Group 9

How to turn your company into a Product-led company

Did you know that investors have found that product-led companies are twice as likely to grow fast than other models? 

A June study published by TechCrunch discovered that product-led growth models are “2x more likely to grow quickly than sales-led” growth models. To tap into this rapid growth opportunity, you’ll want to know how to transform your current growth model to follow product-led growth. Today we’ll show you how it’s done. 

Understand your user journeys  

First, you’ll need to understand the path your users take through your product. Data that tracks the user journey through your product is essential here. 

By tracking user data, you are observing user interaction with your product. This gives you a clear oversight into a user’s path, what went well and what may have triggered difficulty. With this oversight, you can start honing in on improvements. 

Major companies such as Tesla gather user data to hone in on the “product experience” of their brand. By collecting feedback, Tesla ensures that it engages with real users to constantly improve the product experience. Tesla has been credited with “transforming car buying” into an ongoing experience rather than a one-off purchase. 

Create product experiences that push time-to-value 

Now that you’ve got a clear idea of the customer’s path, you’ll want to cut down the obstacles a customer faces using your product. Customers essentially search for a quick problem-solving solution when shopping for products. By trimming down obstacles, you can invest in the speed at which your product solves your customer’s problem. 

This rate of problem-solving speed is called “time to value”. When you reduce the obstacles a product user faces to reach their ideal solution, you accelerate the time-to-value ratio. Creating product experiences that push this speedy solution arrival time is an essential part of driving home a PLG model.  

User Guiding blog summarized PLG as the growth model where the product is the core of the business, and customers are the core of understanding the product. Customer experience and engagement steer data gathering to build a stronger core. 

Steer users to natural conversions with value

PLG modeling focuses on honing and empowering customer-to-product relationships. Steer users to conversions by letting them understand the true value of your product on their own. A free product with many key value features entices the user to experience the product further. This leads to a natural conversion to a higher value tier within your product. 

But while many companies have adopted this model and do let their users take the product for a ride before they buy it, they still treat the conversion stage as “one size fits all”, instead of following the actual user journey their users go through and offer them to purchase a plan only once they hit an actual milestone and are ready to make the purchase. 

Introduce new features based on customer usage

As you steer natural conversions through value, you will want to gradually work in new features and experiences. Using user data to hone this usage-based feature building guarantees that you are adding features customers are eager for, based on their needs.

 UserGuiding blog explains user data led feature adding works because the data “comes up” with new features based on user behavior, and conveys to the user their needs and expectations. 

Base pricing around customer needs

In order to become a full-fledged PLG model, you need to scale into flexible pricing packages that allow customers to subscribe according to their preferences. With flexible pricing, customers don’t feel pressured into making time-based commitments, and they can choose the plan that fits their needs the most. 

 Because PLG needs to deliver value and customer experience instantly, breaking down hesitation barriers is key to unblocking the user pathway to conversion.

Strategize the upsell

PLG experts advise strategizing the upsell after the product has delivered value. Users with access to a demo product already have experience with your product. A PLG company needs to base upselling on features that stand out as added value on top of the current experience. 

By focusing on delivering experience-driven products, PLG models break down barriers to monetization. When the time comes for a paid version, the user knows the current product value and is more willing to pay for added value. 

Overview

These steps are starting places. While product-led growth is easy to implement, there are also many intricate parts that make up a successful PLG growth model. These steps can set you up with an efficient PLG growth model to build from. 

Want to learn more? Follow our team of PLG visionaries at Coho for more insights or contact us.

6 Combining PLG with a sales motion

Combining a sales team with a PLG motion

“Product-led growth” is the latest trend in B2B SaaS, but is it the end-all solution for driving growth and success? The concept of product-led growth is based on the idea that the self-guided product experience in B2C can be applied in the B2B space. However, relying solely on the product to drive growth may have its limitations in a B2B context.

It’s questionable whether clients in a B2B setting will fully understand the value proposition without support and guidance. The pressure-free, self-directed approach may sound appealing, but it may not result in meeting business goals if clients are not fully engaged and informed.

So, what are the limitations of a product-led growth strategy in B2B SaaS? Is a dedicated sales team really necessary, or can the product truly drive growth on its own? These are the questions that need to be explored to determine the most effective approach for driving growth and success in the B2B SaaS industry.

While product-led growth may be a promising idea, it’s important to critically examine its limitations and determine the best approach for driving growth and success in this context. In this article, we will delve deeper into the limitations of a product-led growth strategy and consider the role of a dedicated sales team in B2B SaaS.

Understanding the Value Proposition

Product-led growth is often based on the assumption that customers have a clear understanding of their needs and wants. However, this is not always the case. As demonstrated by the famous iPhone case study, customers may not know what they need until they are guided to the right solution.

Forgoing a professional sales team in favor of product-led growth can be a misstep, as the role of the sales team goes beyond selling the product. The sales team’s main function is to provide product-market fit, offering solutions that the customer may not have considered. The customer’s default journey may not be the most suitable for their needs, and without the guidance of a professional, they may miss out on the best solution for their needs.

People prefer to receive advice from experts, and a well-trained sales team can offer that expertise. However, many sales teams are viewed as less credible due to a focus on closing sales rather than guiding customers to the right solution. An effective sales team must balance both the needs of the customer and the needs of the company, and should be trained to provide expert guidance to customers, helping them make informed decisions.

