Last year, I presented at the Product-Led Summit about product-led companies adding a sales motion to their go-to-market strategy. Many well-known companies have done this, including Slack, Dropbox, and Atlassian. This year, I tackled the opposite concept—evolving a sales-led model toward product-led.
Of course, it’s common sense that a product-led company might add a sales organization to expand usage, broaden adoption, sell to the enterprise, and assist buyers. That’s much easier than the inverse when a sales-led company wants to transition to a more product-led model.
Transitioning towards product-led from a purely sales-led model is infinitely more complex than the PLG + Sales approach. That’s because a product-led model is built from day one around the concept that customers can try, buy, renew, and expand without talking to a person. It’s foundational. But, a sales-led model doesn’t typically have a product that’s built that way. It often requires demos, proof of concepts, training, and customer-supported onboarding or implementation.
Let’s examine how companies can adopt a product-led approach even when they are firmly entrenched in the sales-led approach.
ProductLed defines it as “a go-to-market strategy that relies on using your product as the main vehicle to acquire, activate, and retain customers.”
In a true product-led model, the product is so useful to the end-user that customers tend to spread the word to their friends and coworkers. It starts bottom-up—from one user to another—which leads to organic growth as adoption spiders out across a network.
When defining whether or not a company employs product-led growth, I ask myself, “Can someone try, buy, and adopt this product without ever talking to a person from the company?” If so, in my view, that’s true and classic product-led growth.
What exactly is the difference between product-led growth and sales-led growth? In the sales-led model, a sales representative pitches the product to a centralized buyer or buying committee within an organization. That buyer then decides to purchase the product and pushes it out across the company.
Some employees may like it, and others may not. Regardless, the decision is made for them in a top-down manner.
With product-led growth, however, the process is bottom-up and organic. The software is usually discovered by a single person or a small group of people. As they start using the product, others join in naturally as product adoption fans out across an organization or peer network. Think Slack, Zoom, Dropbox.
Product-led growth is a fantastic strategy for growing your customer base without friction, but it isn’t easy. Think about all the software your company uses to operate. How many were you truly able to consider, evaluate, and purchase without talking to a sales representative? Probably not that many—it’s rare air.
To pull off pure product-led growth, you need: