Building a Product Qualified Lead process for your Complex product

This is part 4 of a 4-part series on PQLs: What they are, how to find them and how to build a winning Product Qualified Lead process

Want to know everything you didn’t know about Product Qualified Leads (PQLs)? Get our e-book.

activation slack alerts for Product Qualified Lead process

In case you haven’t heard, PQLs are leads that are more likely to convert because they have found value in your product. If you’re a modern SaaS business, you want to find these leads. So the only question left — how? It’s elementary: you need a Product Qualified Lead process.

So you’re convinced: you want to find PQLs and make a Product Qualified Lead process for your business. But where to start?

To build a proper Product Qualified Lead process, you will need to:

  1. Properly define what the criteria by which your leads will become product qualified (otherwise known as an Activation checklist)
  2. Have a set of guidelines for turning these leads into paying customers.

Let’s get started!

defining a pql is important for a winning Product Qualified Lead process

First off, how complex is your product?

When our customers ask how they should be designing their Product Qualified Lead process, the first question we ask them is: 

How complex is your product? 

More simply, how hard is it for a new user (or small group of users) to self-serve their way to first value? Don’t forget: self-serve means without any manual support of intervention from your team. 

The answer to this question is the starting point for your PQL definition. It’s answer tells you how Activated a new account should be before your team gets involved. 

This post covers a Product Qualified Lead process for complex products. Not sure if that’s you?

Ask yourself how many of your last 10 signups self-served their way to first value. If the answer is less than 4, read on!

A new user is almost always going to require manual support to get to the promised land. Complex products often require technical implementation, access to data or tools from other departments, or some deeper domain knowledge for a user to get value. 

A complex product might have a free trial period, but is more likely to only sell to customers who go through a sales demo with a more hands-on approach. 

Think Salesforce.

Looking for a different product type? Download our e-book.

Next, how big is the opportunity?

Now that you’ve decided you have a complex product, you should think of the other main factor that will determine how quickly your Sales team gets involved. Namely, the size of a Sales opportunity. As with simple products, if a new trial holds the potential for more revenue, you’ll want to get your Sales team involved earlier. 

At the very least, you should be able to categorize your new trial signups into Small, Mid-Size and Large revenue opportunities. 

Oftentimes, companies will use the company size of a new trial as a proxy for opportunity size. This is certainly one way to go about it, but you define opportunity size based on whatever criteria makes sense for your business. 

Putting it together with Activation Rate

The more complex a product, the earlier your Sales team should intervene. Similarly, the bigger the size of the opportunity, the sooner you want your Sales team on it. Sounds simple, right? (That’s good, because it is). 

If you have a complex product, you’ll need to get involved sooner regardless of the deal size. That being said, you’ll probably still want to wait for accounts to hit a certain level of Activation and keep your Sales and CS team focused on bigger deals.

Here are good rule-of-thumb Activation rate guidelines for a complex product:

Deal SizeReach out when:
Small 50% – 75% Activated
Mid-Size25% – 50% Activated
Large0% – 25% Activated

As you go through the next section, keep in mind the goal of a Product Qualified Lead process for complex products is to balance the time of your Sales team. That way, they are focusing on larger opportunities but aren’t abandoning smaller opportunities with a high likelihood to close.

Product Qualified Lead process for the Small Opportunity

Product Qualified Lead process for the small opportunity intermediately complex product
Product Qualified Lead process for small opportunities — Wait until they’re ready to convert

These pose quite the conundrum for Complex products. You know your product needs manual support for most users to get value, but how much time can you afford to give such a small opportunity? 

In these cases, the complexity of your product may just work in your favor. Wait, what?! 

That’s right. Small accounts that are really interested in your value proposition — in the promise of your product — will make the effort to get set up and experience some of the value. 

When their Activation is high, you’ll know they’re committed and it’ll be worth it for your Sales team to give them some attention. How high is high enough? We recommend waiting till they’re at least 50% Activated

How to engage these Product Qualified Leads

Because it is harder for users to recognize the eventual value of a Complex product on their own, trial leads on this product will likely need some kind of demo of the product from your Sales team. They will need to see the finished cake (complete with frosting) if they are going to move forward and convert. 

In these cases, it’s important for your Sales team to engage these users and invite them for an in-person demo of the platform, perhaps with an email. 

Want to know how to win over small deals? Download our e-book and get considerations and sample emails.

Product Qualified Lead process for the Mid-Size Opportunity 

Product Qualified Lead process for the mid-size opportunity intermediately complex product
Product Qualified Lead process for mid-size opportunities — more users, lower Activation

These mid-sized opportunities are exactly what they sound like. Bigger accounts than a small opportunity, but smaller than a large one. The bigger the account, the more users involved, the more coordination necessary and the more complex the path to conversion. 

So let’s be honest: Not many opportunities will self-serve their way to conversion with a Complex product, regardless of the size. But because these are bigger than small opportunities, you’ll want to get your Sales team involved soonish, probably at around a 25-50% Activation level

How to engage these Product Qualified Leads

The challenge here is still the complexity of the product. It’s hard for users to identify the full value of the platform on their own. 

Focus your manual intervention on booking a time to talk to your Sales team instead of pushing the account toward deeper Activation

 

Not sure what to say? Download our e-book and get sample emails to win these mid-size deals.

Product Qualified Lead process for the Large Opportunity

Product Qualified Lead process for the large opportunity intermediately complex product
Product Qualified Lead process for the large opportunities — It’s ok to jump in a bit earlier

When you get large opportunities to sign-up for you Complex product, you don’t need a great deal of product usage to justify, at least, an initial touch point from your team. In fact, you should feel comfortable reaching out to these accounts soon after they sign-up or when they reach just about 25% Activation.

From there, it’ll be somewhat similar to a traditional Sales process. Or at least as you’re going to get with a modern SaaS product. Start by identifying the key decision makers and make sure that they see the complete, fully-baked value of your product, which can be hard to do during a trial so get them on a demo ASAP.

Ready to take that large opportunity from trial to forever? Download our e-book.

Product Qualified Leads is a Team Sport

The evolution of SaaS means it’s out with the old way to sell software and in with a new “try-before-you-buy” business model. The same goes for how we qualify leads. No longer is the number of times someone visited a website or attended a webinar an adequate measure of a their likelihood to convert to a paid account. 

Nowadays, the most accurate indication of an account’s likelihood to convert is their success with the product. This is why qualifying any lead needs to be based on how successful they are with a product before starting to pay for it. 

Want a way to figure out how likely a lead is to close? Try Sherlock.

This is why every SaaS operation needs a process for defining and engaging Product Qualified Leads (PQLs). (Good news! We’ve got an ebook for setting that up). 

We have spent a great deal of time talking about Product Qualified Leads and that PQL process, but up to this point we have mostly addressed PQLs in the context of your Sales team, which makes sense. Product Qualified Leads are essentially today’s version of SQLs. These are leads that are ready for sales attention. Which is why we have focused on the Sales team to date. 

But the reality is that the Product Led Growth model — and therefore an effective Product Qualified Lead process — calls for cross-functional effort and coordination. It is cliche to say that something in your business is a “team effort”, but in the case of a building and managing a PQL process, this is a legitimate claim. 

But don’t run away form this fact — embrace it. Embrace the fact that a modern SaaS business can no longer operate effectively in traditional silos. We can no longer hide behind individual metrics and toss customers over our proverbial fences. The early customer experience, and the journey from TRY to BUY is defined by the efforts of several teams. 

In this post, we will focus on the teams involved in building a solid PQL process and their respective roles in that process.

Which teams need to be involved in your Product Qualified Lead process? 

What do we mean when we say “cross-functional”? Who is on your PQL squad? At the very least, it should be this crew:

  • Product
  • Marketing/Growth
  • Sales/Revenue Ops (if you have them)
  • Sales
  • Customer Success

I know what you’re thinking. Whoa! That’s a lot of people involved in one process! 

Don’t worry. While each of these teams play a pivotal role in the process, their contributions fit perfectly within the scope of their regular work. Let’s take a deeper look into the role each team will play:

Product Team: The Gatekeepers

Obviously your product — and as a result, your Product team — is central to a PQL process. I mean, we’re talking about Product Qualified Leads here. These are leads that are qualified based on their engagement with the product. This means your Product team has a central role for two reasons.  

First and foremost, the Product team is charged with building a product that, well, has value. But as it relates to PQLs, they also need to design and orchestrate a product experience that enables new signups to find their way to some level of value before requiring human support.  This means good UX, in-product messaging, on-boarding flows, education, etc. This is the Product team’s most important contribution to your PQL process. 

However, that’s not their ONLY contribution. Any PQL process is dependent on product engagement data. This data is required to build and define PQLs for your business. You need to know:

  • how much each account is engaging with the product;
  • how far they have gotten toward Activation;  
  • how many users are engaged (and which ones);
  • what features they have (and haven’t) used;

And your Product team owns this data. That means they play an essential role in facilitating that the right product data it tracked, transformed into a usable format, and delivered to your team when and where they need it. While many Product teams won’t see this as part of their responsibility, it is. 

As you can see, this whole process hinges on the Product team. They are The Gatekeepers.

Marketing/Growth Team: The Architects 

When we say “marketing” here, we’re not talking about your typical, old-school lead-gen marketer. We’re talking about a more modern growth marketer that (a) can think and design for a complete customer experience; (b) is very comfortable getting her hands dirty with data; and (c) is adept at working in a cross-functional capacity. 

This person will likely become the architect of your PQL program. She will play a major role in supporting the product team to build that great initial customer experience — from in-app messages, sign-up flows, on-boarding emails, and beyond — with the goal of driving as many PQLs as possible. She will also play a critical role in crafting the conditions that will define PQLs for your business and in building a playbook for addressing them in a way that works for your specific situation.

