For as long as I can remember, the traditional sales strategy involved a highly active sales team pounding the pavement, crisscrossing the country to attend trade shows, and lots and lots of phone calls and follow-up emails. The goal is to get in front of potential customers to tell them what your product offers and why they need it. For SaaS companies, the initial goal is to book a product demo. However, as the industry dynamics evolve, so do the engagement methods. There’s undoubtedly still a place for this approach, but there’s a new kid in town called product-led growth (PLG), and let’s just say there’s talk.
Let Your Product Do The Talking
In the early 2000s, SaaS companies turned heads when they started using their products to attract and retain new customers rather than relying solely on their sales and marketing teams to push leads through the sales funnel. Once the sales touch is removed, you really only have your products to drive growth—hence, the term product-led growth.
The Diverging Paths To Business Growth
Everyone is familiar with sales-led organizations. They prioritize human interaction as a way to sell products and services. Simply put, they let the sales team do what it does best—relationship building and articulating the value of their products and services. With this strategy, customers typically have to request a demo and have a sales team member walk them through all the bells and whistles of the product to see it in action. And don’t get me wrong, this way is still alive and well. It’s particularly effective for complex products that don’t lend themselves to self-guided experimentation.
Contrarily, product-led organizations let customers self-serve, meaning they get to use a product before they speak to anyone at the organization.
Shifting The Product Development Mindset
The thought process toward product development often leans heavily on the technological aspect, prompting questions like "How do we build this?" and "Who would want this product?" However, I’ve realized that this approach isn’t that effective.
Core Advantages Of A Product-Led Growth Strategy
Customer Benefits
-Superior User Experience: Free or limited access trials let users autonomously assess the value of a product at their own pace, allowing customers to experience your product when and how they want without any hurdles.
-Continuous Customer Feedback Loop: This helps you improve the product in real time and focus on developing products that meet the needs of your current and future customers.
Business Benefits
-Shorter Sales Cycle: Self-onboarding removes the obstacles (e.g., human interaction and demo requirements) for potential customers so they can immediately start using your product. Converting them into paying customers doesn’t take long if they find it valuable.
-High Retention/Lower Churn Rates: Creating customer-centric products and delivering them to users with a dedication to product enhancement increases customer satisfaction, making it easier to attract and retain customers.
Attracting And Retaining Customers Through User Experiences
Customers expect a lot these days. To thrive, businesses must take a highly focused, customer-first approach to product development and delivery. Trials or "freemiums" allow customers to test drive a product or solution before making a purchase decision.
This methodology creates a win-win situation for the customers and the organization, making it an effective strategy for SaaS businesses aiming for sustainable growth.
The original content of the note was published on Forbes.com. To read the full note visit here