Automating the Unimportant

It is true that some aspects of the customer journey can be automated, and when managed correctly, automation can even be used as a sales tactic. In the digital age, transparency is highly valued, and customers appreciate the ability to access information such as pricing and product demos without the need for human interaction.

However, it’s important to note that price and product demos are not the only factors that determine the success of a sale. We can assume that most businesses offer competitive prices that align with the level of service they provide, and that this is also true of the competition. Automated product demos, while convenient, cannot be tailored to the specific needs of each customer.

General pricing and product demos demonstrate general competency, but they are not enough to differentiate a company from its competition. This is where the sales team comes into play. Automating the less important aspects of the sales funnel allows the sales team to focus on the mid-funnel and close, which are critical to securing the sale. An effective sales team can provide personalized guidance and expertise that cannot be replicated through automation.

Overcoming Objections

While automating common objections in the sales process can be a helpful tool, it may not work for more significant clients who have specific and complex questions. In such cases, having a precisely trained and experienced sales team proves to be incredibly valuable. Your sales team should not only be able to overcome objections but also understand the unique problems that your clients might face.

A sales team equipped with industry experience is capable of navigating through the deep-level questioning of a client and finding the best product market fit. This is the stage where sales representatives are not just trying to sell but genuinely trying to understand the client’s needs and tailor their product accordingly.

It’s crucial to avoid making the mistake of giving the entire sales process to technology just because it’s a popular buzzword. While there might come a time when this is possible, we are not there yet. While there might be a handful of articles claiming that Gen Z would rather interact with a computer than a human salesman, these statements only hold true if your sales team does not have any new information to offer.

In today’s world of technological advancements, it’s crucial for both your product and sales team to provide value to clients. Your sales team must create a personal touch and provide new and relevant information to encourage long-term business relationships. As technology evolves, so should your sales team to provide both technological and personal value to your clients. To be successful in sales, it’s important to strike a balance between technology and a human touch.

Want to learn how to leverage a sales team within a Product-led growth motion? Contact us to book a demo!

Group 4

4 ways to prioritize the right customers as a customer success manager

Your success in customer success management primarily comes down to your response to one question: How do you best organize your time with customers? This is especially important in the B2B SaaS environment. You are interacting with more people per day than most folks talk to in a week. What’s more, everyone in your client circle expects to be treated like royalty! How do you prioritize? It’s not easy, but here are some guidelines to help.

ARR

The most obvious way to curate your customer base is by size. The customers that are bringing you the highest annual recurring revenue (ARR) certainly merit some sort of priority. If your business revenues rely on term subscription agreements, ARR is a metric to consider highly.

In most cases, your high ARR customers are the ones that are keeping the lights on. These are usually the customers with more choice about partnerships as well. The bottom line: If they are displeased with your services, it means much more to you than to them if a switch gets made. By all rights, you should be intimidated by this. This is a healthy pressure that keeps good businesses honest. However, it does not mean you should prioritize the needs of these customers to the detriment of your smaller clients.

Customers that may provide a smaller overall ARR may also require less maintenance. If you can more easily retain a group of smaller customers, this leaves your business with the manpower and technical resources it needs to grow. In most cases, a good balance between the two groups is the best solution.

Upsell Potential

If your business is like most companies, it doesn’t make the majority of its revenues from initial sales. Customers who upgrade to your premium products and cross sell opportunities are the ones that really matter to your bottom line.

If you are successfully upselling, that means you are keeping your customers happy. Happy customers, along with the ability to maintain their satisfaction, is a skill that not all companies have. If yours does, you must take full advantage of it.

Make sure you are keeping accurate statistics of important client metrics including product use, product use frequency, team size and adoption rate. From here, you can determine where your ARR is coming from more precisely and prioritize your customers based on their potential for future revenues as well as their current account size with you.

Churn Prevention

In general, it is five times more difficult to get a new customer than to retain a current one. With this in mind, churn prevention should be an important metric in the way you prioritize customers. Creating a health score for accounts may help you to prevent churn; otherwise, you may end up wasting valuable resources putting out fires that could have been prevented.

Make sure you are keeping up with the number of customers using your platform within major accounts, as well as the trends you see in use frequency and behavior. Having a snapshot of usage is one thing, but understanding behavioral and use frequency trends over time is much more telling if an account is at risk of churn.

Personal Relationships

The X factor in any business relationship is the personal outreach between client and vendor. People do business with people they like. The tiebreaker between two companies with similar value offerings is often the personal relationship with the client. If you can help it, try to only do business with clients you know will get along with for a long time.

If you spend time cultivating a good personal relationship with clients, they are more likely to receive your upsell correspondence favorably. They are also much more likely to overlook the inevitable small mistakes that your business will make. This runway is especially essential when you are trying to build relationships from the ground up with new clients.

So yes, you may want to consider prioritizing your clients by the “vibe” they give you. As a matter of fact, you should not be afraid to fire a client if that client is demanding priority that he does not deserve. Trying to make everyone happy can only result in less favor being given to the clients you should actually be prioritizing. Great relationships also improve ARR because happy clients are more likely to renew subscriptions and refer others to your business.

Prioritizing your client base can be difficult, but it is an exercise that you must undertake in order to ensure the longevity of your business. Use the tips above as a general guideline to create a short list of clients that most likely deserve priority support. From here, you can begin to evaluate each relationship from a financial and personal perspective, eventually identifying those handful of important clients that you will be moving forward with in the long term.

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Want to learn more about how you can use your product data to identify the best upsell opportunities and prevent churn? Contact us to book your demo!