In short, she will likely be the one that brings all the moving pieces together and makes this process a reality. 

Ready to give your teams everything they need to take users from trial to forever? Give Sherlock a try.

Sales/Revenue Ops: The Trafficker 

If you have a Sales Ops team, they will sit right in the middle of your PQL process. Their role here is no different than their role in any lead qualification process. They will play a critical role in insuring that the PQL metrics are delivered to the right place so that your sales team can take appropriate action — quickly! 

Sales Ops will ensure that your sales team spend less time digging for the right leads and more time interacting with qualified prospects. 

Sales: The Closers

Their role is pretty clear. Their job is to take these precious leads from PQL status to closed deal. Bring ‘em home! 

But they will also play an important role in defining – and refining – PQLs. Their feedback, from the frontlines, will help you understand if the way you are defining PQLs works effectively in their process and actually leads to more closed deals. 

Customer Success: The Caregivers

In a PLG model, CS teams can play an essential role — not just post-sale, but pre-sale as well. 

Yes, that’s right. In fact, in many cases, CS will play a more important role than a Sales team in converting accounts in a Product-led growth model. In a product-led growth model, prospects aren’t interested in being sold to. They are interested in getting value from a product. Your CS team specializes in making this happen and should be brought into the sales process as soon as possible. This function can have a huge impact on turning early users into PQLs. 

Looking for a run-down? We’ve got you covered

TeamArchetype Role in PQL process
Growth/MarketingThe Architects– Helping to design onboarding and early user experience with the product
– Defining PQLs for your organization
– Designing customer engagement process for trial or free accounts
ProductThe Gatekeepers– Designing and building early customer experience that enables users to self-serve to some level of value
– Generating and distributing key product data to enable a PQL process
Sales OpsThe Traffickers – Make sure that sales team is aware of PQLs where they need them  when they need them
SalesThe Closers– Help team define and refine the criteria for Product Qualified Leads
– Close. Those. Deals!
Customer SuccessThe Caregivers– Help new users get to value with the product – drive PQLs!

PQLs as a Unifying KPI

Empower all your teams from Product to Sales. Try Sherlock free for 17 days.

One of the major benefits of building a PQL process is that in doing so, you are creating a truly collaborative KPI. There aren’t many metrics in a SaaS business that multiple departments can rally around. You always hear, “marketing owns this”, “sales owns this”, “customer success owns that.” The truth is that most KPIs live in departmental silos, driving more competition and in-fighting than cooperation. But Product Qualified Leads are a pure cross-department KPI. Everyone has a hand in driving Product Qualified Leads and can therefore can collaboratively rally around the metric.

  • For Marketing, high PQL counts mean that they are not only bringing in more leads but more of the right ones. Messaging, targeting, channels all working well, as well as the early user experience
  • For Product, strong PQL counts mean that new users are finding value in the Product AND are finding their way to value. For the first time, PQLs give Product a seat at the revenue table
  • For Sales, PQLs represent their lead list. They know that these accounts have already gotten some value from the product and have the highest likelihood of closing. A long list of PQLs is like Christmas for a SaaS sales person
  • For Customer Success, PQLs not only represent receptive potential customers, but because they are engaged with the product before even buying, they are much more likely of becoming long-term, successful customers

And, of course, PQLs will resonate right up to the board level because more PQLs mean more closed deals. More efficient sales. More top-line growth. More overall business value. Giddy-up! 

Building a Product Qualified Lead process for your Intermediately Complex product

This is part 3 of a 4-part series on PQLs: What they are, how to find them and how to build a winning Product Qualified Lead process

Want to know everything you didn’t know about Product Qualified Leads (PQLs)? Get our e-book.

activation slack alerts for Product Qualified Lead process

In case you haven’t heard, PQLs are leads that are more likely to convert because they have found value in your product. If you’re a modern SaaS business, you want to find these leads. So the only question left — how? It’s elementary: you need a Product Qualified Lead process.

So you’re convinced: you want to find PQLs and make a Product Qualified Lead process for your business. But where to start?

To build a proper Product Qualified Lead process, you will need to:

  1. Properly define what the criteria by which your leads will become product qualified (otherwise known as an Activation checklist)
  2. Have a set of guidelines for turning these leads into paying customers.

Let’s get started!

defining a pql is important for a winning Product Qualified Lead process

First off, how complex is your product?

When our customers ask how they should be designing their Product Qualified Lead process, the first question we ask them is: 

How complex is your product? 

More simply, how hard is it for a new user (or small group of users) to self-serve their way to first value? Don’t forget: self-serve means without any manual support of intervention from your team. 

The answer to this question is the starting point for your PQL definition. It’s answer tells you how Activated a new account should be before your team gets involved. 

This post covers a Product Qualified Lead process for intermediately complex products. Not sure if that’s you?

Ask yourself how many of your last 10 signups self-served their way to first value. If the answer is between 4 and 7, read on!

