring – interwoven with the intrinsic PLG signals and cohorts. The result? A comprehensive workflow that intelligently assesses the pulse of each customer interaction, gauges their potential, and orchestrates timely interventions with surgical precision.
Picture this: a lead enters the scene, interacting with the product, exploring features, and perhaps even demonstrating early signs of commitment. As this dance unfolds, the PLG platform diligently monitors every move, crafting an evolving narrative of the lead's engagement and behavior. Should certain thresholds be crossed – a specific health score attained, a conversion milestone achieved, or a churn risk detected – the symphony takes a dramatic turn.
Here's where the sales department steps onto the stage, but not as the protagonist, rather as an expert guest performer. The PLG platform cues the sales team, providing context-rich tasks within their traditional CRM, rooted in the intricate understanding of the lead's journey. The "why" and "how" of engagement are laid out, ensuring that each interaction is purposeful and resonant. The sales team becomes a harmonious extension of the overarching strategy, capitalizing on the accumulated insights and tailored cues. The result is an engagement that transcends the transactional, embracing the consultative, and nurturing a relationship primed for growth.
As this multi-faceted approach unfurls, the orchestration becomes a virtuoso performance, a balance between automation and human finesse. It's an approach that recognizes the power of the product-led journey, leveraging its momentum while infusing the strategic prowess of sales acumen.
The sales-assisted facet of the Product-Led Growth spectrum embodies a future where automation and human expertise coalesce, where data-driven insights and authentic conversations converge, and where the customer's journey is not a linear path, but a symphony of experiences orchestrated for success.
Within the scope of pure PLG, the traditional notion of sales takes a back seat, yielding to the prowess of a fully automated ecosystem where the product itself is the primary catalyst of customer acquisition, expansion and retention.
Imagine a world where the product, imbued with intelligent automation, becomes the orchestrator of its own destiny. In this visionary stage, the product's capabilities are harnessed to their fullest extent, strategically driving the entire customer journey from initial interaction to conversion and beyond. Sales processes now gracefully recede into the background, only surfacing under exceptional circumstances at the behest of the customer.
At the heart of this paradigm lies a holistic digital ecosystem, meticulously designed to cater to the diverse needs and preferences of modern customers. Every touchpoint, every interaction, and every user engagement are imbued with intentionality, shaped by a deep understanding of the user's journey. Automated workflows seamlessly usher leads through the funnel, with personalized experiences that resonate on an individual level.
The very fabric of this paradigm is woven from data – data that flows seamlessly across platforms, offering insights into user behavior, preferences, pain points, and patterns. These insights fuel a virtuous cycle of refinement. The product evolves in response to user needs, fostering a relationship of symbiosis, where growth is synonymous with the elevation of user experience.
The role of the sales department undergoes a profound metamorphosis. It morphs into a responsive force, a support mechanism poised to intervene only when explicitly summoned by the user. Think of it as the product's guardian angel, ready to assist when a user seeks a human touch or requires guidance that transcends the boundaries of automation.
Many modern consumers relish the autonomy to navigate and explore a product at their own pace, to make informed decisions devoid of external pressures. The transition from traditional sales workflows to this state of pure autonomy respects and embraces this desire for independence.
As the journey of Pure Product-Led Growth unfolds, businesses stand at the precipice of a new era, where the product stands as a testament to innovation, intelligence, and the power of customer-centric design. Here, the boundaries of automation and human interaction intertwine, yielding a harmonious symphony of technology and empathy, all orchestrated by the silent maestro – the product itself.
In scenarios where the intricacies of a platform demand personalized guidance and direct interaction, pure SLG reigns supreme. When closing deals hinges on nuanced discussions, complex solutions, or intricate negotiations, human intervention becomes non-negotiable. This level is also chosen when user behavior exerts minimal influence on the sales process, making sales-driven interactions pivotal for conversion.
For platforms that are still fine-tuning their self-serve capabilities and where users struggle to uncover the "aha" moment independently, SLG/PA emerges as a strategic choice. This approach acknowledges that users need a gentle nudge to find value, and while sales interactions are pivotal, they are supplemented by product-assisted guidance.
When a SaaS platform boasts a self-serve motion and a robust onboarding flow that effectively transforms users into a burgeoning paid base, PLG/SA or PLS comes into play. The platform operates as the primary driving force, but the sales team stands by, ready to offer expertise when users seek it. This level often adopts a seed-land-expand framework, nurturing a steady evolution of engagement.
In the realm of platforms where sales interactions either prove prohibitively costly in comparison to the user lifetime value (LTV) or where users derive maximal benefit without human engagement, pure PLG becomes the ultimate choice. Here, the product is the primary protagonist, guiding users through their journey autonomously.
Companies seldom remain stagnant; growth is an organic evolution. This holds true in the transition from SLG to PLG. As a company matures and its product becomes more refined, the scales tip towards a more product-centric approach. Gradually, the reliance on sales-driven interactions recedes, giving way to the autonomy and empowerment inherent in a PLG strategy.
In essence, the decision of which PLG level to adopt hinges on a delicate interplay of product intricacies, user behavior, and cost considerations. It's a strategic calculus that defines the trajectory of growth and defines the relationship between product and user.
As SaaS companies embrace this spectrum of PLG levels, they embark on a journey that ultimately aligns their approach with the unique needs and aspirations of their platform, ushering in an era of strategic and sustainable expansion.
If you have questions about PLG in general or about journy.io’s PLG platform, please reach out to us, or book a one-on-one meeting with one of our experts here.
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