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For every company that’s trying to figure out how to layer Sales onto an existing product-led model, there are several trying to do the opposite — introduce a Product-Led Growth (PLG) model onto an existing sales-led model.
And this is NOT an easy transition. For those who think this is a simple as slapping free trial sign-up on the website and adding some pretty new onboarding flows in the product is in for a rude awakening. In fact, the product challenges involved with this kind of move – while far from trivial – are many times, the easy part.
One company that is in the throes of this transition right now is Audiense – a European audience intelligence startup helping marketers and consumer researchers understand how to be relevant to the audiences that really matter to brands.
Although they started off as a self-service tool for community managers and small agencies, Audiense transitioned to a B2B sales-led model years ago. Their core product has been a sophisticated solution with a higher price point and every customer had to go through a sales process to buy the product.
Recently they decided to move to a product-led model.
Juan Fernández is Audiense’s Head of Product and is leading the company’s transition to PLG. We sat down with Juan last week to talk about how he plans to make the transition.
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SHERLOCK: The first thing I’d love to understand is why Audiense decided to move to a Product-Led model? What was the reason for this move?
JUAN: We decided to move in this direction because we thought we were limiting our business by requiring customers to go through a sales process. We thought if we could allow new accounts to sign-up and try the product without talking to sales, we’d attract a much wider base of prospects. We also wanted to reduce the cost of acquiring new leads and disrupt our market by letting everyone experience our product first hand.
SHERLOCK: And has that proven to be true?
JUAN: Definitely! We’ve seen a steady growth in leads month after month since we went to this model. And the best part is that these leads already have a deep understanding of what we do and what we offer. That makes the commercial conversation much easier.
SHERLOCK: What product changes, if any, did you have to make (or are you planning to make) to support this new model?
JUAN: Lots! The first set of changes we attacked was a frictionless sign up journey, a clear pricing model and a very simple online checkout process. Now, our focus is on constantly improving the whole customer journey, phase by phase. We’re starting with Activation rate, followed by feature adoption, conversion and finally product virality. It’s an ongoing process. Measure, identify friction, fix and measure again. Rinse and repeat! 🙂
SHERLOCK: How did your sales team respond to this move?
JUAN: To be honest, this was one of our biggest concerns. We wanted to make sure that opening up the product to self-serve signups wouldn’t hurt our sales pipeline. We wanted more leads, but not if it meant hurting our Salespeople.
SHERLOCK: How did you avoid that?
JUAN: Well, first of all, a lot of our new business comes through channel partners, so our sales team isn’t dependent on free trial leads. But we still had to approach this product-led offering in a way that wouldn’t threaten them. Our product-led offering increases the number of hot leads (PQLs) for each salesperson, so they’re actually pretty happy about it.
SHERLOCK: Interesting. So you are starting by removing some (but not all) of the friction for potential buyers. Are they ok with that?
JUAN: So far, it appears so. What we see is that customers considering the cheapest plans are happy to purchase without talking to a salesperson and those considering an Enterprise plan prefer to go the sales-led way. For us, it’s all about deciding which route to take for whoever is engaging with the product.
SHERLOCK: And has this move changed how you are managing leads through your “funnel”?
JUAN: Definitely. I had to set up a process for qualifying these new leads based on how they are using the product and their firmographics (such as company size and location). We have Product Qualified Leads that we put in automated nurture campaigns and PQLs that I send to the sales team every week. It’s all pretty manual for now. I run a report for new accounts that have reached a certain Activation rate during their trial and send it to the sales team as a list of qualified leads.
We also launched email sequences to accounts that haven’t reached a certain Activation rate yet. We want to encourage them to become more Activated or to raise their hand for a quick chat with someone from our team.
SHERLOCK: And what type of engagement emails have you seen the best results from so far?
JUAN: We are still testing a lot of this, so I can’t really say empirically at this point. But emails that come directly from someone at the company and offer help/support with the product, or better yet, specific features receive more responses. These sorts of emails have the added benefit of promoting actual conversations, which helps us move these accounts toward conversion.
SHERLOCK: Is your sales team happy with the transition so far?
JUAN: Yes! They actually prefer talking to leads who have at least tried the product and understand its value. Plus they don’t have to waste their time on customers who don’t really understand the offering. These leads have traditionally taken up a lot of their time, as I’m sure you can imagine.
SHERLOCK: What’s next for the transition?
JUAN: A couple of things. First of all, we need to become more systemized about the process. Both on the automation side and on the ideation side.
We want to reduce the amount of manual work by automating engagement sequences that we know are working. We also want to refine the way we ideate and prioritize improvements. I want my team and I to focus on developing a well-defined weekly ideation protocol, where we’re looking at our KPIs, deciding which metrics we’ll focus on, listing ideas, ranking them by cost and impact, and executing on the best ones.
SHERLOCK: Sounds like a lot! Why are you, as Head of Product, leading this effort versus someone in Marketing or even Sales?
JUAN: I think a move to “product-led growth” puts the product at the center of the operation, so the product team really needs to own the process. But this affects all departments so we created a cross-functional PLG team. It’s like The Avengers: a group of very different people, each one with a different superpower, and I am extremely proud to be working with them.
Apart from me as a team lead, this team is comprised by a marketer who is in charge of driving traffic to our top of the funnel: generating visits with our blog, newsletter, social media and advertising; then a product manager in charge of the on-boarding experience and the email sequences. We also have a customer success manager in charge of the knowledge base and the technical support and someone from the ops team in charge of account settings, legal and accounting. And finally, a UX designer who supports all of us by designing delightful experiences and beautiful graphic material.
SHERLOCK: Awesome. Any advice you would give to others trying to make the transition from a traditional sales-led approach to a product-led approach?
JUAN: I’m still learning myself, so I wouldn’t dare. I read a lot and ask a lot of questions of people who have had success with product-led models. One thing I would say is that you have to think about it as an evolution and a constant learning and experimentation path instead of some immediate switch you can turn on.
SHERLOCK: This is great advice, Juan. Thanks so much for taking the time to tell us about your process!
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