With intermediately complex products, about 50% of new users can self-serve their way to value without manual intervention. Unlike their simple counterparts, these products typically have a free trial, but do not have a freemium version. Think Adobe.

Sometimes intermediately complex products are simple to set up, but hard to get to initial value. Other times, they are harder to get set up, but deliver easy value beyond that.

Looking for a different product type? Download our e-book.

Next, how big is the opportunity?

Now that you’ve decided you have an intermediately complex product, you should think of the other main factor that will determine how quickly your Sales team gets involved. Namely, the size of a Sales opportunity. As with simple products, if a new trial holds the potential for more revenue, you’ll want to get your Sales team involved earlier. 

At the very least, you should be able to categorize your new trial signups into Small, Mid-Size and Large revenue opportunities. 

Oftentimes, companies will use the company size of a new trial as a proxy for opportunity size. This is certainly one way to go about it, but you define opportunity size based on whatever criteria makes sense for your business. 

Putting it together with Activation Rate

The more complex a product, the earlier your Sales team should intervene. Similarly, the bigger the size of the opportunity, the sooner you want your Sales team on it. Sounds simple, right? (That’s good, because it is). 

If you have an intermediately complex product, how soon you get involved will be very much based on the deal size. You can wait for smaller accounts to become (almost) fully Activated before getting manually involved. But if a large deal starts using the product, you’ll want to get your Sales and CS team involved to increase the chances of a close.

Here are good rule-of-thumb Activation rate guidelines for an intermediately complex product:

Deal SizeReach out when:
Small 75% – 100% Activated
Mid-Size50% – 75% Activated
Large25% – 50% Activated

As you go through the next section, keep in mind the goal of a Product Qualified Lead process for intermediately complex products is to balance the time of your Sales team. That way, they are focusing on larger opportunities but aren’t abandoning smaller opportunities with a high likelihood to close.

Product Qualified Lead process for the Small Opportunity

Product Qualified Lead process for the small opportunity intermediately complex product
Product Qualified Lead process for small opportunities — Wait until they’re ready to convert

Intermediate products require an — intermediate level of manual support for success, but it’s hard to justify that support for these small opportunities. 

On the flip side, any small opportunity that shows enough interest in this type of product to self-serve their way to success is an opportunity that is highly likely to convert. 

Enter the PQL process. You can justify some manual intervention for some of these accounts, but you have to be selective about it. Your sales team should get involved, but only when these smaller opportunities reach at least 75% Activation

How to engage these Product Qualified Leads

Sales should take a Customer Success approach with these accounts. Congratulate, encourage, and support. It’s about extending account engagement and Activation, not getting a demo. 

Want to know how to win over small deals? Download our e-book and get considerations and sample emails.

Product Qualified Lead process for the Mid-Size Opportunity 

Product Qualified Lead process for the mid-size opportunity intermediately complex product
Product Qualified Lead process for mid-size opportunities — more users, lower Activation

It’s likely that you’re going to need some manual intervention in order to convert these opportunities at a high enough rate. 

These accounts are more likely to have multiple users — and multiple decision makers. This means you will need more than one person to fall in love with the product in order to get a conversion. 

And that means this account will require more and earlier attention from your team. Qualify these leads once they get to 50-75% Activation and get someone on your team involved if you want them to convert! 

How to engage these Product Qualified Leads

Have a Customer Success rep engage with these accounts before your Sales team does. We know, we know — this violates every B2B playbook ever created. 

But for mid-size opportunities trialing an intermediately complex product, having someone who can help users navigate to a higher level of Activation will be more valuable than any kind of sales “pitch” you can offer. (And, don’t even think about just adjusting your sales pitch.) 

A CS-followed-by-Sales combo outreach delivers the right kind of support at the right time for these accounts and helps drive conversion rates. 

 

Not sure what to say? Download our e-book and get sample emails to win these mid-size deals.

Product Qualified Lead process for the Large Opportunity

Product Qualified Lead process for the large opportunity intermediately complex product
Product Qualified Lead process for the large opportunities — It’s ok to jump in a bit earlier

This is just the kind of lead your Sales team has been waiting for! You should drop everything and go after them with everything you’ve got, right? Wrong. 

Your intermediately complex product doesn’t need immediate intervention so you should allow every trial (no matter how big) some space to prove their interest in your product before a full onslaught. (It’s hard, we know.) 

But why? With bigger companies, it is often a lower-level employee who signs up for a free trial. They might not have any organizational support, which is fine — but is the very reason why a signup alone is not enough to justify Sales effort. 

With all that said, this is still a big account, so you should consider them product qualified earlier than if they were smaller. Wait for them to be 25-50% Activated and then go get ‘em! 

Ready to take that large opportunity from trial to forever? Download our e-book.

Building a Product Qualified Lead process for your Simple Product

This is part 2 of a 4-part series on PQLs: What they are, how to find them and how to build a winning Product Qualified Lead process

Want to know everything you need to know about Product Qualified Leads? Download our e-book.

activation slack alerts for Product Qualified Lead process

In case you haven’t heard, PQLs are leads that are more likely to convert because they have found value in your product. If you’re a modern SaaS business, you want to find these leads. So the only question left — how? It’s elementary: you need a Product Qualified Lead process.

So you’re convinced: you want to find PQLs and make a Product Qualified Lead process for your business. But where to start?

To build a proper Product Qualified Lead process, you will need to:

  1. Properly define what the criteria by which your leads will become product qualified (otherwise known as an Activation checklist)
  2. Have a set of guidelines for turning these leads into paying customers.

Let’s get started!

defining a pql is important for a winning Product Qualified Lead process

First off, how complex is your product?

When our customers ask how they should be designing their Product Qualified Lead process, the first question we ask them is: 

How complex is your product? 

More simply, how hard is it for a new user (or small group of users) to self-serve their way to first value? Don’t forget: self-serve means without any manual support of intervention from your team. 

The answer to this question is the starting point for your PQL definition. It’s answer tells you how Activated a new account should be before your team gets involved. 

This post covers a Product Qualified Lead process for simple products. Not sure if that’s you?

Ask yourself how many of your last 10 signups self-served their way to first value. If the answer is more than 7, read on!

Slack and Dropbox are great examples of simple products. With both, a single user (or small number of users on an account) can easily self-serve their way to initial value. Both also have freemium versions, which are more commonly seen with simpler products.

Looking for a different product type? Download our e-book.

Next, how big is the opportunity?

Even with a simple product, there is some variance in how quickly you’ll want to get your Sales team involved. You need to also consider the size of a Sales opportunity. If a new trial holds the potential for more revenue, you’ll want to get your Sales team involved earlier. 

At the very least, you should be able to categorize your new trial signups into Small, Mid-Size and Large revenue opportunities. 

Oftentimes, companies will use the company size of a new trial as a proxy for opportunity size. This is certainly one way to go about it, but you define opportunity size based on whatever criteria makes sense for your business. 

Putting it together with Activation Rate

The more complex a product, the earlier your Sales team should intervene. Similarly, the bigger the size of the opportunity, the sooner you want your Sales team on it. Sounds simple, right? (That’s good, because it is). 

If you have a simple product, you should generally wait for accounts to become (almost) fully Activated before getting manually involved. However, if a large deal starts using the product, you can might want to start the manual intervention phase earlier to increase the chances of a close. In this case, you’d have your Sales (or CS team) start engaging when the account is only 25-50% Activated. 

Here are good rule-of-thumb Activation rate guidelines for a simple product:

Deal SizeReach out when:
Small 80% – 100% Activated
Mid-Size60% – 80% Activated
Large25% – 50% Activated

As you go through the next section, keep in mind the goal of a Product Qualified Lead process for simple products is to drive as many paid conversions as possible with little to no manual intervention.

Product Qualified Lead process for the Small Opportunity

Product Qualified Lead process for the small opportunity simple product
Product Qualified Lead process for small opportunities — Wait until they’re ready to convert

Simple products are designed so that the majority of accounts coming in are small accounts that can self-serve their way to value (and, most likely, even to a point of paid conversion). With a simple product, you can choose to not offer any manual intervention or you can choose to intervene when they approach the point of conversion.

While it’s easy to write off small accounts (you may not even have a dedicated salesperson for them), realize that there is gold in them there hills! Your Sales (and CS) teams should be monitoring this segment on a regular basis and looking for opportunities to take some of these accounts over the finish line. 

Any small account that gets to 75% Activation is absolutely worth some light manual intervention. 

How to engage these Product Qualified Leads

They don’t really need a value pitch but a slight nudge or reminder could be just the thing that gets them over the finish line. 

Want to know how to win over small deals? Download our e-book and get considerations and sample emails.

Product Qualified Lead process for the Mid-Size Opportunity 

Product Qualified Lead process for the mid-size opportunity simple product
Product Qualified Lead process for mid-size opportunities — more users, lower Activation

You have a simple product and a mid-size opportunity. Great! The goal is still to have users self-serve their way to success — at least as much as you can. 

With that being said, mid-size accounts are more likely to have multiple users (and multiple decision makers) so it’s likely that some manual intervention will be required. More users, more touch points, and more potential decision makers complicate the on-boarding, Activation, and conversion of these accounts. 

You should consider these account product qualified and get someone on your team involved at about 60% – 80% Activation.

 

Looking to win that mid-size deal? Download our e-book and get everything you need.

Product Qualified Lead process for the Large Opportunity

Product Qualified Lead process for the large opportunity simple product
Product Qualified Lead process for the large opportunities — It’s ok to jump in a bit earlier

The whales! Go get ‘em! 

But be careful. It’s typical for Sales teams to see a big, shiny logo and then drop everything to chase it down. Don’t do this! The user that signed up for your product is probably a lower-level employee who was doing some initial investigation. (This is why we call these types of trials “Heartbreakers”) 

Don’t let your Product Qualified Lead process falter chasing a heartbreaker

Have some restraint and let these trials self-serve their way forward before reaching out. Your Sales team should allow this account to show sufficient interest before chasing them down. Of course, the size of the potential opportunity means you should product qualify this lead at an earlier stage of Activation (about 25-50%). 

Ready to take that large opportunity from trial to forever? Download our e-book.

The Seven SaaS Trial Leads You Need to Know for SaaS Revenue Forecasting

The-Seven-SaaS-Trial-Leads-You-Need-to-Know-for-SaaS-Revenue-Forecasting
Share the full infographic!

If you’re a modern SaaS business (you are, aren’t you?), you probably have some sort of revenue forecasting system. And to get any value from that system, you need to know how likely your SaaS trial leads are to convert.

That means plugging values into a spreadsheet with a formula, typically

deal size x likelihood to close

Of the two, deal size is relatively easy to determine. But how do you determine likelihood to close? If you’re like the average modern SaaS business, you might have a conversation with the Account Rep in charge of the account. Surely they’ll know. 

“How are we feeling about Footprint Inc?” you ask the Account Rep. “How likely are they to close?”
Oh, they’ll close. We’ll get them for sure. I can feel it.
“Great! I’ll just put them in the spreadsheet —”
94% — they’re going to close.
“Because they’ve been especially engaged with our key features during their trial?”
No, how would I know that? I can just feel it.
“You can…feel it?”
Yes, I can just feel it. They’re going to close.
“Ok. Is it because they’ve gone through all the Activation steps?”
I told you! I can feel it.
“Ok, Jim if you’re going to give a percent you need a reason.”
No, I don’t.
“Ok, very well. I’ll just ask Product for the account engagement and put them in the spreadsheet based on —”
638.
“638 what?”
They’ll close.
“Jim, that’s not even a percent!”

This is clearly not a sustainable way to determine how likely it is that a trial will convert. Want a better way to forecast revenue? Product Engagement metrics give you singular insights for your revenue forecasting so you don’t have to rely on Jim’s “feelings” anymore. (Sorry, Jim, but who were you kidding? 638?)

The key product engagement metrics to consider for your SaaS revenue forecasting are:

Activation (Rate):

n. A static measurement of how far along a user or account is in their journey toward “first value” or the “aha” moment where they realize how great your product is. 

n. An indicator of how far along someone is to becoming a product qualified lead

Engagement (Score):

n. An over time measurement of how much a user or account is using your product

Communication

n. A measure of responsiveness and proactive outreach that a user or account displays during a free trial period

Most SaaS trials fall into one of seven types, based on their Activation, engagement and communication during their trial period. Have you met all seven? 

Ready to find trials that will convert? Give Sherlock a try.

Types of SaaS Trial Leads


SaaS Trial Lead #1: The Golden Leads

90% Chance of Conversion

If only SaaS revenue forecasting was all Golden Leads

SaaS Trial Leads golden lead description
Don’t we all wish every lead was a Golden Lead?

These people are almost guaranteed to convert. From the beginning, they do everything right. They get set up in the product quickly and stay highly engaged throughout the trial, often bringing in more team members. They’re also extremely open and communicative with your team, clearly describing their goals, taking advice, and asking questions whenever they get stuck. You can’t do better than a Golden SaaS trial lead.

Key engagement indicators:

  • High Activation
  • High Engagement
  • Actively Communicate

How to handle these SaaS trial leads:

Just enjoy the ride with these leads. They’re really committed to making your product work for their use case so do everything you can to help them make it happen. And don’t be afraid to show them important but less obvious features — they’ll be on board to try them! 

SaaS Trial Lead #2: The Silent Successes

75% Chance of Conversion

Don’t be discouraged by silence when SaaS revenue forecasting

SaaS Trial Leads Silent Successes
Just because these SaaS Trial Leads are quiet, doesn’t mean they don’t care

These SaaS trial leads sign up and self-serve their way to value. They don’t respond to any emails or communication attempts from your team, but they maintain high Activation and engagement rates throughout the trial. As much as may seem disinterested, their engagement tells a different story.

Key engagement indicators:

  • High Activation
  • High Engagement
  • Low/No Communication

How to handle these SaaS trial leads:

Firstly, don’t give up hope. Just because they’re not communicating, doesn’t mean they’re not interested. It’s easy to rank the likelihood to close lower for these leads because they don’t talk much, but stay focused on their Activation and engagement and be available if and when they do need help. Then wait and watch them lead themselves to glory. 

SaaS Trial Lead #3: The Contrary Converters

60% Chance of Conversion

Feedback (even if negative) is good for your SaaS revenue forecasting

SaaS Trial Leads Contrary converter
These SaaS Trial Leads complain a lot, but they’re still engaged

These people communicate constantly and consistently throughout their trial — but most of what they have to say is negative. They challenge your features, complain about your on-boarding experience, question how you wrote your help docs, etc. They just don’t seem happy with what you’re doing. Despite all of those complaints, though, these SaaS trial leads keep engaging and implementing. 

Key engagement indicators:

  • Medium Activation
  • Medium Engagement
  • Actively Communicate

How to handle these SaaS trial leads:

Support these SaaS trial leads happily through their grumpiness. When they frown, you smile. Listen to them and make them feel heard. If they find value in the product, they will convert. And they might even become one of your biggest advocates!

SaaS Trial Lead #4: The Positive Procrastinators

30% Chance of Conversion

Actions speak louder than words when it comes to SaaS revenue forecasting

SaaS Trial Leads Positive procrastinator
Don’t get caught up trying to give these SaaS Trial Leads everything they want

These SaaS trial leads may seem like some of the most promising. They say all the right things and seem excited in a too-good-to-be-true sort of way. These trials always have some excuse for why they can’t make progress on their trial. They never get set up with your product, and their sweet nothings may feel nice but are meaningless in the end.

Key engagement indicators:

  • Low Activation
  • Low Engagement
  • Actively Communicate

How to handle these SaaS trial leads:

The biggest thing to remember with these SaaS trial leads is that talk is cheap. Be firm with them. Make them commit to an action plan. Make them commit to becoming Activated with your product. If they can’t or they won’t follow through, don’t waste your time. 

SaaS Trial Lead #5: The Fizzlers

10% Chance of Conversion

When SaaS revenue forecasting, keep in mind: early excitement doesn’t always lead to lasting results

SaaS Trial Leads fizzler
These SaaS Trial Leads start hot and then burn out

These leads are the most disappointing of all in many ways. They start out so excited (much like the Golden Lead), becoming Activated quickly and constantly remarking how all of your features feel made for them. But then something changes — their engagement tails off, and they’re gone.

Key engagement indicators:

  • High Activation
  • Low Engagement
  • Low/No Communication

How to handle these SaaS trial leads:

Keep these SaaS trial leads on your marketing lists. (As far as SaaS revenue forecasting, they’re not going to close during their trial). They were clearly excited about something you had to offer, but it may have been a matter of bad timing. No one knows what the future holds!

SaaS Trial Lead #6: The Incompatible Ignoramus

5% Chance of Conversion

Bad leads are bad leads — no need to categorize them otherwise when SaaS revenue forecasting

SaaS Trial Leads incompatible ignoramusSaaS Trial Leads incompatible ignoramus
Is it even fair to call these SaaS trial leads?

These SaaS trial leads are just bad. There’s nothing else to it. They don’t have the resources or motivation to get your product implemented, but they interact with your team, taking up valuable time. They insist they want to make things work, but who are we kidding? 

Key engagement indicators:

  • Low Activation
  • Low Engagement
  • Actively Communicate

How to handle these SaaS trial leads:

Smile and move on. Be grateful for the initial interest and efforts of these leads, but don’t waste time. They may, at some point in the future, have the resources or feature needs. They may come back. But in the meantime, you don’t need them signing up and spreading bad vibes about your product in the marketplace.

SaaS Trial Lead #7: The Heartbreakers

5% Chance of Conversion

Sometimes SaaS revenue forecasting requires that you let go of a hollow dream

SaaS Trial Leads heartbreaker
Don’t let these SaaS Trial Leads turn into a morale black hole

Like their namesake, these leads are everything you want but can’t have. They’re well-known logos that would make your brand shine. Just saying their name gives you goosebumps. But the problem is they never actually use the product after signing up and are generally unresponsive to Sales outreach.

Key engagement indicators:

  • Low Activation
  • Low Engagement
  • Low/No Communication

How to handle these SaaS trial leads:

Just. Let. Go. Be happy that such a great SaaS trial lead showed enough interest to sign up but don’t dwell on them. Likely, the wrong person started the trial and they just aren’t engaging with your features. It might be worth it for your Sales team to spend some time mapping this account and trying to find the right buyer, but not too much time.

SaaS revenue forecasting is all about product engagement

Chances are, by this point, you’ve realized that SaaS revenue forecasting is all about looking at engagement. Is the SaaS trial lead engaged during the trial period? If so, they’re more likely to convert. If not? There are more fish in the sea.

Need a tool to separate the Heartbreakers from the Golden Leads? Try Sherlock free for 17 days.

What do you think? Did we miss any SaaS trial lead personas? Send us an email at marketing@sherlockscore.com and let us know.

Activation vs. Engagement: What’s the difference?

If you spent a day at Sherlock, you’d hear us throwing these terms around as often as “coffee” and “SaaS” (very well, perhaps less than “coffee”). But what does Activation mean? What does Engagement mean? How are they related? What’s the difference?

Quite excellent questions!

Here’s our CEO, Derek Skaletsky, on the topic.

TL;DR

Let’s begin with Activation (Rate)

n. A static measurement of how far along a user or account is in their journey toward “first value” or the “aha” moment where they realize how great your product is.
n. An indicator of how far along someone is to becoming a product qualified lead

There are a few things a user would need to do to get set up in your product and get value out of it. These things vary based on the product. Let’s say you’re a modern SaaS company with a GSuite plugin for email collaboration. Your Activation steps might look like this:

The account journey from signup to Activation
The account journey from signup to Activation

Here’s an obvious fact that follows: Activation rate is just the percentage of steps completed. That means if an account or user has done 2 out of the 5 steps above, they are 20% Activated. 

They are 20% of the way to hitting first value with your product. Excellent!

Sherlock screenshot showing Activation rate
Account Activation is on the left in Sherlock

In Sherlock, you can see an account or user’s Activation rate in a few places. The full Activation checklist is on the left side of any account or user detail page, and the Activation rate is visible on any user or account overview (because it’s such an important metric!) Additionally, you can see Activation rates in other platforms you’ve integrated with Sherlock — Intercom, Slack, and Hubspot being among them.

Use Activation rate in Slack, Intercom, Hubspot
Sherlock integrates with Slack, Intercom and Hubspot

Setting up Activation in Sherlock is simplicity itself. Get started and never miss another Activated trial again

When to use Activation (Rate)

Activation Rate in the Customer Journey
The Customer Journey

Activation rate is quite important in the early phases of the user journey, especially if you have a freemium version or free trial. In that case Activation, occasionally combined with firmographic criteria, is the best indicator of when a trial account is ready for an interaction with your sales team. (It becomes even more important when you have a large number of trials and your Sales team needs ones to focus on.)

But that doesn’t mean that Activation is no longer important after the free trial is up. Post-sale, Activation gives your Customer Success team a way to measure how far along the account is in the on-boarding process and what steps each user needs to complete to be fully on-boarded onto the product.

Separate you paid and trial accounts so your different teams can use different Activation criteria

User vs. Account Activation

It’s been said (and will be said again): If you are a SaaS business, you operate at an account-level. 

  • Accounts sign-up
  • Accounts adopt
  • Accounts convert 
  • Accounts pay
  • Accounts expand
  • Accounts cancel

Curious, it seems there’s a trend here.

Sales teams have always known this. Just look at how any CRM is organized. Marketers know this. That’s why ABM has taken off in recent years. SaaS businesses sell to other businesses — your product is used by teams. You operate at the account-level. 

Why wouldn’t you track Activation the same way? You would track it the same way. But accounts are made of users.

Track activation at both the account and user levels
Sometimes users have different Activation criteria than accounts

There are some Activation criteria that the account needs to do. For example, adding a certain number of team members to the account. On the other hand, there are some Activation criteria that a single user needs to do to become Activated. Think actions like setting up a profile or creating an individualized template. To truly understand how far along an account is on the path to Activation, you need to understand both the account Activation and the Activation rate of the individual users on the account. 

Track both account and user activation with Sherlock

Now, Engagement Score

n. An over time measurement of how much a user or account is using your product

This is all about the events (or actions) a user or account can take in your product. As you are well aware (surely), there are several things that one might do in any given SaaS product. Some of these things are more important than others. Login, for example, is not that important. Sure, everyone does it, but how much value does someone get from logging in? 

An obvious fact, that — not a lot.

Creating a report, however, is more valuable. A user would certainly derive more value from creating a report than logging in. (This is, of course, assuming you have the sort of SaaS app where creating a report is part of the value.) There are events that are likely even more valuable than creating a report and similarly events that are less valuable than creating a report.

engagement scoring model pql
Some events are more important in your product than others, so why would you weight them all the same?

So to get a good sense of how engaged a user is with your product, you need to collect all the (at least somewhat) important events that one might do in your product and weight them accordingly. Then, you need to do some math to find the engagement score for both users and accounts.

Don’t want to do the math yourself? Weight your events in Sherlock and let us calculate your engagement

When to use Engagement Score

Yet another obvious fact — all the time! In all seriousness, there are several things an engagement score can tell you. 

  • It surfaces accounts that are at risk and ones that are ready for an up-sell. 
  • It shows you which users on an account are going to be internal champions for your brand. 
  • It gives you an indication of which accounts might be good to reach out to when it comes time to build out your social proof

But most importantly, and partly because it is over time, the engagement score offers singular insights into the overall health of your business. If it’s on a downward trend, it could indicate you need to make some changes. A graph with a positive slope means you’re doing something right!

engagement going up/down over time
Engagement is a good indicator of how your product is doing

At-a-Glance: Activation vs. Engagement

Activation RateEngagement Score
Static metric to determine how far a user/account has progressedOver time metric for assessing how much a user or account is using your product
Use it at the beginning of the customer journey – both pre and post-saleImportant to track across the entire customer lifecycle
Trends are essential for identifying risks and opportunities

Ready to start scoring? Give Sherlock a try.